From today’s BBC news business pages today:

Surprise hike in consumer prices

The rising price of imported goods – particularly fruit, vegetables and toys – has caused an unexpected rise in one measure of UK inflation. The Consumer Prices Index (CPI) was pushed up to an annual rate of 3.2% in February, from 3% a month earlier.

But a sharp fall in mortgage repayments caused the Retail Prices Index (RPI), which includes housing costs, to fall to zero for the first time in 49 years. Economists had predicted that both measures of inflation would fall.

Hetal Mehta, senior economic advisor to the Ernst & Young Item Club, said: "It is surprising to see CPI inflation increasing when a sharp fall was widely expected."

Surprise? Unexpected? Good Lord almighty! With the poor old beleaguered Sterling plunging from €1.40 to €1.05 , what the hell did our feeble-brained, so-called professional economists expect? The prices of all those French cheeses and Golden Tasteless apples, along with all the out-of-season Spanish vegetables, have been shooting through the roof recently. On top of that, our dear old Sterling has plunged from $1.90 to $1.45, even though it was America that caused this disastrous worldwide financial fiasco. My mother is 91 and she sure as hell noticed day to day living expenses rising markedly. Anyone who spends any time regularly shopping for food with their brain in gear would have been feeling the familiar painful twinge of inflation in their pockets.

Hetal Mehta, who sounds like a far better anagram (health team?) than he does senior economic adviser, must be one very out-of-touch puppy. Were I Ernst & Young, I’d be looking for a replacement. There are countless cheaper people out there who can get things that badly wrong.

Poor old Joe Public’s cause is clearly completely hopeless. All is lost. Not only must we suffer at the hands of incompetent banking professionals who lose our money but the economists have IQs somewhere south of 100, too.

[Aside: By the way, what on earth is the once revered BBC doing beginning a paragraph with a conjunction; not just a sentence, if you please, but a whole new paragraph? Where are today’s custodians of English grammar? It makes me weep.]

Last year when our Mazda’s insurance was up for renewal, I leapt onto one or two of the plethora of price comparison web sites to see if I could better my car insurance price. I was very pleased to see that I could save myself about £100, one of the most competitive quotes being from the AA insurance services. I decided to go for it. One factor which encouraged me in that direction was that the AA was offering a 30% discount on AA membership if I bought it at the same time as the insurance. Good ol’ Mazzie was 9 years old and, though he had been reasonably reliable, I thought a spot of breakdown and recovery cover now might not go amiss. I went for that too and still saved on my old insurance premium.

[Aside: I was less ecstatic when my new insurance policy arrived from the AA and I noticed that the policy number began with the letters "SAG". Sure enough, it was a Saga policy sold to me through the AA insurance services. I felt a little older – but that’s another story.]

Anyway, a few days ago my AA membership renewal notice arrived in the post. The price had increased from about £70 to £102. Ah ha, now that I am an existing member, it strikes me that I’m not getting the 30% discount any more. The AA web site still mentions "up to 38% discount" on breakdown cover when you buy online but, of course, here I am, an existing customer, simply being renewed.

Armed with a competitive price from Green Flag (£60.90) for comparable cover, I phoned the AA and told them I wanted to cancel my membership. "Why?", they asked. "Because I can save £40 with Green Flag", I responded frugally. After an explanation of why the AA did not consider Green Flag to be direct competitors (unlike the AA, Green Flag does not have patrols wasting fossil fuels constantly driving the length and breadth of the country), the nice lady on the phone put me on hold while she went "to see if I can do anything about your renewal premium". […Irritating musical interlude…] Click! Magic, they could now renew me for £71.40. Looks like a phone call got me my 30% discount back.

It seems to be too frequently the case in our current incarnation of the world (version 5 release 15) that discounts are offered to new customers simply to entice them into the fold. It used to be the case that existing customers were rewarded for their loyalty whereas now the faithful customer tends to be penalised in favour of the new sucker customer. Price comparison web sites are a typical case in point: we are actively encouraged continually to jump ship and grab introductory discounts. Do companies no longer care about repeat business? They should do; it should be easier and, therefore, cheaper to hang on to existing customers than to win new customers, or so I was taught. Am I missing something?

Much as I love Aleksandr and all his pals at www.comparethemeerkat.com, I can’t help but think that there is something vaguely twisted about a world that favours the fickle over the faithful.

The original text of a particularly useful quote, attributed to Maslow’s Psychology of Science, is apparently:

I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail.

 

Such would appear to be the case with our glorious Bank of England, as they slashed yet another 0.5% off the base rate making it a paltry 0.5%. It matters not, it seems, that all their previous incremental cuts totalling about 4.5% made no difference to our financial ills, they insist on soldiering gamely on with the same strategy regardless, as if the difference between 1.0% and 0.5% is going to make a blind bit of difference.

Having looked at mortgage rates (about 5%) and, in particular, loan rates (about 7.5%), it appears that the only group affected in any significant way by the Bank of England’s hammering on with the same tactic is the country’s prudent savers whose income from interest has been slashed to almost nothing. It is the savers who are playing the part of the nail and being beaten senseless. What appears to be happening is that the banks, the very reprehensible idiots that got us all in to this current appalling mess, are widening their margins. Loan rates were up around 7.5% when we were actually able to earn a noticeable amount of interest. The banks’ loan rates do not seem to be shifting downwards but their interest rates on savings sure as hell are. Having lost all the public’s money, they first add insult to injury by saddling that very same public with a gigantic tax bill to bail them out. The public has had to pay them to lose their money, for Lord’s sake. They further tighten the thumbscrews by giving us no returns whilst essentially maintaining their charges to us. Finally(?), they stick the boot in by having the effrontery to use chunks of our bail-out money rewarding their own abject failure with outrageously large pay-offs thinly disguised as pensions. Nice one!

On the other side of the coin, I have no sympathy with the currently fashionable grumble that conditions for obtaining a mortgage are unreasonable. I’m hearing that factors such as three times salary are available but, horror of horrors, only if one has managed to save a reasonable deposit (e.g. 10%). Far from being unreasonable, this used to be the norm "when I was a boy". Indeed, three times salary used to be seen as generous, available only when conditions were very buoyant. If you can’t save a deposit when you aren’t paying a mortgage, how the hell does one expect to be able to make payments on it. The trouble is that a generation has been raised to expect greater than 100% mortgages with factors as high as a ridiculous six times salary. Strewth! No wonder the financial world went barmy.

Be that as it may, all that’s really happening now is that savers are being unreasonably penalized. Savers make up a significant chunk of the spending public but their spending power has been seriously reduced. Consumers can’t do their bit bit to spend their way out of a recession when, as now, they are left with no disposable cash.

Penalizing the prudent to help out the imprudent seems not only a particularly outrageous strategy but one that is doomed to failure.

I’m not a great one for mobile phones. I think it’s partly because I neither needed one nor was provided one at work, so I never got into the habit of spending hours printing money for mobile phone companies. Doubtless, it is also because I have never spent hours nattering on any kind of phone. I’m just not a big phone user. Be that as it may, I did possess a very old Pay & Go Nokia phone (3310?) "just for emergencies". I top it up by about £30 a year, so little do I use it. I’d replaced its original flagging battery once but that replacement battery was beginning to flag again; it would last all week on standby but try and do anything and I would be greeted by a cheery, "beep!" accompanied by a "low battery" warning. It could wait for a phone call for days on end but when one arrived it couldn’t answer it. Very useful!

For little more than twice the price of yet another replacement battery, I could now get a new, lightweight, slimmer, basic modern mobile phone using improved rechargeable battery technology. Lightweight (<50%) and slim line (<50%) are good – if I can’t tell it’s in my pocket, maybe I’ll carry it with me. "Basic" would be good but now seems to mean a phone incorporating not only a crappy digital camera but an FM radio as well. Yikes! Of course, to use the radio, I ‘d have to fill my other pocket with the earphones. No matter, I can’t remember the last time I turned the radio on in our cars, far less wandered the streets listening to one.

I called the O2 sales folks and told them I wanted a new Nokia 2630 but that I wanted to keep my old number (it’s a particularly nice number even though very few people actually know it). "No problem, just switch the SIM card from your old house brick over to the new phone/camera/radio", the lady said. "The SIMs are all compatible are they?" "Yes, just switch it over." "Great, thank you", I responded and divulged my credit card details.

I was mightily impressed when my new modern, lightweight, slim line, mobile phone/camera/radio turned up at our front door at about 8:30 the following morning. Actually, it was a DHL@Home lady that turned up but you get my drift. The point is, prompt service – excellent. I unpacked my new phone/camera/radio, conquered my mobiphobia and managed to switch my SIM card into my new toy. A swift charging of the new toy’s new battery and I’d soon sent my first text message to Carol’s phone. I did have to keep ignoring silly suggestions for words that new phone/camera/radio/dictionary guessed that I wanted to type but essentially all seemed well.

Two days ago, I needed to use my new phone/camera/radio/dictionary in anger for the first time. Carol and I had parted company (intentionally, I hasten to add) in one of the Milton Keynes shopping centres and, when it came time to reunite with her, I didn’t know which shop she was raiding. No matter, Nokia to the rescue. A swift search through my contacts for Carol’s mobile number whilst hanging around in M&S out of the wind and … "STOP – Call not allowed". The "STOP" was particularly graphic: a very small red road sign. Cute. The "Call not allowed" was much less subtle but seemed equally graphic. Must be an aberration: try again … "STOP – Call not allowed". Maybe they have a blocking system inside M&S? Out into the car park and try again in the open and very cold air …"STOP – Call not allowed". Try phoning my home land line … "STOP – Call not allowed".

I’d got plenty of credit and I’d been merrily sending and receiving texts for over two weeks. I have even successfully received a phone call. When it came to making a phone call, however, I seem to be equipped with a Nokia 2630 camera/radio/dictionary. The "phone" part of the deal – the very part I had come to think of as the multi-faceted device’s primary function – was sadly lacking.

An Internet trawl produced a few others who had fallen foul of the "STOP – Call not allowed" scourge. Sadly, though, it produced no answers other than irrelevant ones banging on about PIN, PIN2 and PUK codes.

O2 support seemed unfamiliar with "STOP – Call not allowed" but suggested I try extracting, cleaning, and reinstalling my SIM (no joy) followed by trying my SIM in another phone (yeah, right, I have several spare mobile phones). We did try it in Carol’s phone but it’s a different network and wouldn’t come up. If none of that works, they could send me a new SIM for the same number, though this seems to take three days longer than a new phone, for some curious reason.

Nokia support seemed less than familiar with "STOP – Call not allowed" but valiantly tried all they could to have me bounce around countless menu options changing various very technical settings – all to no avail. "I’m afraid you’ll have to send your phone/camera/radio/dictionary in for service/repair, sir", said the helpful and apologetic Nokia support man. Drat!

Wait a moment, maybe it’s worth trying Carol’s SIM in my new phone/camera/radio/dictionary. Being a SIM-free thingy, it may not be locked into a network. Sure enough, up it came on Carol’s network and, further more, it could make real phone calls. It was my old-fashioned SIM causing the problem.

The helpful chaps at O2 gave me a new 3G SIM card, swapped my number and credit over to it and all is now well with my phone/camera/radio/dictionary thingy. Clearly all SIM cards are not compatible.

I’m surprised no one seemed familiar with "STOP – Call not allowed", though. Surely this can’t be that isolated a problem?

The process of mind expansion marches on. What better way to begin the new month of March than with another new word to add to one’s vocabulary? The splendid Mr. V. M. Yeates has done it again. Writing as an exhausted Sopwith Camel pilot on the western front in WWI:

… beyond a phenakistoscopic veil he saw the flying moons and spheres caught in webs and dragged away.

Where’s that blasted dictionary? If things carry on like this, I’m definitely going to have to get an extension to the book loan [Winged Victory – V. M. Yeates]. It’s worth it, though, ‘cos my knowledge is increasing in leaps and bounds. It seems that a phenakistoscope is a device whereby a disc bearing a series of still images is rotated before a viewing slit, the ultimate effect being one of motion. I’ve seen things like that, especially on the Antiques Roadshow.

I can’t begin to imagine how good the old English education system must have been. Admittedly, RFC pilots tended to come from well-shod families; the commoners were used as little more than infantry cannon fodder in World War One – but one has to wonder at a Sopwith Camel pilot writing such colourful prose.

Our modern education system is open to all, not limited to the landed gentry, but appears to struggle to produce people reaching such a degree of literacy. It simply isn’t fashionable. “One mustn’t stifle creativity by insisting that they get it right. It’s more important that they have a go.” Piffle! Language is a wonderful thing which can, and should, be very precise. It’s about the only thing that differentiates us from the animals, whose physical prowess far outstrips ours. Let’s not regress to the prehistoric level of interpreting grunts. [You can tell that I’ve never raised a teenager, can’t you?]

Thank you V. M. Yeates, for more than you could ever have imagined.