What is inflation?
Inflation is defined as the change in the level of prices. Most of the time, people mean the “Consumer Price Index” or “CPI” when they discuss inflation in a country. This is the change in the price “shopping basket” of consumer goods for a country that the national statistics agency has sampled over time on a monthly basis. The “core CPI” is the change in prices without the food and energy components, or “ex food and energy”. Since food and energy prices are volatile, the “core CPI” is thought to be a more accurate measure of underlying inflation.
This is an important question, because our central banks are the ones behind the rise in inflation, not OPEC, oil companies, or greedy corporations. If one must point the finger, point it at central bankers. “Inflation is always and everywhere a monetary phenomenon.” -Milton Friedman Now, in its strictest sense, inflation is not what one hears reported on TV; it is not a rise in the price of oil or the price of food or the rise of any good or service. Quite simply, inflation is a fall in the price of money. Dictionary.com says: Economics. a persistent, substantial rise in the general level of prices related to an increase in the volume of money and resulting in the loss of value of currency (opposed to deflation). -Dictionary.com However, this definition confuses cause and effect. A correct definition would be: Economics. an increase in the VOLUME of money, which eventually leads to a persistent, substantial rise in the general level of prices and results in the loss of value of curren
Everything is so high and keeps going up, but you’re not making anymore money to go along with those prices. Food, gas, clothes and where you live from apartment rent to taxes on your home, is higher than what your income is. You can’t save money because there is never enough money left over and you actually don’t have enough for what you need for your daily living expenses. How do you beat inflation when it keeps rising and you’re not making anymore money to match it? The first thing you need to do is put your scale of living one degree below your means. Downsize your living style to match the economy. Most of us live above our means and don’t realize it. If you have always gone to a full service gas station, start going to a self service. Yes, you have to pump your own gas, but you save money by doing it yourself. With the cost of gas you need to cut back since gas prices keep rising and you’re not getting anymore money to go along with those prices.
