Is Christine Legarde right about inflation?

realitykeeper

Christine Legarde reckons inflation could be back down to 2% in two years. She says it could go higher before it goes lower. But, is she right about it returning to 2% in 2 years. I think it will go significantly higher and it will take a lot longer than 2 years to go back down to 2%.

Also, I think 0% or deflation would be better than inflation at any level.

2% is the target, sure, but not a hope it will be back to that in 2 years. I see it holding around 3.5-4% for the next 4 years at least. Lots of stuff to work through that is impacting on it

There's also going to be more increases. I wouldn't expect to see reductions begin until 2025/2026

buried

Sure these lads in the European Central Bank were never wrong before, so there's literally no f**king chance she'll be wrong this time.

SEPT 23 1989

I remember Christine from her loan sharking IMF days

absolute waffler

there is no "crisis" its the cost of living now going forward now

no going back

buried

This wan was on 'The Late Late Show' with good auld Ryan Subsidy too, ami right? Ahh I mean, this troika agent really knows what's going on. How can you not trust

Trustine LeFarce

m2_browning

We are already most of the way there according to CSO

realitykeeper

https://www.boards.ie/discussion/comment/121402194#Comment_121402194

.... and that is the other thing, are the official inflation figures believable? And ultimately, would it really matter if they are or not? I mean if inflation is high, people will know about it and no amount of understating will ease the pain.

buried

https://www.boards.ie/discussion/comment/121402194#Comment_121402194

Go into tesco in the morning and buy 50 everyday items and see if you are most of the way there, according to your own wallet

m2_browning

https://www.boards.ie/discussion/comment/121402240#Comment_121402240

Who needs facts when you have feelings

buried

https://www.boards.ie/discussion/comment/121402261#Comment_121402261

Who needs facts when you are trusting Christine Legarde. You may as well trust the local drug dealer to look after your gaff for 20 minutes while you go down the CSO office to commend them on their great work.

m2_browning

https://www.boards.ie/discussion/comment/121402273#Comment_121402273

CSO has nothing to do with Lagarde

buried

https://www.boards.ie/discussion/comment/121402283#Comment_121402283

Clap clap. Where did I say she did?

eightieschewbaccy

https://www.boards.ie/discussion/comment/121402294#Comment_121402294

You were responding to a poster who had made a response about CSO stats in fairness...

L1011

She could be wildly wrong and still be significantly more right on this topic than you've ever been.

Wolf359f

https://www.boards.ie/discussion/comment/121402240#Comment_121402240

So what % price difference do you see in those 50 items compared to this time last year?

buried

https://www.boards.ie/discussion/comment/121402457#Comment_121402457

At the very least 65-70 euros plus in the price.

m2_browning

https://www.boards.ie/discussion/comment/121402475#Comment_121402475

Don’t forget your club card

Wolf359f

https://www.boards.ie/discussion/comment/121402475#Comment_121402475

You're going to have to give it as a %. I've no clue if those 50 items you chose were €20 last year or €400 last year.

buried

https://www.boards.ie/discussion/comment/121402490#Comment_121402490

Well if you are talking about percentage then its definitely 20% - 30% higher than the year before. This is basic items, milk fruit and dairy

buried

https://www.boards.ie/discussion/comment/121402402#Comment_121402402

Both of them are saying the same thing though aren't they? That inflation is coming down. Yet me and you, or any ordinary joe soap, your an ordinary joe soap, right? We have yet to see it, so in fairness, both of them are talking absolute total nonsense. Doesn't matter if they aren't literally connected to the literal hip when both of them are literally talking nonsense. Unless your shopping bill dropped from this time last year?

buried

https://www.boards.ie/discussion/comment/121402485#Comment_121402485

I must get a Christine Lagarde 'club card'. Then I'd be away with it.

Wolf359f

https://www.boards.ie/discussion/comment/121402512#Comment_121402512

Well just looking at Tesco prices and comparing year on year:

Milk €1.15 down to €1.05

Butter, no change.

Cheese, no change.

Pink lady apple, 55c down to 50c

Sliced pan 99c down to 89c

Bananas €1.55 up to €1.59

Chocolate digestives €1.20 up to €1.30

Coffee €2.75 no change.

I'm not really seeing anything up 30%

buried

https://www.boards.ie/discussion/comment/121402847#Comment_121402847

Well, you're going to have to itemize the brands you are selecting to the brands I have to buy. I have no clue if those items you are selecting are the ones that I have to select.

Matters nothing anyways because I have been buying the same brands year in, year out for the last decade. So unfortunately I know what I am talking about. But, continue to try to prove me and my wallet wrong, maybe you can do my shopping for me, seeing as how sure you are so correct?

Have at it.

Wolf359f

https://www.boards.ie/discussion/comment/121402857#Comment_121402857

That's just all Tesco own brand apart from the butter. That was kerrygold. Let me guess it's only the brands you choose that have all increased 20-30% in the space of 12 months.

eightieschewbaccy

https://www.boards.ie/discussion/comment/121402857#Comment_121402857

K, specify the milk brand and the price this time last year versus now. Easy.

joebloggs32

Milk prices are definitely down as the earlier poster said.

Problem with tesco pricing is that the clubcard gimmick means the same product has two different prices so making comparisons at different times of the year can be tricky.

buried

https://www.boards.ie/discussion/comment/121402899#Comment_121402899

Yes that's exactly what I am saying, so how does that configurate with the brands I have to purchase? They've all gone up. Not only that but I'm self employed, I have to mass purchase bulk materials from suppliers, materials that have all increased in price nearly 70-80% from this time last year.

So all this nonsense talk of de-creased inflation is exactly that. Nonsense. But, believe who you want. I have to keep increasing my prices too for my business, which is an essential business.

And guess what happens with that? Increased or de-creased inflation?

buried

https://www.boards.ie/discussion/comment/121402907#Comment_121402907

Glenisk, Avonmore, Kraft Heinz Company, all dairy/milk products based companies that have increased prices within the last year.

astrofool

https://www.boards.ie/discussion/comment/121402924#Comment_121402924

What materials are you bringing in? I've noticed a lot of the building materials which shot up over the pandemic, have come down this year. Some raw materials could be up 70-80% but they weren't a large % of the finished products anyway (a hard sell if you're an importer though).

Those raw material values will have gone up worldwide leading to alternates being used instead (which usually takes about 6 months to switch over).

buried

https://www.boards.ie/discussion/comment/121402976#Comment_121402976

I now have a governmental levy, placed upon construction materials such as dry readymix from reputable quarries who are the ones who have to pay this levy for the gangsters in un-reputable quarries who supplied pyrited laden concrete mix to houses all throughout the state that are now falling down. The quarries that supplied the defective pyrite have folded, so the reputable ones, the ones I have always used, have to pay the price. That levy is at 30%. So there is that.

I also have to mass purchase bulk goods from overseas that since the suez boat debacle have seen these prices literally reach over the 70% mark. That situation happened over two years ago, yet the prices for the materials within those containers have not come down. So there is that too.

Fr Tod Umptious

https://www.boards.ie/discussion/2058323785/is-christine-legarde-right-about-inflation

Also, I think 0% or deflation would be better than inflation at any level.

Deflation is bad, it stifles growth.

Why replace an item now when it will be cheaper in 6 months.

Why re-do the kitchen now when it will be cheaper in 6 months.

Sales decrease, people lose their jobs.

Spitty_Carragher

The annoying thing is them still keeping 2% as the target even after all the massive inflation of the last few years.

"hey you've been shafted by 20% increase in prices but just remember, we still want 2% per year after that!"

Spitty_Carragher

https://www.boards.ie/discussion/comment/121403045#Comment_121403045

A sustained level of deflation would be bad yes.

After 20% price increases in a few years though? No, it would be helpful.

If you're saying people would hold off buying things because things would be cheaper, later, then why are bank despsits so high now? Wouldn't people be going mad buying anything they can? After all, even in a perfect world of 2% inflation, it still makes things more expensive next year than this year.

realitykeeper

https://www.boards.ie/discussion/comment/121402261#Comment_121402261

I think you are confusing fact with fiction.

realitykeeper

https://www.boards.ie/discussion/comment/121402847#Comment_121402847

To take just one item on the list, i.e. bananas. You give no indication as to whether the weight is the same or the brand. Everything would have to be identical for the comparison to be meaningful. I have kept last years receipts but have not done a comparison yet. I will do so and report back.

realitykeeper

https://www.boards.ie/discussion/comment/121402907#Comment_121402907

I would only trust the receipts I kept to do the comparison.

realitykeeper

https://www.boards.ie/discussion/comment/121402976#Comment_121402976

Only like for like comparisons matter. Conparing a sirloin steak last year to a tin of dog food this year is not an accurate measure of inflation.

realitykeeper

https://www.boards.ie/discussion/comment/121403045#Comment_121403045

No, deflation is excellent. Inflation is a stealth tax and deflation is wonderful because it prevents that dishonest form of taxation. If a person wants to eat, they eat.They don`t wait for prices to fall. They governments rely on gullible people to believe their ridiculous explanations. If they were honest the would admit the reason they favour inflation is because it is a stealth tax. The 2% is completely arbitary by the way.

SEPT 23 1989

https://www.boards.ie/discussion/comment/121402847#Comment_121402847

hopefully we can stabilize to the same extortionate prices from previous years

never a reduction

Bass Reeves

Watch raisin Bank figures. It's paying 4% rated for 1-3 years and it just slightly below 4% for a four year term. Sharp drop for 5 year rates. However banks are conservative and they may be heading on 3+ year figures. However fairly strong inflation for next 3 years I suspect.

astrofool

https://www.boards.ie/discussion/comment/121403025#Comment_121403025

Yea, it's a tough business to be in, things that emit carbon will keep going up. The construction industry was screaming about any added regulation before pyrite and mica happened and the levy was almost inevitable (and those who kept the standards high suffer) but it is a time to diversify and find new products with better margins, industries adapt and those who adapt with them get rich (family business used to import materials from China and would always be tracking changes and new regulations, it was a pain, but blaming inflation, especially when it's global, just means inaction).

astrofool

https://www.boards.ie/discussion/comment/121403142#Comment_121403142

The basket of goods for inflation measures are continually updated but the item comparison is the same (rib eye steak to rib eye steak), but you're going on about deflation being a good thing, so I'm not sure if you're winding people up or just misguided in this whole area.

Peregrinus

https://www.boards.ie/discussion/comment/121402240#Comment_121402240

To be fair to the CSO, your suggested method is only measuring inflation in grocery prices, while the CPI measures inflation over household expenditure generally — all goods and services, including rents, mortgage interest, utilities, insurance, healthcare expenditure, motoring expenses, tradesmen, transport, telephone and internet, hairdressing, clothes, meals out, entertainment — everything, really. Your focus on groceries means you are excluding about 92% of the household expenditure that the CPI covers.

And, while you're suggesting working off 50 reference prices, the CSO works off about 53,000 price quotes for 615 different items.

So, no offence, but I'm still inclined to treat their figure as a bit more robust than yours.

Mr. teddywinkles

Not until the next crisis and money has to be pulled outa thin air to pay for. War in ukraine ain't paying for itself now is it

Oscar_Madison

https://www.boards.ie/discussion/comment/121402512#Comment_121402512

I pretty much buy the same basket of goods month on month- definitely 15% at least more expensive than last year - you even know yourself when walking around the store picking up the items.

Meat went up 10-20-% depending on what cut you buy. I use Dunnes Stores which means I get 10 off 50 shop or 5 off 25- the only other supermarket I’d go to for some small items weekly is Super Value so I’m bloody glad of the 20% off in Dunnes- both supermarkets sell similar items and similar prices so Super Valu every week would be very expensive and their discount loyalty card is crap- and a lot less than what Dunnes savings are.

These days I set a target of no more than 100 euro a week after discounts and try to stick to it where possible, Christmas time being the exception .

I rarely go to Lidil and only for very small things like their bakery items and haven’t been in an Aldi in years - just never warmed to them for some reason- maybe there’s a fortune to be saved there I dunno but I don’t think so - their prices are going up too I’d imagine - I’d probably also be tempted with the likes of cut price chain saws or ski wear or what not, which would just add unnecessary spending to my basket 😀

Steviemak7

https://www.boards.ie/discussion/2058323785/is-christine-legarde-right-about-inflation

Inflation is calculated on an annual basis hence it can quickly come down when calculated against a high inflation month the previous year. For example if inflation last November 2022 was 10% (this was 10% higher than Nov 2021). So once high inflation months are removed from calc then inflation can drop quick enough

Jonathan2712

Lagarde has two Masters Degrees from top universities, she also has had a world class career including;

-         Chairperson of a major global legal firm by 43 years old

-         French Minister for Foreign Trade,

-         Minister for Agriculture

-         Minister of the Economy

-         Manging Director of the IMF

-         President of the European Central Bank

-         Fellow of Robinson College, Cambridge

-         Director of the Asia Development Bank

-         Board Member of the World Bank

-         Two honorary doctorates

Should we trust her opinion of inflation, or someone’s anecdote about a recent trip to Tesco?  

m2_browning

https://www.boards.ie/discussion/comment/121403095#Comment_121403095

You have an issue with Central Statistics Office reporting?

prunudo

https://www.boards.ie/discussion/comment/121403499#Comment_121403499

As a Dunnes shopper, I'd concur with that. Few of my regular items still going up, Dunnes blueberries €2 to €2.49, Nescafe 200g up to €7.95 on special, used to be €6 on special, yoghurts still going up, 2x4 pot used to be €4, now €5.30 on special. It all adds up I tell you.

But back to Legarde, I wouldn't trust a word she says.

astrofool

https://www.boards.ie/discussion/comment/121403499#Comment_121403499

Dunnes prices reflect the vouchers, you gain a little bit if you spend 50, you lose if you spend 55 while it also creates lock-in (need another voucher and use the current one). It's a common marketing tactic.

You would definitely save by using Lidl or Aldi, even if you buy exactly the same branded good.

Oscar_Madison

https://www.boards.ie/discussion/comment/121403552#Comment_121403552

Yeah blueberries- 25% jump in prices-must invest in the fruit markets 😀