There's plenty of periods, even 10, 20 year periods when inflation was moderate to high and gold declined. So in the short or even medium term, gold tends to be a pretty poor inflation hedge. In the long run, it's just stocks. It's companies that can raise their prices in conjunction with inflation. When airline ticket prices go up by 50%, Delta's revenue just went up by 50% which will eventually transfer to the nominal dollar amount of their profits over time.
Everything feels unprecedented if you don’t study history, and 2022 wasn’t unique for the stock market. Morgan Housel is the best-selling author of “The Psychology of Money”. He joined Motley Fool co-founder and CEO Tom Gardner for a conversation about:
- Why cash is a better hedge against inflation than many believe - Parallels between the 2022 stock market and the dot-com bust of the early 2000s - What Tesla investors can learn from Starbucks’ past decline Companies discussed: BRK.A, BRK.B, TSLA, SBUX Host: Tom Gardner Guest: Morgan Housel Producer: Ricky Mulvey Engineers: Tim Sparks, Rick Engdahl
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