View Full Version : inflation: how to take advantage?

12-17-2004, 03:25 PM
Let's say you think there's going to be some fairly nasty inflation of the dollar in the coming years. (let's not argue about whether this will actually happen.)

How do you take advantage of this?

Could you put your savings in a foreign currency, the euro, say? How do you do this?

What US investments would you make?

Assume also that you're talking to a financial moron.



12-17-2004, 03:31 PM
Are you looking to make money or preserve it?

If you are trying to preserve it, you may want to consider inflation-indexed bonds. I believe they're called I-bonds, but I've no personal experience with them.

If you're looking to make money, you could probably go short the major indices, as stocks should fall if hit with major inflation.


12-17-2004, 04:23 PM
I agree with the Rocket Man on I bonds if you want to play it safe. I bought my first one in October. The current interest rate is 3.67% through April 2005. It is composed of the risk free rate + an inflation premium. Here's a good FAQ on them:


and you can purchase them at: www.treasurydirect.gov (http://www.treasurydirect.gov)

12-17-2004, 05:32 PM
Buy gold and/or gold stocks.

12-18-2004, 12:57 AM
Bonds: Pimco total return fund, GIM, TIP
Natural resources: IGE, VDE, PEO