In this monologue, the speaker explains that a decline in the headline inflation rate does not translate into a lower cost of living because only deflation—an actual drop in prices—does that. He argues that official inflation measures (CPI) understate the true rise in everyday expenses, citing examples such as mortgage rate hikes and large price increases on specific goods. He proposes a personal rule of thumb to double the reported inflation figure to approximate personal cost‑of‑living inflation. The video also serves as a promotion for his financial‑education platform, Rob.team, offering courses and a free Money Mastermind University module to help viewers improve financial literacy and build multiple income streams.
Chapters
Inflation down but cost of living up. What the actual fluff? So people don't really understand what inflation is and how it works, and some people, I think, naively believe that if inflation goes down, the cost of living goes down. This is not how it works. I'll tell you how it works because You're not really educated on this properly. Like, one of the fundamental things you should be taught in school is money and how it works. And inflation is a huge part of money and how it works. Inflation on your money is essentially a tax on your money. Inflation on your debt is essentially a paying off of your debt. But you're not told this or taught this. So why— how can inflation go down but your living expenses go up? Well, this is because the only way that your living expenses will go down is if we have deflation. So deflation is a reduction in the cost of goods and services, or a reduction in prices. Now, a reduction in inflation isn't a reduction in prices because inflation is an increase in prices. So a reduction in inflation is just a slowing down of the increase in prices. And inflation is usually calculated— and by the way, this is, let's be honest, we only know what we're told. And how do we know that what we're told is true? By that I mean, do I believe inflation figures are accurate, linked to our cost of living? I do not. And I'm sure many traditional economic economists will argue with me and jump up and down and scream and shout and rant, but we're told right now that inflation is marginally over 3%. So we are told therefore that the average increase in prices over the last 12 months is marginally over 3%. Do I believe, with how I spend my money and where I spend it, that over the last 12 months my living expenses, my cost of living, has gone up marginally over 3%? No, I do not. I do not. Let me know what you think. Do you think that the economic inflation rate that we are told represents your actual cost of living? I don't. I mean, so many things I've seen have gone up 25 to 50%. In the last 5 years, and even if only a few things that I spend my money on went up by that amount, then that would wipe out zero or negative price increase in everything else. And what if your mortgage interest rate went up from 2.7% to 6%? You might feel that. So let's just be clear. A reduction in inflation is not a reduction in your cost of living. Your cost of living only goes down if we have deflation. We haven't had that since 2015, and it was 0.1%, which is negligible. So when inflation drops and there's all this, whoo, look at this, aren't we great as an economy, aren't we great as a nation because inflation has gone down, all it means is a slowing of the increase in prices and cost of living. Therefore, it's still a continued increase in prices and cost of living. Now, mostly we are going to have inflation. It doesn't have to be that way, and there are downsides of deflation. However, if our prices have gone up so much and our cost of living has gone up so much since, what, lockdown 2020, wouldn't it be nice if this, uh, cost of living slowed down, stopped, or even reversed? Because this is the problem. When prices go up, they rarely go down again. When salaries go up, they rarely go down again. So if you're a business owner and you've seen salaries go up 20, 30, 50% almost overnight, they're not going to go down again. No one's going to ask for a pay decrease to support you. So people get confused, and hopefully now you've been educated that Um, by the way, inflation was over 10% at one point after lockdown. So, and that's averaged over the 12 months, not just that month, because inflation is usually measured as an increase over the last— an increase in prices or cost of living over the last 12 months as an average. Chris has said it can be reversed. Well, for it to be reversed, there has to be deflation, because a reduction in inflation is not a reduction in your cost of living, it's just a slowing down of the increase of your cost of living. And like I said, most people don't understand this difference. So look, number one, hopefully you found it useful to understand what inflation really is, which is a slowing down of the increased cost of living, not a reduction in the cost of living. And by the way, if it's going up a lot, it probably means it's gone up a lot. And I believe that it's usually a lot more than they tell you because you have to factor things in your cost of living that aren't in their basket of goods. And do they put all the items in their basket of goods? No. Might they want to spin the inflation to give some positive PR or to achieve their own outcomes of profit. Yes. So you have to figure out what your real inflation is on your life and what your actual cost of living has gone up by, and it's a lot more than 3.2%. Okay, I— my rule is, um, whatever the government tell me inflation is, I double it. That's my rule. I just think that, you know, because it's good to be a bit pessimistic, isn't it? Um, protect the downside and then go for the upside. Be pessimistic, look at the worst-case scenario, and then be optimistic. Be pessimistically optimistic. So if they tell me it's 3.2, I think it's 6.4. And if they tell me it's 10.1, I think it's 20.2. And I see where I'm spending my money and what the costs have gone up by, and nothing's gone down. Oh, apparently because meat went down, therefore inflation's gone down. Well, I'm not seeing it. Okay, now look, if you'd like to get ongoing consistent better financial education that they're not teaching you in schools and university, and that your parents didn't teach you because they didn't know, and the government don't want you to know, and the central banks don't want you to know, I recommend you join Rob.team. Rob.team is my digital financial freedom platform to help you start and scale a business, make, manage, and multiply more money, and build multiple streams of recurring income. Um, the good news is that Rob.team has hundreds of hours of courses, resources, and masterclasses to build multiple streams of recurring and passive income, get your tax bill down and your income streams up. In fact, we just yesterday did a 3-hour tax reduction masterclass. And even better news is it costs less than 20 pence a day. You can cancel any time with no ongoing contract. Now usually to get educated and get a degree could cost you 50 grand. The record for the most amount of debt a student has gone into is £256,000 in traditional education. I mean, how crazy is that? And for less than 20 pence a day, less than a couple of coffees a month, you can join Rob.team. So to join, it's really easy. All you have to do is type in Rob.team. That's Rob.team. Rob.team. And if you join now, I've got a special bonus for you, which is a 12-module, 16-hour Money Mastermind University course, completely as my gift to you for joining now. Now, why would I do this? Because I want to change the education system around money. I want you to learn how to make, manage, maintain, and multiply money. Get proper factual education, not from theorists, but from people who've actually made millions. You know, I'm like the bare-knuckle fighter with 100 street fights. The economists in university are like the people who've sparred in big teddy gloves, you know, done a bit of padwork. There's a big difference. Um, so yeah, if you want to move your way towards financial freedom and independence and get better financial education and knowledge, um, you can get my 12-module, 16-hour Money Mastermind University course completely for free as a gift to, um, when you join Rob.team. Here's the thing, I'd love to change the education system, but let's be honest, it's too big and powerful for me to change it. That's why I've launched my own. That's why I have nearly 10,000 members now, um, past and present in Rob.team. Because we're building not just a community and not just a movement, but a revolution. And if you'd like to have a revolution in your finances, I recommend you join Rob.team. So type in R-O-B dot T-E-A-M. I'll see you in the members area. Remember that a reduction in inflation is not a reduction in prices, it's a slowing down of the increase in prices, and it's still an increase in prices. And my guess is They're probably not mostly telling you that because it's good spin to say that inflation is down, when in reality, since 2020, what has it been in total? What's our money worth now compared to 2020? I mean, I wouldn't be surprised if our spending power's halved. Let me know what you think in the comments. What do you think our spending power's gone down since lockdown 2020? What can you do about it? Join rob.team and get better financial knowledge. Start and scale your business, make, manage, and multiply more money by getting hundreds of hours of courses, resources, and masterclasses. See you on rob.team. Thanks for tuning in, and remember, if you don't risk anything, you risk everything.
