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inflation, value stock investing how to profit from it



5/26/2009
The inflation process happens when a currency gets devalued may actually not be as bad as people are making it out too be. While almost all experts agree that at least a moderate amount of the dollar losing value is sure to happen thanks to the money being printed for bailouts, it may not actually be as bad as people think it will be. Many people reading this right now might be thinking, is this guy crazy? How could the dollar losing value actually be a good thing at all for people? I am about to answer why the dollar losing value can actually be a good thing depending on your circumstances and I will talk about it bellow.

The things that make the dollar losing value an actual benefit to people are their current assets and if they are into debt or not.

-The things that may make an inflated currency a good thing for youIf you own a lot of assets like gold, silver, or even real estate that is a hard asset, then the value of your goods should at least keep up with or outweigh the dollar falling. The other thing that makes the dollar falling a great opportunity is actually debt. If money is easier to come by and you owe a million dollars to a bank then an inflated currency may be the greatest thing that will ever happen to you. The amount you owe to the bank except for the interest never changes, therefore if you owe them money but money is now worth less because it's easier to come by, then you are ahead in the since that you borrowed money that was expensive and then later paid the debt off with cheap money. This is why if you truly believe that the dollar falling in value is going to start happening if the very near future then now might actually be the time to get into a lot of debt for the potentially long term gain that you may receive by doing so. By getting into debt I don't mean buy things that you have no reasonable way to pay off, and I also don't mean buy just any old thing, you must buy assets like real estate because they will hold their value.

-The things that make an inflated currency a bad thing for youI think one of the things that can actually make the dollar falling in value bad is if someone owes YOU a lot of money. If you are owed a lot of money for whatever reason and you aren't getting a really good interest rate. Also saving money without INVESTING it in anything can also harm you, thanks to the affects of an inflated currency for the future. The more you save the more it will affect you, and having a lot of cash around just isn't a good idea because it will become worth less over time if you just stuff it under your mattress without buying assets or getting interest of any sort.

In total I think it's important to understand that it is almost a mathematical certainty that we will have at least somewhat of an inflated currency in the future; the question is are you and your investments prepared for it?

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