Best of the Week
Most Popular
1.The Brexit War! EU Fearing Collapse Set to Stoke Scottish Independence Proxy War - Nadeem_Walayat
2.London Terror Attack Red Herring, Real Issue is Age of Reason vs Religion - Nadeem_Walayat
3.The BrExit War, Game Theory Strategy for What UK Should Do to Win - Nadeem_Walayat
4.Goldman Sachs Backing A Copper Boom In 2017 - OilPrice_Com
5.Trump to Fire 50 US Cruise Missiles To Erase Syrian Chemical Attack Air Base, China Next? - Nadeem_Walayat
6.US Stock Market Consolidation Time - Rambus_Chartology
7.Stock Market Investors Stupid is as Stupid Goes - James_Quinn
8.Gold in Fed Interest Rate Hike Cycles- Zeal_LLC
9.The BrExit War - Britain Intelligence Super Power Covert War With the EU - Nadeem_Walayat
10.Marc Faber: Euro to Strengthen, Dollar to Weaken, Gold and Emerging Markets to Outperform - MoneyMetals
Last 7 days
Bifurcated US Stock Market - 29th Apr 17
Damn the Deficits, Huge Trump Tax Cuts Ahead! - 29th Apr 17
Gold Hostage to Stocks - 29th Apr 17
Warren Buffett Hates Gold… But Here’s Five Reasons You Need To Own It - 29th Apr 17
Stock Market Sentiment, Re-Fueled Along the Way - 28th Apr 17
Calling out the Central Bankers - 28th Apr 17
Fed's Third Inetrest Rate Hike and Gold - 28th Apr 17
USD/CAD - Invalidation of Breakout or Further Rally? - 28th Apr 17
What Happened to the Stock Market Crash Experts Were Predicting - 28th Apr 17
Earth Overshoot Day - Human Population Growth - 28th Apr 17
Misunderstanding GDXJ: Why It’s Actually Great News For Junior Miners - 28th Apr 17
What Makes Bitcoin Casinos So Remarkable? - 28th Apr 17
Financial Markets Improvised Explosives - 27th Apr 17
More Stock Market Short-Term Uncertainty As Stocks Get Close To Record High - 27th Apr 17
Elliott Wave Theory: Is Elliott’s Theory Enough? - 27th Apr 17
Billionaire Investor Paul Tudor Jones Says Stock Market Valuation Is “Terrifying” And He Is Right - 26th Apr 17
The Great BrExit Divides - Britain, USA and France - 26th Apr 17
10 Facts That Show Our Taxes Are Worse Than You Thought - 26th Apr 17
What Trump’s Next 100 Days Will Look Like - 26th Apr 17
G20: SURPASSING THE 2nd GLOBAL STEEL CRISIS - 26th Apr 17
What A War With North Korea Would Look Like - 25th Apr 17
Pensions Are On The Way Out But Retirement Funds Are Not Working Either - 25th Apr 17
Frank Holmes : Gold Could Hit $1,500 in 2017 Amid Imbalances & Weak Supply - 25th Apr 17
3 Reasons Why “Spring Forward, Fall Back” Also Applies To Gold - 25th Apr 17
SPX may be Aiming at the Cycle Top Resistance - 25th Apr 17
Walmart Stock Extending Higher - Elliott Wave Trend Forecast - 25th Apr 17
Google Panics and KILLS YouTube to Appease Mainstream Media and Corporate Advertisers - 25th Apr 17
Gold Price Is 1% Shy of Ripping Higher - 25th Apr 17
Exchange-Traded Funds Make Decisions Easy - 25th Apr 17
Trump Is Among The Institutionally Weakest National Leaders In The World - 25th Apr 17
3 Maps That Explain the Geopolitics of Nuclear Weapons - 25th Apr 17
Risk on Stock Market French Election Euphoria - 24th Apr 17
Fear Campaign Against Americans Continues Nuclear Attack Drills in New York City - 24th Apr 17
Is the Stock Market Bounce Over? - 24th Apr 17
This Could Be One Of the Biggest Winners Of The Electric Car Boom - 24th Apr 17
Le Pen Shifts Political Landscape- The Rise of New French Gaullism  - 24th Apr 17
IMF Says Austerity Is Over - Surplus or Stimulus - 24th Apr 17
EURUSD at a Critical Point in Wave Structure - 23rd Apr 17
Stock Market Grand Super Cycle Overview While SPX Correction Continues - 23rd Apr 17
Robert Prechter Talks About Elliott Waves and His New Book - 23rd Apr 17
Le Pen, Melenchon French Election Stock, Bond and Euro Markets Crash - 22nd Apr 17
Why You Are Not An Investor - 22nd Apr 17
Gold Price Upleg Momentum Building - 22nd Apr 17
Why Now Gold and Silver Precious Metals? - 22nd Apr 17
4 Maps That Signal Central Asia Is at Risk of War - 22nd Apr 17
5 Key Steps For A Comfortable Retirement From Former Wall Street Trader - 22nd Apr 17

Market Oracle FREE Newsletter

Why 95% of Traders Fail

UK CPI Inflation Soars Despite Bank of England Deflation Propaganda, Shocks Academic Economists

Economics / Inflation Nov 13, 2012 - 03:59 AM GMT

By: Nadeem_Walayat

Economics

Best Financial Markets Analysis ArticleUK CPI inflation soared for October by rising to 2.7% up from 2.2% (Sept) which is set against academic economists / mainstream press expectations for a rise to just 2.3%. Whilst the more recognised inflation measure, RPI rose to 3.2% up from 2.6%, against press expectations of 2.8%.


Mervyn King, the Governor of the Bank of England had earlier this year forecast that UK inflation would continue falling into the end of this year which the mainstream press and academic economists had been busy regurgitating at length. However today's inflation data reasserts the actual Inflation mega-trend which is for Inflation to remain well above the Bank of England's target rate of 2%, with average CPI for 2012 expected to come in at a rate above the Bank of England's upper limit of 3%.

UK CPI Inflation

The mainstream press headlines say it all (Google) of still not having a clue at all, after having missed three whole years of an inflation mega-trend in progress.

The academics and pseudo economists are again bringing forward virtually every reason under the sun to explain why Inflation has risen, where this time it is apparently tuition fees and food inflation, which are ALWAYS said to be temporarily price rises. However what the most vocal commentators most consistently miss is that the primary driver for Inflation is the debt that the government has been busy printing to the tune of an additional £130 billion a year (budget deficit), which the countries central bank (Bank of England) has been busy monetizing by printing money that it channels to the banks to BUY government bonds that the government prints.

When you print £130 billion per year you are pouring petrol onto the inflation fire, and when you monetize the debt by printing money then you are in effect pouring rocket fuel onto the inflation inferno as I covered at length in the in-depth analysis - 20 Jul 2012 - The Quantum of Quantitative Easing Inflation is Coming! of what is likely to transpire going forward and more importantly why.

The Exponential Inflation Mega-trend

Whilst the mainstream press and academics focus WHOLLY on the annual CPI Inflation graphs as illustrated above, the reality is that of an exponential inflation mega-trend as illustrated by the below graph that shows that despite the British economy having been in economic depression for the past 4 years, yet it has still suffered inflation of over 15%.

UK CPI Inflation Index

The inflation mega-trend is something that the mainstream press never mentions as the journalists who think they are economists rely on vested interest academic economists to pump out propaganda that virtually wholly focuses on what amounts to just the annual momentum in the rate of change of inflation that paints a picture of relative stability when the truth is that of an exponential inflation trend that over time virtually guarantees that value of wealth such as savings will effectively be stolen by governments towards the purpose for the buying of votes to win elections. This demands action be taken to protect oneself from this theft of purchasing power, strategies that I have covered at length over the years and in-depth in the Inflation Mega-trend ebook (FREE DOWNLOAD)

My expectations remain for UK inflation to average above the Bank of England's upper limit of 3% for the duration of this DECADE. My intention remains to generate a more detailed trend forecast for UK inflation for over the coming years ( i.e. as illustrated by past forecasts), which is also necessary in terms of resolving towards trend forecasts for the UK economy and markets such as the UK housing market, to get this on completion in your email in box ensure you remain subscribed to my always free newsletter.

In the meantime the Bank of England continues the QQE fraud as I warned of several months ago (20 Jul 2012 - The Quantum of Quantitative Easing Inflation is Coming! ) that I will discuss in detail in my next in depth analysis as it does warrant a detailed look to dissect the debt monetization dynamics, in the meantime don't let yourselves become infected by mainstream press deflation delusions that will follow after the Bank of England's quarterly economic propaganda report due out tomorrow, because deflation has NEVER been imminent, nor will it be for the duration of this decade.

Source and Comments : http://www.marketoracle.co.uk/Article37514.html

By Nadeem Walayat

http://www.marketoracle.co.uk

Copyright © 2005-2012 Marketoracle.co.uk (Market Oracle Ltd). All rights reserved.

Nadeem Walayat has over 25 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of three ebook's - The Inflation Mega-Trend; The Interest Rate Mega-Trend and The Stocks Stealth Bull Market Update 2011 that can be downloaded for Free.

Stocks Stealth Bull Market Ebook DownloadThe Interest Rate Mega-Trend Ebook DownloadThe Inflation Mega-Trend Ebook Download

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 600 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Nadeem Walayat Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Catching a Falling Financial Knife