Inflation - on the surface, it would appear at times as though you're doing really well with investing. If the 'wealth' you see is increasing over time, this is great right - but have you factored in inflation?
Central banks around the world are churning out new currency at phenomenal levels right now – we call this quantitative easing or QE. The idea is to fill up the giant pothole left in our economies after a rather unpleasant first half of 2020.
As we've covered already on this show, there's a huge difference between value and price / between currency and money. With all this money printing going right now– does this really lead to an increase in value over time, or just price levels?
Specifically, as investors, we’re justifiably concerned about this thing called inflation taking off as a result of quantitative easing. What if the currency that denominates our investments is watered down – has our net worth really increased?
In this episode – we’re asking the question about inflation – is it a friend or foe?
Chris Tennent Brown is the senior wealth economist at ASB bank, and he’s my special guest today. At the end of this episode, you’ll understand:
What is inflation?
How do central banks control it?
Why 'money printing' may not actually generate the inflation that logically, you'd expect.
Most importantly, we going to cover what we, as everyday investors should be doing, to hedge against inflation when trying to grow wealth.
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