A stern warning from a central banker

bendix

adwat wrote: »

Agreed. Inflation is far higher than the official figure - food, petrol, gas & electricity, council tax - all these have increased more than 4%, some massively so.

I worked out my personal inflation for last year and it comes to 10% for the above items which are the minimum you need to run a household - I'm sure if I put in "optional" items like car & home insurance (which have risen horrendously) it would be slightly higher.

Given the real increases in cost of living and the unlikely prospect of inflation busting wage rises we're in for a period of austerity - this much we're told on an almost daily basis.

Houseprices are going to go fall slowly for a good ten years I reckon - as interest rates are slowly increased over this time period.

Meanwhile electronics costs plummet every year. Travel bargains are easy to find - I remember Freddie Laker astonishing the travel industry 35 years ago by announcing London to NYC flights for under £200. A third of a century later, it's still relatively easy to fly to NY for £300.

My personal inflation is negligible, if not negative. I struggle to find things that I buy are any more expensive now than a year or so ago.

FTBFun

The only thing i've noticed being a little more expensive (although not really that much more) is food, although that's more to do with commodity prices than inflation.

FTBFun

bendix wrote: »

Meanwhile electronics costs plummet every year.

Indeed - my current TV is a 26" Samsung HD LCD which cost £350 3.5 years ago (it was a good price then).

Now you can get a 32" for £250.

shortchanged_2

FTBFun wrote: »

Indeed - my current TV is a 26" Samsung HD LCD which cost £350 3.5 years ago (it was a good price then).

Now you can get a 32" for £250.

That's called technological advances, to make way for the next wave i.e 3D TV. It's progression.

Can you remember when PC's first came out!

FTBFun

shortchanged wrote: »

That's called technological advances, to make way for the next wave i.e 3D TV. It's cyclical.

Can you remember when PC's first came out!

Not quite! I can remember the first PC my parents bought in the late 90s - cost about £1500 and was less powerful than my current iPod Touch.

shortchanged_2

FTBFun wrote: »

Not quite! I can remember the first PC my parents bought in the late 90s - cost about £1500 and was less powerful than my current iPod Touch.

Exactly!!!

Hereward

shortchanged wrote: »

That's called technological advances, to make way for the next wave i.e 3D TV. It's cyclical.

Can you remember when PC's first came out!

I think you find it's called Economies of Scale: making lots of the same thing in a standardised process makes it cheaper to produce. Technological advancement is the replacement of old technology (for example, CRT TVs) with new technlogy (Flat Screen, 3D TVs).

bendix

Doesn't matter what it's called. It has resulted in costs plumetting.

The point being that it's anti-inflationary.

shortchanged_2

Hereward wrote: »

I think you find it's called Economies of Scale: making lots of the same thing in a standardised process makes it cheaper to produce. Technological advancement is the replacement of old technology (for example, CRT TVs) with new technlogy (Flat Screen, 3D TVs).

Isn't that what I have just said.

shortchanged_2

bendix wrote: »

Doesn't matter what it's called. It has resulted in costs plumetting.

The point being that it's anti-inflationary.

So are you saying a new 3D tv that costs around £1000 now and in 5 years time you won't be able to get one for around £500?