Poor economics, poor politics

Unemployment is up by 35,000 to 2.5 million. At the same time inflation has risen to a six month high of 3.3%. More unemployment and more inflation is forecast in 2011 as the cuts in public spending and the VAT rise make their damaging economic and social impacts. Its crazy not to be stimulating key parts of the economy at this time - very poor economics from the Conservative-Lib Dem Coalition. Despite this situation Labour leader Ed Miliband only asked very briefly about the economy in today's questions to the Prime Minister. Ed and his team are weak on the economy, weak on defending Labour's record and the need for economic stimulus and weak on political strategy and tactics.

See http://www.bbc.co.uk/news/business-11998364 on unemployment
See http://www.bbc.co.uk/news/business-11996631 on inflation.

Food and clothes prices: much more than narrow economics

For me there has never been any such thing as cheap food and clothes because someone or something, somewhere is paying the costs or suffering the consequences of 'low' prices such as in our supermarkets...joined up, systems, thinking shows this. However, even those who have formerly had other perspectives are increasingly saying that the era of 'cheap' food and clothes is over (see the link to the Daily Express article and Primark comments below).

Fascinating interview on Radio 4 today about this (see link below). World demand for meat is up and so is demand for wheat and other grains to feed the animals, land that could or did grow food is being taken for energy crops or other purposes, human population is rising, climate change is cutting yields in key locations - factors like these are increasing demand whilst also lowering supply and that means the dominant overall trend in food prices over time is definitely upwards. Adopting greener lifestyles would over time moderate the upward prices trend.

BBC News - Today - 'Upward long-term food cost trend'

The rising cotton and food prices are driving fears that our weekly shopping could soon become more expensive.

Natalie Berg from the research group Planet Retail examines whether consumers would have to bear the brunt or whether companies would be able to absorb any price rise.

See also:

http://www.dailyexpress.co.uk/posts/view/199383