The government is moving – finally – to partially protect family budgets from the cost of living crisis. But the surge in prices for everyday goods is far from the only source of inflation.
For decades the price of key assets – especially property – has been rising more rapidly than incomes, leaving a long trail of social and economic damage. The effect has been a wealth bonanza for those with assets, but bad news for the millions of households that have been unable to board the runaway wealth gravy train. Yet such inflation has failed to raise a whimper amongst the political classes or headline writers.
The UK is asset rich. Private wealth holdings (such as property, land and financial assets such as shares) are worth around £15trn, nearly seven times the size of the economy, up from three times in the 1970s. That is, they have been rising in value at just over twice the pace of the economy.
