Who benefits from inflation? The Biggest Binger and Borrower of all: the government. MPs also. They are just one of hundreds of greedy groups of Oldies with big houses and loans.

Prevention? Used to be gold in exchange for paper (see MONEY).

The graph below shows how inflation is measured these days. It used to be RPI (retail price index) but is now CPI (consumer price index).

Every month 9 Monetary Policy Committee (MPC) members [1] meet for lunch at the Bank of England. Before lunch each takes a shopping basket to fill at a nearby shop. One seeks out 1kg of 6" bananas, another 400gms standard instant coffee, another 1 litre of blue top milk, another 2 DVDs,... You get the drift.

They return and over pre-lunch drinks they position themselves for the next pronouncement on inflation. What they pronounce has little to do with reality.

Prices of coffee go up if there is frost in Brazil. This is not inflation.

Price of steel in a building goes down if engineers can design the same strength with less. This is not deflation!

A suspicious mind might say MPC members vote on inflation depending on whether they are borrowers that day or lenders. If most are borrowers they might vote for lowering interest.

The basket holds the wrong stuff. There is no land in the basket. Surprise, surprise. Charles, the Dukes and the Archbishop of Canterbury do not want it publicized ever. It is a stupendous store of value for them since they hold a lot of the best (See Land Value ).

At this time (early 2010) most economists are schizophrenics with respect to deflation/inflation. They want inflation for themselves with respect to property prices, but not for any other services. So they determinedly keep property out of the CPI or RPI.

Property quietly inflates because oldie economists back property with special tax concessions. Thus a continuation of the economic policies which launched this 2007-2010 financial maelstrom in the first place. In Pimlico in 1982 £ 110 of savings would buy one square ft of living space.
By 1996, £ 280 was required and by 2007 about £ 700. THAT IS INFLATION!!
Oldie property owners and governments like this cheating policy of destroying savings to make property and national debt shrink.
Millions of property-active / business-inactive oldies are hooked on property as a tax- subsidized / free ride.

With tax free gains of 200-300% every 15 years or so, why risk capital in business or even try ones own business. "Let those out of property look out for themselves. Anyway they get benefits from our taxes."

Fraudulently! These property-rich oldies fail to own up to their massive inflationary fraud.
Their tax free property gains, each year on average, more than wipe out the usual taxes they pay such as PAYE and NIC.
Those millions of property owners with properties above £ 600,000 in 2008 have had payroll taxes cancelled out. Also by living in good locations, "extra good quality healthcare and education" has been free to tap into, right outside their front doors.
The economic result: what OLDIES - led by their bad-economist economic advisers - do not want is DEFLATION. The bank bailout aided by massive government borrowing (to be laid on us) is an oldie policy to prevent a property price meltdown.
This would be great for under-30's.

OLDIES must be forced to share their EXCESS PROFITS - from property INFLATION.