Inflation, Interest Rates & House Prices

[@BR-gz3cv]

Love Gary’s breakdowns of what’s “really” going on around us. Refreshing to see an Incredibly sharp guy who hasn’t abandoned his working class heart. Please keep up the great work!

[@riptoncampbell]

The clever man spends many hours learning how to read books, the wise man spends many hours learning how to read people. #dyslexia #dyslexic #unorthodox #business #howtobeamillionaire #howtobuildwealth

[@ohnoitisnt]

Yes it takes a certain type of person - someone who genuinely explains the topic down to the fundamentals, and who isnt so morallly corrupt to not just take the money and run

[@bryansmith1920]

In the modern world this man should be our Chancellor In a new Political party created for the Young people of Britain

[@tonychorley4936]

Not just young people, I am in my 70’s and a huge fan.

[@annstafford4789]

​@@tonychorley4936 Correct

[@T1tusCr0w]

I’d break my back to get a party run by people like Gary into power. Run on economics that WORK! Our country is really finished if we don’t have 10+ years of great economic policy and amazing governance. We’re 5 bad years from being maybe the 8th or 9th richest country. And our Gini coefficient ( matrices on poverty ) has fallen off a cliff.

[@pansepot1490]

Not saying he doesn’t have good points but everyone looks a genius talking from their armchair and never having their ideas tested or questioned. Yeah I know he’s made millions trading but a neurosurgeon is not necessarily also a good heart surgeon. I’d prefer if his video format was a live Q&A. Some things he said imo don’t add up and I would like clarification.

[@T1tusCr0w]

@@jayandgem I mean he walked away from MOAR! There’s few people who only have to stay put and make all the money but they walk away because they know how the money is being made. He has already been tested. He passed.

[@pdnpcpomcblHwbd]

This man was spot on. 10/2024 and government tried to take credit for drop in inflation.

[@namlehai2737]

Wow

[@markcampbell9356]

I don't know why I only "discovered" you yesterday, but you articulate so well what I and a friend suspected was happening back in 2020. Thank you for your clarity and work!

[@imcaufieldholt]

Confirmation bias?

[@Skylark_Jones]

"What you're seeing here is kind of the death throes of an economy which has given up on taxing the rich." Wow.

[@mattmccormick6984]

Brilliant explanations Gary, this country is so far in the gutter/sewer people can't even begin to picture the mess

[@andymcpandy2128]

This government is so dirty it wouldn't be welcome in the sewer.

[@StoutProper]

I’m not sure inflation will be coming down anytime soon. The government is in a ton of debt and is trying to inflate its way out of it. Same for the wealthy elite, inflation is good for them because it means their debt is less. The only thing that could help bring down inflation despite the government is AI, but that will be at the cost of employment, and it’s not yet clear whether the government will allow it.

[@bigtree6992]

I hope we see more of Gary on TV and media to get this message out there, we desperately need taxation reform for the rich

[@lesleywillis6177]

My wife and I have both worked full time (and more) for over 40 years. We have some savings, property and investments. How much of it do you want?

[@RhetoricalMuse]

@@lesleywillis6177 You're not rich

[@bigtree6992]

You obviously haven’t paid attention. You aren’t the rich he is referring too

[@damatolgreen5329]

Listen & learn

[@tombanks6920]

@@break1722 that is an absolutely ridiculous thing to say

[@marvinwright7656]

Bro I’m addicted to your videos! I have always been interested in money / banking / economics but never really understood all of the workings behind the yellow tape. However the way you articulate and break everything down is spot on! Thank you bro 👊🏾👌🏾👏🏾

[@Jesusspop]

Thanks for all your work Gary, what you’re doing is hugely important. Keep it up !

[@marcusdaniels9717]

I don’t know about anyone else but I need to watch this 2 or three times to really understand it. But some early constructive criticism… We need to stop saying ‘tax the rich’ It has a stigma to it. People who we need to bring with us switch off when they hear it. Maybe say tax wealth or tax passive income. Thanks for my weekly economics lesson Gary. It’s helps me understand money, class and hierarchy.

[@bluevan12]

Sadly some will still see that as taxing ambition, aspiration and perceived hard work.

[@tonychorley4936]

When really all we are asking is that they pay the same rate of tax as those of us whose money comes from wages, earned income. How is it fair that Rishi Sunak only pays 22 % tax on the millions that his money makes.

[@tonychorley4936]

Surely all we are asking is that the rich pay their fair share. Why should they pay less tax than those of us on PAYE. Rishi Sunak only paid 22% tax on his millions. He is happy to raise our taxes, how is it fair that tax laws favour the rich. I just want them to pay their fair share, goodness knows they can afford it, they don’t wind up at food banks because of rising prices. Oh, and Non Dom status must be removed.

[@marcusdaniels9717]

@@bluevan12 I agree. That cohort are not who we need to convince in the short term though.

[@marcusdaniels9717]

@@tonychorley4936 exactly! People’s brains are so boiled. If you describe it as ‘taxing the Rich’ it goes over their heads.

[@pauljenkins4987]

It's not just mortgages that are affected by interest rates, it's every single thing that's bought on credit, from your builder's van to your factory's production line to your neighbour's washing machine, flat screen TV, etc. The more marginal your circumstance the more likely you are to buy goods on credit. And although the intent of interest raises is to restrict the money supply so as to hold prices down, for a large part of the population that effectively increases inflation.

[@forecast_hinderer]

Charles Eisenstein used a powerful analogy for never enough money in a recent video on his channel called Sacred Economics, The Stand 2023. He likened the current system to a game of musical chairs where you have everything at stake if you can’t find a chair when the music stops. He says, the question is, who decided we need to remove chairs in the first place.

[@drp277]

This guy is a genius!

[@Ab.Stat.]

Always enjoy your videos, Gary. I think a large part of the audience is interested to see you unpack the theory behind this with graphs and case studies and what not. Maybe you're worried that sort of video would be too slow or dry but I reckon a good chunk of this audience are massive nerds like me.

[@lucindasmith589]

A good graph can show in a second concepts that take a while to explain.

[@marianhunt8899]

No, humble barely educated person here. I just acknowledge the real evidence of destruction and despair I see around me. Ordinary people can't afford a roof over their heads, elderly people not being able to afford the rapacious privatised nursing homes and care companies, degrees becoming unaffordable and the super rich making eye watering amounts of profit not to mention what they have hidden off shore. Also, small businesses being strangled in favour of the trans national mega corporation. I could go on but I think the picture is clear.

[@YourLoveNeverFails]

Yup, I love visual illustrations and graphs, makes me get concepts just like that.

[@rhythmandblues_alibi]

Yes please!

[@JBLegal09]

Very similar situation in Australia, although our cash rate isn't as high as yours, the rate of increase has been much faster. I like this guy - no BS 👏

[@rhythmandblues_alibi]

Would love if Gary did some in-depth analysis of other countries, like Australia because I live here, but also China, India, these massive economic powerhouses that don't seem to get much coverage in the mainstream news.

[@holdencauldield4824]

hahaha just found your Chanel out today and have been watching a couple of videos, I couldn't help but look when this video was made because you actually predicted what happened with inflation that it would eventually drop,and not only that rishi sunak and Jeremy hunt both came out last month claiming it as a political win for their Conservative party that they had help cause the drop in inflation, you predicted this 7 months ago, please keep up the good work.

[@thomasking4791]

Gawd I feel old, this year I've switched to sensible shoes, talk radio and loving finance channels like this one. Thanks Gary!

[@mikeharvey9811]

Everyone should try to get their friends family and MPs to watch this. I know young people who are so grateful that I bang on about this, but it needs all of us to share this! Barb

[@Afsheenn]

My mortgage is up by 400 quid per month. Thank you Lizzie.

[@cosmosnomad]

I think this one is on Rishi because he was chancellor during the pandemic years

[@m_b4]

You're still being paid to borrow. Unlike a saver without a mortgage who is having their savings devalued by inflation.

[@RedmotionGames]

@@m_b4 Only being paid to borrow if your wages are rising in line with inflation. Which noone's is.

[@m_b4]

@@RedmotionGames so when house prices go up (house price inflation) you'll be calling for higher interest rates right?

[@MrDuncl]

@@m_b4 Absolutely. Had House prices been accurately including in the inflation rate and adjusted for things would have been relatively stable over the past 20 years. "The bad news. Food inflation is 20%. The good news (for first time buyers) inflation is under 1% as house prices have dropped 10%.

[@chriswhite8144]

Thank you for your clarity Gary. Your explanations are hugely helpful.

[@zyxmn]

Hope this channel becomes more popular , fat chance the main stream media are gonna talk about this . They are never gonna blame the government they work for .

[@Tochinoki]

Absolute hero. Keep it up Gary!

[@mookt3873]

Hit the like button to get youtube to spread this message far and wide

[@andy_ppp]

And comment for the algorithm!

[@rickym.3826]

Thank you Gary, amazing how you explain a complex topic like fiscal and monetary policy to the average Joe, in such a simple way! The Conservative party is going to be HAMMERED in the next election!

[@markquarrington5001]

Unfortunately you are preaching to the converted. The people I know who own their own house, even those with a mortgage see increasing house prices as a good thing and those who aspire to own their own property are still desperate to be allowed to take on ever increasing amounts of debt to ‘get on the property ladder’. The majority of people still buy into the rise in interest in rates was due to the war in Ukraine, and increasing house prices and lowering taxes, including for the rich both being a good thing.

[@travis3430]

I look at the house prices & laugh, as it's not worth that in actual reality. Housing is a giant Ponzi scheme in a way

[@juliewake4585]

I think he feels if he can get this out to as many people as possible hopefully minds may change eventually. It will be a long slog, admittedly, but he has started to appear on MSM.

[@DeadRed11]

​@@juliewake4585 Yes, exactly. Also, he is educating the converted. Now, we can speak to others with this information he has provided.

[@IncredibleMet]

The super wealthy, the ones he continually wants to be taxed, own mainstream media. There’s no way his message will become widespread. He is not censored because that will make a martyr out of him. Instead, when he goes in media channels, the goons/puppets of the super wealthy will attempt to dilute, distract or even confuse his message. The middle to high income earners watch the media channels and presume he’s going after them when actually he means the people who own the companies these high income earners work at.

[@andrewrobinson2565]

You need at least TWO houses to benefit from the rise in house prices, because you will always need a roof over your head. It's not complicated, and means watching a lot of TV and limiting expenditure to pay the first house off early, to then get the loan for the second one. 🎉

[@OneFlyMind]

1 year later.... superb predictions!!!!!!!!!!

[@garyseconomics]

This is from 18 months ago actually - I'm good at this!

[@namlehai2737]

Dang you should go into banking or something man

[@couldntfindafreename]

We need to get this channel up to 10M+ subs to have any chance changing tax policy. Let's go!

[@mateobravo9212]

You do work where others turn a blind eye, Gary. Sincerity and integrity are the greatest of things, keep it up. Remind me of Paul Mason's influence in the GFC around 2010. I have just started binge watching your channel after the shout on LBC Radio this morning with James O'brien. Greetings from Spain.

[@Libertarian606]

Gary Stevenson… Financial insight second to none. Political insight nonexistent. Which unfortunately means that Gary isn’t able to offer any solutions

[@mansurpias8440]

Hi dear Gary, please prepare yourself to become our country’s leader, we need such a person like you for the whole downtrodden human of the world. Show them how the wealth should be distributed. Regards

[@MishkaUK]

Great stuff @garyseconomics! I wish this was on TV , this whole channel series. This and Martin Lewis and minds of people woudl start opening up and brains ticking. I wish I understood all this much much earlier in my life. I have introduced this channel to my 17 yo as GAry is so relatable for the younger audiences. Bring thi sto schools

[@keithmcdougall4893]

We need to see you on the main channels talking about this a lot more. Question Time would be good. I posted this on my Facebook now. 👍🏾

[@himoffthequakeroatbox4320]

Do you think they'd dare have him on Gammon Time?

[@vanng5689]

Thank you for the clarity in explaining 12 plus years of Tory policy!!!

[@dj796]

Bingo, inequality has never been wider as it is now in my lifetime. Great work.

[@alisonrootham2032]

Again Gary. Amazing. Explaining in 'normal' terms. Thank you

[@kezzt]

A massive collapse in house prices of 50% would bring the average house price in London to 7.5x the average median LONDON salary. Figures per Land Registry and ONS. Absolutely ridiculous and unsustainable system.

[@goych]

Yup

[@paulbrown5839]

That's why London is dead. Where are the artists? Shoreditch was affordable 30 years ago. Nowhere is affordable now. London has lost its characters, they've been priced out or trapped into safe careers by large debts.

[@shandyooo]

London property is an investment diversification strategy for the global rich.

[@bmxaf]

Due to govt policy we now have to compete with the poorest people in the world for jobs (driving down wages) and with the richest people in the world for housing (completely unsustainable)..

[@anthonypert574]

And what will ulez on top of that do to London

[@johnburrows3385]

When interests rates go up the rich only benefit ,they never suffer.

[@T1tusCr0w]

And that’s before the vulture funds. Investors who throw in a decent chunk of money to a manager who waits & goes to the foreclosure auctions & gets houses dirt cheap then does them up & when the stimulus comes in ( it always has so far ) They get new renters into cheap assets & get richer than ever.

[@petermanuel5043]

Love these discussions. Thanks 👍

[@trimmusic6571]

Another really interesting video, thanks Gary. A quick but if feedback - the audio in your videos is always a bit quiet compared to other channels. This makes listening whilst making dinner or something a bit challenging. If the Audi could be mastered to a higher volume output (without clipping) that would really help listeners like me with noisy kids etc.

[@bartlemy]

Gary you are explaining this perfectly and I thank you for the knowledge you are passing on. I saw you the other day cycling through Algate and wanted to say hi but it was a busy junction 😅

[@grantwarrender8909]

Brilliantly detailed podcast. Thanks Gary!

[@tropics8407]

Brilliant ! 10 months later and you are 100 pct correct so far 👊 inevitable

[@lichh64]

Thanks for explaining all of this. I have watched your interview on Insider and since then I have watched many videos on your channel. Eventhough I don't live in the UK, the concepts you explain help me to understand how the world works and to a similar extent the situation here as well.

[@fathead1968]

Here from Russel. Best thing I've heard for a long time.

[@fathead1968]

I’m on board mate!

[@carlrhodes3421]

Another great video Gary. Really appreciate what you're doing and what you stand for 👍👊

[@Fj8282haha]

Nailed it! Extra wealth Tax on ppl with 10 million and up 🎉🎉🎉🎉🎉🎉

[@craig2892]

Gary, could you make a video on what you would do if you were PM/CotE and address all of the angles the current government and opposition use to not do those things? I'd love it to consider the longer term rather than just a single 5 year period. Thanks and keep up the great work. You're one of the heroes we need right now.

[@gabrielventer493]

Unreal insight as usual. It would be nice if you could connect rich people giving out mortgates to how we all see mortgages, where you go to the banks like natwest etc and give the right paperwork and get given a rate etc. Like you talk about how rich people use mortgages to get assets like renting, but we normally get mortages from the bank so wheres the connection there? Great video dude I tell everyone I know about you!

[@b0b1000]

Well said Gary 👏

[@lisafarmer10]

You're correct. I don't like it at all, BUT I trust your truths and judgements. So thank you 🙏 for this and all your work.

[@drunkenggoat279]

The fact this channel has got so many followers gives me a little bit of hope

[@MysteryG-dt6qu]

The charts at this link prove that QE DOES cause inflation: www.theflyingfrisby.com/p/the-truth-about-house-prices-uk-regional?r=p79l9& www.theflyingfrisby.com/p/how-much-has-your-house-really-gone

[@markbuchanan5990]

The other lever I expect the gov to try and push through lenders is to increase mortgage terms, to say 40 years, thus making monthly payments more affordable and giving the rich more money on their asset in terms of interest. Maybe more than 40 years, just to keep prices up

[@Pikey4321]

I'm sure I remember at some point, BoJo mentioning "multigenerational" mortgage terms at some point, where 50-70 years mortgages could exist and you pass on the debt to your kids. Horrendous for us but amazing for the wealthy.

[@markbuchanan5990]

It’s crazy that the governments answer to a lack of housing and prices beyond the means of average earners is to push prices higher and reduce building. Anything to keep wealth at the top and stamp duty thresholds static. We will be working to 80 to reduce the liability handed down to our middle aged children. I will add I have been lucky enough to make it onto the property ladder thanks to parents help, and it still makes no sense to me

[@T1tusCr0w]

@@Pikey4321 i had comment Where I explained it on one of Gary’s video’s. It makes people able to afford stuff while being paid less. Keeps asset prices from tumbling & gives the rich hard power over families by basically forcing indentured servitude in by the back door. Debtors prisons & the whole infrastructure would come with it. Oh and these would be a valuable asset to be sold when packaged on the market. The rich love that!

[@Fouraday]

So depressing that his Majesty’s Government won’t tax the rich! Shame on him!

[@cheds1]

They are a private corporation for profit . Most your tax’s goes to pay central banks . The game is rigged. Coming to an end

[@Fouraday]

Very depressing predictions

[@ShaunieDale]

This government has been installed by the rich in order to keep their tax burden down.

[@cafehamm]

Great video, straight to the point.

[@noneofyourbizness]

easy to follow and u/stand....as always. excellent project.

[@daddo1600]

Great explanation... Also note Inflation can be caused by Supply and Demand.... Covid had alot of money and demand for goods as people were being paid to not work....NOW the supply chains are the issue where the demand is still there but supply is in a choke hold.

[@matthewjamesturner8]

Legend love this ❤❤❤ helping a lot with my estate agency job 🎉🎉🎉

[@MsSweetescape123]

Gary for Prime Minister !

[@MsSweetescape123]

Gary is rich but wasn’t born into wealth, so he is down to earth and hasn’t lost his morals. If he were Prime Minister, I believe he would push for firmer taxation policies that actually work to tax the rich without leaving loopholes for the rich to exploit. Sadly, Gary, I think your very honesty and the fact that you came from humble beginnings means that you won’t make into the Eaton club and therefore, into Number 10. I say that with great disappointment by the way, as I think you’re exactly what we need to reduce inequality and raise living standards in this country. You’ve got my vote for sure!!

[@JamesParus]

Interest rate should be low for individual buying his own home. But higher if its investment house/apartment.

[@jorriffhdhtrsegg]

Need more tax for owning houses that the owner doesn't live in

[@richardrawden8894]

Well your taxed more to start with as you have the 2nd home tax, then as you can only claim 20% of your mortgage payment against your tax that’s another cut. I look at it from another perspective, if I own some properties which will keep me comfortable in my old age, I’m still going to paying tax when I’m retired on my properties and private pension, therefore I’m not going to be claiming benefits and taking out of the system, I will still be contributing. Am I wealthy ? No , am in rich? In comparison to some yes in comparison to others no, no way. But it’s so easy to say ‘tax the rich’ I believe there should be ‘tax breaks’ for entrepreneurs who take risks that helps employ a lot of people, which in turn gives these employed people a chance to purchase their own properties and maybe a buy to let or whatever they wish to spend their hard earned money on. Why to people bash someone who has been sensible with their money?

[@economicspredictions5979]

thanks so much for this video makes so much sense that I just didn't see

[@robertwilliams4084]

Brilliant analysis. I understand inflation now. Thank you.

[@valerieclaresanders]

Hi Gary, superb content as always, thank you, please keep speaking truth to power. I also think your presentation skills, editing and formatting, and ability to be concise and deliver ideas in a calm, diplomatic way is improving... while I also love your more ranting and heated energy in previous videos, I think your recent content and personality presentation is taking on the glossy mainstream 'veneer' that unfortunately seems necessary to get more comfy upper middle class people willing to listen and take you/this information seriously. 😂 When people scrabbling round at the bottom bring any of these ideas up we're inevitably seen as resentful, uneducated, lazy, bitter people coming with guillotines, when mostly we just want more equality and to have a decent life without endless struggle and debt to just stay afloat. So, a wealthy educated person like you advocating for these ideas more and more eloquently is an enormous help for the conversation to progress I think. Would you consider please breaking down the topic of student debt schemes and student debt interest rates etc. - UK and USA. This is another huge financial elephant in the room for my generation who were brainwashed into the myth that "investing" in our education could give us more opportunities, equity, and social mobility, when in fact for most of us it just shoved us further down the food chain before we even fully entered society. Now many are burdened with a form of debt which is a strike against them against other more "productive" forms of borrowing, provides next to nothing in return (depending on the degree paid for), and no assets whatsoever to show for it all at the end of repayment (if they ever reach the end, many probably never will until their 70s). I'm curious how you would break this down... other than please explaining to the next generation why for most people it's not worth the risk to borrow heavily just to go to school! I don't want more young people to have their futures jeopardised by this kind of crushing dread and despair I have to face every day because of a shitty, unqualified, uninformed decision I was encouraged to make in my teens. I am going to spend the rest of my working life arbitrarily owing money to very rich men who own and sell my debt amongst themselves. Decades of useless debt just for being a working class woman daring to get a degree. Please please talk about this. We need to have our dilemna heard and understood just as much as those struggling with a mortgage.

[@rhythmandblues_alibi]

Yep for the majority of people it is far better to do an apprenticeship and go into a trade than to go to uni. I know that's what I'd do if I could do my 20s over again.

[@garethatkinson2549]

You are so interesting. Thank you. Keep going

[@rivkahlevi6117]

I think you're spot on about the coming rise of corporate landlords. Really hope it doesn't happen, but it seems inevitable.

[@LeeJahn-ih9xu]

Happening

[@asahdo]

The reason it’s so depressing is because there’s no way to make it happen. The government, Tory or “Labour” (aka Tory lite), will never ever tax the rich. They’ll let the poor starve before they do that. And as long as there are people worse off than them the middle classes will never vote to change things. They’ll just blame it on the money we spend to help people survive.

[@Soraviel]

The middle class, a long time ago (always) blames the working class lifestyle.

[@madameblatvatsky]

They want the poor to starve, it's the whole purpose of their existence. Starve the poor and make more people poor.

[@Jay...777]

The world is going to see some big changes soon. When will all this neoliberal wizardry hit the buffers? Ever since the 1980's they have printed money and thrown it at the problem - boost liquidity. The dollar hegemon is now under threat from an Eastern reserve currency & payment systems. Oil is no longer sold exclusively in dollars. The west is being isolated from the rest of the world. The global south backs Russia & China. Games up for the colonial masters.

[@jorriffhdhtrsegg]

Things will change if the middle and working class realise they have more similarity with eachother if much difference at all than the owners, who will eventually own everything i.e. bourgeoisie, capitalists, elite, upper

[@Pjj878]

Nonsense, it's comments like this that perpetually keep the tories in. There is a massive difference between them, even if there are similarities

[@muthuk2]

Dear Gary. Thank you from the bottom of our hearts to opening up our eyes to see what is really going on in the financial systems of this world. I have question: When you keep saying during Covid government printed out a lot of money and gave it to very wealthy individuals. Who are these individuals? Why was the money handed out to them instead of the regular people who needed the money as they lost their jobs and income ? How could the economy have been sustaining if the regular folks weren’t given money to spend ? Why is the government afraid to tax the rich ? Is there something fundamentally wrong here which means to say who is exactly in charge of a country - the rich or the government?

[@bigdaz7272]

Love your channel Gary. Always giving us new ways to consider our situation. Well done :)

[@jamesowen1213]

One easy to swallow tablet that the patient will not take explained in easy to follow language thanks Gary. One linked phenomenon which will have long term effects is the falling birth rate.There will not be enough mice to keep the treadmill running 😮

[@lmorgan877]

This is a great point which is never part of the public discussion. I'd recommend Stephen Shaw's documentary 'Birthgap' for anyone interested in global demographic trends.

[@lucindasmith589]

Would love to hear Gary's analysis of what would happen in this scenario.

[@T1tusCr0w]

If you want to know what would happen if there is not enough workers just read about the Black Death in Europe. Peasants had a massive jump in circumstances for the 1st time in almost time immemorial. There’s other factors now but it’s a good study.

[@geoffvalero3516]

Straya have increased immigration to 1 Million a year to keep house prices up there....straya is i believe 20 times the land mass of the Uk with, 75% less people and yet here we have london like house prices all over the country...ever increasing house prices is the only barometer of national happiness according to the average mug and msm..its akin to a cult here

[@christinacramsie5646]

Automation should take care of that. Boris Johnson was ever a fan of depopulating.

[@kernel1kadafi]

Gary can you give us advice on what to do? As in short term? Mid term? Long term? Im speaking as someone that is in the lowest 10% percentile

[@kennedyjames007]

Brilliant.

[@Soraviel]

Love your content Gary, so essential.

[@markusnystrom852]

Thank you, Gary! Great video!

[@Kapitalistdjungeln-tj4wm]

Great video, Gary, and an incredibly important topic. With a "black belt" in inflation economics, I just want to clarify that the wealthy actually benefit both when interest rates are lowered and when they’re raised, but in different ways. The fundamental issue in today’s economy is therefore not the interest rate itself, but rather how inflation is measured. What we call inflation is only a consumption inflation, which reflects just about 25% of the total economy. In fact, 75% of our economy is instead linked to our asset inflation. Furthermore, consumption inflation isn’t driven by interest rates but rather by production costs, which in turn are influenced by global instabilities. Meanwhile, asset inflation is primarily driven by our interest rates. But, as mentioned, that part isn’t included. If the central bank had instead adjusted the policy rate based on the economic cycle, market fluctuations and likely the financial gap would have been smaller. It would be super interesting if you could do an episode diving deeply into this issue. Clear up misunderstandings and demonstrate how the central bank and politicians should actually act.

[@johncorner9295]

Cheers....😊

[@saturndirect8085]

SPOT ON

[@Jay...777]

Tax wealth not work.

[@saeedtaherbeigi6270]

I do not understand why when it comes to inflation no one talks about how all supermarkets and British gas and Centrica have increased their profits by many folds, for example Tesco has tripled its profit. The top 4 supermarkets increased their profit by 42%. British gas and Centrica have forecast an eightfold rise in earnings.

[@DUB-sential]

Much price gouging going on.. too much monopoly

[@jam99]

Tesco profits have been all over the place. Where did you get 'tripled' from? And since when? Why do people make such pointless comments without facts? As for people not talking about energy companies' profits, yes they have, a lot of talking. Starmer is constantly talking about all that money on the table and windfall taxes were implemented, a bit.

[@agentq4153]

I have been watching for a while. It all makes perfect sense, but what can I actually do.

[@Alex-cw3rz]

Also keep in mind that inflation is also hitting poorer families more not just because they were already struggling with the cost of living. But general products used by everyday people have gone up much higher than the 18% inflation figure for example Pepsi Max 2 litre bottle was £1 a year ago now it's 2 that's 100% inflation.

[@T1tusCr0w]

It’s because the cheapest stuff has most demand. More people can almost afford that. So more pull with equal supply. Prices go up faster. Just another thing that makes the poor even poorer.

[@jorriffhdhtrsegg]

@@T1tusCr0w demand inelastic giffen goods. They are a) essential b) have a demand pressure because poorer consumers were previously buying them, now those with relatively high income to those have stopped buying the more expensive products. Thus all that demand gets pulled into specific items that are on the lower end of and inferior to alternatives. So for the poorer consumer there is no 'lower alternative' though, to transfer and save money with, they take the hardest brunt of all the concentrated demand.

[@T1tusCr0w]

@@jorriffhdhtrsegg yes exactly. There is no substitute to go to down the scale so demand on the cheapest goods grows. & as more wealthy people suffer the pinch they substitute from better goods to cheaper ones too thus increasing the demand even more.

[@nostromo13]

Very interesting video. In terms of inflation, it seems that corporate profiteering is also massively contributing, considering the outsized profits many have been reporting. Just look at the energy sector alone. That obviously does further contribute towards inequality, but taxing corporations with outsized profits also needs to be part of the political agenda.

[@rhythmandblues_alibi]

Yes so many companies use inflation as an excuse to raise prices exorbitantly. Its disgraceful. Supermarkets in Australia are making record profits while families struggle to afford food and rent! And the govt does nothing. It makes my blood boil.

[@Michael-vf2mw]

That's more a symptom than a cause.

[@cosmosnomad]

Fantastic explanation. One of your best ones so far. Really interesting food for thought.

[@rockweaver]

Wonderful helpful explanations ❤

[@lmorgan877]

I'm loving these Sunday morning videos Gary. Here's a question for you. If the UK's national deficit continues to rise, keeping in mind that it's already 100% of GDP, will we eventually reach a point where the interest on the debt accumulates faster than it can be paid off? If so, what happens then?

[@BigHenFor]

Japan's Sovereign debt-to-GDP ratio is 200%. What happened then? Multiple Rounds of QE as Bank Reserves given to Banks designated to make their balance sheets look good, but neutralising their ability to borrow or lend to the Real Economy, because they can't raise capital by taking deposits, nor can they raise capital from the international capital markets. Through QE, the Bank of Japan is the biggest owner of assets in Japan. Why?

[@jonp6798]

I think we have a way to go get as the government can keep inflation high which will artificially raise GDP and devalue the debt. Ideally you also actually raise GDP but it’s pretty hard to do. So what’s going to happen, now that’s a difficult question to answer. We’ve already delinked currency with gold and instead linked it with the dollar under the premise that we can always get a certain quantity of gold for the currency. Then that was gotten rid of in the 70s so now the dollar is worth something because it’s generally accepted as such and it’s backed by nothing. Where do we go from here. There will be some kind of crash at some point and it’ll all change again. Whether that be just write off government debt by the same amount in all countries or china becomes the new main currency. Who knows. All I know is it’ll impact everyone and there’s nothing I can do about it.

[@lmorgan877]

@Jon P Thanks Jon. It makes for interesting speculation, doesn't it. I completely agree that governments will do absolutely everything in their power to keep the train on the rails for as long as possible. My worry is that by kicking the can down the road with QE, the deficit has grown to the point where defaulting on it is becoming more and more likely. When you look at the rest of Europe's debt to GDP (Greece - 178%, Italy - 147%, Portugal - 120%, Spain 115%, France - 113%) it would only take one country to default to start a house of cards effect. That's before you start getting into the rumours about a new BRICS currency to rival the dollar and the lengths America would be willing to go to to keep its position as top dog.

[@himoffthequakeroatbox4320]

100% is not a magic number. Have you fallen for the "a country is like a household" fallacy?

[@colinbrigham8253]

Thank you Gary 😊

[@tomwhiteley7481]

a huge percentage of the residential market in the UK is moving to a build-to-rent model. institutional investors (mainly pension funds and insurers) fund developers to deliver them large, purpose-built developments for rent only (generally 300 - 1000 apartments). apartment developments in city centres initially, now broadening into single family housing, ie typical houses, out in the towns and villages. the trend is accelerating massively so there might not be much property to buy in 10 years time.

[@phupinder6450]

Hello 👋🏽 Gary. I really like your educational videos. Hope you have a great week

[@jimmyadiya1174]

This is the first video where i've seen the Wealthy lending the money for the mortgages rather than owning the underlying property. Previously the discussion is the properties transferring to the rich, is this a 2 tier where rich are either buying to let, or lending Landlords some of the funds? Why would the rich not want to benefit from the rising asset prices and instead lend the money at the prevailing interest rate potentially at or under inflation? Thanks for the informative content

[@YourLoveNeverFails]

Time. Being a landlord and owning the asset yourself takes up time, effort, energy, physical presence and takes up your mental load. Even if you outsource parts of this to a ‘hands off managed service’ estate agents who let it on your behalf, you still have to do admin paperwork for it, deal with tenants not paying, damaging property etc. Its easier to sell the asset via a mortgage to a poorer person, because yes you get back less than if you still owned it, but by selling it, and earning the interest, it’s truly passive income. No work required AT ALL. Even if the interest rate of return is at or below inflation, investors still do it, to manage or balance risk in their portfolio, diversify their assets, in lower yield/lower risk assets like mortgage interest debt.

[@mynameistim3701]

I‘m impressed how like every word and forecast you made actually happend. They stopped increasing. Now they are cutting rates. I‘m wondering how and why did the money during covid end up on the richs bank accounts?

[@tombanks6920]

I don't agree with Gary's view that poor people are just victims but he's spot on with the patterns and mechanics of the financial and political system.

[@ChrisBeard]

Glad to see the star of the show back. #redspottymug.

[@Alex-cw3rz]

You'll also notice because we live in an upside down crazy country, a lot of everyday items rich people are less likely to buy have had much higher inflation than products richer people are more likely to buy, unless they are investment purchases of course.

[@georgeiosub2012]

I agree with taxing the rich, but till then we can take a few drastic steps to stop the house prices for going higher: 1. no mortgages should be allowed for second homes (only after you agree to sell the first home). Cash buyers only. 2. no corporation should be allowed to own a living space 3. taxation on income from rent should be increased gradually to the same threshold of taxation for high earners (45%).

[@anitacohen8753]

Debt is an instrument of control. The sooner the majority of Aussies wake up to that the better for them and the country!

[@Plurubisunum]

I think there is another factor that is slowing the rental market down - landlords are not coming into the market, in fact they are exiting the market because the government has taxed this particular part of the economy to death. It's just not worth it financially and also legislation has increased risk to landlords.

[@irtezaali2302]

@Gray what’s your opinion on taxing wealth rather than income. Do you think it’s possible to replace one with the other?

[@adcdemyers9621]

Brilliant......what's the best way that a poor working man can help and bring about a change ? Advice...

[@bobbymcgeorge]

Am I right in thinking that the government has a choice between rising house prices and a growing economy? You can have one but not both! It's more profitable for banks to lend the credit they create to property speculators (so keeping the house price rising) rather than lend it to small and medium size businesses (which would grow the economy). Many thanks for a very informative clip!

[@daviddawson9099]

Spread the word we are listening

[@edgardner1948]

My labour has been devalued by 10% and I still haven't worked out where it's going. I'd be up for an episode "what happens if we all default our mortgage at the same time so even the bailiffs end up with Notices on their digs"

[@sfgoddard]

It is a zero sum game - the money has/is going somewhere. We hear the usual suspects: Covid, Russia and in the UK, Brexit and Truss but the Greed Hoover is still fully functional taking the dosh away from all to the few. Companies and entire Countries are doing well. For some in short and others in long. They carefully prepare their future horses ready for when they are forced to dismount the old.

[@sfgoddard]

At least Dracula just wanted our blood, the Greed Hoover just wants it all.