Second, much lower energy prices. The plunge in the oil price since last summer amounts to a net transfer from oil producers to Western and Asian consumers of approximately $1.5 trillion, a sum equivalent to more than half the UK’s annual economic output. Money which would otherwise have flowed mostly into Western assets – from top-end London property to US and European treasuries – is being switched to disposable incomes instead, where presumably it will be spent. This might seem to contradict the deflationary narrative, but the one follows from the other. Price deflation may be bad for profits, but where it is caused by a positive supply-side shock, it also adds to consumer spending power. The advantage should therefore shift from the one to the other.