Is there anything in here to panic about, most especially when it comes to interest rates, which the Bank of England still have at 4.75%, which rate is up for review again this week? The answer is yes, but that is only because what this makes very clear is that rates are too high. They need to fall so that we have zero real rates – suggesting a two per cent cut is required.
OK, so he’s looking at the wrong inflation rate anyway:
Core CPI (excluding energy, food, alcohol and tobacco) rose by 3.5%
But look at the base contention there. We should have zero real interest rates.
It’s almost as tho’ the man’s so ignorant of economics that he thinks the time value of money is nothing.
In Elynomics, every theory and every precept is underpinned by its practical impact on its founding genius, Captain Potato.
His time is worth nothing, as witness his incontinent blogging, and hence his output is also worth nothing. The present value of next week’s or nest year’s nothing is of course nothing and that is the inalienable logic upon which his argument reposes
He sounds like a man with a huge mortgage, rather than one with money invested.
So he wants to continue with the shit the economy got into post 2008? Right.
That would be consistent with his on-again off-again disdain for discounting future cash flows, although at one time (and fairly recently) he seemed to have had the concept explained to him. Maybe it didn’t stick?
@Dcardno
It was as recently as November 27th. He was blogging about the time value of money and using a100% interest rate as an example. Perhaps he is yet to discover it still applies with more normal interest rates where the maths is a little harder.
Leave the poor ignorant fellow in his spudidity! It’s not fair to criticize one so incapable of understanding even basic economics – you wouldn’t kick a wounded dog, would you?
He has demonstrated a level of economic ignorance surpassing even that of Rachel Thieves and should be allowed to wallow in his moronity, with his train set, until his inadequate pensions fail to provide for his dotage.
He’s the poster boy for the triumph of ego over ability!
“a level of economic ignorance surpassing even that of Rachel Thieves and should be allowed to wallow in his moronity, with his train set”
Does his delusion that he could control the economy come from the feeling of control he gets from playing with his train set, or is the train set a substitute to make up for his lack of access to the levers of the economy?
Murphy has now filed accounts for Tax Research LLP and Finance for the Future LLP at Companies House.
Tax Research LLP has income of £23k, of which £15k was donations from his blog readers.
Finance for the Future LLP still gets £70k per year from the Polden Puckham Charitable Foundation (although this ends next year). Murphy gets 60% and Colin Hines 40%
He also gets c.£17k from the Corporate Accountability Network (this also ends next year)
Accounting Streams hasn’t filed accounts yet – not clear if he is getting any money from them.
He’s about to finish his contract at Sheffield University. So from next year he’ll only have his state pension and donations from his readers, so looks like he will be relying on his wife’s taxpayer funded final salary pension.
The inflation rate indices are poor judges of inflation as they are too distorted. For example, if the government raises taxes by an average of £1000 per person, and uses that money to fund an energy price cap which saves an average of £800 per person, then inflation seems to have been reduced because of the change in the price of energy, but in fact everyone is poorer by £200. The same applies to any market-distorting intervention which moves an expense between one caught by a price index and one omitted because it is classed as a tax.