British Gas Freezing Pensioners Not Prices, 9.2% Price Hike, Exponential Inflation
Personal_Finance / Household Bills Oct 18, 2013 - 05:07 AM GMTBy: Nadeem_Walayat
It's that time of the year when Britain's cartel of 6 energy suppliers steps forward one by one to announce extortionate price hikes with SSE's 8.2% of a few days ago now being followed by British Gas announcing that they will hike energy prices by 9.2% (gas prices by 8.4% and electricity by 10.4%).
So whilst many frail pensioners will freeze to death this winter dozens of media representatives of British Gas have been busy reading their propaganda scripts across the mainstream media in an attempt at putting up smoke and mirrors as justification for the price hikes -
"There are costs that are not in our control, there are several of them such as the cost of buying the energy on the global market." - Christine McGourty, British Gas
"The price of wholesale gas is rising we are buying in a global market and the demand for it is booming" - Ian Peter, Managing Director of British Gas
The following graph illustrates the truth that the there has been NO RISE in the market price for gas for THREE years! In fact the wholesale price for gas is still 30% LOWER than where it was five years ago in 2008 during which time British Gas has increased gas prices by MORE than 50%! This is EXTORTION! and successive governments have done nothing about the price fixing, neither Labour before nor the Conservative Coalition since 2010, and the price for electricity shows a similar pattern to that of gas
The series of annual price hikes have lifted the average dual fuel bill to more than £1450, which are now due to go up again by another £140 for October 2013 to September 2014! Even the Office for National Statistics (ONS) has calculated that energy price hikes are an extortionate 41% OVER Inflation i.e. more than 50% over the past 5 years.
Switch Provider?
The governments answer (Ed Davey, Energy Secretary) was to suggest switching supplier to another energy cartel member. Yes switching and FIXING may delay a price hike by upto 12 months as longer switches already have built in price hikes anyway, but contrary to what the price comparison sites suggest this is not as simple as a few mouse clicks because it can take more than a month to complete process of switching with much tooing and froing as my forthcoming analysis (video) will illustrate.
The real solution is for the energy cartels to be broken up, as the ILLEGAL price fixing is currently not being prosecuted. The Serious Fraud office must investigate and bring charges against the energy providers board of directors because there is a clear case for price fixing when one compares price hikes against actual market prices.
The bottom line is that the only way retail customers can protect themselves from the price hikes is by being invested in the monopoly profit generating companies such as Centrica (owners of British Gas) and thus receive the price hikes back in the form of capital gains (9.5% over the past 12 months) and dividend income (4.75% current yield), that's a return of 14.25% against a price hike of 10%.
UK Governments Baldrick Nuclear Power Plan
The governments solution to Britain's energy crisis is to build a Chinese state controlled Fukushima style nuclear power plants in Somerset, so much for National Security!
This illustrates what my recent in-depth analysis focused upon that democracy is an illusion and that the politicians actions are always in the interests of the ruling elite - The Illusion of Freedom - Democracy, Religion, Science and Propaganda
Exponential Inflation
The following graph of official CPI inflation rate (that tends to under report real inflation by between 1-1.5% per annum) illustrates the exponential inflation mega-trend in motion that asset prices tend to be leveraged to and oscillate around and hence one of the primary mechanisms of how the elite accumulates wealth, whilst the effect on the wage slaves is to continuously lose purchasing power of net earnings that is unable to cover real inflation such as the 10% hike in energy costs, thus forcing workers to take on debt and thus become reliant on political bribes (benefits and entitlements culture) and become perpetual debt slaves who will spend virtually their whole adult lives servicing their debts, for instance over 90% of today's graduates will leave university with about £60,000 of debt that they will then be focused on servicing for the next 25 years of their lives.
My next in depth analysis will be Governments Inflating Housing Bubbles to Encourage Debt Slaves to Borrow. Ensure you remain subscribed to my always FREE newsletter to receive this analysis in your email in box during the coming week.
Source and Comments: http://www.marketoracle.co.uk/Article42732.html
Nadeem Walayat
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Nadeem Walayat has over 25 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of four ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series.that can be downloaded for Free.
Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 600 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk
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