Are equities an inflation hedge?

Discussion in 'Economics' started by Maverick2608, Sep 19, 2022.

  1. "The big reason equities worked as an inflation hedge in the 1970s was because the Fed allowed it to. If the Arthur Burns-led Fed had jacked up rates as much as Paul Volcker eventually did, equities would have suffered -- just as they did under Volcker’s onslaught. If you buy into the market right before the Fed jams on the brakes and the economy tips into recession, expect to feel pain. And also expect it to take a long time to recover losses."
    https://www.bloomberg.com/news/newsletters/2022-03-29/your-equities-inflation-hedge-is-in-trouble
     
  2. mikeriley

    mikeriley

    The best hedge against inflation is ones wisdom,
    insight and ability to short the market and
    ride the bear until things change.
     
  3. speedo

    speedo

    Best hedge against inflation is to make more money.
     
  4. Innervoice

    Innervoice

    No.. buy short term T bills.
     
  5. Yes, in the long run equities are very much an inflation hedge. But they will suffer from transient shocks such as when interest rates move higher.
     
    Maverick2608 likes this.
  6. deaddog

    deaddog

    Depends on the equity.
    Something pople need is likely to keep pace with inflation.
    Something people want, maybe not so much.
     
  7. Make more money in the market to beat inflation, not just to simply beat inflation...but enough to buy a house, two cars, two Calico cats and a watch that cost $400K. and live happily ever after in Seattle and eat Alaskan King salmon and King Crab legs and clam seafood chowder.
     
  8. schizo

    schizo

    Equity is the sole reason why we got here in the first place!!

    Tell the idiots at the Fed to base their decisions on the REAL ECONOMY and not the stock market.
     
  9. TheDawn

    TheDawn

    Are equities an inflation hedge?

    -Depends on the equity. Not all equities are created the same. I find equities overall go down as a whole when inflation is high.
     
  10. Hahaha indeed!!!
     
    #10     Sep 19, 2022