Hedging against inflation

Broadback

Seems that you can hedge virtually everything these days, is there a way to hedge inflation? I can weather this economic downturn but if inflation takes off then I will be in deep trouble. Now I think that inflation will roar away in the fairly near future, so can I, and if so how, plan for this?

gozomark

NS&I index linked

tradetime

.....or index linked bonds

LesU

gozomark wrote: »

NS&I index linked

Just make sure that their index is the same as your personal index, otherwise you might just as well have saved anywhere.

gozomark

I can guarantee it won't be the same as your personal index - it could be higher or lower

sabretoothtigger

Gold should rise as currency becomes more worthless afaik, helps with international devaluation as well.
Since obama was voted in, gold has risen 20%

tradetime

LesU wrote: »

Just make sure that their index is the same as your personal index, otherwise you might just as well have saved anywhere.

Yes, if you go to the special magic section on their website, you can enter a list of your outgoings each month and they'll create a special custom index to link it too.

kamir

I'm guessing that if inflation starts to rise your assuming that the government won't raise the base rate (because of potential damage to the recovery) and therefore the bank savings rates will be in-effective vs inflation ?

Broadback wrote: »

Seems that you can hedge virtually everything these days, is there a way to hedge inflation? I can weather this economic downturn but if inflation takes off then I will be in deep trouble. Now I think that inflation will roar away in the fairly near future, so can I, and if so how, plan for this?

Broadback

kamir wrote: »

I'm guessing that if inflation starts to rise your assuming that the government won't raise the base rate (because of potential damage to the recovery) and therefore the bank savings rates will be in-effective vs inflation ?

I think it is worse than that. The government are spending/pledging billions more than we are paying them. There is no way the international community will purchase UK bonds, in fact there is strong international thought that the UK rating will drop from AAA. So the only option to the government is to print money, nothing ramps up inflation as fast as that. Keep an eye on wheelbarrow sales, if they go up worry!

gozomark

Broadback wrote: »

There is no way the international community will purchase UK bonds, !

sorry thats rubbish - they are buying them every day - there is billions of new debt issued every week, alot of it is bought overseas

gozomark

Broadback wrote: »

in fact there is strong international thought that the UK rating will drop from AAA.

that could happen, but unlikey - its already happened to several Euro countries, and it could also happen to the US.