Tuesday 17 April 2012

Fun With Numbers

From the BBC:

Retail prices in the UK are barely higher than a year ago, according to the government's Retail Price Index.

The Office for National Statistics (ONS) said prices in February had risen by just 0.3% over the past year. There are big regional variations, with prices rising in London, the South East and Scotland, but falling sharply in Northern Ireland and the North East.

Russell Quirk, of online retailers eStuff.co.uk, said retail prices in London were "in a league of their own". "Average prices in England are only in the black due to the strength of London," he said, "If it weren't for the capital, the overall retail price picture would be a lot less pretty."


Also from the BBC:

House price inflation rose unexpectedly to 3.5% in March from 3.4% in February, according to the Office for National Statistics (ONS).

Scotiabank economist Alan Clarke said the central bank faced a tough balancing act. "In the context of the Bank of England, we are not growing and certainly not growing fast enough, and that argues for more QE," he said. "But uncomfortably high house prices are a significant obstruction. So it is not going to be an easy decision for the Bank of England in May."

8 comments:

Robin Smith said...

How does one grow an economy? By producing more stuff

How does one produce more stuff most effectively? By raising wages and reducing monopoly profits(rents)

What is all governments policy? To raise rents and reduce wages.

The Law of Slavery says that people know intuitively that they can only "earn a living" by "collecting rent". To earn by doing work is always going to make one poorer.

http://gco2e.blogspot.co.uk/2012/04/law-of-monopoly-and-law-of-slavery.html

Bayard said...

At least the Beeb is using the right language - "house price inflation", "uncomfortably high house prices" - none of this "house price rises good, any other price rises bad" crap.

Mark Wadsworth said...

RS, yup, agreed.

B, I took two articles and swapped round "house price inflation" and "retail price inflation".

Sarton Bander said...

> How does one grow an economy? By producing more stuff

Wrong. By letting people exchange more time. Often "stuff" is involved, but for say hairdressing the physical amount of hair-clippings is unrelated to the economic gain.

Bayard said...

M, I thought it was too good to be true. The problem is that a small rise in the RPI and a small rise is house prices are both considered a bad thing, but for opposite reasons.

Mark Wadsworth said...

SB, a hair cut is obviously "stuff" for these purposes. All labour is labour, the cost of a car is 99% labour (or accumulated labour = capital).

B, exactly.

Sarton Bander said...

I wonder about the split. I'd reckon quite a lot of the car cost is rent-seeking, but the majority is labour.

Mark Wadsworth said...

SB, yes, it's probably not 99%, car manufacturers are cushioned somewhat by patents, design rights, brand name, subsidies, quotas and tariffs, and their senior managers probably pay themselves handsomely.

But nonetheless, the car industry is pretty competitive, i.e. not super-profitable - cars and petrol are very heavily taxed and not subsidised at all - and all those patents, design rights and brand name have to be created first and protected, they can disappear quite quickly if a manufacturer messes up badly enough e.g. Toyota recalls.