Interest rates predicted to rise again tomorrow….

[Borothruandthru]

Remember, quite a few economists had semis on over the Truss / Kwarteng mini budget, hailed it as brilliant.........

Follow a couple of economists on twitter and, while a lot of the stuff goes well over my head, they have been going mental about the interest rate rises and basically saying the BoE is incompetent. There are a number of alternatives but they seem to take this option consistently?

When you reach a certain age, a semi is definitely glass half full !

 

[BoroMart]

It’s nothing like Brexit, if the BoE were such experts how did inflation get so high in the first place? Surely an expert could have reacted to the surge in energy prices quicker, Metin Lewis was giving consumers 3 months notice of what to expect?

It's like brexit in that luddites believe they know more than experts...and I include myself in that before people get tetchy.

They don't have absolute control over inflation, if they raise interest rates too high it impacts other economic factors. It isn't an isolated lever that only impacts inflation.

Sorry that I don’t have a degree in economics but I’m not sure you really need one to figure that out.

You do need one to understand the nuances of the entire economic system.

I didn't say ours were wrong to raise it. They have to because others have.

So therefore you agree that the assertion that the BoE don't know what they are doing is wrong. The macro-economic factors lead them down that path.

As for these experts knowing best then you can go back and check the voting records and you will find that the experts are rarely unanimously in favour of the same decision so either there isn't a right answer or there is and some of the experts are wrong.

Yes, some of the experts are wrong, but most are not. That doesn't mean people on the internet without full knowledge of the facts and data, and most not understanding the complexity, are very often wrong, but occasionally right by accident.

Remember, quite a few economists had semis on over the Truss / Kwarteng mini budget, hailed it as brilliant.........

The absolute majority thought it was dangerous nonsense.

 

[Nano]

Yes, some of the experts are wrong, but most are not. That doesn't mean people on the internet without full knowledge of the facts and data, and most not understanding the complexity, are very often wrong, but occasionally right by accident.

No, you are misunderstanding my point here. There is no right or wrong option. Some economists think one thing and others think another. A majority doesn't indicate right or wrong. If it did then it is more than feasible that the majority are "wrong" at times.

So therefore you agree that the assertion that the BoE don't know what they are doing is wrong. The macro-economic factors lead them down that path.

I never said they don't know what they are doing. I don't think that what they have done has reduced inflation. It has prevented it climbing further because we haven't had a devaluation of the £ which would lead to higher importing costs but that is reactionary because the only reasons we have been increasing rates is to keep up with others. I originally said that it would have been better if nobody had increased rates. Increasing rates hasn't reduced inflation anywhere. Inflation is not being caused by consumer spending so raising rates everywhere has just added internal costs onto external costs for people. The external costs are still driving inflation globally and it is only those costs coming back down which will improve things and no amount of messing with interest rates up or down will change that.

 

[Scrote]

Where did you do your masters in economics that shows that you are right and all the experts in the central banks are wrong? They have far greater depth of knowledge in these areas than you or I

It's hilarious reading all these non-experts with their silver bullet theories on the complexities of micro and macro economics. It's easy to post how simple complex economic strategy is, but actually doing it is another kettle of fish. Dumbing it down to a couple of comments on a message board is not being an economist. It was the same with brexit, get rid of rules, bring back control, it's easy....

These are the economists who were warned well in advance about what became the 2008 crash.

They are largely from a similar social, economic and political background and are working towards goals based on those factors.

This isn't like climate denial, covid vaccine hoaxes or even Brexit. Economics isn't a science - doing the same thing at different times will produce different results.

Basically the BoE are telling everyone to batten down the hatches and make ends meet because there is no political will to solve the underlying problems.

 

[Nano]

Don't forget that these are the same experts telling everyone to accept being poorer and not to ask for a payrise.

 

[sherlock]

So why do you think the trained economic experts in the BoE raised inflation?

Because they haven’t got a clue what else they should do, and they feel they have to be seen to do ‘something’.

 

[sherlock]

thing is there are lots of things people are buying they need & services, but I've still seen people buying new cars, computers, designer gear, TVs, eating out and fry and get a builder to do an extension and the waiting list is still massive so increasing rates would affect all those also

There are affluent people who’ll keep doing those things regardless of how high interest rates go.

 

[Pak_Doo_Ik]

It's like brexit in that luddites believe they know more than experts...and I include myself in that before people get tetchy.

They don't have absolute control over inflation, if they raise interest rates too high it impacts other economic factors. It isn't an isolated lever that only impacts inflation.


You do need one to understand the nuances of the entire economic system.


So therefore you agree that the assertion that the BoE don't know what they are doing is wrong. The macro-economic factors lead them down that path.


Yes, some of the experts are wrong, but most are not. That doesn't mean people on the internet without full knowledge of the facts and data, and most not understanding the complexity, are very often wrong, but occasionally right by accident.

The absolute majority thought it was dangerous nonsense.

I agree re Brexit that was always a decision that should have made by the government and not by the public because most people (myself included) didn’t really know all the details and knock effects but I don’t want to get dragged in to a debate about Brexit.

As you say it may help to have a degree to understand the nuances of what the BoE are trying but as they continue to play their one string banjo to do the same thing with little effect as this seems to show there are not a lot of nuances involved. It’s the same old mantra that is always followed, inflation high raise rates to cut spending, economy crashed decrease rates to kick start the economy.

Also I noticed you didn’t comment about wages so does that mean (in your opinion) these well educated types are correct in their assertion that employees are wrong to be asking for pay rises that are in line with inflation?

 

[sherlock]

I agree re Brexit that was always a decision that should have made by the government and not by the public because most people (myself included) didn’t really know all the details and knock effects but I don’t want to get dragged in to a debate about Brexit.

Always worth remembering that it was only ever an advisory referendum, there was no obligation whatsoever for the government to go through with it.

 

[Randy]

So why do you think the trained economic experts in the BoE raised inflation?

Exactly. I'm not clued up on all things economic but I'd back the corner of the banking experts and not the corner of a social worker if push came to shove.

 

[sherlock]

Exactly. I'm not clued up on all things economic but I'd back the corner of the banking experts and not the corner of a social worker if push came to shove.

It’s the social workers that have to face the mess these so called banking experts create for families.

 

[Pak_Doo_Ik]

Don't forget that these are the same experts telling everyone to accept being poorer and not to ask for a payrise.

Exactly Nano, and yet people seem loathed to comment on the BoE’s stance of below inflation wage increases???

 

[BoroMart]

Well this thread has been a really good barometer to measure the continuation the anti-expert views in this country.

 

[sherlock]

Well this thread has been a really good barometer to measure the continuation the anti-expert views in this country.

You're sounding ridiculous now.

There is no single 'expert view' as has been explained, therefore it is impossible to have a defined 'anti-expert' view.

 

[Pak_Doo_Ik]

Erm, just a thought but football message boards or even forums in general aren’t going to last very long if you have to be defined as an expert before you can be allowed to pass comment or offer up opinion.

Anyway back to below inflation wage increases………………

 

[BoroMart]

You're sounding ridiculous now.

There is no single 'expert view' as has been explained, therefore it is impossible to have a defined 'anti-expert' view.

BoE don’t employ luddites and that’s what we are talking about here but of course people that have never worked in such a role know better, that’s the internet for you

 

[Nano]

BoE don’t employ luddites and that’s what we are talking about here but of course people that have never worked in such a role know better, that’s the internet for you

Not all experts are as expert as they appear:

Japan's cyber-security minister has 'never used a computer'

Yoshitaka Sakurada is responsible for ensuring the 2020 Olympic Games are not hacked.

www.bbc.co.uk

 

[sherlock]

Not all experts are as expert as they appear:

Japan's cyber-security minister has 'never used a computer'

Yoshitaka Sakurada is responsible for ensuring the 2020 Olympic Games are not hacked.

www.bbc.co.uk

As can be ably demonstrated by pretty much every single government minister, none of whom have any background in the area that they are in charge of.

 

[Chris_Boro]

Interest rates are going up to mitigate potential risks.

The whole point is there's no crystal ball to predict exactly what will or will not happen by not doing one or the other. All the BoE can do is forecast the potential risk to the economy in keeping interest rates low versus high.

These risks are weighted and a decision is made, being right or wrong isn't a factor since that would entirely depend on individual perspectives.

Our economy is on a knife edge, all it can take is one bad policy decision and the Pound plummets.

 

[Paintolerance]

BoE don’t employ luddites and that’s what we are talking about here but of course people that have never worked in such a role know better, that’s the internet for you

You are taking a very odd stance. As above, if we can only comment on subject matter we are experts on, this board and indeed social interaction on the internet is dead.

The BoE are applying simple supply and demand economics , as you are of course aware. Suppress demand, thus prices fall. It's a dead easy diagram.

However, these are exceptional times. A far more effective method would be for government intervention to address rampant profiteering by the likes of utility firms and other major corporations. Of course, profit is king so a proper solution is unlikely to be implemented.