The next recession

[trailer]

https://www.bbc.com/news/business-57764601

Rising interests rates to quell inflation that is caused by an energy crisis. You wonder how these people get the jobs and positions that they have.

OK then, tell us how they should dampen inflation. Maybe give Ukraine to Putin?

Do you think the war in Ukraine really has that much impact on inflation/ energy prices? Or is it companies taking the piss?

Prices started rising before the whole Ukraine scenario: https://www.ons.gov.uk/economy/inflationandpriceindices/articles/energypricesandtheireffectonhouseholds/2022-02-01

Tax the complete balls out of the energy companies (89m in profit a day - somehow I think they can afford to lower prices) and use the revenue to subsidise customers on a sliding scale, with lowest earning families more heavily subsidised than those at the top.

How does rasingin rates and therefore increasing the price of mortgages, credit cards, loans etc benefit those struggling with soaring energy costs?

It's not supposed to.
Rates are jacked up to slow down the economy and put a halt to the gallop of inflation which seems to be driven by a mix of the money supply , the supply chain effects of the war and the impact of resource constraints in the case of oil and gas.

In economic textbooks, which assume there are no other factors at play and that inflation is demand driven, that may be true. However, this is real world and inflation isnt driven by the like's of a house extension or office cabin that contributed to building material inflation during Covid. Raising interest rates to encourage borrowing and less spending doesn't dampen energy costs. People need are already cutting back and can barely afford heat or electricity yet record breaking profit after record breaking profit are being made by the energy firms.

As pointed out above, the rise in energy prices was happening before the war and the price cap removal was before the war.

It's pure price gauging from the energy companies and they are laughing all the way to the bank. Raising rates isn't going to do much for energy prices and most likely will further drive the wealth gap wider.

Exactly. Every business is increasing prices because of energy. Especially food were it is so energy intensive. If the BOE did nothing inflation would disappear naturally as it always does anyway. What they are doing now is saying please choose between paying your mortgage/rent, heating your home or feeding yourself and family.
Growth has already slowed. So what exactly are they trying to achieve? Because it's not quelling inflation.   

[seafoid]

https://www.bbc.com/news/business-57764601

Rising interests rates to quell inflation that is caused by an energy crisis. You wonder how these people get the jobs and positions that they have.

OK then, tell us how they should dampen inflation. Maybe give Ukraine to Putin?

Do you think the war in Ukraine really has that much impact on inflation/ energy prices? Or is it companies taking the piss?

Prices started rising before the whole Ukraine scenario: https://www.ons.gov.uk/economy/inflationandpriceindices/articles/energypricesandtheireffectonhouseholds/2022-02-01

Tax the complete balls out of the energy companies (89m in profit a day - somehow I think they can afford to lower prices) and use the revenue to subsidise customers on a sliding scale, with lowest earning families more heavily subsidised than those at the top.

How does rasingin rates and therefore increasing the price of mortgages, credit cards, loans etc benefit those struggling with soaring energy costs?

It's not supposed to.
Rates are jacked up to slow down the economy and put a halt to the gallop of inflation which seems to be driven by a mix of the money supply , the supply chain effects of the war and the impact of resource constraints in the case of oil and gas.

In economic textbooks, which assume there are no other factors at play and that inflation is demand driven, that may be true. However, this is real world and inflation isnt driven by the like's of a house extension or office cabin that contributed to building material inflation during Covid. Raising interest rates to encourage borrowing and less spending doesn't dampen energy costs. People need are already cutting back and can barely afford heat or electricity yet record breaking profit after record breaking profit are being made by the energy firms.

As pointed out above, the rise in energy prices was happening before the war and the price cap removal was before the war.

It's pure price gauging from the energy companies and they are laughing all the way to the bank. Raising rates isn't going to do much for energy prices and most likely will further drive the wealth gap wider.

Exactly. Every business is increasing prices because of energy. Especially food were it is so energy intensive. If the BOE did nothing inflation would disappear naturally as it always does anyway. What they are doing now is saying please choose between paying your mortgage/rent, heating your home or feeding yourself and family.
Growth has already slowed. So what exactly are they trying to achieve? Because it's not quelling inflation.

They are trying the reduce the impact of inflation as opposed to letting it run naturally.
Central Banking is a joke.

This explains why . They increased the amount of  money in the system in March 2020 and there was no inflation until Q3 21. So it took 18 months to show up. Then they reacted too late. Now they expect interest rate increases to have an immediate impact.

https://www.cnbc.com/video/2022/10/13/short-if-the-fed-waits-for-core-inflation-to-hit-2-percent-itll-drive-economy-into-depression-says-jeremy-siegel.html

[trailer]

https://www.bbc.com/news/business-57764601

Rising interests rates to quell inflation that is caused by an energy crisis. You wonder how these people get the jobs and positions that they have.

OK then, tell us how they should dampen inflation. Maybe give Ukraine to Putin?

Do you think the war in Ukraine really has that much impact on inflation/ energy prices? Or is it companies taking the piss?

Prices started rising before the whole Ukraine scenario: https://www.ons.gov.uk/economy/inflationandpriceindices/articles/energypricesandtheireffectonhouseholds/2022-02-01

Tax the complete balls out of the energy companies (89m in profit a day - somehow I think they can afford to lower prices) and use the revenue to subsidise customers on a sliding scale, with lowest earning families more heavily subsidised than those at the top.

How does rasingin rates and therefore increasing the price of mortgages, credit cards, loans etc benefit those struggling with soaring energy costs?

It's not supposed to.
Rates are jacked up to slow down the economy and put a halt to the gallop of inflation which seems to be driven by a mix of the money supply , the supply chain effects of the war and the impact of resource constraints in the case of oil and gas.

In economic textbooks, which assume there are no other factors at play and that inflation is demand driven, that may be true. However, this is real world and inflation isnt driven by the like's of a house extension or office cabin that contributed to building material inflation during Covid. Raising interest rates to encourage borrowing and less spending doesn't dampen energy costs. People need are already cutting back and can barely afford heat or electricity yet record breaking profit after record breaking profit are being made by the energy firms.

As pointed out above, the rise in energy prices was happening before the war and the price cap removal was before the war.

It's pure price gauging from the energy companies and they are laughing all the way to the bank. Raising rates isn't going to do much for energy prices and most likely will further drive the wealth gap wider.

Exactly. Every business is increasing prices because of energy. Especially food were it is so energy intensive. If the BOE did nothing inflation would disappear naturally as it always does anyway. What they are doing now is saying please choose between paying your mortgage/rent, heating your home or feeding yourself and family.
Growth has already slowed. So what exactly are they trying to achieve? Because it's not quelling inflation.

They are trying the reduce the impact of inflation as opposed to letting it run naturally.
Central Banking is a joke.

This explains why . They increased the amount of  money in the system in March 2020 and there was no inflation until Q3 21. So it took 18 months to show up. Then they reacted too late. Now they expect interest rate increases to have an immediate impact.

https://www.cnbc.com/video/2022/10/13/short-if-the-fed-waits-for-core-inflation-to-hit-2-percent-itll-drive-economy-into-depression-says-jeremy-siegel.html

Well it won't work and with huge tax rises and massive spending cuts coming people are in for a pretty tough time. One silver lining might be that it confines the Tories to opposition after the next GE.

[armaghniac]

Exactly. Every business is increasing prices because of energy. Especially food were it is so energy intensive. If the BOE did nothing inflation would disappear naturally as it always does anyway. What they are doing now is saying please choose between paying your mortgage/rent, heating your home or feeding yourself and family.
Growth has already slowed. So what exactly are they trying to achieve? Because it's not quelling inflation.

At this point interest rates are only being returned to normal.
Back in the 1970s and 80s when there was an oil price shock then inflation did not subside for a decade or more.

as for the general position, the UK is living beyond its means. It is like a person who has stayed in the same job and turned down overtime, but has continued to spend more based on the credit card. That person needs to pay off the credit card and find a better job if they want to spend more.

[gallsman]

Stripe letting go 14% of its workforce, or about 1,100 people. Suspect the Collisons personally had a lot to do with the severance packages being offered, as Americans appear to be gobsmacked by it.

[Fear Bun Na Sceilpe]

Stripe letting go 14% of its workforce, or about 1,100 people. Suspect the Collisons personally had a lot to do with the severance packages being offered, as Americans appear to be gobsmacked by it.

what was offered

[shark]

Stripe letting go 14% of its workforce, or about 1,100 people. Suspect the Collisons personally had a lot to do with the severance packages being offered, as Americans appear to be gobsmacked by it.

what was offered

https://stripe.com/ie/newsroom/news/ceo-patrick-collisons-email-to-stripe-employees

A level of ownership there , that I have not seen from other tech leaders.

[imtommygunn]

The tech industry is like a wee bubble. Many companies don't make money and rely on VC and when there is much less VC round then boom. I work in it and especially in west coast america it is very far removed from the real world. So many are targeted towards IPO or acquisition and really that is their main goal even over profitability.

Also a lot of companies do not grow responsibly. A big bang approach is taken to growth and then any wobble like this causes issue.

[seafoid]

The tech industry is like a wee bubble. Many companies don't make money and rely on VC and when there is much less VC round then boom. I work in it and especially in west coast america it is very far removed from the real world. So many are targeted towards IPO or acquisition and really that is their main goal even over profitability.

Also a lot of companies do not grow responsibly. A big bang approach is taken to growth and then any wobble like this causes issue.

There are 2 economies in the South. One based around multinationals that grows well and the other based on local companies that doesn't. 

In the US s&p index 495 companies go nowhere while 5 drive everything

[seafoid]

US mortgage rates now 7%

https://www.cnbc.com/video/2022/11/04/housing-inventory-jumps-as-homes-take-longer-to-sell.html

[seafoid]

https://www.cnbc.com/video/2022/11/04/the-longer-inflation-sticks-around-the-more-difficult-it-is-to-fight-says-jason-trennert.html