ECONOMIST Milton Friedman, in his famous explanatory definition, wrote that "inflation is always and everywhere a monetary phenomenon". Such a definition will doubtless provide comfort to the government and validate its own monetary policy following yesterday's news that the UK's annual inflation rate last month fell below the Bank of England's 2per cent medium-term target for the first time in 21 months.
A FEW months ago, I opined in this column about the skyrocketing increase in Britain's money supply and the fact that no-one seemed to be taking any notice. M4 money supply grew 14.5 per cent in the year to September - a 16-year high. The last time this occurred was during Nigel Lawson's boom which was followed by the John Major slump. Last Thursday, the Bank of England took notice and raised interest rates to 5 per cent. One reason cited by the monetary policy committee was a worry about that "rapid" monetary growth coinciding with "limited" spare production capacity across the economy, which is just the old definition of inflation I learned in Economics 101 - too much money chasing too few goods.
Consumer spending is growing at its fastest rate in five years and consumer confidence has turned positive for the first time in five years. This continued improvement consumption has been fuelled by a further fall in unemployment, increasing production and an increase in business confidence. Finance minister Zalm argues that tax revenues indicate that the economy is growing faster than the official figures indicate and that the budget is on course to be balanced this year. The improvement in the labour market and fall in the unemployment rate have led some to argue that inflation may rise in the future but for now it remains benign at 1.8% on the EU harmonised basis. There will be a general election on 22 November after the collapse of government over immigration policy.
... to June calculated on the national definition, up from 1.2% in May. On the EU harmonised basis, ...
Prospects for the economy remain favourable and, after GDP growth of 3.1% in 2005, another year of around 3% expansion is in prospect. Consumer confidence remains high, as does business confidence, while the unemployment rate has fallen to 5.0%, a 30-year low, and concern about labour shortages are rising. The government is expected to ease entry restrictions on workers from the new EU countries in May but will demand that they work under the same labour contracts as Danish workers. The government's new welfare proposals also aim to raise the labour supply by raising the retirement age, shortening the period of study for students and better integrating immigrants. So far inflation has remained subdued and the current account is also in large surplus. The DKK has nonetheless recently bee...
...The unemployment rate on the EU definition in February stood at 4.4%, down from 5.3% a year e...
The article explores the social, cultural and economical processes that lead Roma children into labour and their own interpretations of the value and risks of working. Based on qualitative research in several Roma communities in Romania the article analyses the different family strategies in coping with the economic difficulties of transition and the place of children in this process. The article is interested in the relationship between children and family, school and community and attempts to decipher what aspects in these relations encourage early entry into work. It argues that Roma children do occasional, poorly skilled, work that is relevant in their family economy, but invisible in and acceptable for broader society. Ultimately, the article argues that casting the situation of Ro...
...Although this last definition risks oversimplifying children s work, it may offe..."Credential inflation" is a term that best describes this situation. Thi...
BANKS are profiting from the savings crisis by raking in huge margins on investment-linked products that experts claim are being mis-sold. With conventional savings accounts failing to keep pace with inflation the UK's high street banks and building societies are making up to 12 per cent profit on the sale of structured products. The definition of structured products and the way they work can vary hugely. On the high street the typical plan offers 100 per cent capital protection plus a degree of upside in the value of a specified index (usually the FTSE 100) between an opening and a closing date, with five years the typical term.
...Indeed, it requires the definition of the explanatory variables, the determination of...Since the inflation rate for most countries was relatively stable in t...
STERLING dropped yesterday to a five-month low against the euro, amid a seeming hardening of view that UK economic weakness might put back the timing of the first rise in benchmark interest rates from their record low. The euro climbed to about 88.2p during yesterday's session - its highest level since last October. It was last night holding above 88p - up about 0.2p on its pre-weekend close against the pound.
... 17-nation eurozone by declaring that "inflation rates..are now durably above the common definition...
INVESTMENT
..., perceived as the main reason for inflation hitting 7.3% by year end, well outside its targete... higher economic growth will be, and by definition the higher the fight against poverty. . "There is ...
ALL the Liberal Democrat and Conservative special advisers ('SPADS') were summoned to Downing Street on Wednesday for a meeting. With a portrait of Queen Elizabeth I looking down on them, the assembled SPADS were informed by the Prime Minister himself that if any of them were caught briefing against each other or anyone in the Government they'd be out. One of those present tells me that at that point there was a fearful silence. Everyone knew that Cameron, a former SPAD himself, meant what he said. When the David Laws story broke on Friday night, this discipline held. Nobody spoke out of turn.
... quite significantly but to use the definition of a non-business asset and the indexing - the linnk to inflation - to offset this rise in the rates. Certainly, it ...
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