(Kitco News) – As inflation continues to rise to its highest level in 40 years, investors seek hedges against rising consumer prices.
“Commodities are my benchmark. Equities are a good hedge for moderate inflation, but we got over it. I like gold because it is stable,” said Briton Hill, president of Weber Global Management. “Gold is easy to get in and out of and you can buy it anywhere. Silver is also a good investment.”
Hill discussed investment hedges in this inflationary environment with David Lin, Anchor of Kitco News.
“There are also some good commodity ETFs that cover the entire spectrum. I like DBC, which is an Invesco ETF. It covers gold, wheat, oil and all sorts of things. This is a good ETF that investors can keep in the their wallets, ”Hill continued.
Hill said gold could trade between $ 2,500 and $ 3,000 an ounce and silver could go up to $ 50 an ounce over the next two years. “Right now, I need to be in something that preserves my wealth, which is why gold is such a big part of my portfolio. It has been for the past couple of years,” Hill revealed. “But times like these create huge opportunities. There are some great deals out there, but it’s about weighing economic factors with valuations and then deciding when is a good time to buy.”
“Gold is one of my favorites, along with silver. But silver is a wild animal, which means it has huge swings and shoots everywhere,” added Hill.
Comparing the performance of gold and cryptocurrencies during this inflationary period, Hill noted, “The argument for cryptocurrencies last year was that it would replace gold as a new hedge from inflation, which would have rampant performance during this period. But in this environment, gold has far outperformed Bitcoin. “
Hill explained why he is so bullish in the commodities sector. “Commodity stocks like mining and energy companies will do just fine, because people will continue to use their products. Commodity prices are skyrocketing and tend to do very well during inflationary cycles,” Hill pointed out.
Hill expects food and agricultural businesses to fare well in this inflationary period as well. “We will see a lot of things brought locally rather than importing food and other goods. We will bring local manufacturing. New factories will be built in the United States to help with supply chain problems,” she said. “It’s gotten to the point where things have gotten so expensive. Now it’s cheap to build again in America.”
Discussing his outlook on inflation, Hill expects it to continue growing. “The latest CPI report was at 7.9% for February. I think we will see next month’s numbers even higher, because it didn’t take into account the general increase in gas, food and other prices. we have seen since the outbreak of the Russia-Ukraine war, “Hill stressed. “I wouldn’t be surprised if we see double-digit inflation in next month’s numbers.”
For more information on hedging investments in this inflationary environment, see the full video above.
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