February 9th, 2011

Government Official Loses Bet on the Economy

This time last year an economist wonk at the liberal-leaning CentreForum took a dislike to Guido’s economic foresight. Deficit denying Liberal Conspiracy made a predictably over the top attempt at playing up the difference of opinion calling Guido innumerate, an allegation later quietly withdrawn.

Subsequently a wager was drawn up with the Freethinking Economist Giles Wilkes: a book of the loser’s choice would be sent to the winner. After a year of month-after-month of above target inflation announcements by the Bank of England, Giles, a good sport and former bookie, has decided to admit early that deflation just isn’t going to happen. In fact the realisation is becoming mainstream that the danger is quite the opposite, as Guido has long pointed out, of runaway inflation resulting from QE. Inflation is always and everywhere a monetary phenomenon. Guido doesn’t want to worry anyone, but Mr Wilkes is now Vince Cable’s Special Advisor…


  1. 1
    Billy Bowden is the greatest umpire ever ! says:

    Hang the fucker!

  2. 2
    chunky munky says:

    i am a spaz and I know inflation is here to stay

  3. 3
    chunky munky says:

    billy, what detergent do you use to get your pillow cases clean?

  4. 4
    Tachybaptus says:

    Guido, be sure to ask for a Gutenberg Bible. Then sell it.

  5. 5
    BBC Controller says:

    Note to all news producers. When reporting on cuts to local authority budgets always stress front line services. Do not talk about waste, inefficiency and bureaucracy.

  6. 6
    Billy Bowden is the greatest umpire ever ! says:

    What was the bet Cash ? I hope he doesnt put on expenses…..

  7. 7

    O/T but Ed’s got to be worried he’ll share Harryy’s fate:


  8. 8
    Billy Bowden is the greatest umpire ever ! says:

    Oh i just re-read , Still i hope he doesnt put the book on expenses.

  9. 9
    Gordon Brown says:

    The choice of book just has to be “Beyond the Crash”

  10. 10
    Anonymous says:

    Note the illiterate yob’s comma in the LC headline.

  11. 11
    Martin Flatters says:

    It’s self evident that loose monetary policy will lead to higher inflation. QE is just an extension of monetary policy when interest rates are practically zero. QE was entirely appropriate when we were facing economic meltdown and the base rate was reduced to 0.5%.
    Going forward there is a case for small increases in the base rate as long as it is viewed it will not choke off the recovery. The priority in the medium term is to reduce the deficit and through economic grown reduce the debt/GDP ratio. This is a higher priority than inflation.

  12. 12
    Grouchy Grammarian says:

    It’s an apostrophe – but you’re correct on the other point.

  13. 13
    Trinny says:

    How do these people get these jobs?

    I want to be a special adviser.

    Where do I sign up?

  14. 14
    Sophie says:

    Vince Cables “special advisor”?

    Is that the new name for a male nurse who wipes your bum in a care home when you get really old & confused?

  15. 15
    MI5 says:

    “Overheard @DenisMacshane saying “Joan is leaving me and I’m going to jail”.
    2:46 AM Feb 7th via The Visitor Widget”

    It’s looking good friends…

  16. 16
    Amazon says:

    Can sell you 500 for £25, they are justing taking up space and getting mouldy. A purchasing officer has been suspended for buying them, I mean what was he thinking?

  17. 17
    streamfisher says:

    You got an app that sounds an air raid siren every time Guido posts a new thread Billy?.

  18. 18
    Billy Bowden is the greatest umpire ever ! says:

    He is so going to get a sore arse .

  19. 19
    Jack says:

    The Business Dpartment should be abolished…huge savings…

    Do you honestly think ANY business man would listen to Vince the Gaffe
    Cable and his SPAD ??

  20. 20
    MI6 says:

    Any new on Devine yet?

  21. 21
    Nick says:

    A really interesting podcast on inflation, which actually suggests that – shock horror – inflation may be a bad thing (think Zimbabwe…)


  22. 22
    Grumpy Old Man says:

    Guido. If you haven’t yet asked for the book of your choice, may I direct your attention towards Mark Skousan’s “The Making of Modern Economics” It invariably leads to complete recovery from an attack of Neo-Classical Endogeonous Growth Theory, or Balls Syndrome as it is otherwise known.

  23. 23
    Vince "old and confused" Cable says:

    Makes sense for someone economically illiterate to be advising Vince on Economics. if you start printing money inflation will go up at some point…

  24. 24
    Evan Davis says:

    Don’t mention the deficit. I mentioned it once, but I think I got away with it.

  25. 25
    streamfisher says:

    Things can only get better, who was it said that?

  26. 26
    South of the M4 says:

    They are in Amazon’s warehouse in Swansea, so they have already been taken out of reach of civilisation.

  27. 27
    Hugh Janus says:

    Shit a brick Billy, are you sitting all day crouched over your keyboard ready to pounce on the next thread?

  28. 28
    Gordon Brown says:

    I’ve got a pet woodlouse.

    It lives in my hair.

    He is my best friend.

  29. 29
    Gordon Brown, Deficit Denier-in-Chief says:

    Deficit ?? What deficit ???

  30. 30
    streamfisher says:

    Yanks are weirdos, why worry about Baals when you’ve already got a fort called Wayne.

  31. 31
    Anonymous says:

    In post Soviet Russia, inflation was definitely not a monetary phenomenon…

  32. 32
    Anonymous says:

    At least the story is about the boy and not his father

    Still not apologising for the filthy slobish article last week are you Guido

    Were you pissed or cocked up or just having an off day ?

  33. 33
    Engineer says:

    Wrong. Inflation is evil – as anybody who lived through the ’70s and early ’80s will tell you. It attacks the most vulnerable in society most – pensioners living on fixed incomes, for example, and it erodes peoples’ savings.

  34. 34
    Ireland's Own says:

    The only thing going up faster than prices for the retarded, useless eater Brits is Gayboy Fawker’s cock when he sees the next banker’s arse to lick. Have you not fucked off out of Ireland yet, you fat odious wanker?

  35. 35
    Cynical-old-bag says:

    That’s just what we all need.

    Someone else in denial.

  36. 36
    Always willing to help says:

    SpeshAds ‘r’ Us

  37. 37
    Gordon Brown says:

    Do you still hate me Guido?

  38. 38
    Cynical-old-bag says:

    Or for a little light reading, how about Stephen Hawkings’ A Brief History of Time.

  39. 39
    Zimbabwe ? says:

    Guido’s been predicting Zimbabwe style hyperinflation for years.

    You both lost.

  40. 40
    Mubarak says:

    I’m in de Nile.

  41. 41
    Dennis the Menace says:

    This years Beano Annual is just as good a read.

  42. 42
    Dave's new BBC spindoctor says:

    I’ll see if I can get Dave to match Labour spending again.

  43. 43
    Mike Hunt says:

    well fuck my old boots, who would have thought it.

    After all, no one has ever seen it before, apart from Weimar, Zimbabwe, Hungary, Yugoslavia etc.

    Print money, get inflation. Even Postman Pat can grasp that one.

  44. 44
    Gordon Brown says:

    if Guido is going to get a book , Then may i recomend ” Wieghtwatchers , Diets of the year” :-)

  45. 45
    William Hague says:

    ‘appen I as to ‘bed you in’ young lad.. ba goom!

  46. 46
    Vince Cable says:

    I don’t appear to have been sacked yet ? Strange ???

    It’s like I’m unsackable.

    Like I said all along.

  47. 47
    When legend becomes fact...print the legend says:

    Probably shortly to be remaindered to “The Works”…at 99p…even at that price they may struggle to shift them

  48. 48
    Clamity Clarke says:

    Guido you are not innumerate !!!

    You are an apologist whom is also innumerate.

    My other fav Guido prediction, earlier this year… “Coulson to stay put”…as Guido put it …LOL

  49. 49
    Gonk says:

    I can advise as well. I’d like to give it a go.

  50. 50
    Gordon Brown says:

    Today I will be wearing a bedsheet.

  51. 51
    Double Dip says:

    Let sunshine win the day!

    Then Osborne will have to find another excuse.

  52. 52
    Gideon Osboobery says:

    I said it to a snowman at christmas.

  53. 53
    John Major's Face Full of Curry says:

    I recommend a spicy curry clam to warm up the economy.

    Oh yes!

  54. 54
    stevep says:

    correct use of apostrophes for decades. don’t often see that, well done.

  55. 55
    Ed Balls says:

    So what!

  56. 56
    Mike Hunt says:

    And with pensions for anyone who doesn’t work for the state being continually eroded and annuities worth next to fuck all, inflation is really something to be feared.

    All stupidly low interest rates are doing at the moment are protecting the feckless fools who borrowed way beyond their means from defaulting.

  57. 57
    Hugh Janus says:

    This bumbling and seriously misguided old fool, who lusted after power for so many years, was happy to make frequent pronouncements from the safety of the sidelines. But when he achieved high office (God knows how) he was totally out of his depth. He really is a pitiful figure now. In many years I can’t recall any politician, even those mendacious cretins in NuLiebour, who would ever have been so stupid as to consider voting against a bill that they themselves were taking through Parliament. As for his ridiculous outburst against Murdoch….

    The fact that he’s still there is truly the 8th wonder of the world.

  58. 58
    Ed Miliband run over my cat says:

    And the cat never stood a chance….

  59. 59
    streamfisher says:

    Said President Mubarak.

  60. 60
    sockpuppet #4 says:

    Here’s what I want to know for folks who are always right:
    About 2-3 years ago, the pound dropped like a brick. But prices of goods made abroad didn’t immediately go through the roof. (presumably shops had £ based deals, had stock, cut profits).

    How long does it take for a drop in sterling to become inflation?

    A couple of months ago there were “factors from outside the uk” making inflation go up. one of these being that their currencies didnt devalue as much as sterling.

  61. 61
    Eeu to me says:

    A shroud would be better.

  62. 62
    Tom Baldwin says:

    You will never make me go to rehab , I say no no no…

  63. 63
    Gideon Osboobery says:

    It’s not inflation we have to worry about.
    It’s the cold weather freezing all the pound coins that’s causing all the trouble.

  64. 64
    William Hague says:

    ‘appen my Spad is an expert on inflating my bell end, ba goom!

  65. 65
    sockpuppet #4 says:

    Is that you Jonty?

    QE was a tax on anyone holding sterling.
    So perhaps you do want to tax people who have money or belongings valued in sterling, but it reduces people’s faith in how worthwhile it is to save, or to invest in the UK economy.

    Oh, and that money that was taxed from savers (ie printed), did it actually get “invested” (I’ll let you define that in any way you like), or just go into paying off old debts of the government.

  66. 66
    Martin Flatters says:

    I agree that inflation is bad but the priority at the moment is the deficit and sustaining the economic recovery. As I said, small increases in interest rates may be justified as long as they don’t affect the recovery.

  67. 67
    Vince Cable says:

    I can’t be sacked!

    I can’t be sacked!

    I can’t be sacked!

    I can’t be sacked!

  68. 68
    oink says:

    he’d never get on Lord Lang’s panel

  69. 69
    Mr Natural says:

    Enoch was right about inflation as well.

    Governments, and their attendant host of commentators and propagandists, have executed what is perhaps the greatest confidence trick of all time, a confidence trick on a gigantic scale: they have caused inflation year after year, and at the same time persuaded everyone that somebody else was to blame. It is equivalent to stealing a man’s wallet and then getting him locked up for theft.

    Speech at Chippenham, 11 May 1968.

  70. 70
    Gordon Brown says:

    I was ok until I ate those Flumps

  71. 71
    The consequences of printing money says:

    Inflation is theft !

  72. 72

    Good call Guido! I had my doubts.

  73. 73
    D Draper says:

    Anyone lend me a tenner?

  74. 74
    The sayings of the arsonist in chief says:

    ” In the front bench, who is the one without courage, who is the one without a Brain , who is the one without a heart..?”

    Balls is obviously missing Gordon.

  75. 75
    String emUp says:

    Way back in Maggie’s day the fight was against inflation , now we have the deficit. If I remember correctly it was one Mr Anthony barber who kicked off the worst inflation in the early seventies with a printing lots of money budget. Then Wislon got back in and continued the fine work ending up with banana republic style inflation. Wislon had by then gone and the hapless Callaghan was PM. Maggie got in and railed against inflation , brought in her cutbacks and then unemployment really went up. It was always us , the people , who caused inflation because we were so greedy. Never was it anything to do with any government. Then we were suddenly blessed with the BoE and its inflation target. Now if goverments are not responsible for inflation , how can they target certain rates of it. Don’t make sense to me unless they have been lying to us. They wouldn’t do that would they ?

  76. 76
    Clamity Clarke says:

    Seems Guido “The Patsy” has been prompted to big up the “inflationary pressure” line.

    Tory HQ been on to him

    Remit: Disseminate negative stories about inflation and its economic impact – try to shift blame – present case for measures to counter Inflation.

    *** To you and me *** Interests rates are about to rise.

  77. 77

    I would like to see more quantitative sleazing!

  78. 78

    Surely, there must be miles of tubes inside that building.

  79. 79
    sockpuppet #4 says:

    Something I’ve been wondering about:
    About 2-3 years ago, the pound dropped like a brick. But katie-pr****ces of goods made abroad didn’t immediately go through the roof. (presumably shops had £ based deals, had stock, cut profits).

    How long does it take for a drop in sterling to become inflation?

    A couple of months ago there were “factors from outside the uk” making inflation go up. one of these being that their currencies didnt devalue as much as sterling.

  80. 80

    …But you can be moved.
    how would you like to spend some time at Ag and fish?

  81. 81
    Ampers says:

    No he has a smart phone and only goes to his computer when a message comes in.

  82. 82
    Homosexual Muslim says:

    Hello boys.

  83. 83
    Ampers says:

    Or a full set of Encyclopaedia Britannia?

  84. 84

    No, they are not. But they really should.
    Having negative interest rates isn’t very sustainable.

    but there’s still plenty of time. Japan has been stagnant for 20 years and are only just being made to pay aa2 rates.

    If only we had some well built cars and tiny DVD cameras to flog abroad.

  85. 85
    AC1 says:

    Are there special shops only found in Swansea that sell women dresses that are one (or more) sizes too small?

  86. 86

    Anecdotal. 25 months ago, I wanted a set of four new tyres for my Toyota 4×4.

    I was quoted €800 in Austria and similar in Germany. I came back to England and bought five (spare as well) for £400. The exchange rate was then £1=€1.05.

    Paid for the tyres, deisel, ferry, accommodation involved in coming back, with more to spare.

    How long can that sustain itself?

  87. 87
  88. 88
    annnnoyperson says:

    Special… as in what sense of the word?

  89. 89
    Vaguely Gay says:

    “Guido doesn’t want to worry anyone, but Mr Wilkes is now Vince Cable’s Special Advisor…”

    He seems like a nice boy.

  90. 90
    Disco Biscuit says:

    Yes but what book did you get?

  91. 91
    mr micawber says:

    Economics for Dummies, what else?

  92. 92
    Homosexual Muslim says:

    Does anyone want to do me up my back allah?

  93. 93
    Fulls Top says:

    But capital letters stevep?

  94. 94
    Anonymong OE says:

    Actually you are both wrong and both right – we’re in a biflation world now, but don’t worry yourself about it. Continue having the political squabbles while those of us in the know profit on the misery.

  95. 95
    Anonymous says:

    How would you like to get stoned first?

  96. 96
    Engineer says:

    Some years ago, a competition was held at a book fair for the funniest title. The winner was ‘Foundrywork for the Amateur’. How about that one? It would keep the Fawkettes out of mischief for a while.

  97. 97
    Osama the Nazarene says:

    …but he’d deny it.

  98. 98

    Big baps begin over the bridge, boyo.

  99. 99

    It was bad enough when they just took the wallet.
    Gordon took the house.

  100. 100
    sockpuppet #4 says:

    “a book of the loser’s choice would be sent to the winner.”

    theres only one choice.

  101. 101
    Homosexual Muslim says:


  102. 102
    Engineer says:

    If it was economically viable to employ people in this country, we’d have a positive balance of payments. Labour costs, and the costs of meeting myriad regulations, are stifling growth.

  103. 103
    fuckwits 'r us says:

    Could be ‘Billy Bowden’ special.

  104. 104
    DisgustedOfTunbridgeWells says:

    Never apologise, it’s an admission that you were wrong.

  105. 105
    Tachybaptus says:

    A complete first edition of the Gutenberg Bible will fetch £20 million.

  106. 106
    Club Soda says:

    Its very bad form to use lol, here.
    Even worse to use capitol letters, LOL.

    If you’d have used an exclamation mark the ‘Windows Club’ would have been forced to ask for your membership.

    This isn’t Facebook.
    There are standards to adhere to.

    Very low ones admittedly, but nevertheless.

  107. 107

    Engineer is a gentleman.

    (BTW An early definition I heard was that a gentleman uses his elbows …)

  108. 108
    Engineer says:

    Biflation – is that being willing to give someone of either sex a blow-job?

  109. 109
    Tachybaptus says:

    Damn, missed that. Then it really will be Beyond the Crash. Can’t think of anything less welcome.

  110. 110
    ApostrophesAreUs says:

    Beware of the spelling/grammar police.

  111. 111

    Someday someone will figure out that 5 million employed, even on a low rate of pay, are more productive than 5 million watching Homes under the Hammer.
    IDS seems to have grasped it. Sadly about 30 years too late.

    Even better, 100,000 watching Escape to the Country, instead of being employed by the council demanding business rates far beyond the ability of a small business to generate them would create 500,000 jobs.

  112. 112
    Engineer says:

    (…..and his knees. And he always says ‘thank you’ when he’s finished.)

    As for being a gentleman, well it takes one to know one. I would not lay claim to being expert at punctuation, however. My mistakes in that field are legion.

  113. 113

    Mr Assange believes they have.

  114. 114

    We must take care here, Engineer. The term was first introduced by Dr F Osborne Brown but I think he is not related.

  115. 115

    Though’s grammer fawkers our everyware;

  116. 116
    Anonymous says:


  117. 117
    There's no fool like an old fool says:

    He was trying to impress the Telegraph girlies, Huge…especially when they laughed at his jokes.

  118. 118
    Gordon Brown says:

    Ha, ha, ha it’s Monday.

  119. 119
    streamfisher says:

    Pigs bladder my arse!

  120. 120
    Paul Marks says:

    Mr Wilkes and “Uncle Vince” Cable seem made for each other – someone should get them a room.

    More seriously – when is Mr Cable going to be sacked? To have this nasty little collectivist as “Business Secretary” is absurd.

    Of course the department he heads should also be abolished.

  121. 121
    AC1 says:

    As far as I can make out, Post Neo-Classical Endogenous Growth Theory, seems to boil down to an excuse.

    Tax the Shit out of every exchange cos magic “innovation” will mean the economy isn’t f**ked.
    The economy, as everyone with an ounce of common sense knows, does not work this way.

  122. 122
    Sludge Pump says:

    Could somebody please explain the reason for ‘ Special Advisors’? Surely Vince Cable and the rest of the Cabinet members must be proficient at the positions they are undertaking in running the country? They each have an army of Civil Servants, supposedly well versed and trained in the relevant departments specifically designed to guide them? In the real world, unless of course you are positioned via ‘The Old Boy Network’ it is expected that when undertaking a position one would have some relevant experience in the field for which you’re being employed. This is obviously not the case when running a country as it appears that any individual regardless of ability and knowledge has a divine right the fuck up and not be held responsible or to account. This probably just why Brown and Blair are still running free and Balls has been promoted and the coalition is struggling.

  123. 123
    Heath or Powell? Powell Everytime says:

    Powell was indeed a great man and what is more a rarity among the political class, an honest man of the utmost integrity.

  124. 124
    Splooge says:

    DVLA or the Potato Marketing Board

  125. 125
    Matt L Urgist says:

    Are you suggesting our Vince is a carpet shark ?

  126. 126
    Hugh Janus says:


  127. 127
    Hugh Janus says:

    “Labour costs, and the costs of meeting myriad regulations, are stifling growth.”

    Liebour certainly did cost – our prosperity and our reputation.

  128. 128
    Ain't worth the paper it's printed on says:

    and filling the gaping holes in bank balance sheets by the tax on credit balances of savers through engineered inflation

    ie THEFT

  129. 129
    Ain't worth the paper it's printed on says:

    No, the banks (on-going process)

  130. 130
    Old geezer says:

    Special advisors are there to tell them what they want to hear, because the civil service will only tell them what they ought to hear.

  131. 131
    tory boys never grow up says:

    Perhaps Guido should read the sentence following that to which he links on the Adam Smith website – and then look at what has happened to overall money supply figures despite quantitative easing. He might then realise that something else other than money supply has an impact on inflation. Even Thatcher eventually stopped believing such monetarist garbage.

  132. 132
    tory boys never grow up says:

    I wouldn’t worry about who is and who isn’t special adviser to Vince Cable since it is becoming increasingly clear that his role is not to have any impact on Government policy but merely to help deliver the votes of gullible LibDem MPs. Well at least Lord Oakeshott has now figured this out – although it seems to have put an end to my career as his unpaid special adviser


  133. 133

    There are plenty of factors which cause inflation and deflation, but ultimately supply and demand will out, even money itself is subject to the fundamental rules of market economics.

  134. 134
    Fransico D'Ancona says:

    the rapist

  135. 135
    Hon Sec says:

    Furthermore it is compulsory to always get the use of who and whom wrong.

  136. 136
    Hon Sec says:

    Sum won muss kippern I open.

  137. 137

    He called you innumerate, you should have called him illiterate.

    The headline in your image “Guido Fawkes’ is confused and wrong…” does not require an apostophe after Fawkes.

  138. 138

    Printing money doesn’t CAUSE inflation.

    Printing money IS inflation. In the literal sense.

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