???If inflation isn't entrenched in the U.S. economy then what pipe are they smokin'??
Russia broke the stock market. Now there's only one reliable way to make moneyInvestors searching for safe havens during the worst inflation in more than 40 years are out of luck.
As markets sink on fears that the economy is heading toward, or is possibly already in, a recession, individual investors are searching for higher ground to protect their assets.
Several traditional hedges against inflation have worked well in the past: gold, real estate investment trusts (REITs), oil, and Treasury Inflation-Protected Securities (TIPS). More recently, crypto was seen as potential hedge as well.
This time around, however, investors are hitting a snag. Since June 1, all of the popular inflation hedges have lost money. Benchmark crude, gold, silver, indexes that track REITs and TIPS as well as bitcoin are all down.
In other words, traditional inflation hedges aren't hedging inflation.
The cause is a confluence of issues: Inflation is running high on a global scale, and the pandemic and geopolitical chaos spurred by Russia's invasion of Ukraine have upended bets that have typically paid off. ..............
..............The most reliable hedge against inflation, however: stocks. As long as you have patience. Equities historically have overcome inflation, but over an extended time period.
"Over the long haul, equities tend to outperform inflation by a wide margin. But it's really more like a marathoner beating a sprinter over the long run," said Shawn Cruz, head trading strategist at TD Ameritrade. Many investors look to readjust their portfolios in the meantime.
"In my opinion, the world gets the joke: the Fed is going to stamp out inflation one way or the other," he said. "The inflation trade is over." Instead of attempting to hedge against rising prices, Graff added, individual investors would be much better off running the marathon and riding out the current market volatility.
The bad news is investors are going to have a hard time making money in this inflationary environment — even if they are hedged against it. The good news is that the financial markets don't appear to believe inflation is truly entrenched in the US economy. .....
https://www.cnn.com/2022/07/20/investing/inflation-hedge-investing/index.html
