How To Beat Inflation
Inflation has a corrosive effect on corporate profits if input costs rise ahead of selling prices, and therefore not good news for equities, although over time stock prices tend to drift upwards if inflation really begins to rage. Bonds loathe inflation because central banks have to raise interest rates in order to combat inflation and fixed-yield bonds fall in value. So while a stock and bond market correction in few months might temporarily depress the price of commodities then this is a buying opportunity, as commodity prices are likely to perform well under conditions of stagflation than bonds and equities.