3 Factors keeping prices from rising

Under normal economic conditions, the U.S. would be experiencing high inflation due to the billions in stimulus spending and the Federal Reserve's monetary policies.

But the combination of unprecedented deficit spending and cheap money has not been reflected in retail prices - at least not yet. Here are a few factors keeping prices in check:

1. High unemployment. Because so many people are out of work, they are being cautious about spending, which keeps demand low relative to supply, keeping prices lower.

2. Lower oil prices. The cost of oil has a significant impact on prices for everything from fuel to plastics.

3. The demise of the debt-driven consumer. Consumers are paying off debt, saving more of their money and looking for bargains, which helps curb inflation.

By Investopedia.com October 10, 2010