Inflation Proofing Your Portfolio

Nov. 17, 2021 2:42 AM ET, , , , , , , 6 Comments
Ariel Santos-Alborna
3.25K Followers

Summary

  • Labor shortages requiring wage increases and a permanent increase in the rate of change of M2 growth lead me to believe that current inflation is secular.
  • Bonds are not a sure investment with the entire yield curve below the inflation rate and a maximum 28% gain in the unlikely event that yields go to zero.
  • Equities in price inelastic sectors, commodities, real estate, and crypto should have a larger allocation in the average portfolio.

Surprised black man looks at receipt total with food in mall

Elena Perova/iStock via Getty Images

Year over year CPI hit 6.2% this month, its highest print in 31 years. This article examines arguments for the transitory versus secular nature of recent inflationary trends before looking at specific asset classes. I lean toward secular

This article was written by

3.25K Followers
Ariel writes about crypto and global macro. He is the author of "Understanding Cryptocurrencies: Bitcoin, Ethereum, and Altcoins as an Asset Class," published by Business Expert Press. His work has been featured in Forbes and Finnotes.org. He is the Head of Operations and Strategy at Axal - an a16z-backed startup at the cutting edge of AI and crypto.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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