Is Christine Legarde right about inflation?

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 😀

prunudo

https://www.boards.ie/discussion/comment/121403669#Comment_121403669

To be fair, its ridiculous that we expect out of season fruit to be brought half way around the globe to appease our needs, but alas thats the way of the world now.

Oscar_Madison

https://www.boards.ie/discussion/comment/121403727#Comment_121403727

Yeah it’s shame on me actually (being serious for a minute) - I guess the public wants what the public gets- I wouldn’t complain if I didn’t have blueberries for 6 months of the year - I know sustainability starts with the individual but supermarkets could help here too

realitykeeper

https://www.boards.ie/discussion/comment/121403174#Comment_121403174

The cement levy (to pay for the mica scandal) is really intended to inflate the cost of new builds and by extension, housing in general. If you buy a new house, you are paying for the mica/pyrite scandal. Builders are also aware they will have to pass that cost on. The question is, who will want to pay for that and who would rather emigrate.

realitykeeper

I think inflation is very noticeable in Marks & Spencer. They were pricey to begin with but they are ridiculous now.

realitykeeper

https://www.boards.ie/discussion/comment/121403518#Comment_121403518

This deference to authority is exactly what our leaders are looking for. I would rather think for myself.

eightieschewbaccy

https://www.boards.ie/discussion/comment/121404047#Comment_121404047

That could be more to do with Brexit imho. There's been a huge quality issue with them since Brexit.

realitykeeper

https://www.boards.ie/discussion/comment/121403529#Comment_121403529

I have an issue with the CPI. It is government filling in it`s own report card. The method of calculating the CPI should remain constant but instead it changes constantly to make inflation seem lower than it is. It doesn`t really matter though, citizens have to deal with real inflation and the credibility of our fact finders will come under increasing scrutiny and I don`t just mean by consumers. Countries like the BRICS hold our bonds but if our inflation figures rise or become suspect, they will demand higher interest payments before investing in Irish government bonds. The theft of Russian bonds and assets by western countries has rightly signaled alarm in other parts of the world. We are unworthy of trust.

JVince

This thread shows exactly why boards has gone to total crap in the last 2-3 years.

A fairly reasonable question and the replies are akin to what you'd get in a creche. And I'm probably insulting 3 & 4 year olds at that!

m2_browning

https://www.boards.ie/discussion/comment/121404145#Comment_121404145

So you do have an issue with CSO

your username is ironic

crusd

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

Lower inflation means the rate of increase has slowed not that they are decreasing. You would need a sustained period of lower inflation to start to notice in day to day prices