How does one protect themselves from inflation and what are the best inflation proof investments?
First, you must understand the definition of inflation. It is basically a fast rise in prices caused by an expansion of the money supply. This is already underway in the United States and I believe big inflation is coming soon, so it's important to know how to protect your money.
I invest in many of these myself because I understand the strong likelihood that inflation is coming in my country, so I've taken some steps to protect my money if that happens.
Here are my favorite ideas:
- GOLD
- Silver
- Natural Resource Stocks
- Real Estate including Farmland
- TIPS - Treasury Inflation Protected Securities and other inflation proof bonds
-Inflation proof savings accounts
- Coal and coal stocks
- Oil stocks
How does real estate perform during inflation and hyperinflation? If you are wondering how real estate performs during inflation, my answer is somewhat complicated.
While home prices do in fact increase during times of high inflation, it's important to understand that they could be falling in value at the same time. This has happened throughout history a couple of times.
Stocks also might increase in price the next couple of years, but they could also very well be decreasing in value at the same time.
What you need to do is learn how to measure stuff against other stuff, and not worry to much about price because it is denominated in a country's home currency. It might sound complicated, but once you start reading about this subject it becomes much less so.
By Steve T Nicastro
First, you must understand the definition of inflation. It is basically a fast rise in prices caused by an expansion of the money supply. This is already underway in the United States and I believe big inflation is coming soon, so it's important to know how to protect your money.
I invest in many of these myself because I understand the strong likelihood that inflation is coming in my country, so I've taken some steps to protect my money if that happens.
Here are my favorite ideas:
- GOLD
- Silver
- Natural Resource Stocks
- Real Estate including Farmland
- TIPS - Treasury Inflation Protected Securities and other inflation proof bonds
-Inflation proof savings accounts
- Coal and coal stocks
- Oil stocks
How does real estate perform during inflation and hyperinflation? If you are wondering how real estate performs during inflation, my answer is somewhat complicated.
While home prices do in fact increase during times of high inflation, it's important to understand that they could be falling in value at the same time. This has happened throughout history a couple of times.
Stocks also might increase in price the next couple of years, but they could also very well be decreasing in value at the same time.
What you need to do is learn how to measure stuff against other stuff, and not worry to much about price because it is denominated in a country's home currency. It might sound complicated, but once you start reading about this subject it becomes much less so.
By Steve T Nicastro
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