Yes, inflation is on the way. Perhaps, as Nouriel Roubini argues, it will take some time as the deflationary pressures of a still worsening economy and failing banking system work themselves out, so we may even see some deflation first. However, the Fed can't print the equivalent of the U.S. GDP's worth of new dollar bills (about $13 trillion) and not have serious inflation (unless we get government imposed price and wage controls?) at some point. I won’t even begin to discuss what happens if the demand for U.S. Treasuries dries up.
- Steady high yields, most of the recommendations’ dividends are very safe, some less so (but with more upside potential). Thus you are well paid while you wait for the market to recover (versus negative real returns in cash).
- Earnings and yields can keep pace with USD inflation, thus providing at least some protection for your principal and income.
- Currency diversification and thus reduction of risk from declines in the USD relative to other currencies.
- Strong businesses that continue to maintain or grow their revenues, incomes and cash flows even in this environment.
- Owning or controlling vital hard assets or commodities that hold or increase value in times of inflation AND/OR dominant position in a market niche with steady and growing demand that allows these firms to raise prices when needed to keep pace with inflation.
- Earnings and distributions in a non-USD currency, ideally one that is tied to hard assets and commodities.
- High dividend yields about 7% or higher: Regardless of price movements, you continue to get steady junk bond like yields with far greater safety and better price appreciation potential (as long as they meet the above criteria).