FX Street - Fighting Inflation: Five Things to Buy Now Before Prices Go Up

Article by Jacob Wolinsky in FX Street

During times of high inflation, consumer goods, investments, real estate, fuel, and gold prices can increase significantly. The increase in the cost of living expenses is a symptom of inflation -the expansion of the money supply within our economy. Inflation can deplete your wealth, leading many people to look for alternative options to hedge against it.

The following is a list of tried-and-true inflationary protective assets

1. Gold:

For generations, gold has been viewed as a primary investment option for savvy investors looking to protect their wealth from inflation.

Governments, central banks, financial institutions, and investors view gold as an alternate form of currency, during times when fiat currency loses purchasing power. When inflation rapidly increases, governments turn to their gold reserves to keep their countries solvent. Central banks from around the world have purchased over 393 tons of global net gold in 2021 alone.

Gold preserves purchasing power for longer periods of time when compared to fiat currencies like the US dollar and euro.

One ounce of gold in 1945 was worth $35. Today, gold is worth around $1800, and analysts predict that gold can easily hit $3000 an ounce in 2022. One of the reasons for gold’s price increase is the US dollar’s loss in purchasing power over time.

As consumers start to ditch dollars, stock, property, and luxury goods during economic downturns, gold is expected to climb to record level prices. Gold becomes an attractive financial vehicle. When those assets turn to liabilities during economic hardship. It’s not too late to buy gold today, but as inflation continues to increase over time, gold will become increasingly more expensive to buy. So don’t wait!

2. Silver:

Silver is another precious metal that has been used as a means to hedge against inflation for many years and has recently become even more popular.

Currently valued at around $23 an ounce, it's cheaper to buy silver than gold and is often more accessible to those looking to build a portfolio.

Silver closely follows gold’s price fluctuations, and the “Gold-Silver Ratio” is often referenced when tracking these price changes.

Another factor that gives silver value during high inflationary times is the increase in demand as both a financial vehicle and an industrial component. Silver is used for many industries including jewelry, tableware, medicine, solar technology, cars, and electronics.

As economies work to recover from downturns, silver demand for industrial components spikes. This leads to a higher price, as well as opportunities for silver investors to turn a nice profit.

Many notable market analysts project that for 2022 silver’s price will reach well over $30 an ounce, with some projections estimating over $100 an ounce. At the current rate of $23 an ounce, it’s a perfect .......

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