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As anyone in the United States well knows who eats or drives an automobile prices have began to advance at a rapid rate. Grocery prices especially are beginning to hurt the consumer as the prices for milk, meats, and vegetables reach record highs.

While the government still tells us that inflation is under control they conveniently leave the costs of energy and food out of the CPI index. Clearly your government considers all American consumers as idiots when they expect you to believe the official CPI numbers.

In addition to bad news on the food and energy front the housing slump is showing signs of getting worse as foreclosures hit record levels. While panic may not have set in yet we are probably not too far from it.

Credit markets have began to notice the sour smell of higher inflation in the air as well as to worry about the sad state of the housing market.

Look for an end to the artificially low interest rates of the last few years. It is likely that we are in the early stages of what will become a credit crunch with sharply higher rates on the horizon.

Should you anticipate needing a loan any time soon you will probably be better off locking it in now rather than taking your chances on an improving market. Rates have been at low levels for a long time so any break from the prevailing pattern of the past few years should be taken seriously as over time markets tend to return to the mean.

In summary, look for rates to increase and to continue to move higher for a long time.

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