The public is ignorant when it comes to economics. So are the pundits & politicians. INFLATION is increasing MONEY SUPPLY! As more dollars chase the same or fewer services and products, price will naturally increase. An easy example of this is the price of a college education. Easy to get loans & grants caused the price of tuition to spiral ever higher. Along with tuition, wages paid to college presidents and administrators have skyrocketed to obscene levels. Now think just a moment what tuition would be or could be if everyone had to pay out of pocket.

And what do you think our fine central bank officials are doing right now. They are attempting to inject more cash into the economy than has ever been attempted before - before its over, trillions. They are doing this because systemic problems threaten to bring the economy, the world economy, to its knees. The massive injection of paper money into the economy will cause - is causing inflation that will be much worse than most anticipate. Hyperinflation is a possibility, although slim. (My wife complained yesterday about the prices at the Grocery store. Said the cheapest apples were priced at $2.75 lb.)

Some, although few, politicians recognize some of this. For instance, Julianni proposes changing the capital gains tax to something indexed to inflation. If you invested $100 10 years ago and now that investment is worth $200 - NO ITS NOT. Inflation, even at the low levels we've enjoyed over that time has made the dollar worth half as much. That $200 buys you what $100 bought 10 years ago - or less.

Unfortunately, like I said, our politicians by and large, cannot wrap their minds around the inflation problem. Perhaps too busy running for office. In any event, we elect those most like us.

There is one guy who understands, and he doesn't stand a ghost of a chance because people don't think. It's Ron Paul (and before you shut down, read what he said):

“Inflation is immoral,” said Congressman Ron Paul when we sat down with him a few months ago.

“It’s immoral in the sense because it steals, it steals value. If you double the money supply and your prices go up twice as much, it’s an invisible hidden tax. But the real immorality here is that some people pay higher prices than others. So if you’re in a middle class or especially in low middle income, your prices might be going up 15% a year...and somebody on Wall Street might be working leverage buyouts and making billions of dollars and they don’t have to worry about the rising costs of living.

“This to me is an immoral act that is prohibited by the constitution and the outcome is always tragic.”

As far as gold, it's protection, it's insurance, it's real money for the last 6000 years, and it will never go to zero. I've been investing in and talking about gold since 2001. Back then it was $250 an oz.. It recently went over $900. That's a 260% increase in the investment. Not bad and better than anything else.

Sorry about my 2 cents running so long.