The Inflation Thread

[Aaron]

https://www.newsroom.co.nz/2017/07/18/39165/inflation

The mystery of the disappearing inflation

Can't remember what day but on the front page of the business herald last week (I think)they broke down the June quarters inflation figures. Computers, electronic devices, airfares, recreation and petrol prices are all dropping. House construction, rent, food and electricity prices are rising. It sort of looks like dropping prices in non-essentials(except petrol) are disguising the rise in the price of essentials. Admittedly if you go to the reserve bank site wage inflation seems to be keeping up for the quarter. Probably reading too much into one quarter's figures though. It is interesting to compare the rise in wages and housing over any number of periods. Wages definitely losing to capital but lets not discuss a capital gains tax this election as wealth from rising prices shouldn't be taxed whereby money generated by the sweat off your brow the hard earned way to wealth should be taxed as people with wealth don't want to contribute to society. Seems fair.

[Valuegrowth]

Can't remember what day but on the front page of the business herald last week (I think)they broke down the June quarters inflation figures. Computers, electronic devices, airfares, recreation and petrol prices are all dropping. House construction, rent, food and electricity prices are rising. It sort of looks like dropping prices in non-essentials(except petrol) are disguising the rise in the price of essentials. Admittedly if you go to the reserve bank site wage inflation seems to be keeping up for the quarter. Probably reading too much into one quarter's figures though. It is interesting to compare the rise in wages and housing over any number of periods. Wages definitely losing to capital but lets not discuss a capital gains tax this election as wealth from rising prices shouldn't be taxed whereby money generated by the sweat off your brow the hard earned way to wealth should be taxed as people with wealth don't want to contribute to society. Seems fair.

Relative to some developed countries and income level Food, rent and clothing prices are high in New Zealand. This will lead to slowdown in the economy in the mid and long run unless housing market adjusts to the fair value.

https://www.interest.co.nz/property/88965/housing-costs-these-days-make-much-greater-proportion-household-budget-they-used-msd

Housing costs these days make up a much greater proportion of the household budget than they used to,' MSD incomes and inequality report finds

http://www.stats.govt.nz/browse_for_...PJun17qtr.aspx

Consumers Price Index: June 2017 quarter

How about following?

https://www.stuff.co.nz/taranaki-daily-news/business/94966044/Shamubeel-Eaqub-I-ve-bought-a-house-at-last

Shamubeel Eaqub: I've bought a house at last!