Lord King at Bank of England - another five years of this fucking idiot in charge of the Nation's financial affairs

Lordy Lord "Don I gotta Winner" King of the Bank said at the Mansion House 16th June 2007...

"Our central view remains that inflation will fall back this year as the rises in domestic gas and electricity prices last year drop out of the annual comparison, and the recent cuts in prices feed through to household bills."

"It follows news that the majority of Britain's major gas and electricity suppliers have raised their prices by an average of 15pc and 12pc respectively. The Governor Mervyn King is expected to voice concern that these pressures - along with rising food prices and the threat of increasing salaries - could lift the CPI far above its 2pc target in the near future. Mr King was forced last April to write a letter of explanation to the Chancellor when inflation hit 3.1pc, the only time such a letter has had to be composed since the Bank was made independent in 1997."

Some time ago Lord Patel wrote to Roger Bootle whose scribblings regularly appear in the Financial Press - after some prompting this reply was received from him on January 29th 2008



So don't expect the cheerleaders of "one of the finest brains in the City" to point out what a piss poor job he and his cluster fucks in Threadneedle Street are making of running the MPC....or their apparent total incapacity to see more than 24 hours ahead.

If you want a good indicator of what will happen to food prices goto the Minneapolis Grain Exchange MGEX today and see what happens when it opens.

Should your busy day involve meeting Lord King pass it on. meanwhile chew on this Press release operative when the market opens today.


FOR IMMEDIATE RELEASE
CME Group, KCBT and MGEX Announce Price Limit Expansion for Wheat Futures

CHICAGO/KANSAS CITY/MINNEAPOLIS, February 8, 2008 – CME Group, the Kansas City Board of Trade and the Minneapolis Grain Exchange announced today that all three exchanges will implement new price limits for Wheat futures and mini-sized Wheat futures on Sunday, February 10 for trade date Monday, February 11.

Price limits will be set at $0.60 per bushel above or below the previous day’s settlement price. Should two or more wheat futures contract months within a crop year (or the remaining contract month in a crop year) close at limit bid or limit offer, the daily price limits for all contract months on the respective exchange shall increase by 50 percent the next business day and an additional 50 percent each subsequent day two or more contract months within a crop year (or the remaining contract month in a crop year) close at limit bid or limit offer. Daily price limits shall revert back to $0.60 after no wheat futures contract month closes limit bid or limit offer for three consecutive business days. There shall be no price limits on the current month contract on or after the second business day preceding the first day of the delivery month, except in Minneapolis where there are no price limits in the spot month on the first business day following options expiration.

The joint expansion of price limits is considered necessary due to the unprecedented price ...... Just watch this chart for Spring Wheat futures for the next few days

UPDATE -all markets opened up at market limits 60 cents a bushel.
UPDATE 11/2/08 - 4.30 EST
Chicago tribune has good background piece - Limit on wheat prices raised
Daily move can reach 90 cents per bushel amid supply crunch

Domestic inventories of hard red spring wheat, used to make bread and pasta, will fall 40 percent from a year earlier by May 31, according to the Agriculture Department. Inventories will be the lowest since 1948 .

Please pass on the UK Treasury / Bank of England Forecasting section.