Every £ tracked
Updated: Mar 28
Most people know that £millions of pounds and dollars have been pumped into the financial system over the past couple of years. This has the potential to fundamentally change the way we live in the very near future.
If you have cash in the bank then you are getting poorer. In March 2022, you are lucky if the interest rate is higher than 1% whilst inflation is running at 5.5% (office for national stats). . Actually, most people realise that inflation is higher than this official figure. People already experience price rises of up to 10% on some goods and services. So after a year, your £1 savings became £1.01. But oh dear that loaf of bread you were going to buy has risen from £1 to £1.10.
Commodities such as energy and wheat are rising (due to kerbs imposed by administrations like Joe Biden pipeline cancellation, and by other factors such as conflicts (wheat comes from Ukraine). Some people like to prepare whilst other media tells you that this prudence is a bad idea.
Some features of today's world
According to Stansberry research, globilisation is over and the world is being zoned off in terms of fuels an rescources like precious metals. If you are an investor then some say it is becoming more difficult to invest in fossil fuel companies, They are considered to be polluting Earth killers that people don't like . They are becoming demonised a bit like tobacco companies . So this means that less money is going to fossil fuels and supplies are only going to go down. Another thing, according to Nigel Farage, much fuel refining (20 to 40%) including diesel is done in Russia. Not a good thing in view of conflict.
There is a move to net zero by 2030. However, it is impossible for most companies and organisations to reduce their carbon ouput to absolute zero. You cannot make any sort of transportation or put anything in a package or bottle without causing an amount of carbon. So lets say a company or organisation manages to get carbon down to 20% but can't do any more. They would then have to buy say 20k tonnes of carbon credits from someone else to offset that 20% they had difficulty with. Companies such as carbon neutral ltd are involved in this . . That someone else might be for example a certified indonesian mangrove swamp owner, Amazonian forest preserving tribe, or Norweigian company pumping CO2 back into rock strata. These are "blue carbon" type methods. Most big companies are signed up to do this so that they become clean, virtuous and eco friendly.
This looks like the direction that Councils are headed. East Suffolk Council for example is currently reviewing all assetts to reduce carbon emissions to a minimum. It is looking for accurate ways of measuring its success.
In the future, Government might consider a carbon tax on individuals. So if you have too many cars, or live in a house with more square footage than you need then your carbon footprint is too big and you will have to pay. How will they know what I have and what I buy you may ask. The answer is that we can all see that money is being digitised and the days any meaningful amounts of cash are numbered. There are already limits on cash carried abroad . In the near future, Governments will have it's own blockchain and every transaction will be tracked .
Taylor rule interest rates
The Taylor rule is a kind of formula that tries to predict the desired relationship between inflation rates, bank interest rate , and productivity. Stansberry research company says that things are so far out of normal parameters that interest rates would have to be raised around 40 times to get back to stability. The system is leveraged to the max and it now has to stay that way or else risk collapse. .