I have recently gotten a Parallax RFID reader and I was trying to make it work with my Arduino uno. I have gotten all the necessary wires attached and I used a RFID reading program I found from Make (I will put the code at the bottom). When I open serial monitor and move an RFID card near it, it spits a series of x's and ø's(eg. xxxxøxxxxøxxøø). I am expecting to see a combination of letters and numbers. I think its a problem with the code, but I dont know enough about it to know whats wrong. I have recently updated the Arduino software.
You probably have the COM port settings at the wrong baud rate for the terminal program compared to the sketch. (Note that the sketch sets it to 2400 baud)
An alternative would be that the RFID code sends back binary data, rather than ASCII data.
Finally, it looks like the serial port is used both for the RFID and the computer at the same time, which is probably ... somewhat scary. The computer is going to want to pull the serial transmit line one way all the time while you're not sending data, and then RFID chip will very likely fight the computer for it.