>>No inflation!!??<<
Yes, Steve, no inflation.
I can not speak to what is happening in the UK, where I assume you are located, but in the US:
1) prices of just about all manufactured products continue to fall,
2) food prices are generally stable,
3) agricultural commodity prices are generally close to or at long term lows,
4) industrial commodity prices (primary metals, oil, etc.) are robust but generally show no secular uptrend.
These positive economic fundamentals are supporting solid gains in per capita income and really quite spectacular gains in purchasing power for US consumers.
>>Have you seen US house price levels?<<
Yes. The ongoing gains in US house prices reflect the underlying strength of the US economy and more importantly the exceedingly robust demand generated by the boomers for move-up housing and by the echo-boomers for starter homes. However, this robust market is not a cause of, a result of, or related to in any way, the generally accepted metrics for inflation which measure the cost of a representative basket of goods and basic services. What's more, the affordability of US housing, arguably a more useful metric for shelter costs, is currently at the higher end of its historical range.
>>Oil prices are at a two yr high.<<
Two points:
1) Not for long.
2) Inflation-adjusted oil prices are close to 40 year lows.
>>Might not conform to govt/economist definition of consumer price index, but they sure suggest that the money supply is excessive.<<
How exactly do housing and oil prices "suggest" that the money supply is excessive? To whom do they suggest this?
>>OK, oil price has a lot of other factors, but at the end of the day the fuel buying public is still willing to drive round in large cars with V8 engines in. Not exactly a necessity.<<
"Not exactly a necessity." Hmmm. What criteria are you applying to determine what is necessary and what is not?
The problem, Steve, is that you have absorbed the values of a European socialist democracy. You are quite comfortable - perhaps you do not even think about it - with your socialist government putting its hand in your pocket and stealing from you 64 pence - more than 75% of the total cost - for each liter of petrol that you buy. You are so comfortable with this, in fact, that you have made a virtue out of your necessity - driving around in a tiny automobile because of the legal mugging you receive every time you pull up at the pump.
Post script - US gasoline tax: 8.5 pence per liter. |
