February 23rd, 2010 | 
Author: Is Your Money Keeping Up With Inflation?
In today8217;s unpredictable global economy you obviously never know what is going to happen next. Uncertainties and concerns regarding the Iraqi threat North Korean crisis and hidden terrorist cells and networks continue to loom in the back of the minds of consumers. Moreover the stock markets and industries around the world.
Price inflation is another major concern for everyone. The latest Consumer Price Index (CPI) number released by the U.S. Department of Labor8217;s Bureau of Labor Statistics states that prices in all U.S. cities are up 0.1 in the month of December for the calendar year of 2002. The Consumer Price Index (CPI) is a program that produces monthly data on changes in the prices paid by urban consumers for a representative basket of goods and services. Furthermore the national unemployment rate continues to remain steady at 6.0 for the month of December 2002. Believe it or not this may not be as bad as it sounds.
Economic theory suggests that an increase in the inflation rate will lead to a decrease in the national unemployment rate. But since the unemployment rate is currently 6.0 this may also suggest that in order for this rate to eventually decrease we should expect more inflation in the future. The recent upsurge in oil prices together with precious metals supports this theory and may also be a hint of what8217;s to come.
Well it seems that you probably can8217;t avoid inflation but there are definitely opportunities that you can take advantage of in order to keep up with it. One option might be to consider depositing your money into a savings account rather than a money market account. Most major banks are currently yielding an Annual Percentage Yield (APY) that ranges from 0.5 to 0.75. Even though this is pretty low it is higher than what most money market accounts are currently offering.
One of the best rates that I have recently seen is ING Direct8217;s offering of 2.25 APY for their Orange Savings Account. But if these rates are not what you are looking for consider investing in the stock market. With the latest downturn in the economy shares are pretty cheap and going fast. There are now many online brokerages that allow consumers to purchase stocks for a small fee. For instance Sharebuilder lets consumers invest for as little as 4. However please be wary this investment option is a greater risk so you should consult with a financial advisor before taking this step.
Whether you choose to put your money in these investment opportunities or not it is up to you. But just remember that if you don8217;t you are actually losing money because the 8220;purchasing power8221; of your dollar is decreasing as the inflation rate is increasing.
About the writer:
Carlos T. Fernandez is the business columnist for Dominican Times Magazine a publication that focuses on the hispanic culture and the issues affecting its communities. He is also the publisher of a popular financial planning and management website entitled Building Wealth (http://buildingwealth.blogspot.com).
ctfernandezhotmail.com
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