STEALTH INFLATION POLICY - INFLATION 3.5% AND RISING

[olddutch]

Mervyn King's Monetary Policy Committee has a track record of overshooting its inflation target - CPI is up to 3.5% today ! And each time the MPC claim that rises in inflation are "temporary".

It seems that the MPC is attempting classic "debt deflation". What this will do is let debtors off the hook, while penalising creditors. The MPC means to do this stealthily, maintaining its headline target of 2% CPI, while allowing actual inflation to persist at levels far above the target.

More and more people are beginning to realise what the MPC is doing. This will raise inflation expectations and ensure that businesses and employees fight hard to raise prices and wages, to protect themselves, thus cementing the Mervyn King's so-called "temporary" rise as a permanent rise.

Anyone with cash savings or fixed interest investments should be thinking very hard how they can protect themselves from Mervyn King's mens "stealth inflation" policy. It will help bail out those in debt, but it will again be at the expense of the many pensioner and other conscientious savers !

What is the best way for Pensioners who have saved for their retirement and all other Savers to protect their savings from being plundered by this policy which amounts to a cogent insidious Stealth Tax on the Thrifty ?

[jake-the-peg]

This is true, as inflation rises the Nations debt drops in real terms.

There have been times where interests have been really very high especially compared to the US and far East in investors have sat back and been paid for doing no more that putting their money in the bank.

Some of them go about criticising people who "think the world owes them a living"

The pendulumn swings, the dice are shaken, there are new winners, new losers - the key is being able to adapt to change