Inflation has rocketed - for rich people. Why must we all pay more?

Inflation has rocketed – for rich people. Why must we all pay more?

The cost of clothing, petrol and diesel, concerts and plays mean inflation has rocketed – for rich people. Why must we all pay more?

People who don’t have the spending money to drive to nights out at the new show while showing off the latest designer fashions ought to feel aggrieved that the prices of these things mean we all have to pay more.

You see, the higher prices of these mostly-exclusive items means the Bank of England is unlikely to lower interest rates on Thursday (December 19, 2024). This means businesses that have outstanding loans of any kind – in other words, most of them – will have to pay more than they might reasonably have expected.

And that means we all pay more, in increased prices for goods and services.

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Personally, I’m not happy to pay more at Tesco (or wherever) because some toff had a “walloping night out” watching Wicked (or whatever).

Your mileage may vary, depending on whether you can afford the price of petrol.

But it’s how inflation works. Rises in one sector affect the lot.

It also indicates that the business cycle may have reached a peak and be on its way down. Inflation is rising steadily, and wages for many people have also increased unexpectedly, but employment is being choked off because of the extra charges placed on employers by Rachel Reeves’s Budget, and with interest rates high, investment will also be held back.

Expect a recession in the New Year.

Reeves will be expecting one. She’ll have factored it into her expectations when planning the Budget. She’ll be hoping that the pain she inflicts now will result in a better future later.

But a better future for whom?


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