Who does not want to believe that inflation is somewhere below 3 or 4%? But then again, who would like to believe that money really does grow on trees? Are you kidding aside, unlike money in the trees, the story, the Americans still led down primrose path about inflation. What I mean is that it should have low inflation today is a full-blown urban myth.
consumer price index (CPI) serves the government well. As the cost of living adjustments for Social Security, Medicare, Medicaid, welfare payments, wages and pension adjustments for civil servants and retirees are all tied directly to the CPI, the index having low saves the government nearly a billion dollars.
But what about you?
apparently low CPI in combination with low interest rates and easy credit encourages overspending and increased use of credit. If he knew that the real inflation rate is at least 10% annually, would be as comfortable incurring debt at your current rate? I do not think so. You would realize you were going to need more income in the year (s) to come up not long to eat your resources. Experts agree that the cost of living is rising faster than revenue.
In fact, The Wall Street Journal on January 3, 2006 reads in large letters: ". For Americans in 2005, earnings did not keep pace with consumption boom" Spending has not outpaced spending in the U.S. since 1933. According to an article in 2005, preliminary data show that the American government spent $ 39 billion more than it earned. Access to credit has become more important than ever before. According to the Plastic Safety Net: the reality behind debt in America, October 2005, food and other basic loan is paid more frequently.
Are you crazy when on the one hand you say the CPI is low, the economy is growing, but on the other hand, your personal experience says something very different? Heating bills go up 50%, housing prices rise by 45% between 2000 and 2004, property taxes soar along with college tuition and medical premiums. Go figure! People are tapped out and living on the edge.
government is a whole tool kit of strategies to maintain a low "official" rate of inflation. One of them involves preserving what is called unstable goods and services or from the index or "weighted" in such a way that they have a lot of influence (ie, property prices, property taxes and energy costs.) As far as real estate, consumer price index is used rent image, called rental equivalence for monitoring housing costs as a way to avoid factoring in real housing costs. It is very important because 30% of the CPI has to do with housing! Real estate tax increases do not get factored in at all. Read this article, basic rates:
Richard Benson, president of the Specialty Finance Group, LLC and PrudentBear.com, and his wife took on the task of monitoring their personal expenses, to reveal your true rate of inflation. Their starting point was the happy fact that they owned their cars and houses (paying more). Even so, they discovered that the basic costs are rising 80-10% annually, including health insurance, automobile and property costs, electricity, high speed internet, telephone, property taxes and monthly maintenance. Food (groceries), gas for cars and clothing costs are not included. Imagine what the real inflation rate for those with mortgages, especially if they are purchased within the last 5 years!
When this "unofficial" basic fact of escalating costs and probably 10% of the actual rate of inflation is considered, it is a serious break. However, when combined with the fact that interest rates are the highest in two years, and that the housing bubble peaked and may soon burst to start the recession, it's really numbing thought. For the past five years, homeowner Mania is driving the economy, personal finance spending through a "cash out" mortgages to pay for all the savings and income can not.
A report written by Lehman Brothers investment firm said that while residential building is only 5% of our national economy, one third of economic growth in this period can be attributed to the housing boom. Goldman Sachs Group Inc. and the Center for Economic and Policy Research estimates that if the housing market does not change dramatically, the U.S. stands to lose between 1-6000000 jobs. And that does not include jobs in other industries that are dependent housing construction.
no corrections spending rate for the average American (and world citizens), the era of modern-day slavery lurks dangerously close. Similarly, in the ownership of human masters, the risk today is one of the co-owned credit lending institutions. Since all chunks of revenue pledged to pay interest loans (on behalf of "to have everything" and "Live Rich"), families and individuals pay the real price -. The gradual loss of personal freedom
It's time to wake up from wishful thinking and smell the truth of the economy shape shifting to one that requires individuals to access credit as a basic necessity. Unfortunately, as a positive and optimistic will change the way the system works. Right solutions require the acquisition of secret information about how money works, the personal conviction on the basis of this secret about the money to change the personal finance habits and grassroots cooperation with other like-minded people. It is nothing less than a lifestyle revolution.
