ECONOMY

Our bank account balances may suffer a bit in the coming months if predictions of higher food prices come true. A new Wall Street Journal article discussed the possibility of seeing higher prices at the grocery store and even restaurants due to inflationary tides in the economy. If this is the case, we could see an abrupt end to one of the tamest years in food pricing in nearly two decades.

Milk, Beef and Coffee to Increase

When it comes to home prices, there’s always someone who benefits and someone else who suffers. Today, news that prices didn’t increase as much as had been predicted in August 2010 is likely to disappoint many. For the housing market and those looking to get away from an underwater mortgage or sell their home, a small increase in prices is bad, but for those looking to buy, this could be good news.

S&P Index Shows Home Prices Increased Less than Hoped

In late September, the National Bureau of Economic Research (NBER) announced the end of the most difficult recession since the Great Depression had come to an end in June 2009–over a year prior to the announcement. Many find this hard to believe because at the time, thousands were still losing jobs and homes were being foreclosed upon in record numbers every week.

Even now, we’re still in the midst of a difficult time and are still seeing job losses and record foreclosures. This makes many of us wonder if, despite what NBER says, the recession is really over.

Those receiving Social Security checks will be disappointed for the second year in a row as the annual cost-of-living increase will not be implemented for 2011. The 2010 failed increase was the first time in three decades that Social Security recipients did not receive their cost-of-living adjustments and it’s happening again.

Low Inflation Equals Failed Increases

Thomas J. Feeney has been in the investment industry for over four decades. As the chief investment officer of both Marathon Asset Management Co. and Mission Management & Trust Co., there isn’t much of the financial world he hasn’t seen. As much as his schedule allows, he also breaks down his thoughts and strategies on his blog, Measure of Value.

Every other week, we’ll tap Tom’s insights to get a deeper perspective of what’s going on in the market and see through his eyes what the smart money is thinking.

With questionable foreclosure filings at the center of media attention, it’s no surprise that a record number of homeowners lost their homes in the third quarter. According to a report released by RealtyTrac on Thursday, bank repossessions and foreclosure auctions in the months of July, August and September rose to 102,134 and 372,445, respectively, leading some to believe that invalid documentation could be contributing to the significant loss.

Total Foreclosures Increase Significantly

Photo courtesy of Hugo Infante/Government of Chile

The ongoing rescue of the 33 trapped Chilean miners is nothing short of amazing. The 70-day ordeal in the San Jose mine in Chile has captivated a world audience and a live feed of the rescue efforts can be viewed on the internet. What’s impressive was that original estimates of the recovery time was expected to be as long as four months. While a successful rescue and the safe return of the Chilean miners to their friends and families is certainly a feat to be celebrated, their ordeal is not over.

Investing in any type of market can be a tricky prospect these days because of recent history of unexpected crashes. However, for those who have been thinking about investing in mortgage-backed securities, the prospect is even scarier because of the downfall of the housing market in 2008 and the struggles associated with both Fannie Mae and Freddie Mac.

Despite the suffering economy, some experts say Ginnie Mae’s mortgage-backed securities are safe to invest in and still offer a good chance for growth. So is investing in Ginnie Mae really a good idea considering the volatility of the housing market?

While a foreclosure freeze has been suggested to ensure invalid filings have not been taken by large mortgage processors, the Obama administration refuses to support this action. As told by Federal Housing Administration Commissioner, David Stevens, taking such a major step simply is not “prudent.”

Invalid Foreclosures a Big Issue

Seniors receiving their social security checks in January 2010 may be disappointed to find that for the first time in three decades they won’t receive their cost-of-living adjustment.

The 2-3 percent increase usually hits checks in January of each year in order to keep up with inflation; however, this year, the extra money won’t be there.

How are Increases Calculated?