jeudi 4 septembre 2008


'Too much money chasing too few goods.' I'd explain to my students. That covers about 1% of it. But reading this , "Many electricity and gas companies have recently announced fresh price rises, which will continue to put upward pressure on inflation for months to come. But eventually they will start cutting prices and that will have a big impact on inflation, especially as the price levels will be compared with higher prices a year earlier, thus giving a downward push to the inflation figures, which always show year-on-year price changes."

makes you think again. Effectively, next year even if prices stay where they are (i.e. rip-offingly high) inflation goes down, index linked pay increases fail to match rising prices, the government looks better and it looks like the free market has solved another crisis.

Economics is the illusion placed by power around money.