7 Reasons Why All Investors Over Age 70 1/2 Should Consider a Qualified Charitable Distribution

This article is original content written by Manchester, CT Financial Advisor Thomas Scanlon, CFP®, CPA Our observation is that many people are very generous with the donations they make.  It sure helps that there is likely a tax deduction for this, no question.  Many people are accustomed to donating cash, writing a check to the … Read more

Lies, Damned Lies, and Statistics

I took a statistics class back in college. Like many of my other subjects I didn’t do that well in it. I did, however, gain a deeper understanding of what average meant and still continue to aspire to get up there someday. The United States Government produces no shortage of statistics. The amount of data … Read more

3 Proven Reasons Why Investors Should Have Their Own Personal Inflation Index

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INFLATION

 

 

1) The Federal Government Figures Appear to be Gamed

 

The Bureau of Labor Statistics (“BLS”) issues the inflation numbers monthly. It’s convenient that the government inserted the word ‘Labor’ into this bureau. Otherwise it would just be “BS”. The number to focus on is the Consumer Price Index (“CPI”).

To do this calculation, they strip out food and energy costs. Their reasoning for this is that these categories are too volatile. Fair enough, they are. But don’t forget, you are still constantly buying food and energy.  After these two are removed, this is the so-called Core Inflation Rate. This is currently running at 1.6% annually as of January 2014.

The primary issue with how this number is calculated is what they call “quality improvements.” For example, if you buy a new computer that has more memory, a faster processor and better resolution in the monitor, this is adjusted in the inflation index.  The bottom line is that the Core Inflation Index is suspect at best.

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