In Search of the Ultimate Inflation Hedge 

High inflation is followed by uncertainty and panic, making me wonder if it's time to liquidate my $200k portfolio, or maybe consider some defensive investments. I've heard analysts emphasize on value stocks performing good, what stocks exactly can be the ultimate hedge?

This is too confusing. I'm just gonna go all in on Dogecoin at 20x leverage.

My Wednesday is instantly improved

I love how no matter how many personal finance videos you watch, the best option is always to have a well diversified portfolio

The U.S. dollar index (dxy indes) will drop from 103 to 74 as hyperinflation rages. Don't get suckered in because they'll claim inflation is falling coming into the midterm elections only to have it reaccelerate into hyperinflation in 2023.

13:56 "the money supply and inflation are not related". this is an interesting statement that flies in the face of what i know. could you do a video on it? It is an important current topic

Ben Felix is the only commentator/youtuber I am aware of that offers genuinely good and straight forward advice. These videos teach us what we should be learning in school from a young age and aren't taught.

I'm enjoying the consistent uploads again. I appreciate the great information, thanks! If you're taking requests I'd really enjoy a video exploring your comment regarding the lack of relationship between money supply and inflation.

At some point CSI should have a whole episode dedicated to Fama, there’s not a single episode without one of his articles!

"The money supply and inflation are not related". I would love you to expand on this topic because I've heard otherwise many times recently.

This man delivers the best financial content on youtube. No one is even close.

Oil and energy commodities having high inflation returns makes sense given that they drive a very large share (directly and indirectly) of CPI. Hence, you're buying positively correlated exposure to the CPI index.

I always appreciate your excellent data visualizations on these videos

Well presented Ben. Truly the best finance educator and well presented historical data based on facts.. Thank you Ben and keep up the great work for your audience.

Very informative. Always great videos from you Ben. Thank You. 😀

I love to see how Ben really enjoys himself when explaining all this. Keep up the good work!

I love how you always end each video with the diversified portfolio money shot.

I lost everything in the last recession and learned from it. I made sure to live below my means and save every possible dollar. I also invested correctly and diversely instead of buying material things, restaurant meals, and expensive vacations. I've been waiting all these years for the next recession so I can capitalize on irresponsible debt. If this video is correct, it will be a very exciting investment shopping spree for me

Another remarkable video! I appreciate the end bit about your opinions and, as always, the strong academic basis for the videos.

As always you are an source of enlightenment. Thanks for the great info and date (and the chuckle when you mentioned gold)

This is just awesome, thank you so much for putting this video together!

As always: thank you for this very good content. Please keep up the great work.

Once again, thanks Ben for this video. I am amazed to see how comments on gold diverge from a professional to another.

Thank you so much again Ben! Amazing video!

I was looking for answer, and you have it. Thanks, Ben.

I can't share this enough. Great content as always!

Your videos and podcasts are the best financial advice that exists on the internet.

Awesome video content! Next year I'm going to remember this video production especially gold🥇 laughing

The GOAT! Well timed video and the most perfect breakdown as usual.

Great video, if possible, can you do one on ETFs based on commodity swaps. I am wondering if they have a place in a diversified portfolio (and thus dampen the volatility problem that you described).

Love the citations :) In the end, how does one prepare for the unexpected? Solid basics. It's true in life for most things.

Shorting NASDAQ is quite good inflation hedge for me so far ;-)

Great info. Thanks, Ben!

As always, awesome video. What I love about the videos is everything is backed by data, not opinion. I'd love to get your take on whether investing in property or shares is better. I've seen some information on it, but would love to see what the data says. Keep up the great work.

Great video. Very good research references

Excellent content. Thank you

Thank you, Ben!

superb as always

I think an important distinction to make is that in the 70's "Value" companies had little debt, and were considered value because of their high book values relative to price, whereas growth companies often had more debt to fund their expansion, and thus were hit harder by rising rates. Today, due to a decade of low interest rates leading to unnecessary borrowing, most "Value" companies today have tremendous amounts of debt, but have good book values relative to price because they have a lot of assets that supposedly exceed the debt. If interest rates continue to rise as they did in the 70's an stay elevated for an extended period of time, this would put value stocks with high debt levels in a very difficult position, and force them to use cash flows to cover interest, reducing future cash flows. Lastly, price to book doesn't tell the full story of a stock like it used to. If you look at a company like Teladoc, they were trading below book value and were thus included in many value index funds. But in reality, their book value was inflated because of Goodwill associated with what they paid for acqusitions. Then you also have companies like Microsoft that have tremendously valuable software products they've built that produce tremendous profits, but because they were built in house, they are not reflected on the balance sheet. I had my portfolio tilted towards value due to my concerns of overpriced growth stocks(companies with no revenue trading at $100 Billion valuations was absurd to me), but I think with the recent correction in growth stocks, a market cap weighted index fund is much less risky than a value tilted portfolio.

Well, taking on higher debt / leverage is undoubtedly an inflation hedge !

Great video as always! I have a question Ben - What about Real estate assets? Aren’t these supposed to be good for inflation?

Nice to see Ben emoting and moving his body in the more recent clips. He's come a long way from the stiff, wooden monotone delivery of old. Great stuff as always!

Thank you for your high quality content

Dude! You do fantastic work!!

Very refreshing information, with low correlation to other finance RU-vidrs!

Great content, thank you!

Thanks Ben!

Thanks Ben for this video. Any video planned on Monte carlo simulation to simulate alternate portfolio returns?

Nice video, as always, Ben. But I'm in doubt with one of your arguments, I think you didn't discuss it for the sake of not extending the video too much. Could you explain me or show me some material about why market supply is an outdated way to understand inflation? It makes much sense for me that increasing the market supply without creating wealth is adding demand for the same amount of wealth produced, so this products will raise up their price, leading to inflation.

Great video... is there a differentiation between cost push and demand pull inflation in any studies?

You know what probably would help a lot of people ? If you could provide the script of the video ! It’s seriously a lot of very important information which I’d love to collect because I just can’t keep it all after watching the videos couple of times. Especially when there are so many videos with important informations :D pls think about putting it in the description or as a link or something :)

Inflation is such a buzzword these days. There are so many ways to measure inflation. Core inflation, consumer price index etc.

Historically, the Great Depression and the 1970s, oil was the best "hedge" against inflation. My portfolio is 100% energy companies and I am up over 50% this year and over 100% in 18 months.

Boooom Ben Felix maths lesson ♥️

Another fantastic video, Ben! Thank you! If you're looking for another video topic, I think it would be fascinating if you would make a video analyzing Chris Cole's "dragon portfolio" and the thesis underlying it, please.

Great video

Excellent.

Great video as always but feel that it should discuss Dalio's All Weather portfolio.

probably the best personal finance channel, 🙏

The information and value of this video is pure gold.... sorry for the pun....

Hey Ben, great video as always. Would you possibly do a video about the 'deflationary spiral' you mentioned? I don't see why that would be a bad thing, for the currency to deflate.

Thank you Ben! You explained everything well...but what about REITs?

Glad to hear that my portfolio of global stocks with small tilt to value is ideal 😎

I’d love to see a discussion between you and Peter Schiff regarding gold ! :)

thank god he's back,,man did i miss his video's ..other then Warren Buffet Ben Felix is my second favorite person to listen too when it comes to common sense investing

Fantastic stuff Ben. Thanks for being the best financial-content creator on RU-vid.

What about banking stocks? When inflation rises, interest rates typically also rise increasing banking profitability. And of course you also get the equity risk premium.

Please a video that explains why money supply and inflation are not correlated. I love you Felix.

“At the time of filming: April 24th, 2022”. Interesting, I would have thought this was filmed this week

Could you make a video about investment horizons and bond maturity. Seems like it is more nuanced than it sounds

1:19 your answer

Very interesting. Do typical global ETFs have ‘value stocks’?

Appreciated.

Thank you for the video I’ve seen others comment this as well But would owning your primary residence (or a rental or two) help hedge inflation

Hi, Can you cover private and venture capital type stocks?, also things to look for when buying preferred stocks, fixed , fixed to floating etc. as these seem to be a source of higher dividends than average ?

Ben's laugh when discussing gold made me laugh. Whenever some mentions gold as an investment I always think of the crazy uncle who rants about gold being a good investment.

Hi, what's your idea on having some Commodities ETF such as DBC in the portfolio? Will it give protection against inflation?

I'm not an economist or have any formal finance, banking, economics etc, however I can usually walk away with some a reasonable understanding. Today was an exception as I was non the wiser at the end!

It seems like the only perfect inflation hedge is some passive tangible asset that produces something you would otherwise have to pay to consume in the future. Like solar panels, improved insulation, or a magic bag that always has avocados inside. These things would have a real return, tax-free, in low or high inflation.

Ben, I hope you do one on tactical asset allocation(I'm not into it, just want your opinion on it).

very good fact-based presentation

very cool

Deflated recording volume on Ben Felix's video is the Ultimate Inflation Hedge!

What about I-bonds from the Treasury?

What would be a better choice: MSCI World Small Cap Value or MSCI World Small Cap Value Weighted?

"the money supply and inflation are not related" - It would be super helpful if you could help explain this in more detail, as my simplistic view still thinks this way.

You didn't talk about fixed interest debt. Surely debt is the perfect inflation hedge. If a HELOC for example was used to buy productive assets like stocks you would outperform unleveraged stock returns in inflationary periods since the value of your debt would decline faster than the interest rate.

So again the answer is to have a diverse portfolio. In today’s case a heaping bucket of I Bonds would be nice.

Question - how come the rational reminder model portfolio only has a value tilt for small caps? Wouldn't it make sense to overweight value stocks on the large cap side as well?

How do you feel about consumer staples etfs like vdc?

Hi Felix, do you think we will see a shift to active managers?

Video audio quality is too low Ben. I had to put my alexa on lv10 to barely hear it. Thanks for the video though. By the way, cheese price has been a good inflation hedge throughout the years :)

I just stumbled upon I-series bonds ...Are they too good to be true?

Great video, can you elaborate in another video causes for inflation? does the money supply really have no correlation with inflation? to me, ceteris paribus, an increased supply of anything causes it to love value, no?

Great video but what about real estate, there is also some thesis that property will rise in every time.

Clear, concise, spectacular

What about Series I as an inflation hedge??

I would consider a REIT fund an inflation hedge. The issue is that REITs are also quite volatile. While they mix well with stocks, enjoying a mostly low correlation over time and stock-like earnings, their benefit is over longer periods.

Hello Ben! I love your content, but I'm having a really hard time following your videos. I don't know why, it could be just me. Maybe the presentation could use a bit of an update? I don't mean to criticize, just sharing my feelings.. thank you for your shared knowledge.

Well, measuring anything based on year to date returns is short-sighted at best. For example, Exxon Mobil is up 42% YTD, whereas Nasdaq 100 is down 27% YTD. So clearly, oil & gas are the future, and tech’s best days are over, right?