Rules of economics.

People are often fooled by the rules of economics

Economists look studious and make pious pronouncements about headline inflation trend and interest rate.

One thing I know is that it ain't half dear to live!

Fuel continues to spiral upwards. Round here diesel passed 1.30 a litre and is heading doggedly for 1.40, we cannot be far off the 1.50 litre of diesel.

Economists say that high price curbs demand and yet there is not sign of anyone chucking their car keys away any time soon.

Neither are all the leviathons for sale with people lining up to buy sensible cars.

Economics is not science because there are people involved in the equation.

Really, fuel should be falling, the price seems to be steadying or even falling slightly on the wholesale market. But of course the oil firms are all turning record profits.

They have learnt the lesson, fuel can go up a hell of a lot more and we will still keep on buying.

The actual market thing is itself driving price with wholesale betting on the future price of commodities pushing everything up.

Of course there is still the underlying contradiction. Manufacture has moved to the third world with markets laregely being in the first.

Here in Britain under Thatcher we moved to a model where we would all sell each other things, not real things but services.

This is an immensly fragile way to live which can easily implode on itself.

Everyone says housing will crash, but, and it's a big but, last time that happened there was adequate supply. Today we are still not building enough houses to meet potential demand.

The global price of food promises to create a whole new raft of problems. Allready on land round here normally used for silage we have seen the ploughs move in and the crops planted.

But, the price of food contains within it the biggest threat. The great faine in Bangladesh was no famine at all. Food was not short, it was the money that was missing. If, driven by speculation on markets we again have full markets of unaffordable food the consequence could be dire.

The systems of economics spoken about as laws and science are complex social relationships which are far more fragile than we think. Each economic system of relations may well contain within it the contradictions that lead to it's demise.

A very famous man said that.