Which is worse?
- 2% CD when inflation is 0%
- 8% CD when inflation is 6%
If you assume both cases will be hit with a 25% income tax, you'll have no real return on the 8% CD due to the 6% inflation. For the 2% CD, you'll at least have a 1.50% real return after taxes and inflation.
MyMoneyBlog has a good review of this issue