What Do You Think The REAL Inflation Rate Is?

HeWhoKnows on 06/01/2022 - 12:51
Last edited 06/01/2022 - 12:52

We all know the Government and the RBA are in cahoots to keep interest rates as low as possible.

This is because any increase in interest rates would have serious, far reaching consequences such as:

a) significantly increasing the government's loan interest bill due to our enormous govt debt. This in turn significantly reduces the govt's ability to fund services and social security payments
b) significantly increasing many people's home and investment loan interest payments so sending many borrowers to the wall or at least forcing significant cuts to consumer expenditure
c) sending the economy into a deep recession or long lasting depression for which our government and the RBA are not equipped to handle
d) a resulting property crash so damaging everyone's wealth and possibly making our banks insolvent

Yes my friends the RBA via these ridiculously low interest rates have placed themselves into a corner with no way out.

Hence they also "manipulate" the inflation rate to justify these ongoing low interest rates because if inflation was "reported" as going significantly higher, then the RBA would have to take action by increasing interest rates.

RECENT EVIDENCE OF INFLATION OUT OF CONTROL….
The price of fuel alone has gone up 100%. (which affects the price of everything)
Cheese up 18% in 12 months and 30% since just before COVID-19. Milk the same and more!.
Meat and seafood is skyrocketing every week right before our eyes…packets of home brand meat pies have increased by 33% this last year alone and they contain less than 30% meat.
Then there are all the packet size shrinkages not even taken into account in the inflation figure (deliberately)
If you eat out regularly you know that restaurant prices have increased 33% this year alone.
And any construction manager will tell you building material prices are going through the roof - if you can even get supplies.
Shipping container costs are up 700%. Yes that's correct!
And don't even get me started on skyrocketing property prices.
Now we have lots of people going on strike every week because they can see their pay packets buying less and less every week. And plenty of businesses are finding it difficult to attract workers so having to offer higher wages to get employees back.
How much more will all this add to inflation in 2022?
Yet our Reserve bank tries to tell us that inflation is still under 3%.
They must think people are stupid.

So my fellow and highly informed OBs how much do you think is the REAL rate of inflation?
Please indicate in the poll.

Also feel free to add your own observations of rapidly increasing prices in the comments

Poll Options expired

  • 63
    3%
  • 16
    5%
  • 43
    7%
  • 238
    10%
  • 65
    15%
  • 112
    20%
Financial

Comments

          • Drakesy on 08/01/2022 - 14:18

            @Chandler: Your supply rate/service charge is based on the auditor generals valued rental price for your property. (Higher the property price, higher the service charge)

            You can look it up and it provides an insight into whether you're getting shafted or not.

        • cloudy on 06/01/2022 - 18:34

          There doesn’t seem to be an optimist in the house, bad either way hey.

        • askme69 on 08/01/2022 - 15:10

          When they sell and move to regional areas and force the prices up. My kids could of purchased near where they grew up, now they have to move 40km away.

        • greatlamp on 09/01/2022 - 13:16

          Council rates are based on your land value - in comparison to the land value of others in that LGA.

          If everyone's block in the LGA increases in value by 20%, your rates don't increase by 20%.

          The council takes the total amount of money they need to collect, and divides it by the total land value in the LGA. It's the top line that is increasing - set by the council itself, the actual value of your land doesn't affect council rates

      • smartazz104 on 07/01/2022 - 11:46

        Rolling in something, that's for sure…

      • Ultimate Gattai on 08/01/2022 - 00:36
        +1

        Reminds me of my customer at my work place who sold his house for 2mil on the coast, he's happy he's got spare change in his pocket (I kind felt like he was bragging about it though), whilst his friend in the same area sold his house for almost double. It's crazy how much the price of housing is sky rocketing!

        • Felixrising on 11/01/2022 - 02:43

          Which is great if they're downsizing, are they?

          If they've been betting on residential housing costs increasing through speculative property investment, then no doubt they've benefitted from the cost of living increase that first home buyers and renters are experiencing which is really a form of wealth redistribution from the poor to the at least semi wealthy.

          I'm increasingly anti property investment, if people want to benefit from the increase in price of goods and services, invest in the stock markets. Investing in businesses is an investment in PRODUCTIVE ASSETS. But Australian infatuation with using the residential property market to speculate and inflate has to stop. Residential Property is UNPRODUCTIVE asset class. Tax incentives like the CGT discount need to go and stamp duty on 2nd or more houses needs to go way higher IMO to drive mom and pop investors towards business investing and share markets.

          Back to your customer who doubled his property price, my neighbour is 75, lives by himself in a 3 bedroom townhouse and owns a house at the beach too. We were talking to him about buying his townhouse off him, but he changed his mind and won't sell because he's realised if he's out of the market for even a few weeks he risks not being able to get back in at a comparable level. So he's sitting tight and contributing to a stock shortage. Retirees not willing to downsize to something more suitable for their needs are also practicing a form of land banking. There are several properties around my neighbourhood that have stood vacant for over 12 months, coming up on 18 months now, as property developers are realising they qualify for a CGT discount leaving it vacant (not renting it out) for >12 months. Even the local real-estate agents are buying into the market and offloading as little as 6 or 3 months after buying (also leaving vacant) because it 1) contributes to a stock deficit and 2) works out as profitable when property speculation is so rife. Reminds me of cryptocurrency speculation when FOMO drives profits. .

          • Ultimate Gattai on 12/01/2022 - 02:50
            +1

            @Felixrising: I'm not sure if he's downsizing, he's moving into my little regional town (which he lived in when he was younger), and most houses in my area are around $300,000, so I imagine he's using the difference as a retirement fund. I haven't see him again since, so I haven't had a chance to ask him about it.

            I honestly won't be surprised if it crashes like Ireland's property market did, in some states like NSW, it's ridiculous how much rorting property developers are getting away with and leaving people holding a handbag (the amount of faulty and collapsing buildings/towers/ect… is unacceptable). I also don't agree with the strain it's putting on renters as it's almost impossible to get a house atm, and those that are available are either snatched up quick or expense as people are desperate for a place to live. It's also sad that Australia's economy is built on mining, property and selling coffee to each other, I can only see this property market going badly for the country, but politicians and banks are desperate to prop it up because letting it fail would have a massive domino affect on the economy (it's also one of several reasons why the RBA doesn't really want to increase interest rates, even though we need it to slow property investment/purchases).

  • Presence on 06/01/2022 - 15:15
    +9

    The price of fuel alone has gone up 100%. (which affects the price of everything)

    Citation required.

    • HeWhoKnows on 06/01/2022 - 15:36
      -7

      Fuel is required for all transport which is required for ALL GOODS!.
      Not just getting you from A to B.

      Cost of fuel hence directly affects cost of goods and hence pricing

    • netjock on 06/01/2022 - 16:08
      +17

      If OP talks about the price of crude which went negative at the beginning of the pandemic, you could say it has gone to infinity.

      I believe fuel was around 99c at the depths of the lock downs but no way 100%. OP is just sensationalising like Murdoch media.

      • Brianqpr on 07/01/2022 - 11:57

        Indeed, and current fuel price levels were around several years ago so it really depends which period you are using to make your point.

        Fact is that any significant increase in interest rates will slam the brakes on consumer spending. Its always been a blunt tool, never more so than right now.

        • netjock on 07/01/2022 - 13:04
          +2

          Fact is that any significant increase in interest rates will slam the brakes on consumer spending

          Think we need to go back to pre pandemic as an example. RBA interest rates were 1.75% (or there abouts) and property prices were flat and consumer spending was going nowhere. Interest rates have been falling ever since 2010.

          With the pandemic what has changed? Lock downs, now no lock downs and now people are off sick. Nobody driving trucks or at the factory means less goods being produced. No interest rate rises can sort that out. It isn't like demand is going up, it is actually supply shrinking and being unable to adjust. It will adjust at some point to catch up, then we'll have deflation again.

          Stock markets have fallen because the Fed is going to raise interest rates. If you use spreadsheet models, higher interest rates is a bigger discount rate on returns. But the problem is are you going to sell $1 of Apple shares so you can put it into US treasuries paying 1.5% when inflation is 6% and Apple can lift their prices to maintain their margins? With inflation all companies with power to raise prices would be doing well.

          IF the RBA raises rates and it screws the sharemarket then where all the money going to go? Property? Crypto? I'd suggest there might be a squeeze on property prices up! Sometimes unintended consequences of policy actions.

        • Ultimate Gattai on 08/01/2022 - 00:39

          I'm actually shocked it's as cheap as it is, the cost of filling my tank hasn't really increased much compared to before the pandemic, so this is a bit of a breather for me financially.

      • abb on 10/01/2022 - 14:39

        I saw a photo of a petrol station advertising 80-something in the early lockdown days. So it's possible to see a 100% increase if you cherry pick data and ignore the fact that it was brief dip due to 'unprecedented' circumstances.

    • Ryk on 06/01/2022 - 17:12

      maybe 30%

  • outlander on 06/01/2022 - 15:38
    +1

    Probably about 10% for most things. Yes I'm worried, but I have no idea what short term moves I can do to protect myself from it so I try not to think about it too much.

    If it was just Australia that'd be one thing, but it appears countries all over are becoming unraveled.

    Seems like the stage is being set for another world war

    • HeWhoKnows on 06/01/2022 - 15:43

      History shows that serious global economic problems have generally ended up as wars unfortunately.
      Firstly currency and financial wars as we are having right now
      Then military wars which appears to be clearly on the horizon (China) by all reports.

      We just hope not.

      • tunzafun001 on 07/01/2022 - 00:47

        …WA seperating from the rest of Australia…wouldn't blame them.

    • Ultimate Gattai on 08/01/2022 - 00:42

      I don't believe it will come to war as economically/financially, war is devastating, look at previous world wars, this would only exacerbate the issues we have now, China might be crazy enough to attempt it, but my money is on no war happening.

    • supersabroso on 08/01/2022 - 02:33

      If you have any savings or offset, just convert it to crypto stablecoins (value won't go up or down with the market) and stake it for 20% interest. Only catch is that it needs to be stablecoins pegged to the USD, TAUD will only net you 8.5%-10%. Either way, this is still way higher than the 1.35% from a savings maximiser or the 2.19% from your home loan offset account.

      • Tleyx on 08/01/2022 - 19:08

        Have to pay tax on that unlike the offset

        • rektrading on 08/01/2022 - 21:35

          The net profit is higher than the interest saved in the offset account.

          Debt + hard assets always beat zero debt + fiat saving.

      • lowlifesphere on 09/01/2022 - 15:22
        +1

        isnt there a chance that you won't get any of your money back with these schemes? I know they have worked out for many over the past year but the whole thing can fall apart pretty quickly and wipe everyone out.

  • HeWhoKnows on 06/01/2022 - 15:39
    +10

    Anyone doubting that the inflation rate is heavily manipulated (in all countries) and by how much might like to check out Shadow Government statistics reports for the US.

    http://www.shadowstats.com/alternate_data/inflation-charts

    • s12345 on 11/01/2022 - 08:12

      To make their data faking look plausible they need to use the formula CPI + RAND() not CPI + 3%

  • treekangagaroo on 06/01/2022 - 15:44
    +1

    Should you include REAL estate to get the REAL rate of inflation ?

    If you do your poll options may not be sufficient.!

    • HeWhoKnows on 06/01/2022 - 15:46
      +2

      Well that was another category taken out of the CPI many years ago.
      But it only affects property buyers so is not representative of the typical purse/spend
      But yes its a true and accurate measure of the value of money - monopoly money today!

      As I say to people, ask any person saving for their first home what is happening to the real value of their hard earned savings, how is inflation affecting them and what is happening to their dream of their first home

      • Chandler on 06/01/2022 - 15:53

        Well that was another category taken out of the CPI many years ago

        Yeah, taken out since consumer's can't really afford to buy real estate anyway!

        And real estate pricing changes aren't really indicative of CPI (IMO)

        • HeWhoKnows on 06/01/2022 - 15:56
          +2

          As I pointed out

        • tunzafun001 on 07/01/2022 - 00:55

          If you got $140k you can buy my 3 bedroom house.

          But no traffic, 600m2 block, close to a sandy beach and a friendly community…all that stuff that Sydney seem to hate.

          I wouldn't pay $2 for a house in Sydney, and Melbourne is too cold…I dont get it…get out and look around.

          FWIW i bought my house for $35k in 2004..so 10% a year.

  • serpserpserp on 06/01/2022 - 16:01

    12.8765%

    • HeWhoKnows on 06/01/2022 - 16:18
      +2

      Hmmm
      Obviously very carefully calculated.

      • ryurazu on 06/01/2022 - 17:43

        he got an inflation package calculator, (just an extended excel spread sheet)

  • [Deactivated] on 06/01/2022 - 16:03

    You see. currency and wealth was all gold and diamonds in the past.. and platinum.. but we use all those things in our TV's.. and we can make synthetic diamonds which are true diamond.. even synthetic opal is cheaper and far higher quality vastly higher grade and you can bake it in an oven. Well the point being.. we now used unfixed currency where wealth of a nation and therefore its currency.. is based entirely on what has value such as fuels, foods, water, oils, land, population and workforce and facilities and so on. So you dont just have all this gold and diamonds sitting in a bank vault they're in your diamond tipped drills and your mobile phones and gadgets gold plated circuit boards and audio leads.

    But what controls inflation and interest rates in banks is.. people are too poor cant afford anything so they need loans to start new businesses and companies.. then repay the loans over time by working to pay it off.. its why you cant possibly pay for your house or office building upfront you take out a loan. they know you maybe cant repay it but assume not everyones a stupid idiot and would manage to have some profit from their business as the average small to medium business even just a small homewares/grocery store or coffee shop or fast food place can have easily millions of turn over in a year. If people cant get loans they cant start businesses then no more money comes in. Food and restaurants like mcdonalds make most billionaires most of their money as you may grab a drink or a meal a few times a day but other things you buy once a year at best. plus every person needs food. businesses like mcdonalds are global every half an hour you drive you probably pass one all over planet earth.. it rakes in piles of money towering into outerspace. but countries like australia have about zero global businesses.. which means we have zero billionaires. the only reason our money worth anything is we have heaps of land and we grow the food the mcdonalds sell. though a desert country we kinda got some water.. and plenty of oils and coal and gases and things. so all our hated mining contracts with global world endingly bad nature destroyers.. are the only thing keeping our currency able to import goods. it doesnt help for decades the government here has had policies specifically to prevent local business from thriving in almost all industries and has absolutely failed to make massive cheap world famous landmark instantly recognizable open markets where you can set up a table and sell anything for decades now they just whack some street stalls in the center of CBD's some nights a week and pretend they been doing their job of governing and supporting the nation. Many people mistakenly think they have to pay impossible sums to own a house or to set up a 'westfields' shop.. instead of being able to use affordable longer lasting vastly higher quality building materials that can be erected in fractions of the time for next to no costs we pay impossibly absurdly inflated prices on our houses where japan has hundreds of millions of people fighting over land thats already owned by others on a space the size of an aussie blokes back yard literally (honshuu fits in a central australian property) the japanese houses last like a century or more are better designed better build can withstand earthquakes and 9m of snow and typhoon/monsoon season and more mold and moss than you can imagine and often have hydraulic shock absorber foundations in their building code standards and are build to nationally licenced STANDARDS of specific building and construction materials and methods. Most of the places here in australia fall apart off the plan or a few years in with poor materials quality and are built the wrong way so tiles rated for thousands of tonnes of kg weight are cracking when children walk over them lol or are having the houses rise and fall and shift with moisture and underground clay expansion causing them to crack at the corners and come apart at the seams literally.
    uhh basically many australian things like fruits and foods are stolen or fakes that look similar to real things our HAAS avocados arent headsized columbian ones that are bright melon green and taste like nutella, they're shrivelled prune like things that taste like vegemite. Many things are grown in bulk for industrial use and arent meant for consumption or like thousand of varieties of roadside weeds like mint.. may not be the edible mint but are grown in huge quantities and used to make things that probably end up in food when they shouldnt.. even our metals we mine.. arent being processed in modern methods to bring costs down and greatly improve quality..
    uhh australia is like some time forgotten ancient caveman wasteland our stores sell things for $50AUD that are vastly inferior to $2 goods overseas and they're just a piece of wire like a phone charger cable or a USB cable or an OCC audio cable. other people have USB 4 and thunderbolt.. we have USB 2.0 for $20 and $50 for USB 3.0 or 3.1 its not even 3.2gen2 or thunderbolt 3 .. just look at how many years a HDMI 2.1 cable cost $70?
    so uhh yeah.. basically if they dont forcibly keep interest rates down enough to encourage people to get loans to start businesses or invest here.. then. well our cheap fake poorly built house prices will skyrocket as well as our interest rates and you'll end up paying over a million for a small car space garage converted to a studio apartment in sydney CBD.. oh wait those are actual real estate listings.. my bad..
    what do you want me to tell you?

    Mathematically australia has zero billionaires.. with about 20 million people on about 30 thousand a year for the last so many decades how could they have possibly with one or two stores or businesses located within australia.. have ever had every member of 20-30 million people spend their entire income at their store yearly?
    people like bill gates have something like 6,000 businesses 2/3 of them world wide global businesses in more than 20 major countries.. they are literally the most important people to their country so the country does whatever they tell the country do to! with hundreds of the worlds richest all in the United states its why canada and everybody else tolerate them. and why people race to america to try and get 50 jobs to live the american dream of affording food to eat.. look how fat some of them are!

    • netjock on 06/01/2022 - 17:12
      +2

      Yup. Australia is just overpaid therefore overpriced. It is a vicious cycle.

    • El cheepo on 06/01/2022 - 20:41
      +18

      Who the hell has time to read that wall of text…

      • liongalahad on 07/01/2022 - 11:46
        +2

        lol he has signed up just to to write his piece and disable the account right after that

        I tried to read it but it's a stream of consciousness, bit like reading Joyce's Ulysses, not easy hey

    • postform on 10/01/2022 - 11:05
      +1

      I agree that the expansion of credit is important for a country's growth. The only issue here is.. two things.

      1. Expansion of credit must be responsible, currently its way higher than it should be.
      2. The credit as you mentioned "business" "innovation" in other words flow into PRODUCTIVE pursuits. Currently in Australia 90% of all expansion of credit is in real estate which is an UNPRODUCTIVE ASSET.

      And the reason why Australia wants to do this, there are a few theories but I think most people don't disagree with me on these points.

      1. Wealth effect - you feel richer you spend more - higher GDP, and higher tax collection from GST (this is slowing down - kind of makes sense nothing in real life goes up for ever - law of diminishing returns.)
      2. Home prices going up track two big industries in Australia - Construction industry and the REA industry
      3. Home prices going up increase council rates and stamp duty.
      4. People tend to spend more on their home - upgrading the aircon, upgrading the kitchen.
      5. People with homes tend to get children.
      6. Banking industry is well secured.
      7. People with homes tend to buy another as an investment if they can (which further helps with GOV from points 1, 2, 3, 6)
        7a. Reason behind IP is lower their tax and with negative gearing, deductions, and raising property prices (Over the last 10 years) you'll be on top. (I believe a lot of this happens due to high tax brackets in Australia, designed almost to encourage negative gearing as no other asset is able to do this at this level - yes shares can be negative geared if you borrow but you can't deduct your home's depreciation in shares - which is a big portion of why the negative gearing sometimes end up net benefiting you - a home depreciated over 30 years is laughable - should be a 100).
  • Sweet3st on 06/01/2022 - 16:07
    +4

    Just went to order a storage unit from IKEA. $69 last year, $79 this year. Delivery $40 last year, $49 this year ☹️

    • netjock on 06/01/2022 - 16:11
      +1

      Price risk is steep. It also depends on how often you buy it. Week in and week out then probably but these are durable goods.

      Focus on consumables that we definitely need, tissue paper has gone up 30%, meat gone up. Fruit and veg maybe (but then maybe offset by $1 avocados which is now helping more millennials onto the home owner's ladder)

    • HeWhoKnows on 06/01/2022 - 16:17
      +3

      Whilst not taken into CPI figure it is yet another example of how much prices have increased.
      This one equate to a 14% increase for the product.
      But more importantly the cost of TRANSPORT has gone up 25% !!!!

      • netjock on 06/01/2022 - 16:25

        But how much is the cost of transport component?

        Think about it. If your cost of transport goes up 25%. Say your $30k car goes up 25% and cost of petrol goes up 25%. $30k + $7.5k (over 5 years) plus petrol money of $2k gone up $500 pa. Average wage of $60k, $2k = 3% of your gross salary.

        For consumer goods it spends on what you are selling. A container full of low value toilet paper would cop a lot higher increase than $10 150g boxes of Lindt chocolate

        • luckyang on 08/01/2022 - 14:46

          Sorry, I read your reply four times, and I still can not understand, Could you please explain it again.

          • netjock on 08/01/2022 - 14:49

            @luckyang: Cost of transport is only a small component of the cost of any item. It isn't what is causing 6% inflation. Stop looking at one item thinking it is driving up prices.

            $1 facial tissues at Woolworths now $1.30. It is 30% but compared to your whole grocery bill and pay it is nothing. Bitcoin went up 1000% and some people say it is a hedge against inflation but did inflation go up 1000%

      • GrueHunter on 06/01/2022 - 19:36
        +1

        See I wasn't convinced at work but all the CRAZY CAPS and EXCLAMATION POINTS!!!! really make your case

        That and you being a qualified economist and not some random armchair analyst cum lunatic

        • kyle on 07/01/2022 - 09:25

          OP reminds me of an ex client about 10 or so years ago. He sent a compliant letter by fax. There would be words in caps and each paragraph starts with the word FACT, as if what he said cannot be disproven.

    • bluesky on 06/01/2022 - 16:59
      +1

      Ikea said prices at its stores would increase by an average of 9 per cent around the world in 2022, so even if you have paid higher, the good news is you may have beaten further rises yet to come. (The items I have been eyeing in Ikea since the end of last year have yet to increase, so I am assuming the projected rises have not happened yet).

      • netjock on 06/01/2022 - 17:11
        +2

        Buy up IKEA flat pack furniture now, resell at a profit later. Even 4.5% is better than putting it in the bank. (Joke)

        • bluesky on 06/01/2022 - 17:25

          :-)

    • asmith84 on 08/01/2022 - 13:20

      I went to ikea in mid nov, and after Christmas. Many stuffs i was eyeing went up by 20-40%.

  • [Deactivated] on 06/01/2022 - 16:20
    +4

    Based on the price of goods and services it really varies.

    Cars (and particularly the second hand market) have gone up a lot. 30-50%. Pre covid you never paid retail for a Mercedes for example, as an example, you could get a base GLS for about $130k on the road. The same car is now $180k with no or very little discounts available. Second hand utes have doubled in price.

    House prices keep rising, but they've done that for the last 10 years.

    My supermarket shop has increased considerably. I used to spend about $130 a shop, but now the same items are about $200.

    Electronics seem to have kept the same pricing or have dropped in price.

    Clothes are creeping up in price, but not to the same extent as other goods. Plane flights don't appear to be anymore expensive.

    Take away food is way more expensive, but I feel that was creeping up before covid, with Uber eats really putting pressure on the shops.

    I think if you average everything out, you're probably looking at a realistic inflation rate of about 30%.

    • serpserpserp on 06/01/2022 - 16:23
      +5

      I think if you average everything out, you're probably looking at a realistic inflation rate of about 30%.

      Your analysis is about as finger in the air as anyone else's here, so why not? 30% it is then.

      • [Deactivated] on 06/01/2022 - 16:25
        +6

        Yep, it is. I'm not an economist. But they've been doing a shit job anyway. It's all guess work based on the set of data you choose. CPI data is weighted to suit the figure the Reserve Bank wants, I'm picking some examples from my life which show that CPI is bullshit. Is it anecdotal? Sure. does that make it less valid that manipulated source data?

        • luckyang on 08/01/2022 - 14:57

          They will only claim 'you are wrong' and will NOT show you any real data, because they really can not find any.

    • netjock on 06/01/2022 - 16:26

      Cars (and particularly the second hand market) have gone up a lot. 30-50%. Pre covid you never paid retail for a Mercedes for example, as an example, you could get a base GLS for about $130k on the road. The same car is now $180k with no or very little discounts available

      Obviously need that $130k merc. Not getting a 10% discount on a $30k Corolla is a biggy.

      • [Deactivated] on 06/01/2022 - 16:26

        $180k Merc.

        • netjock on 06/01/2022 - 16:28

          Don't need it at $130k then why would you buy it at $180k? People who do buy it at $180k deserves to pay every cent they are happy to part with. Obviously their money can be better used in someone else's pockets (observation, who am I to tell people where to put their money)

          • [Deactivated] on 06/01/2022 - 16:43

            @netjock: You don't need a car at all, public transport would suffice if you got up earlier. But guess what, we've all got cars.

            • netjock on 06/01/2022 - 17:09

              @[Deactivated]:

              You don't need a car at all, public transport would suffice if you got up earlier. But guess what, we've all got cars.

              Just because you got a car it doesn't have to be the one that is $180k that was previously worth $130k. That is just like getting willingly mugged and complaining about it.

              Wish people would stop holding up these example as some kind of show of wealth. Just go and buy a $30k Corolla and wait until the Merc drops back down to $130k and you still have $20k to put on red / black at the casino. But obviously people who are quick to palm off $50k deserve the shiny new Merc they buy.

              • kyle on 07/01/2022 - 09:28

                @netjock: If someone is after a Merc, they wouldn't even think about getting a Toyota even for a short period.

                • netjock on 07/01/2022 - 13:05

                  @kyle: Not even for money? Just goes to show where the world's going

                  • kyle on 07/01/2022 - 15:13
                    -1

                    @netjock: Once you've driven an European car, you don't want to go back to a Japanese one.

                    • nigel deborah on 07/01/2022 - 19:54

                      @kyle: Maybe 30 years ago. These days I'd take a top spec Toyota over that $180k Merc anytime (assuming I couldn't just turn around and sell it)

                    • netjock on 08/01/2022 - 11:28

                      @kyle: Haha yeah if you don't love your financial well being.

              • greatlamp on 08/01/2022 - 09:04

                @netjock: Substituting a Toyota for a Merc is exactly the kind of thing that is done to disguise the real inflation rate, for example replacing beef with chicken because 'that's what consumers would probably do when beef becomes too expensive'.

                If someone was looking for this vehicle, the price is significantly more expensive this year.

                • netjock on 08/01/2022 - 11:32
                  +1

                  @greatlamp: Inflation: maybe.

                  But you can take real money. Either you got it or you don't. You want a Merc but only can afford a Toyota. If you don't like Toyota then walk. You can't fake that.

                  Starting off with the basis that everyone should be driving Merc rather than a Toyota is just a bit rich isn't it?

                  It is like raising interest rates will create more AdBlue out of thin air. Or make more RAT tests available (or make people consume less).

  • TEER3X on 06/01/2022 - 16:50
    +4

    Just need to look at Tim Tams, they are as accurate as any basket of goods.

    There should be a Tim Tam inflation indicator for this country, and we should make policy decisions based on that.

    • netjock on 06/01/2022 - 17:11
      +5

      You mean like the big mac index.

      I thought previously we had the avocado index. The higher the price of avocado the lower the % of home ownership for millenials.

      • Blakus on 07/01/2022 - 15:21
        +1

        Avocados are dirt cheap at the moment. Is that why so much competition for houses? Lol

  • ryurazu on 06/01/2022 - 17:39

    depends on how you measure real inflation rate the people at the RBA know this as well, this more speculative its the treasury that telling them to alter weight and excluding inflation variables. As we all have eyes the fact that house prices surging 20% that's what the media reports right so if a majority if Australian's are using (renting/buying) housing should mean that is included into the CPI, nope its basically reweigh to mean nothing.

    So taking into account things TRUE real inflation rate i say its closer to 7-10% on a Yoy basis unless house prices dropped which they didn't (expect for the start of the pandemic which they froze all the numbers and placing it on a once in a lifetime event as the reason…. numbers are the numbers there should be no altering) . Remembering this is my feel of it and basically ignored the central bank bs.

    that being said something might have actually come down in price only problem is you are unable to use the services in question so does that mean that others service have weighting of 0 nope. Therefore you can see why the goods inflation even though much higher seem to have very little impact of the RBA underlying inflation impact, the main stream financial media like to eat shit of other financial articles in order to get the clicks and the topic approved.

  • bobbified on 06/01/2022 - 18:05
    +18

    According to my employer, it was 0% as reflected in my salary 'increase'.

    • El cheepo on 06/01/2022 - 20:42

      That's rough…

    • tunzafun001 on 07/01/2022 - 00:59
      +5

      Teachers asked for 3%, then accepted 1.1% … and they are educating the future.

      • greatlamp on 08/01/2022 - 09:08
        +1

        Sick of these limp wristed unions throwing their members under the bus. Is there a scab workforce of teachers who would step in if the strike continued? Pathetic

        • tunzafun001 on 08/01/2022 - 11:07
          +1

          While the Union as a whole is pathetic on most matters (as it has basically been infiltrated…but well done to whoever made that happen).
          In this case the Union opposed the offer, teachers went on strike, the Dept didn't budge…Union said strike again… teachers can't budget to save themselves and the majority took the offer as they didn't want to lose another days pay. It was one of the most pathetic things I have ever been involved in.

          Nothing the union can do when the employees are sheep without a backbone. Well, actually the Union rep is just a staff member. They said "if we strike again we may get nothing instead of 1.1%, are we prepared to do that?". The reality is these people live, sleep and breathe work and have no time to support themselves financially. Teachers die young for a reason. Just rediculously sad. So the Union needed to be more proactive in leading the charge.

      • Eeples on 08/01/2022 - 22:34

        …which teachers?

        NSW teachers were given 2.04% plus 0.25% SG increase effective Jan 1, 2022.

        The current agreement ends in May 2022.

        IMO there will be more industrial action by teachers in NSW around then.

  • x2r9ypbj on 07/01/2022 - 07:29
    -3

    MY WUIFE AGED 75 REINVESTED $ 50.00 WITH THE COM BANK. COULD NOT BELIEVE THAT THE INTEREST RATE
    WAIT FOR IT 0.18% HER RETURN IS $ 92.00 WHAT A JOKE WORKED HARD SAVED ALL OF HER LIFE FOR A PITTANCE
    RETURN. WHILE THE CEO OF THE BANK GETS NEARLY 2 MIL PER YEAR.

    • spurf on 07/01/2022 - 08:36

      I think you meant $50,000? You need to shop around as there are plenty above 1% If you have a little more risk appetite you can get returns of around 3% at plenti.com.au

    • ThithLord on 07/01/2022 - 09:19
      +13

      Here you go, mate. Browse PC Keyboard deals on OzB cos your CapsLock is broken

  • Geoff-bargain on 07/01/2022 - 08:55
    -1

    Another question we should be asking is why is there no performance review of the RBA. They have a very important job and we never seem to review it they are doing it well. I seems to me they are terrible at it. When the GFC started they raised rates before panicking and lowering them. They should have raised them when it was clear the economic impact from Corona was minimal.

  • gromit on 07/01/2022 - 09:43
    +3

    What a moronic rant, The funniest part of it is he doesn't understand that RBA doesn't calculate inflation rates, the ABS does, the RBA relies on numbers from the ABS so claiming it manipulates them is just truly sad.

    Secondly inflation is not under 3% it is 3.8% at the moment, hence the upward pressure on interest rates. Many of the things he described are not down to inflation, they are due to pandemic related supply chain issues and until those are resolved it will be hard to gage actual inflation.

    Also all the calculations and numbers are publicly available from the ABS, so please point out where the numbers have been manipulated.

    • brazen00 on 07/01/2022 - 10:46

      Spot on!

      Although I think you're still looking at the June figures - the latest CPI was September (next one due 25/1/22). The headline figure was 3.0% and the trimmed mean was 2.1%.

      • gromit on 07/01/2022 - 10:50

        yes you are right I was using Last FY numbers. regardless they are much higher than the RBA would like, I think rate rises are imminent if the current covid issues don't get completely out of hand.

        • brazen00 on 07/01/2022 - 10:53

          Yes, I expect we will see a rise or 2 this year, but probably not until later. The RBA say they want to see sustainable inflation of 2-3% and that will take a few quarters.

    • JD9151 on 07/01/2022 - 17:13

      Yep I doubt there's a grand conspiracy going on at the ABS. I think there are better ways parties can maintain governance.

    • postform on 10/01/2022 - 11:12
      +1

      But it was the RBA who mandated what was included - go to their website - https://www.rba.gov.au/calculator/. ABS on the other hand just like you said collects and calculates. Either way they all manipulated because the sample size is quite small. They are always seem to be lower or more favorable than private data collection firms.. food for thought huh!

  • amazonaddict on 07/01/2022 - 10:45
    -1

    Fuel, Milk, Some frozen items are the ones that have increased in price for me. That caused about 0.4% increase in my expenses. Insurances went up by 5%. Then the big one is day care. They went up 10%. So we are looking at downgrading to a less featured day care. We have stopped renovating the house, eating out. So, with a reduced life style people will get through.

    • MrThing on 07/01/2022 - 21:42
      -1

      you mean insurances which go up 5% pretty much every year

      • [Deactivated] on 08/01/2022 - 12:24

        why do they go up every year? Since I got my P's, I havent had an accident in close to 6 years now and my car is being valued less.

        • MrThing on 08/01/2022 - 19:50
          -1

          insurance is a game of scale

          the worse we all drive, the more we claim the higher our premiums go

          • [Deactivated] on 09/01/2022 - 00:44

            @MrThing: And this has happened consecutively for 6 years?

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