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so its pretty well established that the main grunt of the cost of living crisis is based on the wholesale energy prices, and they're forecast to go up, and then up some more for a couple of years.
Thing is, creating gas/electricity hasn't actually got more difficult or expensive. We can't buy it from russia, sure, but a bunch of countries who can't be as principled can, so the gas they produce will, mostly, still be used. In europe we're going to rush around building up infrastructure/do deals to get our fuel in from elsewhere, and at some point, in a few years time, that'll be done.
trying to sidestep the "everyone will just keep it as profit" school of thought, won't that redress the supply side of supply & demand, and so the 300% increase in energy prices we've seen will fall back through the floor, causing potentially more economic pain on the way back down?
If the high prices are just a blip, should we be doing things differently?
I think this is what Andrew Bailey was on about when he was calling for wage restraint, and getting shouted down by the left wing press.
If energy prices do find start to fall (is it a bubble caused by trading gas futures? Demand hasn't gone up, and might fall if we go into global recession) then that's fine, unless we have got ourselves into a wage/cost spiral by then I which case inflation will be much harder to get under control.
As I've said elsewhere, governments are dealing with this in totally the wrong way, rather than panic buying all the gas they can or, in our case, handing people money to buy more fossil fuels, now is the ideal opportunity to try to get ourselves off fossil fuels for good
It's not just energy there's also supply chain issues and a deficit of cheap labour. Most especially effecting the UK
Who are the left wing press?
There is no regulatory mechanism to ensure energy prices go down when wholesale costs go down. We're going to get gouged in both the commercial and domestic energy markets for years to come. I work in energy and carbon management so feeling pretty cynical about what's happening right now and the lack of action from the government, not just in the current fiasco, but in the build up over the last few years.
We won't see deflation of any great significance because for some crazy reason 'success' in an economy is based upon gross domestic product. That measurement doesn't account for the distribution of that product across the populace
now is the ideal opportunity to try to get ourselves off fossil fuels for good
Easier said than done. The main source of renewable energy is wind. Wind is so variable you are baking the need for gas into the system by building more wind. If you have a lot of wind you still need near 100% backup from gas/nuclear. In the UK solar is at zero for most of the day half the year.
More nuclear is the proven way of decarbonising electricity but that is a long term plan that won't do anything in the immediate future.
Elecricity is the easy bit. Home heating is mainly gas. Heat pumps are expensive as they often require upgraded pipework, radiators, and insulation. We are going to need gas for heating for a long time to come.
Transport? There are EVs now but until 2030 ICE cars will be getting sold and will need fuelled for at least a decade after that.
As Russia has weaponised gas and can't be trusted for future supplies the west should be fracking and drilling for gas wherever possible.
The best thing we could do is insulate our homes and businesses. But because some people glued themselves to the motorway the gutless pillocks in charge will never adopt a policy to do it.
We have some of the worst buildings in Europe and we pay an inordinate amount of money for them
IRC is correct that we're going to find it very hard to move away from gas. Instead of fracking and drilling more, let's use less instead. Actually implementing building regs that don't allow gas in new builds, set a deadline for no new gas heating and hot water appliances, and firstly stopping the sale of gas cookers would make big strides forward
There is no regulatory mechanism to ensure energy prices go down when wholesale costs go down
Isn't that exactly what the price cap does? Even if it wasn't there, market pressures between different suppliers should drop the cost pretty quick (although I assume they would be allowed to recoup some of their losses). They haven't made loads of profits in the past..
Elecricity is the easy bit. Home heating is mainly gas. Heat pumps are expensive as they often require upgraded pipework, radiators, and insulation. We are going to need gas for heating for a long time to come.
Well if electricity is the easy bit why not just heat our homes with it directly?
Most of Europe seems to manage this impossible feat (those that don't have district heating).
Well if electricity is the easy bit why not just heat our homes with it directly?
Because electricity in the UK is a lot more expensive than gas. If the price balances out then yes just use electric boilers, electric radiators etc,. It makes no sense having gas heating in a modern, well insulated house. Just have electric radiators and only turn on in the rooms you are using.
Who are the left wing press?
The Mirror, The Guardian - well they are left wing when you are viewing them through the eyes of the typical Daily Mail or Telegraph reader anyway.
I think this is what Andrew Bailey was on about when he was calling for wage restraint, and getting shouted down by the left wing press.
He needs shouting down.
The man is an utter cretin.
Have you seen the wage increases of the CEOs FTSE 100 companies? - 39% since 2021.
Here's how it goes: according to these established crooks high wages don't drive inflation - but when the lower end want a wage rise that's all about inflation.
Given that wages for the average section of society are way behind in real terms how on earth would they drive inflation?
The wealthy drive inflation - they hoard money and resources, thereby reducing availability to the rest of us which limits supplies. The driver of this inflationary cycle is lack of supply.
Bailey and the MPC are engineering a recession to control inflation by making money more expensive. How does this increase resource supply? Guess who that hurts the most?
Deflation is probably baked in and will be more of a problem.
On another note according to the right wing press - government/BoE money drives inflation (Q/E) but commercial bank money supply never does. Go figure.
I'm not sure what infrastructure will be built in a few years time? Most energy projects are complex. I can't imagine anything in wind, gas or near being ready that isn't already planned in and under construction somewhere?
In the UK there are a lot of major wind projects underway and these will be reaching first power in the next few years. I agree we still need to tackle the diversification and storage issue but the potential is there. The UK is always described as meteorologically diverse. We are pretty fortunate in that regard. Off shore particularly. It is quite feasible that there will always be enough wind somewhere to keep the turbines spinning.
I think this is going to be a long run thing unfortunately. Right now we are still seeing pent up demand through lack of supply. There's also high employment. It's creating artificial confidence. As/if this tails off then things might spiral quickly.
That coupled with a government of limited confidence, short term thinking and which would rather create distractions than deal with problems is worrying.
The problem is that a lot of the ‘high employment demand’ is for rubbish jobs in hospitality and retail - minimum wage, jobs of last resort and if the economy tanks, will disappear as consumers tighten belts. Similarly, there are high demands for jobs in care and agriculture that we’re previously done by immigrants which are probably never coming back. Both are causing the economy to shrink, less output, less taxes, whist increasing things like food prices. Add 12 years of austerity and Brexit into the mix and the UK finds itself in an even worse position, hampered by poor productivity and bosses who put dividends, bonuses and profits above sustainable growth. Yes, there may be some deflationary pressure by companies simply reducing margins and prices to survive, many factors are unique to the UK which means it will take longer to recover ie higher prices for longer. Unless fiscal stimulus is targeted most at those in need, at the bottom, it doesn’t auger well by creating the perfect recipe for civil disobedience. We’re in for a rough ride!
Left wing press? There isnt any in the uk bar the morning star
jobs in hospitality and retail – minimum wage
They aren't currently if you're in the countryside. Pay minimum and get no staff, they'll get jobs paying better closer to home. Business owners have lost sight that it's a minimum not "The Wage". They are now into evolve or die territory.
Demand hasn’t gone up, and might fall if we go into global recession
Fallacy.
https://ourworldindata.org/energy-production-consumption
The only way forward is to reduce global demand and yet its going through the roof. I heard the number of air-con units installed recently, crazy. People always take the easy short term cheapest and easiest alternative.
Fit external shutters, no chance.
Plant trees, no chance
Properly insulate buildings, don't make stupid pragmatic suggestions
Paint walls and roofs white, no way
None of that, install a load of air con to increase energy demand, further greenhouse the planet and further heat the local environment.
I think this is what Andrew Bailey was on about when he was calling for wage restraint, and getting shouted down by the left wing press.
Would that be the same Andrew Bailey that gets paid double that of the bloke he replaced AND has failed to deliver his targets?
Ha ha - That's the one.
He's paid heavily just for the press and government to blame when things go wrong.
9 people to discuss up or down. Jeez.
(They follow the Fed anyway.)
TL:DR As individuals we need to avoid debt as much as is possible
We've been behind the curve for years in terms of the indices used to determine inflation v pay. Pay in real terms has been falling
We now have a global warming and energy supply crisis partly linked with energy conservation/insulation v PP/building regs and war.
We'll no doubt see the same in food/agriculture with reductions in available crops, fertilisers and animals already eating their winter feed store because of drought and war
A series of crises are squeezing populations hard caused by generations of governments worldwide failing to address global and national problems.
Yes, we should have been doing things differently for decades. Deflation will to a certain extent be a good thing because people will be able to buy.
The difficulty is that we're laden with debt following C19, the war in Ukraine, infrastructure projects, etc and deflation in circumstances of debt isn't good. As individuals we need to avoid debt as much as is possible
Proof if you needed it that most people have more than enough squandering power, will burn every drop of fossil fuel they can get their hands on and that if current energy prices aren't stopping people spending on non-essentials it will require even higher prices to get deflation.
There is no regulatory mechanism to ensure energy prices go down when wholesale costs go down. We’re going to get gouged in both the commercial and domestic energy markets for years to come.
Unless you're meaning something else, then the price cap is designed to cap retail profits at an average of 1.9%. There's no mechanism to control the wholesale price upstream of that, beyond the retailers are operating in a market that's generally functioning correctly (or as correctly as can be given OPEC and others influencing it).
now is the ideal opportunity to try to get ourselves off fossil fuels for good
It is indeed, but none of that has any ability to ease short term problems for people whose wages don't cover their basic living costs this winter. Boris' wiffwaff about building nuclear power stations isn't going to help anyone before the 2030s, and the lead time for more renewables is fairly long, too.
As usual, successive governments have done nothing to plan for an energy crisis, correcting the lack of storage and generation infrastructure is a job measured in decades. Once it ends, the chances are that whoever is in power will lose interest in it again.
Proof if you needed it that most people have more than enough squandering power, will burn every drop of fossil fuel they can get their hands on and that if current energy prices aren’t stopping people spending on non-essentials it will require even higher prices to get deflation.
What's your argument here? That how dare people go and have a weekend away to have enjoyment in their lives? That if people need to be poorer so they only way they can afford to spend their free time is sit at home watching TV? How dare people look to seek out some enjoyment in their lives - we should bring back the workhouse!!?
FFS when did we as a society get to the point we are vilifying folk for going away for the weekend during the summer bank holiday?! We live in a beautiful country - we should get out and enjoy it. Neither should we vilify people that wish to travel to visit family.
I think his argument was that despite all the warnings over climate change and petrol prices having gone silly people still won't change their habits and will keep driving regardless.
If climate change won't make them stop, or at least reduce it, then what will? Petrol at £2/litre didn't, £3? £5?
As individuals we need to avoid debt as much as is possible
You're only here once, might as well go down in glory 🙂
If the high prices are just a blip, should we be doing things differently?
Even if it is just a blip, you still need to try and mitigate the damage from the initial shock as best as possible.
France probably has the best strategy, nationalise EDF and absorb the shock across the whole population / industry. But, owning a fleet of 60+ Nuclear reactors and being pretty self sufficient in electricity is a good starting point (even if half are offline with containment issues).
Another fun STW thread. Some folk really do wish we just immediately stopped our lives and lived in caves to save the planet.
I think his argument was that despite all the warnings over climate change and petrol prices having gone silly people still won’t change their habits and will keep driving regardless.
I don't think August weekend traffic is a good indicator of driving habits generally. A lot of people booked holidays before the true impact of fuel prices came into play, and it may be the first holiday they've had in three years. If you're spending hundreds on a family holiday, the marginal cost of higher fuel prices is not going to put you off.
We'll see from September onwards whether people tighten their belts significantly when it comes to leisure driving. I'm certainly taking far fewer trips this year.
My last holiday was on the train and bike, the previous one on the bus and walk. Get out and enjoy the countyside by all means but 13 million cars on the road with many of them doing very long runs is an environmental disaster and needs to stop.
Back in the early 60s in south Brum not many people had cars but on th ebank holiday there were hordes of people walking over the Licky hills and enjoying a picnik having caught the bus to Longbridge or Rubery.
As usual, successive governments have done nothing to plan for an energy crisis
The government can't avoid an energy crisis when 13 miilion trips over a bank holiday weekend are byond government control.
Iget weary of posts on this forum blaming the government for everything when the people moaning are active on petrolhead threads, fly off skiing/mtbing/surfing/kite surfing twice a year, have gas central heating and find excuses not to insulate.
Quit moaning about the government, use the trains and busses, don't fly, make the most of your local environment, cut off the gass and insulate... and give up on making references to the workhouse if anyone questions the crazy sqandering way the vast majority of people live.
Iget weary of posts on this forum blaming the government for everything when the people moaning are active on petrolhead threads, fly off skiing/mtbing/surfing/kite surfing twice a year, have gas central heating and find excuses not to insulate.
I am none of those things. The need to reduce individual consumption is not something which removes the obligation on government to plan for problems in energy supply/markets.
Quit moaning about the government, use the trains and busses, don’t fly, make the most of your local environment, cut off the gass and insulate… and give up on making references to the workhouse if anyone questions the crazy sqandering way the vast majority of people live.
People are, fundamentally, selfish and lazy. Why on earth would the average individual take the train on a bank holiday when the car is both cheaper and more convenient? It is absolutely the government's job to recognise this and take steps to make the environmentally less-disastrous option more attractive. Blaming individuals won't change the behaviour of the masses.
No-one in their right mind would be booking a trip away via train this year! There has been swathes of cancellations all year on account of strikes (which I support). Relying on the train is a recipe for disappointment or getting stranded somewhere!
Relying on the train is a recipe for disappointment or getting stranded somewhere!
Tell me about it. Anyone who tells me taking the train is the best way gets told where to go. I booked the train for a stag do up in Newcastle earlier in the year. Both journeys cancelled. New journeys took a chunk of time out of my weekend. My girlfriend has to travel to her Leeds office the odd time. The last 3 trips, have all been cancelled. She takes the car now. Public transport in this country is a sh1tshow. I love the idea of the train, they are much more relaxing when travelling, but they fall so short of my basic expectations.
Public transport can and does work well in parts of the country. Im a regular user in central Scotland. Cheaper quicker and nicer than a car for the journeys i do regularly
I broadly agree TJ that Scotrail are pretty good, but I still wouldn't be relying on them for a trip away this year;
https://www.bbc.co.uk/news/uk-scotland-62579847
Public transport can and does work well in parts of the country
I live in Manchester. I'd expect it to work most of the time. I will say, the tram is okay.
Anyway, this is derailing the thread...
I'll get my coat.
What’s your argument here? That how dare people go and have a weekend away to have enjoyment in their lives? That if people need to be poorer so they only way they can afford to spend their free time is sit at home watching TV? How dare people look to seek out some enjoyment in their lives – we should bring back the workhouse!!?FFS when did we as a society get to the point we are vilifying folk for going away for the weekend during the summer bank holiday?! We live in a beautiful country – we should get out and enjoy it. Neither should we vilify people that wish to travel to visit family.
I live in Manchester.
I'm aware Manchester is pretty grim but I didn't realise the need to escape to do anything fun was quite so acute.
I’ll get my coat.
'Getting your coat' is pretty much the entire government plan to support households in fuel poverty this winter.
Back in the early 60s in south Brum not many people had cars but on th ebank holiday there were hordes of people walking over the Licky hills and enjoying a picnik having caught the bus to Longbridge or Rubery.
You won't make me go on holiday to Rubery no matter how much you complain!!
Blaming individuals won’t change the behaviour of the masses.
Individuals are the masses. And their resistance to change even when the government makes it easy for them is most of the problem.
Those that have taken up grants to insulate their home, fit solar panels or heat pump and maybe even buy an electric car rather than squandering on getting sunburnt in Mali aren't unduly worried about energy costs. That's the demographic of most of this forum.
Another demographic of this forum is the buy to letters who rent out energy sieves to people poorer than themselves and squander the profit on fancy holidays. They could insulate to passive house standards both at home and in their buy to let but don't.
Every other thread on this forum is about sqandering money when people could be getting their energy use under control. The editorial content doesn't help, it's a stream of publicity for flying off to fancy places to ride and MTB. I noted Hannah flew to the US recently for an interview, Zoom would have been an more ecological choice.
*waits for the the excuses, "justifications", insults and abuse*
I noted Hannah flew to the US recently for an interview
No, she didn't. Just one of many things she did while out there.
Looking at what makes up inflation (Many areas beyond energy), the cost of services has risen more than the cost of fuel. A portion of this will be due to fuel cost but there are many other factors at play.
Initial thoughts where that inflation was transitory but it is becoming clear this is not the case.
The way gov + central banks deal with inflation is to increase interest. Fuel may go down but housing will then go up. Inflation may decrease for the country as a whole but not for the average person on here.
Not pushing for a pay rise when inflation is at 10% and your food + housing costs are rising is naive at best IMO.
Individuals are the masses. And their resistance to change even when the government makes it easy for them is most of the problem.
Right. So, if the behaviour of the masses isn't meeting your exacting standards, what should the government do? Call them nasty names to make them feel a bit guilty about it, or make policies that further incentivise doing the 'right' thing?
I'm 100% behind getting people out of their cars and onto public transport - but vilifying car users is not going to achieve that goal.
The way gov + central banks deal with inflation is to increase interest. Fuel may go down but housing will then go up. Inflation may decrease for the country as a whole but not for the average person on here.
Not pushing for a pay rise when inflation is at 10% and your food + housing costs are rising is naive at best IMO.
This is supply-side inflation on multiple fronts, not just energy. Interest rates are a poor tool for dealing with it, because it is mainly driven by non-discretionary spend. Increasing interest rates simply puts more people into debt problems, but doesn't decrease demand for household energy and basic foodstuffs.
It's interesting how our understanding of the situation is framed by the phrases that are handed down. Why not profits/price spiral, cost of war crisis, Brexit penalty crisis, incompetent government charge, profiteering charge, privatisation penalty etc?
Whilst I agree with more insulation and less ICE and all that, the COLC kind of blames the consumer/employee and some abstract supply issues over which we are meant to have no control and therefore nothing can be done (whilst someone is making a big pile out of this). Hence advice about eating cheap beans are wearing woollies etc.
There were cases in the 70s like the pensioner who died trying to eat cardboard and house fires caused by paraffin heaters, we ain't far off.
I’m 100% behind getting people out of their cars and onto public transport – but vilifying car users is not going to achieve that goal.
Naaaa, make it clear that current levels of car use should be as socially acceptable as farting in a lift.
Not pushing for a pay rise when inflation is at 10% and your food + housing costs are rising is naive at best IMO.
Yeah because all businesses are sat on a huge pile of cash in the bank, especially small ones. But crack on and demand 10%+ wage rises. Then you can have a good old moan when the doors close in 6 months time.
A lot of small business owners will already be worrying about how they'll pay the wages this Friday.
Yep, blame the wage earner for not accepting a paycut rather than the gouging rent-seekers and other rising demands on small businesses' income.
I’m 100% behind getting people out of their cars and onto public transport – but vilifying car users is not going to achieve that goal.
Naaaa, make it clear that current levels of car use should be as socially acceptable as farting in a lift.
Vilifying smokers worked.
It is, at least at my work place, seen as normal to drive half a mile and that's just mental. They should be vilified
A lot of small business owners will already be worrying about how they’ll pay the wages this Friday.
Most will be wondering how they can afford their gas / electricity bills which they have just been quoted for the next year. Many simple won't be able to absorb a 4x increase in energy costs and will simply close.
Vilifying smokers worked.
It is, at least at my work place, seen as normal to drive half a mile and that’s just mental. They should be vilified
They are very different. Smoking is pretty much optional. For many, a car is a necessity and there isn't any applicable public transport (or affordable public transport). Our rail network pretty much only works if you can afford to live in a commuter town with a rail link to the nearest big city - which only works for a very well off subset of the population.
We keep building satellite towns will no public transport whatsoever. People living there have to use a car to get anywhere.
E.g. I live in the centre of Cambridge, 10 min walk from train station. I can get a train to London or walk / cycle anywhere in the City. However, small terraced house in my street will set you back £800k and I'm not in a posh bit, this is the cheaper end of town.
They aren’t currently if you’re in the countryside.
It’s even worse on the Scottish islands - plenty of jobs that were popular with EU students, happy to spend the summer in a caravan. Many businesses running reduced hours because of lack of staff and absentee landlords complaining they can’t get cleaners prepared to give up every weekend to clean up someone else’s mess for £10/hr. Many businesses are seeing reduced sales whilst costs of everything are going up. House building has stalled because materials are too expensive.
I noted Hannah flew to the US recently for an interview
Not even worth responding to TBH but you're wrong. Very wrong. Maybe try to establish some facts before launching ridiculous accusations at people?
Yeah because all businesses are sat on a huge pile of cash in the bank, especially small ones. But crack on and demand 10%+ wage rises. Then you can have a good old moan when the doors close in 6 months time.
FTSE 100 executive pay rose 39% in the last year. Oil and Gas suppliers have tripled their profits. Billionaires have got much richer. Banker bonuses are through the roof. You're looking in the wrong direction. I presume you're one of the tiny few in this small group of people who are much better off? If not then why the hell are you defending them?
FTSE 100 executive pay rose 39% in the last year. Oil and Gas suppliers have tripled their profits. Billionaires have got much richer. Banker bonuses are through the roof.
That is 0.001% of companies.
Most people in the UK are employed by SMEs with <100 employees.
It is, at least at my work place, seen as normal to drive half a mile and that’s just mental. They should be vilified
but that is the complete opposite to what we are talking about. Single occupant, sub 1 mile journeys are indeed ridiculous.
However, loading up your car with your family or friends, and a significant amount of luggage/supplies and taking a long motorway trip to the beach/mountains/festival/inlaws is actually a very appropriate use of a personal ICE car.
FTSE 100 executive pay rose 39% in the last year. Oil and Gas suppliers have tripled their profits. Billionaires have got much richer.
FTSE 100 companies!! 🤣🤣🤣
I'm not defending them in any way.
Get in the real world and look a lot, lot smaller. Shit is hitting the fan from the bottom up, not top down.
Most people in the UK are employed by SMEs with <100 employees.
Even for small business, the question is whether their workers should be absorbing the bulk of the increased costs of keeping their business going, rather than their customers, landlords, or the government (by means of an equivalent price cap on business energy or other intervention).
Asking your workers to give you their money by becoming poorer in real terms seems to be the most accessible default option, and it's not too surprising that workers aren't always just going to roll over and take it.
Even for small business, the question is whether their workers should be absorbing the bulk of the increased costs of keeping their business going, rather than their customers, landlords, or the government (by means of an equivalent price cap on business energy or other intervention)
Unless the government steps in rapidly to absorb energy costs for SMEs, most will just stop trading. They don't have the ability to absorb a 4x increase in energy. Pubs would have to put an extra £1/£2 on a pint and expect to sell the same amount in a recession. Any business which is running close to edge won't be viable.
SMEs with a healthy profit, which they would use to invest in new technology / training etc will be reduced to break even at best....
Get in the real world and look a lot, lot smaller. Shit is hitting the fan from the bottom up, not top down.
Yes it is, but it is energy prices which are crippling small businesses not employees demanding more pay. Even if all employees across the economy agreed to a pay cut it would not stop the tsunami that is coming. You're worrying about increases in inflation when the real danger is deflation and depression, or even worse total collapse of the economy. Try to think about what that means for a second, because it scares the shit out of me.
The way gov + central banks deal with inflation is to increase interest
Liz Truss wants to cut taxation immediately to give us more spending power, the issue is that she doesn't say where the money is coming from to keep the UK in a position to spend should the various world-crises continue.
The UK is currently around 100% GDP in terms of borrowing and interest rates are now beginning to rise on debt risking higher inflation and a harder crash, particularly if tax cuts are a reality based on further borrowing
If anything we need to be thinking about raising taxes in the future from those individuals and businesses that can afford it, which comes around to the possibility of windfall taxes and higher top rates
UK taxes have been around 32% of GDP for 50+ years, regardless of who's in power. We want good public services but won't pay for them and successive Governments won't push the issue.
Making public services poorer won't stimulate the private sector
Liz Truss wants to cut taxation immediately to give us more spending power,
Only really benefits the rich, the poor don't pay enough tax for the tax cut to cover more than a few % of the increase in their energy bill.
Also, does nothing for SMEs who will just have to either fold or lay off staff...
Most people in the UK are employed by SMEs with <100 employees.
The vast majority of businesses in the UK employee between 0-9 people.
Only really benefits the rich, the poor don’t pay enough tax for the tax cut to cover more than a few % of the increase in their energy bill.
Also, does nothing for SMEs who will just have to either fold or lay off staff…
That's my point
We want good public services but won’t pay for them and successive Governments won’t push the issue
Making public services poorer won’t stimulate the private sector
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total collapse of the economy. Try to think about what that means for a second
I dont know what it means.
The pound becoming useless for the purpose of purchasing goods and services?
Essential service jobs (eg infrastructure, health, sanitation, public transport) with mass understaffing to the point the services collapse?
Unless the government steps in rapidly to absorb energy costs for SMEs, most will just stop trading. They don’t have the ability to absorb a 4x increase in energy.
Agreed - the alleged Thatcherite idea that Conservatives are the supporters of SME is being put to the sword by every week's delay. **** business, etc. (except big business who pay us, obvs)
Only really benefits the rich, the poor don’t pay enough tax
Or any tax, in fact. There is no benefit to the most vulnerable people, except through the non-existent medium of 'trickle-down economics' (the theory that if you throw money at already massively-rich corporations and individuals, they will spend more and this will eventually benefit the serfs.)
Depressing (relatively) low-paid workers'wages is the last thing you want to do as they spend most/all/more than the money they have leading to a reverse multiplier followed by a negative accelerator as businesses fold.
In my local bar, which serves outstanding beer, numbers of punters have dropped considerably (cancelled quiz night etc). If they sell less beer the quality declines as the pressure for price rises increases. Where I moved from the locals used to knock off work and hit the pubs from 4.30 till 7. Mate reports that a tea time now they're often all empty (so even less reason to go). I imagine this is being replicated elsewhere and this is before the big matters hits the fan.
The UK is currently around 100% GDP in terms of borrowing and interest rates are now beginning to rise on debt risking higher inflation and a harder crash
Calling rone to the thread please... 😀
Seriously, you have this all wrong. You are right that we need to tax the rich (a lot) more, but not so we can reduce borrowing. We need to borrow more, and stop raising interest rates which only helps bankers and creditors. But we need to ensure that the money 'borrowed' is invested in infrastructure and services, and is targeted at people and businesses to prevent them going under rather than finding it's way into the pockets of the rich. The oncoming recession which is being engineered by the BoE is being done for one single reason, to protect the value of assets owned by the richest 10%.
I dont know what it means.
No food on supermarket shelves. Breakdown of normal govt services such as schools, hospitals etc. Mass unemployment, not receiving your salary at the end of the month. Fuel supplies drying up, savings and pensions wiped out, and ultimately mass civil unrest. See Sri Lanka, Argentina, Zimbabwe, Greece, post-soviet Russia etc. It's not pretty, and any government which allows it to happen needs putting up against a wall (and they often are).
The whole economy is a house of cards and the main thing holding it up is energy, and the price of that has just increased by a factor of 10. When those increases filter through to the wider economy, as they are now starting to, the bubble will explode. Unless the govt takes radical action that is, but what hope is there of that?
train vs car for a bank holiday getaway is pretty moot - our car with 4 up (as we are for a bank holiday getaway) emits marginally less co2/passenger km than a train - the car realisitcally runs around 140g/km (110g/km on paper), so 35g/person, a train is apparently ~35-40g/passenger km depending on where it is.
the car also travels fewer km to get to its destination (as we don't faff into london to get to the west country) so overall emissions is reduced
Can I ask how old you are dazh? Obviously don't have to be specific - nearest decade will do! 🙂
It shouldn't be relevant but age does give you some perspective about this. Yes, some people will lose everything, some people will gain a lot.
As a 12yr old in the early 80s we went from having a very nice life living in a 5 bedroom stone country house in an acre of land to all living in a 4 berth caravan for nearly a year when my dad's company collapsed during the recession at the time and 26 people lost their jobs. Took him three years to rebuild a new company.
The world is like this, it doesn't bimble along at 1% interest rates for eternity.
I'm not defending anyone or any government policies, things could be done far, far better than they are now. But energy is only part of the problem.
If Andrew Bailey really is serious about wage restraint then he needs to come out with some pretty good reasons why poor people should accept a few really bad years and significant drops in living standards, and what he's going to do to stop an uncomfortably large % of the UK going 3rd world.
Actually that's the government of the days job.
The world is like this, it doesn’t bimble along at 1% interest rates for eternity.
The world/UK has rarely had a shock to the economy as we are now experiencing. WWII required nothing less than the total reform of the global financial system to support rebuilding. The 70s oil shock resulted in a 3-day week. The collapse of the banks required mass bailouts and nationalisations. The pandemic required govt propping up the whole economy by paying people's wages and dishing out free money to businesses. This crisis is on a par or worse than most of those, and yet we're hearing nothing from any politician or seeing any urgency like we did in 2008 and 2020.
*48 BTW, not that I see the relevance in that.
Seriously, you have this all wrong
"UK government debt is now over £2.2 trillion, or about 99.7% of GDP - a rate not seen since the early 1960s. In June (2021) alone, debt interest cost £8.7bn" (25/7/21) https://www.bbc.co.uk/news/uk-57958178
Two things:
1) Those figures are a year old, but I don't expect that they've improved significantly
2) There are different ways of thinking in economics (IAMNAEconomist, but I know that much 🙂 )
3) Told you, IANAE 🙂 The BoE has bought around £900bn in bonds in quantative easing, someone has to pay for that, presumably us in interest rates??
the car realisitcally runs around 140g/km (110g/km on paper), so 35g/person, a train is apparently ~35-40g/passenger km depending on where it is.
The first google result says 14g/person Co2 on the train and 156g/person by car. The train runs anyhow and the more people in it the lower the CO2 per person.
What is irritating is that the train costs more, in fact on the last long jouney I did (Pau Berlin) I checked and the train was more expensive for two of us than the car, bus or plane but by far the lowest CO2. I took the train. That's cash in SNCF/DB coffers and demand for their services rather than making energy companies richer and driving energy prices.
Every choice we make is a small nudge towards the type of future we want.
We need to borrow more, and stop raising interest rates which only helps bankers and creditors.
I assume by 'we' you mean the government/state/taxpayer?
The government can't decide what interest rates it borrows at.
If it tried to borrow at, say,0 5% no one would lend to it,it has to pay the market rate. This is much more influenced by what lenders can get elsewhere and how risky they think it is than some nominal number dreamt up by the BOE.
As government debt goes up new debt gets more and more expensive
I'm partially trolling here but
on the last long jouney I did (Pau Berlin)
What a terribly long way. How wasteful of you. Pau to Berlin is about 1800km; my holiday this year was 270km away 😉
EVERY CHOICE WE MAKE...
I'm just pointing out that most of us do the things we want and can afford to do. Yes, we can mitigate them, and that's what you're doing, but don't criticise people for wanting to go places.
Those traffic jams you excoriated earlier - how many of those people are taking a local UK holiday instead of flying to Bermuda or wherever?
The BoE has bought around £900bn in bonds in quantative easing, someone has to pay for that, presumably us in interest rates??
The BoE pays for it, they create the funds to buy the bonds, at the instruction of the govt (I believe the chancellor writes them a letter asking them to do it and they are legally compelled to comply). You're right that this has other indirect but not necessarily determinant effects on the economy, but it can't be described as 'people paying for it' through inflation or resultant higher interest rates. It's irrelevant in any case when the alternative is the loss of millions of jobs and the devaluation of savings which would cost people a huge amount more.
The government can’t decide what interest rates it borrows at.
Of course it can, that's exactly what QE does, it manipulates the markets to drive down bond yields*. Central bank independence is an illusion.
*which is one of the main drivers of the stock market bubble as investors have moved money from bonds to equities.
For many, a car is a necessity and there isn’t any applicable public transport (or affordable public transport)
I'm always amazed how some people just "have" a car.
Did you all go on Bullseye in the 90's and win it with a speedboat?
How have I missed out on these costless cars?