Measuring Inflation

Physician's Money Digest, January31 2005, Volume 12, Issue 2

Silver lining:

As anyone who follows businessnews knows, the core rate of inflation,which is arrived at after backing outvolatile factors like food and energy, hasbeen tame over the past several years—sotame that Alan Greenspan and gang haveonly recently begun to raise interest rates,a primary inflation-fighting tool. But justbecause food and energy costs arebacked out of inflation calculations doesnot mean that these price increases aren'treal and don't affect your budget. Inaddition to gasoline, heating oil, andfood, a number of other items, frompaper products to pet food, are gettingpricier. Higher prices canlead to an economic upturn, which bodeswell for the stock market.