Topic: Inflation and protecting you wealth - page 4. (Read 506 times)

Curious about what you were listening to--and the reason I'm curious is because a lot of podcasts/talk radio personalities/Youtube videos tend to exaggerate and distort how bad problems are, and it's usually because they want to sell you something.  One person that comes to mind immediately is Robert Kiyosaki, but there are many others.

Bitcoin?  I don't know; take a look at how it's performed in the past few days.  It all depends on when you buy it and where it is when you finally decide to cash out--and that's true for any of the things listed above.  Personally, I don't think any cryptocurrency is a good choice for a hedge against inflation, and that's just based on volatility alone.

Art? No. 

Stocks?  Yes, but buying them right now is a huge gamble since we've been in the longest bull market in history, and many of them are extremely overvalued.  Even if you bought an index tracking fund you might be in trouble, never mind trying to pick stocks individually.

Commodities?  I don't know; I don't invest in them except for a little bit of silver.  Gold and silver are what most people think of when considering inflation hedges, and I'd say those are probably the best choice.  Volatility is pretty low, and you can always find a buyer when it's time to sell (unlike art).

Real estate?  Right now that's also very risky, because I've heard stories about the market being in a bubble.  But buying something like a rental property that provides income might not be a bad idea.  REITs are just a subset of stocks, and personally I like them for their income.  But again, their value could fall significantly if there is a housing market bubble and it ends up popping.

Something I know a lot of crypto people are against but I would still say is a legit way to defend against inflation is to take advantage of government bonds (or mutual funds in Asia).

The interest can be quite high almost 8-10%, guaranteed by government. If you can get your interest to be higher or equal to inflation, then you protect your wealth.

Commodities, stocks, art, these can go up in value but can also go down or in case of art even you may not find a buyer.

Idk, probably something a bit worse than the current economy that's been brought into limbo by the pandemic.

And yea, I'd like to think that bitcoin will do good as well, but I'm really not betting on it and I'm not that confident. There's just too much weak hands that I wouldn't be surprised if people would dump when needed to; not to mention that a lot of retail look at bitcoin mainly as a get-rich-quick investment and not necessarily an economic hedge in the first place.

What would be a really bad economic situation for you? Is this what happened in the spring of 2020 when everything collapsed (including BTC), or maybe you mean some new global economic crisis that will last for years? I want to believe that Bitcoin will be resistant to something like that, but for now we can't say that this is the case - because every disturbance in the markets also affects the price of BTC.

---

I think the protection of wealth is not just a necessary investment in gold, real estate, or stocks - but that smart investment can also be an investment in producing something that people always need - and that is first and foremost food, with an emphasis on healthy food. Of course, this is something that requires a lot more work and commitment than classic investments, but the risk of losing everything is still lower.

Storing gold isn't THAT bad, unless you're a billionaire and you're planning on buying dozens of gold bars then sure lol. Not to mention that reputable gold ETFs like SPDR Gold Shares(GLD) and iShares Gold Trust(IAU) have existed for a while now.

Gold is fricking expensive to keep, most arts in the market are either expensive because it's a master piece or it's expensive because it's appraisal is overvalued because it was owned by a rich person that has a connection to the appraiser. For me though, I only have bitcoin as an investment but that will eventually becomes different because I plan to slowly diversify my investments too.

Inflation is a scary thing and is often ignored by many people, especially those who do not aware the importance of investing
other than in the form of Bitcoin, commodities (gold) and stocks are on my list, while for real estate I do not yet have the financial ability to start investing there, all the three I choose because can be owned even with limited funds.

All of these does sound great, but for me the real answer would be :

Educating yourself.
If you do invest in your education then there is literally no way that you are going to fail in years ahead.

Planning.
Planning for your future considering all the options and at the same time realizing that you have to make plans in advance for the adversity.

Inflation is a necessary evil.
One must understand that even though Inflation might seem negative but at the end of the day it's much needed for a healthy economy.

Investing is a great way but then again investing in cryptocurrencies should be considered long term investments hands down. Plus there are a wide variety of cryptocurrencies available in the market. You need to analyze the market and look for good trading pairs as well. BTC-ETH would be my all time favorite, their synergistic relationship is too strong.

Investing in real estate right now is not a good idea, since during the COVID even though the prices went down there are risks associated. Wait for a stable price then go for it.

Bitcoin, of course, is on top, although it cannot be denied that its volatility could mean something else could be better in one way or another.

I tend to avoid investing in real estate trusts not only because of all the hassles that go along with it but also of the risks. I'd rather just invest in a hard real estate property myself.

Jewelries could be an option also.

Art and collectibles are also options but one has to be meticulous in choosing which ones would remain in-demand after decades.

Inflation sometimes hits on the market economies and we have an investment that could be anti-inflation assets.  Of all mentioned by OP can protect you from inflation during inflationary climates in market economies but I think only Bitcoin can give you a truly secure asset that you have your own full control of.

I mixed portfolio will put you in a safe place of investment, something like 65/35 stock, real state, and Bitcoin investment.  As they say, don't put all your eggs in one basket, and might this strategy will truly give you protection.

Any investment that seems to be a way to be against inflation is a good collection to your asset. Bitcoin is the top and my 2nd choice is real estate.

I'm not into stocks or any company owned asset.

You have forgotten to mention about precious metals too/jewelry.

It actually depends on how much one has, or what skill or service one can render, what we must understand is that, in as much as people may want to retain the value of their funds from inflation and hyperinflation, many can't actually achieve that due to insufficient/lack of funds. In my opinion, since my knowledge about Bitcoin investment is constantly developing, then I'd definitely choose it as a defense against inflation, I believe and understand the network, thus it seems to be the best option for me. The right thing for people to do is to invest in what they believe to last for the long period, be it Bitcoin, stocks, other commodities, etc. I really hope all this talk about inflation does not get to the worst stage possible, cause then we'd prolly not be talking about investments, but on how people will be able to foot their bills and meet basic needs.

Same here, even though im really that optimistic with bitcoin or crypto as a whole but still i do consider out other investments on traditional aspect on where you could really somewhat able to deal with both
things without minding or focusing that much on a single point.Diversify or try to divide it up because you wouldnt really know on what would happen next and if you do just focus
on one then once it do fails or does have big problem then you wouldnt really be having any other options.

Commodities may sound like a good idea, and so would art.

However, I would say that these are generally illiquid, or you are buying paper versions of commodities which makes it not worthwhile as a hedge.

Stocks/REITs are definitely intriguing but depend on the fiat ecosystem to survive. Cryptos is the logical option to go with out of all of these.

Bitcoin itself is enough probably. Why complicate things further? It is not needed. Keep it simple. The other choices are also not bad though, with one exception, "art". I don't understand art and I don't invest in something I don't understand. I don't know how to value art so I wouldn't be able to sell it from the right price when I decide to sell it so I wouldn't put any money there. You probably can't lose money with the other choices.

I'll just say we diversify and those assets are the best ones to do so with. You basically covered all the sectors of the economy and we do have also a high speculative assets like bitcoin in the mix to spice up your portfolio. Just a circle of bitcoin price increase could cover up for those other asset if they weren't doing so great and same can be said about the combination of other assets if bitcoin was receiving some backlash.

I'm a big fan of art (painting must especially) and I mean vintage ones and not the NFT been over hyped and over price all over the community. Rael estate is a nice one as people will always need accomodation (shelter) as long as they're alive. Same goes for commodity as well, it's not always about the securing of your investment and making yourself rich at times but actually investing in things that contributions to the betterment of society.

I know some people that are buying luxury watches  (Omega, Rolex etc) as a sort of investment. Allegedly they even increase in price once each of the series is sold out.

I am personally still holding majority in BTC, but plan is to get some real estate too, just have to decide what and where. Mostly likely it will be apartment that I can rent via airbnb in the meantime.

I wrote my personal opinion on the listed option below. Personally will choose bitcoin over all of these but I do have some other stuff aside from bitcoin though such as gold


High volatility and definitely not an option that an average joe would go for. High risk high return though


Most people will go for this option, especially gold. Its pretty much the safest option that one could get but the return is pretty small but yeah its enough if you want to safeguard your cash from inflation


Evergrande's bankruptcy will make people think twice on going all in on real estate nowadays.


Second best option after commodities. Basically this is what most people are choosing nowadays


Art? as in 'art' or 'NFT' ? Probably the worst option, not even going to consider this

Saving ourselves from the inflation and buying all of those assets is closely related and I don't think any of those can help us from inflation?
Are we forgetting that if any inflation happens with the fiat (ex. USD) then it will have direct and indirect effect on the bitcoin too! Even an art which someone owns will be useless because it's the currency which has got affected with the inflation and thus things which we will buy would be too costly. i am pretty sure we will not be focusing on buying the art in those periods?

Bitcoin? Well whats the point here! It would be useless to buy and store anything in it's form. All one can do is keep saving the fiat itself and wait for the inflation to fed away.

They all have their pros, cons and risks.

Gold, silver and precious metals are risky as central banks HODL and control an overwhelming proportion of supply. They can move the price anyway they like. Concerns of counterfeit bars and coins have plagued markets in recent times. Which have only contributed to market uncertainty and added fear for buyers and traders.

The risk of commodities is illustrated in recent cases where large commodities shipments were subject to fraud. The media has published many stories recently about shipping disasters and entire cargos lost. As if it were completely normalized for a few containers to fall overboard whenever ships went to sea. These sentiments deter the concept of commodities being a reliable asset for inflation protection. (For those who take delivery of commodities anyway which is generally the arrangement we would expect for long term inflation protection)

High inflation could be correlated with whales dumping their holdings en masse to protect themselves. And capital flight whereby the wealthy pull their money out of a failing nation's economy to invest it in the economy of a nation whose economy is more stable. Which rules out stocks and assets pegged to the economy. Something similar might be said of real estate, although to a lesser degree. In some cases the value of real estate could plummet far enough to become undervalued and a buy.

Bitcoin is definitely one of the better options.

....


Don't forget EU residents bought electronics (things like big screen TVs) in an effort to curb expected euro inflation, back when greece's debt issues 1st came to light.

At some point, it could be less about protecting the value of wealth and more about survival. Having basic necessities: food, water, shelter, electricity, etc could be the goals we end up striving for.