Price increases
 

It seems every way I turn prices have risen, sometimes 20%+. What’s going on? Our roof quote has risen by almost £1k from quote given last summer. My son says his building supplies have risen alarmingly causing him problems quoting customers. I fear for the poor people in this country, I can easily absorb these increases.

I don't understand how the CPI and RPI remain at around 1.0% when everyday items rise by 5-10%. As an example my rates have just risen by 12%, and the weekly food shop by 5%.

You should have gone through the 70's - 20%, pah!

Kev

Sorry, really meant to point to the 80's and 15% interest rates and inflation hitting records highs (33% was it?).

Kev

Some of the ludicrous items in the inflation shopping basket don't reflect the true rise in food costs, council tax, fuel, rent or a host of other essentials that hit you in the pocket. Among other things added to it this year are tracksuit bottoms, dumbbells, smart watches, cappuccino sachets and (unbelievably) "cocktails in a can."

Now call me cynical, but I can't help feeling this is a way to keep the - supposed - inflation rate artificially low.

God yes - a time I would rather forget. Buying our first house I remember being relieved when I got a £5 a month pay rise and then before I had seen the first increase our mortgage went up £8 a month.

Talk about one step forward, two steps back :shrug:

Inflation was peaking at over 20% a year. And the BoE base rate was 11.25% in 1975 and was rarely less than double digit for the whole decade.

From my experience, having lived through that decade, I think managing debt with a BoE base rate of 0.1% is an absolute breeze.

As for price rises - commodities are sometimes difficult to get hold of. Lockdowns the world over is causing price hikes.

Let’s not spin this into a political “hit job” - because the history of who was in power historically when the economy tanked is very much binary

Let’s not spin this into a political “hit job”

I totally agree with not making it political; but, yes, it wasn't easy with 20% + inflation. However, you also have to remember that salary increases were very much government controlled.

I think it might have been called phase 1, 2, 3 & 4.

The long and short of it was as an employee (like me) you had no alternative other than to change your job (employer) in order to get a half decent pay rise.

As an employer, you had to restructure the business, to keep your skilled / experienced staff.

I was fortunate to benefit from the later.

Regards,
Mike

There's been an upturn in house building plus a shortage of both skilled craftsmen and some materials hence price rises.
My son has a business installing bespoke bathrooms mostly involving small select new build developments of 5-6 bed 3-4 bath homes on the Norfolk Suffolk border he is fully committed until late 2022.
It seems that post Covid a lot of people are leaving city centres in favour of a more rural location with big bucks to spend.

It was a dreadful time Mike - Callaghan had to go to the IMF and borrow the largest amount it had ever provided to a failing country. It’s a sobering thought that by any analysis- the U.K. was broke. The BoE had to withdraw from the Foreign Exchange Market.

The reality just how serious the financial crisis of 1976 was is now quite well documented. Thankfully Callaghan went with the IMF loan and accepted the death of Keynesian economics

Spot on. My son is booked up solid right through to mid 2022 with enquiries coming in thick and fast.

The "shopping basket" is based on what the average person buys. Most of us owing to our ages are not average and our spend is completely different to what say a 30 year old spends their money on.
It is to the Government's advantage to have high inflation then the Government debt becomes less in real terms.