Bank of England upgrades economic growth forecasts

wotsthat

ILW wrote: »

Define "small".

The difference between inflation of 2.8% vs 2.0%? Inflation of 2.8%? Inflation of 2.0%? Three small numbers.

Have you ever seen the Father Ted episode when Ted and Dougal are on a caravan holiday? Ted explains that the reason the toy cow in his hand looks the same size as those in the field is because the cows in the field are far far away.

It's about perspective.

Kennyboy66

ILW wrote: »

Why would lower inflation HAVE to have lead to lower GDP? You seen to take this as fact with no substantiation as to why.

A clever person would have increased GDP whilst also keeping inflation on target, thereby maintaining living standards of workers as opposed to those on inflation linked benefits.

Are you Gordon Brown or Ed Balls ? This is just fantasy economics.

No one can abolish the business cycle.

ILW

wotsthat wrote: »

The difference between inflation of 2.8% vs 2.0%? Inflation of 2.8%? Inflation of 2.0%? Three small numbers.

Have you ever seen the Father Ted episode when Ted and Dougal are on a caravan holiday? Ted explains that the reason the toy cow in his hand looks the same size as those in the field is because the cows in the field are far far away.

It's about perspective.

I think even you will admit that is a rubbish analogy and means nothing.
What is 0.8% of £4000 billion?
Is it an insignificant amount?

Graham_Devon

Interesting thing here is that all those backing up the BOE policy were also warning of deflation and the horrors of it.

Just making a point. Won't go down well. So it's probably a rather good one.

wotsthat

ILW wrote: »

I think even you will admit that is a rubbish analogy and means nothing.
What is 0.8% of £4000 billion?
Is it an insignificant amount?

I think we can agree that 0.8% of £4000 million is a significant amount - that's the way I would've worked it out.

I wouldn't have increased the target by 40%, subtracted the target and multiplied the difference by £4000 billion. Using percentages to compare small differences in small numbers is a standard way of presenting data to sell a narrative - a bit suspect.

wotsthat

Graham_Devon wrote: »

Interesting thing here is that all those backing up the BOE policy were also warning of deflation and the horrors of it.

Just making a point. Won't go down well. So it's probably a rather good one.

I'm not backing up BoE policy. Just saying that trying to use a conspiracy theory to say Merv managed to purposely hold inflation above target whilst forecasting a lower level is either a bit frothy or a gross over estimation of his powers.

IMO deflation is still a possibility in the near term and we'll probably see some more QE to avoid it. Don't know about the horrors of deflation but keep an eye on Europe - they'll be dealing with it before us.

ILW

wotsthat wrote: »

I think we can agree that 0.8% of £4000 million is a significant amount - that's the way I would've worked it out.

I wouldn't have increased the target by 40%, subtracted the target and multiplied the difference by £4000 billion. Using percentages to compare small differences in small numbers is a standard way of presenting data to sell a narrative - a bit suspect.

Or to put it another way:

"Kings failure to keep to inflation target costs UK savers an additional £32 billion pounds in one year alone".

Graham_Devon

wotsthat wrote: »

I'm not backing up BoE policy. Just saying that trying to use a conspiracy theory to say Merv managed to purposely hold inflation above target whilst forecasting a lower level is either a bit frothy or a gross over estimation of his powers.

IMO deflation is still a possibility in the near term and we'll probably see some more QE to avoid it. Don't know about the horrors of deflation but keep an eye on Europe - they'll be dealing with it before us.

Conspiracy theory?

Have you not read or heard any of his speeches away from the BOE? He has directly stated they didn't forecast correctly. We'll likely hear loads more once he's retired. He's been saying stuff for a while now outside of the BOE, and we have discussed this on the forum before now, with you active in the discussions.

You are arguing that the people who got it right are wrong, and the people who got it wrong are right. It's not going to wash.

If apoint is raised you quickly say the point is irrelevant. If we talk about a certain period, you change the period talked about to prove a point. If you talk about how far out the forecasts were, you keep banging on about this month alone.

We'll end up going round in circles with this one if you won't just discuss what's actually being discussed. For instance, no one bar yourself have talked about is whole tenure, everyone else is talking post crisis.

wotsthat

ILW wrote: »

Or to put it another way:

"Kings failure to keep to inflation target costs UK savers an additional £32 billion pounds in one year alone".

Do you honestly think it's within his powers to hold inflation at 2% and inflation of 2.8% is an epic failure?

There's a risk in holding cash - negative returns are a real possibility when saving rates are so low. It hasn't cost savers a penny - it's the price they pay for capital preservation.

ILW

wotsthat wrote: »

Do you honestly think it's within his powers to hold inflation at 2% and inflation of 2.8% is an epic failure?

There's a risk in holding cash - negative returns are a real possibility when saving rates are so low. It hasn't cost savers a penny - it's the price they pay for capital preservation.

I believe that missing target once a twice is a minor glitch. Missing it month on month for 4 years is a failure.

Its not only savers cash that is being devalued, it is wages as well. If you came up with a total figure of how much wages had been devalued it would be massive.