Inflation

One of the reasons that JW - and most of us - are so interested in investment (or speculation) is that we plan for retirement.

How much money do we need ?

Of course that depends on what type of living you wish. Because of inflation, a reasonable sum of money today may be good for nothing ten or twenty years later. (As Bill Gates says, we often over-estimate the change in one or two years, but under-estimate that in ten years.)

To many of us, it is confusing - if not hypnotizing - to hear the inflation rate reported by the government: 2 or 3% each year (although the price of pork or beef went up for 50% in the last year, and crude petroleum by even higher a figure).

I am no economist and would not argue with experts. But there is one thing I am certain: inflation rate, as it is reported, does not consider the change in technology and life style. For example, 20 years ago, none of us would consider mobile phone a necessity, and its cost for a reasonable life was nothing. Now we cannot imagine how one can survive without the phone. Although its unit price (and its service) actually decreased in these 2 decades, the cost for a reasonable life rose from non-existent to a substantial sum.