tough times for the "squeezed middle"

[superfrank]

http://www.bbc.co.uk/news/education-15242103

The report also issues a stark warning of tough times for people in the so-called "squeezed middle" - with median incomes falling by 7%, after inflation has been taken into account, the sharpest drop in 35 years.

This is why trying to inflate away debts by printing money doesn't work... the inflation reduces demand because real incomes fall and hence the economy doesn't recover. The Central Bank of Zimbabwe will testify to that.

The effects of globalisation, for a while hidden by the bigger effects of the credit boom, mean that wages don't have a hope in hell of keeping pace.

When the US pulls the trigger on QE3 commodities will rise again (just like they did with QE and QE2) which creates imported inflation that will stifle any hopes of real growth.

[Iron]

Part of the justification for the latest British QE was to prevent deflation.

If Mervyn King thinks that the UK is currently at risk of deflation, he's either an economics genius, or he's living on another planet!

Interesting story about how the latest QE purchases had to be abandoned due to bonds being too expensive - http://www.telegraph.co.uk/finance/econ ... nsive.html.

I guess that's what happens when you tell the market in advance when you're going to make your purchases. It brings to mind Gordon Brown's decision to tell the markets exactly when he was going to be selling Britain's gold reserves. Jolly considerate of him...

Jeff

[superfrank]

you couldn't make it up!

why should they care?, it's all funny money anyway.

it's like a bank note counterfeiter shopping around for the best price.

[Iron]

Maybe things aren't so bad. Just last week Mervyn King said:

“The big impact on living standards, and it’s been a very harsh squeeze on living standards over the past two years, is now beginning to come to an end. We look forward to a period next year when we should see a return to steady but sustainable increases in real take-home pay. Inflation has been high largely as a result of influences from the rest of the world. The high oil prices, the high petrol prices the high gas and electricity prices because of high energy prices in the world. Higher food prices. We’ve also seen the effect of higher VAT at the beginning of the year. Those things are likely to come to an end now."

From http://blogs.channel4.com/faisal-islam- ... rnor/15136

[lilgreenback]

I'll bet him a fiver they keep rising, energy prices and fuel will continue to go up.

One thing I have just thought of, why has no one thought of developing a fuel cell boiler for use at home to heat houses? If it can be used to power cars/buses why not houses it must be easier as they don't need to be too compact and don't move about.

Then we can f**k edf and eon off, instead of being ripped off hand over fist. Sorry if it's a dumb ass idea just wondered rant over!

[Iron]

Gas from shale in Blackpool could keep fuel poverty down (and be the best thing to happen to Britain since North Sea oil):

http://blogs.telegraph.co.uk/news/james ... ake-of-11/

That is, of course, if the green lobby and their Lib Dem mates don't block it...

Jeff

I'll bet him a fiver they keep rising, energy prices and fuel will continue to go up.