The Government Wants You to Believe That There is Little Inflation – You Be the Judge! What Do the Last Two Years Mean for Your Retirement Plans?

It’s been an eventful two years for economists.  Since January of 2009 we’ve seen rising prices, increased unemployment, and stunning increases in the national debt.  Couple this with decreasing median household income and a decline in the value of real estate, and many observers are left gravely concerned about the future state of the economy.

In January of 2009, the average cost of a gallon of gas in the United States was $1.83.  Earlier this year, that same gallon of gas cost $3.10, on average (and the cost of gas has skyrocketed further even since this research was done.)  That’s an increase of nearly 70% in just over two years.  Meanwhile, the average income of households in the US has fallen as the unemployment rate surged.  It’s quite clear, for anybody that has been paying attention, that our economy is struggling mightily.  Below are statistics further illustrating the magnitude of this crisis:

Indicator	January 2009	TODAY	% chg	source
Avg. retail price/gallon gas in U.S.	$1.83	$3.104	69.6%	1
Crude oil, West TX Inter. (barrel)	$38.74	$91.38	135.9%	2
Gold: London (per troy oz.)	$853.25	$1,369.50	60.5%	2
Corn, No.2 yellow, Central IL	$3.56	$6.33	78.1%	2
Sugar, cane, raw, world, lb. fob	$13.37	$35.39	164.7%	2
Unemployment rate, non-farm, overall	7.6%	9.4%	23.7%	3
Number of unemployed	11,616,000	14,485,000	24.7%	3
Real median household income (2008 v 2009)	$50,112	$49,777	-0.7%	4
Number of unemployment benefit recipients (curr = 12/10)	7,526,598	9,193,838	22.2%	6
Number of long-term unemployed	2,600,000	6,400,000	146.2%	3
Poverty rate, individuals (2008 v 2009)	13.2%	14.3%	8.3%	4
Present Situation Index (curr = 12/10)	29.9	23.5	-21.4%	11
Failed banks (curr = 2010 + 2011 to date)	140	164	17.1%	12
U.S. dollar versus Japanese yen exchange rate	89.76	82.03	-8.6%	2
U.S. money supply, M1, in billions (curr = 12/10 prelim)	1,575.1	1,865.7	18.4%	13
U.S. money supply, M2, in billions (curr = 12/10 prelim)	8,310.9	8,852.3	6.5%	13
National debt, in trillions	$10.627	$14.052	32.2%	14

.

These facts are startling, to say the least.  And they are particularly worrisome to many Americans who are either retired or planning to retire in the near future—because if these dramatic changes have happened over only the last two years, what should one expect over the course of the average seventeen year retirement?  If price increases continue at the present rate, would the average retiree be able to afford even essentials such as food and gas?  The sobering reality is that, if your retirement funds are not protected against inflation, you may struggle simply to make ends meet—let alone enjoy the retirement that you have worked for your entire life.

Fortunately, it’s still possible to protect yourself from the negative effects of inflation.  Our Personal Protected Pension Plan™ will protect your assets from inflationary pressure and make it possible for you to maintain the lifestyle that you are expecting to enjoy during your retirement.  Take action and contact us now so we can show you how to protect your retirement. Call (407) 478-1599.

The last two years have seen unprecedented increases in the national debt level, as well as dramatic increases in the unemployment rate and the cost of living.  The conditions are truly ripe for long term inflation, a corrosive force for retirees relying on fixed incomes.  Don’t be caught unprepared.

Sources: (1) U.S. Energy Information Administration; (2) Wall Street Journal; (3) Bureau of Labor Statistics; (4) Census Bureau; (5) USDA; (6) U.S. Dept. of Labor; (7) FHFA; (8) Standard & Poor’s/Case-Shiller; (9) RealtyTrac; (10) Heritage Foundation and WSJ; (11) The Conference Board; (12) FDIC; (13) Federal Reserve; (14) U.S. Treasury