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Inflation is back. It’s official, and you can blame costlier gasoline and other fuels. The tab for common services like a hotel stay and garbage removal are jumping too, as is the sticker price on packaged foods and many other household items. Companies are finding that they can pass on part of their soaring raw-material costs. There is a general consensus among American economic circles that interest rates are on the rise. And this concern is beginning to spill across the border into Canadian economic circles as well.

Typically there is an inflation that the government measures and the ‘other’ inflation that we are all used to feel but cannot see. Inflation that we all feel but can’t see comes in many forms. For example, real estate prices have gone through the roof, so cash buyers are paying through the nose. Borrowers are increasingly resorting to floating-rate and interest-only loans, especially in the U.S., which all but guarantee that they will pay more over the life of their loans. But Canadians are poised to follow suit with the spread of the ever more popular ‘Powerlines’ and credit cards secured by real estate which, once again, have the deleterious effect of keeping you into debt for the rest of your life.

We all face notoriously soaring insurance premiums, deductibles and co-pays as employers shift more of the burden onto employees. Here in British Columbia, for example, Strata insurance premiums have more than doubled in the past year, with strata corporations - especially the financially weak - having no choice but to allot the extra cost to individual property owners.

Even Alan Greenspan, the once revered and now outgoing Chairman of the Federal Reserve Bank, is coming under fire. Once known as the ‘Maestro’ for his impeccable talent at predicting economic behavior, and after being treated like royalty for presiding over the longest economic boom in the nation’s history, Greenspan is now being accused by a small but vocal group of economists of presiding over the U.S.’s high consumer debt, low personal-savings rates, declining dollar and potential real estate bubble. And all this comes at a time when the U.S. is dependent more than ever on foreign money to sustain growth.

The dependence on foreign capital, Asian in the West and European in the East, is a great source of concern for Canada as well. As China is becoming a major economic player and is fueling its own economic growth, and as Europe is coming to grip with the reality of an oversold, overstrong, overvalued Euro compared with the relative weakness of many European economies, the worry is that this foreign injection into the Canadian economy will soon evaporate, thus leaving domestic growth without fuel …. the typical Mercedes without gas.

So where does all this leave mundane folks like you and I? All I can tell my readers and real estate aficionados of my blog is:

BEWARE OF YOUR MORTGAGES !!

Luigi Frascati

Luigi Frascati is a Real Estate Agent based in Vancouver, British Columbia. He holds a Bachelor Degree in Economics and maintains a weblog entitled the Real Estate Chronicle at http://wwwrealestatechronicle.blogspot.com where you can find the full collection of his articles. Luigi is associated with the Sutton Group, the largest real estate organization in Canada, and is based with Sutton-Centre Realty in Burnaby, BC.

Luigi is very proud to be an EzineArticles Platinum Expert Author. Your rating at the footer of this Article is very much appreciated. Thank you.

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When I was about 5 or 6 years old I read one of my first books; the protagonist was a furry blue puppet. Our hero told the dear reader not to flip to the end of the book, there was a monster waiting there…and like any wise blue puppet, he did not want to face said creature.

Being a children’s book, you can rest assure there was no nefarious monster on the last page; just the blue furry hero. Once he realized his fears were unfounded he smiled and went along his merry way.

But I recall thinking…even at that ripe age; now what? No monster…so really, we’re at the same spot we were when the story began.

I have the same kind of feeling about the Federal Reserve’s announcement Tuesday that left a key interest rate unchanged; curtailing the longest run of interest rate increases in recent history. Now what?

The Fed’s decision to recess hikes had been widely anticipated given the signs of a spreading economic slowdown, in part, reflecting the impact of the Fed’s long string of hike rates.

It was the first time the Fed had met and not raised rates in more than two years. In explaining the decision, the Fed noted that “economic growth has moderated from its quite strong pace earlier this year.”

Will Tuesday’s rate pause mean anything to the stock market? For penny stock investors, July was no more fun than June. In fact, it’s more realistic to say the stock market pullback that began after the Federal Reserve’s May 10 meeting is still going on.

And, the relief for millions of business and consumer borrowers may be short lived. The central bank noted that “some inflation risks remain.” Meaning, interest rate hikes could be just around the corner.

Is this good or bad? For astute penny stock inventors…I think this is good. The best time to buy is when penny stocks are low, when there’s fear in the market and sellers are flocking to sell.

The rockets flying over Lebanon and Israel may make investors dump their coveted shares in Acme…but just remember, it’s the same company it was before the shelling began. The only difference, now it’s a bargain.

The stock market is a resilient force. It can take a hammering…and so far, it has always bounced back.

As one witty economic pundit noted, “Eventually, the fear will go out of the market. Economic conditions will right themselves. There will be a cease fire in the Middle East and stocks will rally.”

It may take a while, but it’s always happened. So take advantage of the low flying buying opportunity that is the “Summer of ‘06″. Because eventually, things will heat up again; and some of today’s penny stocks bargains will soon be out of reach.

A seasoned investor with a keen interest in international business and current affairs, John Whitefoot has been working alongside Peter Leeds for the last several years. With over ten years experience in the investing community, Whitefoot is devoted to uncovering the news, trends and ideas that shape penny stocks on a daily basis.

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Imagine a catastrophic event triggering the government to change the rules covering your checking account. Actually, you don’t have to imagine it because it happened in New York on 9-11.

The ensuing halt to commerce in the immediate days after 9-11 (about four total) was enough of a catalyst for our otherwise sloth emulating elected Congressional representatives to pass an act that would ensure the transfer of checks between financial agencies would not again be disrupted by catastrophe, act of God, or dumb luck.

The act is called The Check 21 Act and went into effect on October 28, 2004. It created a new negotiable instrument called the substitute check so that once a customer’s check is deposited, the funds will be available in a matter of hours. This is obviously a plus for the party to whom written.

Float time, the once magical free ride, has virtually disappeared. Not in every instance but you can bet your bottom line, in most. This is a minus unless your bank isn’t using the substitute check negotiable instrument.

Asking your banker is your only way to know for sure. Of course, if you have been reading your statements, the answer may be right in front of you. But, it may not. So, repeating myself, ask your banker.

If your bank is using the substitute check, it is electronically transferring funds instantly between the account on which the check is drawn and the account into which it is deposited. Some would say that is nothing more than a simple bank transaction.

I would agree but the kicker is the original paper check never changes hands. If you see an inherent problem, welcome to the club. However, this article isn’t about problems, inherent or otherwise, with electronic facsimile substitute checks, it is about you knowing about the new procedure put in place by the government to insure commerce continues even under the most dire of events.

You can learn more about the Check 21 Act by visiting the Federal Reserve at:
www.federalreserve.gov/paymentsystems/truncation/default.htm

I don’t know about you, but I believe being forewarned means being forearmed.

Tom Koziol is the author of “Credit Card Capers: All Their Dirty Tricks Exposed” detailing the new lows to which banks have stooped to eviscerate your bank account via the credit card. Learn more at: http://www.creditcardcapers.com

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