Inflation and Exchange Rates

WTF?_2

lostinrates wrote: »

re ethical products and the economy....wouldn't it be better to be tying to establish some, even small scale, Britih manufacture?

I find myself debating when making 'ethical puchases' because of the number of ethical concerns....the exploitation of the workers v the empliyment of the workers, the helping a struggling market v the keeping money in UK, the environmental impact of production and transport v all of the above.

Another thanks from me fc123

It would - if people really were interested in paying more for their purchases.

I suspect that as long as foreign sales can undercut home-produced products significantly, the mass market will go for the cheap imports.

John_Pierpoint

Go to France and you will see the effects of thinking your country is the centre of the world and should be supported at all costs. They still have a car industry (making unreliable cars) and most of the locals drive a home made one.

Mind you we, together with the Germans are propping them up through the common agricultural policy.

fc123

setmefree2 wrote: »

Hi

Sainsbury's are selling fair Trade T shirts for just £3. I have no idea if they are loss leaders or what? Anyone know?

The problem with the Oligopolies (I learnt a new word today, hope I'm using it in context)) is that they jump onto bandwgons.
K Hamnett got involved with Tesco last year on a range and pulled out a few months later as she realised she (her name / brand and values) were just being used as part of a marketing strategy.
She gave a few interviews on it too. :T

I don't ever enter a Sainsburys / Tescos (I only survive 30 mins in Asda during my lowest margin shop once a fortnight before I start to turning to dust) but wonder where they are made?
Are the Non Fairtrade from the same place (Sri Lanka, Bangladesh etc.). And, if from same country, what is the difference in price? One for me to research I think.

I have no problem with the whole 'Fairtrade' system but cannot apply it to any goods I sell as 'Made by me out the back' or 'Made in Leicester' don't qualify for the mark. Goods that qualify tend to be from 3rd world countries. Eg; 'Made by womens co-op in Guatemala'.

The danger of all this jumping in by M + S, Sainsbury's, Tesco et al is that flagging up a small ammount of product as 'Fairtrade' then implies that all the other similar items are Unfair trade....IMO.

I cannot get any organic cotton in small qtys (300mtrs) as all availble production has been bought up by the Oligopolies (I love my new word) and there is none left for the small fabric converters.

Ultimately, it is up to the retail buyer / company to try to verify how their purchases are produced.
I have bought 'French' clothing in the past (mais oui madame, fabrique en France) that was at Made in France prices , but when delivered, was obviously from India or Bangladesh. I could tell by the packaging and the smell (a sandalwood, dusty type of smell). When challenged, he denied ever saying it was made in France.
I worked with a leather factory in Newham some years back. We visited the showroom upstairs but there was a sample problem. I suggested I sat at the machine to show how to do the process I required. I could hear them buzzing from the basement.
Boss was reluctant, but agreed as he wanted the order. I went down into a dark, damp basement and had to stoop, the ceiling was so low. Loads of little interconnecting rooms, full of Bangladeshi men, huddled over machines squeezed in every space.
We didn't use him in the end. Right or wrong? It didn't feel right to me. And they weren't cheapo leathers either.


The only slave labour in my business is me.

OMG, I just got my gigantic order from Internetland shop in (3 times the size that we had forecasted) and my factory can't do it all within the timescale........so guess who is going to be strapped to a sewing machine for 3 wks? Me. Micro scenario of the one in Panorama.
However, on the costings the pay isn't bad at all for the monotony if I work fast so, needs as must.

I disagree a bit with Tradetime about the anti fiur camapign catching on because it was an attack against the rich, it gained momentum because the animals were cute and furry.

Quality of make, fabric types are difficult to assess if it isn't in ones expertise, so the assumption is that the more you pay, the better the item.
Generally, with a comparable item, it just means that there are more profits coming off the process but these may get absorbed in higher overheads (ad campaigns, high profile shop units etc). Whether they are distributed fairly is anyones guess.

Out of my sector, I am as much in the dark as anyone else. I bought a dustpan and brush for £1. I have no idea what this should cost, the margin etc.

Bottom line is that trends in buying lots of things, stuff are changing rapidly, whether through restricted spending power or just sentiment.
A big problem for countries whose economies rely a lot on people 'buying lots of things and stuff'.

fc123

!!!!!!? wrote: »

It would - if people really were interested in paying more for their purchases.

I suspect that as long as foreign sales can undercut home-produced products significantly, the mass market will go for the cheap imports.

Mass market is becoming a very 'uncool' concept, though we are all locked into it some level but fashions can be very influentiall on all sorts of things.
Chicken and egg....which came first.
The economic downturn or an anti consuming trend that kicked off an economic downturn? Or a bit of both one following the other.


The Japanese Govt. gave everyone a £100 (I think) shopping voucher for 'Happy Mondays' to encourage the Japanese to go out shopping. They had stopped spending. I think this was 10 years back? Ironically, we were exporting vintage clothing to Japan through the 90's and could never get enough to satisfy the demand of the 4 shops we supplied.......so there was spending going on at a micro, niche level.

A light read that I really enjoyed is 'Where underpants come from' by Joe Bennett. He travels through China, tracing the production process, start to finish. Easy read, takes a couple of hours. Really interesting and enlightening.

mr.broderick

Generali wrote: »

I'm not picking on your post in particular !!!!!!, more using it to make a general point.

I've seen a few people on here talk about exchange rates and inflation and the effect that the former has on the latter particularly at the moment.

To take the petrol price, seen (correctly IMO) as a driver of inflation:

Fuel duty is, I believe, 50.35p/litre. If we assume petrol at 120p/litre, then about a further 18p is payable in VAT (VAT is payable on the duty on fuel!!!). That means in total we pay 51.65p for the fuel and the rest in tax.

To pick an utterly arbitary figure, if we were to get petrol back down to 90p/litre we'd have to pay only 26p/litre for the fuel (13.5p in VAT plus the 50.35p duty). That means the pound would have to double in value against the dollar to halve the sterling price.

That's pretty sweet if you're off to Florida for your hols. Less so if you're relying on your job working for an exporter to pay for the holiday.

Other goods with less duty need lower rises in sterling to have the same sort of impact but realistically speaking, anything more than a rise in the pound of 10% or so is going to have a serious impact on exporters and those that compete with foreign companies for customers.

To put the fall in the value of the quid into perspective, the trade weighted index has fallen from about 99 to about 93 since my 35th birthday a couple of years back. In that time the highest it has been is 106 and I would guess it has averaged about 100 or so. This isn't a calamatous collapse. (link).

To put inflation into context, the RPI is lower than it was at any point between April 1968 and March 1983 (link). It's higher than it should be but hyperinflation it ain't. As an aside, it's funny that people that were claiming a few months ago that CPI was ridiculous are now seizing on it rising as evidence that we are about to be tipped into some Weimar Republic-style callamity.

My feeling is that the current inflation is classic 'demand pull' inflation. Ie too much money is causing prices to rise. As globalisation has proceeded though, the money supply in China and India matters more than our own for imported goods. The BoE probably has this one right - they need to raise rates if prices of domestically produced things that don't compete with imports start to rise. Unless that happens there's little they can do.

I always read your posts generali and never understand any of them but feel compelled to thank them all

pamaris

mr.broderick wrote: »

I always read your posts generali and never understand any of them but feel compelled to thank them all

Yeah me too.:o

Generali

mr.broderick wrote: »

I always read your posts generali and never understand any of them but feel compelled to thank them all

I just take long words from the dictionary and stick them in random order in a post to appear clever, remembering to add a sprinkle of pronouns, conjunctives and so on. You'd be amazed how well it works.

setmefree2

LOL LOL:rotfl::rotfl: