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To: Elroy who wrote (74573)	11/12/2007 9:00:22 AM
From: Dinesh	Read Replies (1) \| Respond to of 77400

Right. But don't forget the dividends, either. In 7 years, at 2% yield, that's a another 15% of return. Many countries allow adjustment of cost basis for inflation. US is the most regressive in this regard. Even interest income is not allowed to be adjusted, even though everyone knows that expected inflation is a key component of interest rates. Under such circumstances, how can one teach children the value of opening a savings account. By the third grade they are capable of doing all kinds of divisions and subtractions, and figure out that when that interest earned is reduced by first taxes and then inflation, the net effect of saving is a loss in purchasing power. Regards

To: Elroy who wrote (74573)	11/12/2007 9:35:20 AM
From: GVTucker	Read Replies (1) \| Respond to of 77400

Interesting thought, Elroy. For the last 7 years, a Euro investor in the Dow lost a little less than 1% per year even with dividend reinvested at 5% instead of in the index.