Deflation v Inflation

[Fittster]

A couple of months ago they were thread and after thread about inflation but now:

House Prices falling
Shares falling
Oil falling
Gold falling.

So what going on, Inflation or Deflation? Is it time to slash interest rates and use helicopters to drop money on the economy to save us from a Japanese style lost decade?

Edited by Fittster on Tuesday 2nd September 12:53

[anonymous-user]

Stagflation!

[Chilli]

I think we should just print more money....Zimbabwe seems to be doing ok.

[walm]

Fittster said:

A couple of months ago they were thread and after thread about inflation but now:

House Prices falling
Shares falling
Oil falling
Gold falling.

So what going on, Inflation or Deflation?

Just because oil is off from the top it doesn't mean inflation is disappearing any time soon.
Remember that the headline inflation figure is year-over-year.

Oil cost $75 a barrel this time last year, so is still up 44% (in dollars).
House prices, shares and gold don't have much of an affect on headline inflation since a 3-bed Victorian, a FTSE-tracker and some bling are not in your average shopping basket.