"According to Shadowstats, we are now seeing price inflation rates of over 11% – almost three times higher than the official numbers."

They’re Trying to Fool You Into Believing That Inflation Is Not a Problem

Mac Slavo

As of this month, we have reached Ben Bernanke’s 2% threshold for the official Consumer Price Index measure. The CPI-U (Urban measure, which includes food and energy) has reached 3.9%. And those are the official numbers.

Unofficially, if inflation was calculated the same way as it was in 1990, the CPI would show a staggeringly different number.

According to Shadowstats, we are now seeing price inflation rates of over 11% – almost three times higher than the official numbers.

Perhaps Ben Bernanke, Tim Geithner and President Obama don’t see it, but consumers are certainly feeling its effects. As a result, even though Americans’ wages are stagnating in nominal terms, they continue to spend money, which has analysts wondering what’s going on. They conclude that we’re spending more as a direct result of Federal Reserve machinations:

Americans are making a little more money and spending a lot more.

Under normal circumstances, that would be a troubling sign for the economy. But a closer look at some new government figures suggests another possibility: People are saving less money because they’re earning next to nothing in interest.

Saving is already difficult because of more expensive gas and food. It’s even tougher because of the lower returns — the flip side of super-low interest rates that the Federal Reserve has kept in place since 2008 to help the economy.

Critics say the Fed is punishing those who play by the rules — those careful enough to set aside money for savings or people who built up a nest egg and are living on fixed incomes that depend on interest.

Source: ABC News

What choice are people left with? They may not be consciously aware that inflation is over 10%, but their pocket books sense it. Why leave money sitting in a bank account when your cash savings will be decimated within a year? Equity investment has become too risky, with markets swinging 2% – 3% daily. This leaves only one option. Spend.

Read more:
http://www.shtfplan.com/forecasting/theyre-trying-to-fool-you-into-believing-that-inflation-is-not-a-problem_11022011