The left-field threat to Europe ...

[AtW]

So if you have savings of £10k and debts of £10k, both at 4% fixed and everything goes up in price 10-fold but your wages remain the same, then ther value of the savings is decreased, and the value of debt remains the same, so you're worse off than if you had no debts and no savings?

You are worse off because savings gone down in value, debt is still there to repay so net effect is worse than just having savings go down in value but no debts (my case).

[doodab]

But it's value is it's purchasing power, not your ability to acquire it. Otherwise, if your salary doubles, the value of your savings halve.

Exactly. The value of money lies in what you can exchange it for. In most cases the thing you exchange an outstanding debt for is your income, hence it makes sense to measure the value of a debt one owes in terms of ones income.

Measured in that way the value of your savings do indeed halve. For example, someone who gives you £10,000 is only going to get half as much of your time as they would have before.

Like I said, it's relative. You seem to think "purchasing power" is the one true unit of value, I would contend that a unit of my time is an equally good measure.

[doodab]

So if you have savings of £10k and debts of £10k, both at 4% fixed and everything goes up in price 10-fold but your wages remain the same, then ther value of the savings is decreased, and the value of debt remains the same, so you're worse off than if you had no debts and no savings?

The value of both sums of money is always equal as long as you measure them in the same way.

[BlasterBates]

FFS we're talking macro-economics and fiscal and monetary policy here, not how Mr. Bloggs is going to pay his mortgage.
Personally I think fook Mr. Bloggs for borrowing too much.

You idiots need to do some reading of economic history before exposing your ignorance on here.
Inflation is the UK's official government policy, behind the scenes,, as has happened before.

Go and do your own fooking research and education, I don't have time to drum it into your thick bonces.

Yes I read up on Harold Wilson´s inflationary strategy. We definitely more of that, it was incredibly successful wasn´t it.

[BrilloPad]

FFS we're talking macro-economics and fiscal and monetary policy here, not how Mr. Bloggs is going to pay his mortgage.
Personally I think fook Mr. Bloggs for borrowing too much.

You idiots need to do some reading of economic history before exposing your ignorance on here.
Inflation is the UK's official government policy, behind the scenes,, as has happened before.

Go and do your own fooking research and education, I don't have time to drum it into your thick bonces.

So we should all go out and spend/spend/spend and borrow/borrow/borrow safe in the knowledge that the government will always come to our rescue?

[TimberWolf]

...and index linked pay raises for public sector will increase costs even further.

Unless they lie through their teeth about inflation, perish the thought. Maybe that's the reason Merv gets showered with honours and money and perhaps they expect private sector wages to rise faster than the public sector at some stage as otherwise they are screwed.

[AtW]

Merv gets showered with honours and money and perhaps they expect private sector wages to rise faster

Wow, I've just checked and he is not just KBE, but GBE - Knight Grand Cross - highest rank in the order!

I guess that and five million quid in a pension pot would do the trick.

Bank of England, established 27 July 1694.

Current position according to Wikipedia:

Reserves

£7,334,000,000 (in gold)
£229,599,000,000 (total assets)

Source: Bank of England - Wikipedia, the free encyclopedia

So, the real deal (gold) is around 3% of "assets" - 230 bln of them, amazing growth from just 97 bln of "assets" in 2008 (PDF) and 77 bln in 2007 (PDF), trippling assets in just 4 years, what a good banker he is!

[TimberWolf]

Wow, I've just checked and he is not just KBE, but GBE - Knight Grand Cross - highest rank in the order!

Wow, a ranker of the highest order!

I guess that and five million quid in a pension pot would do the trick.

Bank of England, established 27 July 1694.

Current position according to Wikipedia:

Reserves

£7,334,000,000 (in gold)
£229,599,000,000 (total assets)

Source: Bank of England - Wikipedia, the free encyclopedia

So, the real deal (gold) is around 3% of "assets" - 230 bln of them, amazing growth from just 97 bln of "assets" in 2008 (PDF) and 77 bln in 2007 (PDF), trippling assets in just 4 years, what a good banker he is!

Quarter of a quintillion. Easily enough to buy a loaf of bread.

[BrilloPad]

Hungary faces ruin as EU loses patience - Telegraph