2022 Autumn Budget

[Chris34]

Just listened to part of the end of the budget. Looks like inflation is going to absolutely rocket. Minimum wage is going to £10.42 in April. Don't let them 'poor little old little old pensioners' claim poverty when you're putting up their price, they're getting another £870 next year.

This is going to push inflation up a lot further. It's a bold budget and it's good that they're not tinkering around the edges... but inflation is going to hit the roof now.

 

[Jaygti]

Why?
Most economists think it probably peaked this month at 11.1%

 

[Iron Giant]

Why do you say inflation will hit the roof?

the plan is to curb inflation which if we go off what I read some time ago the less spending there is inflation should hopefully fall, this minimum wage increase will be wiped out in effect due to rising increases in tax and the cost of living but we are seeing prices on things fall wholesale energy prices have fallen

If it hadn't been those two idiots causing the sugar rush then we wouldn't have had that wave of chaos although it was a good time to buy more shares when the markets crashed ? I am pleased to see two politicians taking things by the ?? and pishing around we need them to be upfront and say this is how we are going to sort the mess out which is what I have wanted to see for years

here is a small article that everyone can have a quick read as it's a subscription-free article How will Jeremy Hunt's budget affect me? - Times Money Mentor

 

[ched999uk]

Those who bought electric vans will be annoyed as now not only has the electricity shot up but they will pay the same road tax as diesel vans! It was bound to happen at some point but I'm surprised it is happening so early (2025).

Hopefully this budget will slow inflation down and not cripple too many people.

 

[Pjj]

Those who bought electric vans will be annoyed as now not only has the electricity shot up but they will pay the same road tax as diesel vans! It was bound to happen at some point but I'm surprised it is happening so early (2025).

Hopefully this budget will slow inflation down and not cripple too many people.

So they should pay the same road tax as everyone else there vehicles cause damage and wear and tare to the roads the same as diesel , I also don't agree with reduced rates for lower emissions cars as they also cause damage ,lower fuel consumption they will benefit from using less fuel so their running costs will be less .

 

[Chris34]

Why?
Most economists think it probably peaked this month at 11.1%

Because they've increased the pensions by 10.1% along with minimum wage and benefits. On top of this they've increased the cost cap on Energy.

What this means is it puts more money into everyones pockets, if the poorest in society can't pay for things then that is more likely to stunt inflation. If you increase everyones income at the bottom then that means everyones income will naturally increase. To top it off they've given the go ahead for higher energy bills which affect every single businesses costs, which then means this cost is passed onto customers.

Basically if you pump air into a balloon the balloon will get bigger. Now imagine the balloon represents inflation, and the air represents peoples money, if you hand out more money to people the balloon will only get bigger.

 

[Jaygti]

Because they've increased the pensions by 10.1% along with minimum wage and benefits. On top of this they've increased the cost cap on Energy.

What this means is it puts more money into everyones pockets, if the poorest in society can't pay for things then that is more likely to stunt inflation. If you increase everyones income at the bottom then that means everyones income will naturally increase. To top it off they've given the go ahead for higher energy bills which affect every single businesses costs, which then means this cost is passed onto customers.

Basically if you pump air into a balloon the balloon will get bigger. Now imagine the balloon represents inflation, and the air represents peoples money, if you hand out more money to people the balloon will only get bigger.

Nah!

When will we get back to low inflation?

Inflation could fall to our 2% target in the next few months, before rising slightly again. We will keep interest rates high for long enough, so inflation settles at 2%.

www.bankofengland.co.uk

This obviously was based on pension/ benefits rising in line with inflation, as they will.

Poorer pensioners, and those on benefits , and minimum wage workers will still be struggling the same as now.

 

[Part Timer]

The current inflation rate has the higher energy and fuel costs included, when they start to become a year old they drop out of the equation and inflation will drop. Inflation is based on the cost today compared to a year ago.

 

[scottish cleaning service]

Those who bought electric vans will be annoyed as now not only has the electricity shot up but they will pay the same road tax as diesel vans! It was bound to happen at some point but I'm surprised it is happening so early (2025).

Hopefully this budget will slow inflation down and not cripple too many people.

Think second hand electric vans just got a bit cheaper, no one seems to want them.

 

[Part Timer]

Think second hand electric vans just got a bit cheaper, no one seems to want them.

All vans, new, 2nd hand etc, are getting cheaper as no one is really buying at the inflated prices. Can see a lot of the internet based motor traders going to the wall, so wouldn't be putting deposits down.

 

[scottish cleaning service]

All vans, new, 2nd hand etc, are getting cheaper as no one is really buying at the inflated prices. Can see a lot of the internet based motor traders going to the wall, so wouldn't be putting deposits down.

Funny you should say that because I've been keeping an eye on VW Commercial and they have over 300 panel vans forsale now. Last week the window company I used went bust so all their vans went back to the dealer. Dealers get their vans back and then have to try and resell them or lease them. I reckon there will be plenty of nearly new vans coming on the market in January after the delivery companies don't need them.

 

[Chris34]

Nah!

When will we get back to low inflation?

Inflation could fall to our 2% target in the next few months, before rising slightly again. We will keep interest rates high for long enough, so inflation settles at 2%.

www.bankofengland.co.uk

This obviously was based on pension/ benefits rising in line with inflation, as they will.

Poorer pensioners, and those on benefits , and minimum wage workers will still be struggling the same as now.

And you believe the boe?

Just for reference read this from November 2021 (exactly this time last year)

Monetary Policy Report - November 2021

Our quarterly Monetary Policy Report sets out the economic analysis and inflation projections that the Monetary Policy Committee uses to make its interest rate decisions.

www.bankofengland.co.uk

I'll highlight this part...
...............................................

'These effects are likely to continue pushing inflation up in the coming months. We expect inflation to rise to around 5% in the spring next year. We expect these high rates of inflation to be temporary. We don’t think that demand will continue to rise as fast, and many of the shortages that are currently making it difficult for businesses to produce their products should ease.

We expect inflation to fall back from the middle of next year, and to be close to our target in two years’ time.'


..............................................

If they were wrong in November last year... what makes you think they're not wrong this year?

It's anyones guess what the inflation rate actually is but I don't believe the BOE are in a position of credibility. They've completely mis judged inflation and keep getting it wrong.

It doesn't matter if the pensioners and those on minimum wage are no better off next year, what matters is that they'll have more money, more money will push up the price of everything. They won't end up with more disposable income, but the price of everything will go up as a result of them having more money.

So they'll be paying more for exactly the same things which they spend their money on now, which then pushes up inflation... again.

The energy prices will be going up by another 20%. That's a massive jump on an already massive price, this will push the price of everything up. So the current prices are only going to go higher and people will have a bit more money to pay those higher prices.

 

[JEM]

Do you think it would be worth holding out on buying a nearly new van I'm looking at buying a Peugeot Expert 2017 onwards facelift model maybe wait until the new year?

 

[Part Timer]

Do you think it would be worth holding out on buying a nearly new van I'm looking at buying a Peugeot Expert 2017 onwards facelift model maybe wait until the new year?

If your current van is OK I would definitely wait. 2nd hand vans are, in my opinion, between 10 - 20% overvalued. I'm starting to get 2nd hand vans advertised on websites I look at, never had that in years.

 

[Iron Giant]

If they were wrong in November last year... what makes you think they're not wrong this year?

It's anyones guess what the inflation rate actually is but I don't believe the BOE are in a position of credibility. They've completely mis judged inflation and keep getting it wrong.

It doesn't matter if the pensioners and those on minimum wage are no better off next year, what matters is that they'll have more money, more money will push up the price of everything. They won't end up with more disposable income, but the price of everything will go up as a result of them having more money.

So they'll be paying more for exactly the same things which they spend their money on now, which then pushes up inflation... again.

The energy prices will be going up by another 20%. That's a massive jump on an already massive price, this will push the price of everything up. So the current prices are only going to go higher and people will have a bit more money to pay those higher prices.

It's all guessing and speculation on what will happen with inflation and other things whether they go up or down, common sense tells us to take things with a pinch of salt, almost no different to reading up on which shares to buy and analysists predicting what will happen how many times have they got it wrong,

because real-world things happen which do have an impact, the sugar rush budget, look at what that did in one single day and then in 6 months' time what happens from now till Spring will no doubt change predictions again, Amazon has stopped expansion and maybe cutting jobs Meta or Facebook as most know have laid off 11,000 people, now they aren't UK companies but still big players that are taking a serious hit as people are being cautious and reigning in their spending those are just a few things without going into more details or using more examples

 

[JEM]

If your current van is OK I would definitely wait. 2nd hand vans are, in my opinion, between 10 - 20% overvalued. I'm starting to get 2nd hand vans advertised on websites I look at, never had that in years.

Yes it's just too small now I'm getting more work
That particular model I'm looking at varies so much in price with location mileage etc vat no vat, so hard to know what is the "right" price

 

[Part Timer]

Yes it's just too small now I'm getting more work
That particular model I'm looking at varies so much in price with location mileage etc vat no vat, so hard to know what is the "right" price

If you need one now then I'd be looking at the big commercial van sites, like Van Monster, as they're constantly getting large volumes of lease hires in so will be the first to be under pressure to sell.

 

[Chris34]

It's all guessing and speculation on what will happen with inflation and other things whether they go up or down, common sense tells us to take things with a pinch of salt, almost no different to reading up on which shares to buy and analysists predicting what will happen how many times have they got it wrong,

because real-world things happen which do have an impact, the sugar rush budget, look at what that did in one single day and then in 6 months' time what happens from now till Spring will no doubt change predictions again, Amazon has stopped expansion and maybe cutting jobs Meta or Facebook as most know have laid off 11,000 people, now they aren't UK companies but still big players that are taking a serious hit as people are being cautious and reigning in their spending those are just a few things without going into more details or using more examples

Thing is though some thing are difficult to predict. Take shares for example, as you know it's all about predicting human behaviour. It's what the people (or the herd of sheep) are going to judge whether the share price is worth buying, the price can be super cheap but if the herd of sheep don't buy into it then the price will never go up.

The difference with the economy though is that if you pump more money into it then the amount of money passed around will only increase. This increase of passing money around is what causes inflation.

In my opinion they haven't calculated the effect of the increase of pensions and the living wage. The pensions increase is an extra £10.8 billlion pounds per year in pensioners pockets. The living wage is an extra £2.9 billion pounds per year in their pockets. That's just under £15 billion pounds that the economy will swallow up.

For reference the whole of the NHS budget including all the wages is £163 billion pounds per year. So all the amulances, hospitals, gp's.... all that with all that equipment, buildings heating, wages, medicines... well all that costs £163 billion. So the £15 billion increase in pensions and the living wage is 10% of the NHS budget.

It's a hell of a lot of money that is being 'added' to the economy. The key word there is 'added'. It's newly created money that's being added. When a business makes money it's taking money from somewhere else and putting it into their business, it doesn't actually increase the money in the economy, all a business is doing is taking money from someone else. However, if you increase pensions and the living wage then you are pumping the economy with more money. The pensions is newly created money, the living wage is a forced inflation of peoples wages come from the government.

So I don't believe inflation will drop, it will do the opposite because of the above reasons. The energy cost cap increase also adds to the problem as it gives the go ahead for the energy companies to go in and buy at an even higher wholesale price as they know they can pass on the higher costs to the people.

 

[Cghwindowcleaning]

Thing is though some thing are difficult to predict. Take shares for example, as you know it's all about predicting human behaviour. It's what the people (or the herd of sheep) are going to judge whether the share price is worth buying, the price can be super cheap but if the herd of sheep don't buy into it then the price will never go up.

The difference with the economy though is that if you pump more money into it then the amount of money passed around will only increase. This increase of passing money around is what causes inflation.

In my opinion they haven't calculated the effect of the increase of pensions and the living wage. The pensions increase is an extra £10.8 billlion pounds per year in pensioners pockets. The living wage is an extra £2.9 billion pounds per year in their pockets. That's just under £15 billion pounds that the economy will swallow up.

For reference the whole of the NHS budget including all the wages is £163 billion pounds per year. So all the amulances, hospitals, gp's.... all that with all that equipment, buildings heating, wages, medicines... well all that costs £163 billion. So the £15 billion increase in pensions and the living wage is 10% of the NHS budget.

It's a hell of a lot of money that is being 'added' to the economy. The key word there is 'added'. It's newly created money that's being added. When a business makes money it's taking money from somewhere else and putting it into their business, it doesn't actually increase the money in the economy, all a business is doing is taking money from someone else. However, if you increase pensions and the living wage then you are pumping the economy with more money. The pensions is newly created money, the living wage is a forced inflation of peoples wages come from the government.

So I don't believe inflation will drop, it will do the opposite because of the above reasons. The energy cost cap increase also adds to the problem as it gives the go ahead for the energy companies to go in and buy at an even higher wholesale price as they know they can pass on the higher costs to the people.

Shares don't work like that or not for most.I have shares in a company they are a very strong company should they develop a new product or post a good pre tax profit the share price will hold or go up if they remain stagnant or post a loss or a product doesn't come to development the price will drop it has nothing to do with how many people are buying them.,
Of course if every one wants in and there aren't many shares avalable then that will push the price up but that would be a short term gain for sellers.

It's like the current inflation most of this high inflation is based on all the free covid money floating about factored in with a supply and demand issue.This money would have all but gone now and cheap borrowing is all but ended.People won't keep chucking money about like they have as they just won't have it.

Giving 10% rise to those at the bottom isn't going to fuel inflation some of these people can barely afford to eat or heat there homes.These people at the bottom aren't using that extra to buy cars, holidays or home improvements meals out etc.

The rise in interest rates and gas,elec and fuel factored in with the high cost of everything else will make even those who can afford it with money to become cautious and not spend this will slow the economy and inflation down.

 

[mike007]

This government caused this mess with their Covid lockdown policies not us. And the same players are in the present Government pretending it had nothing to do with them. The present unelected Prime Minister was the Chancellor if you remember!, and the current chancellor was knocked out of the running early doors and now these clowns are running this shambles. Oh and they are also proposing from next April to raise tax on petrol and diesel by 12 pence a litre on top of the current tariffs.

 

[scottish cleaning service]

What increases inflation is printing more and more money. In the Weimar Republic a guy came across a wheelbarrow full of money. He dumped it out and ran away with the empty wheelbarrow. If we were allowed to just print money then Zimbabwe would be the richest country on the planet. Th US dollar can print more because its the world's reserve currency but there comes a point when the East will get fed up with rubber dollars bouncing all over the planet and refuse to accept them. We are getting nearer that tipping point. ?