‘The first digit may not be a one!’
Schiff also highlighted rising commodity prices as an indication that higher inflation is on the horizon.
“Look at this chart of the CRB,” he noted in a separate tweet, sharing a chart of the CRB Commodity Index that monitors the prices of a diverse range of commodities.
Commodity prices are commonly believed to be a leading indicator of inflation. When the cost of raw materials goes up, that eventually gets reflected in the price of final products — and consumer prices go up.
Schiff cautioned, “This will likely be the biggest commodity bull market since the 1970s. By 2025 #inflation will likely be in double digits, and the first digit may not be a one!”
The message is alarming. The last time the country saw an inflation rate of over 20% was in 1947, driven by the elimination of war-time price controls, supply shortages and pent-up consumer demand.
Don't miss
- Commercial real estate has beaten the stock market for 25 years — but only the super rich could buy in. Here's how even ordinary investors can become the landlord of Walmart, Whole Foods or Kroger
- Car insurance premiums in America are through the roof — and only getting worse. But 5 minutes could have you paying as little as $29/month
- These 5 magic money moves will boost you up America's net worth ladder in 2024 — and you can complete each step within minutes. Here's how
Protect your purchasing power
Inflation erodes the purchasing power of your hard-earned money. Due to the link between commodities and consumer prices, investing in commodities can serve as an effective hedge against inflation.
Investors can add commodity exposure to their portfolios through commodity futures, ETFs, or the stocks of companies that operate in this area.
Among various commodities, Schiff has a clear favorite: gold.
A long-time advocate for the yellow metal, Schiff described gold as a "safe haven" from inflation in 2021 — a time when inflation rates began to climb sharply in the U.S.
Gold is regarded as a hedge against inflation for a simple reason: It can’t be printed out of thin air like fiat money and hence is a safe store of value.
Last year, Schiff renewed his call for investors to consider gold, suggesting that the metal was underpriced.
“... I think it has to be repriced higher to reflect the reality of much higher inflation. We’re not going to go back to 2%, probably in my lifetime. It’s going to be much higher than that, and when investors come to terms with that, they’re going to bid up the price of gold much higher,” he said.
Fast-forward to the present, the enthusiasm of investors has indeed propelled the price of gold to record levels. The precious metal recently broke through the $2,200 per ounce mark, setting a new milestone.
These days, there are many ways to gain exposure to gold. You can own bullion, buy shares of gold mining companies or ETFs, or even tap into potential tax advantages with a gold IRA.
What to read next
- Cost-of-living in America is still out of control — use these 3 'real assets' to protect your wealth today), no matter what the US Fed does or says
- Jeff Bezos and Oprah Winfrey invest in this asset to keep their wealth safe — you may want to do the same in 2024
- Stop crushing your retirement dreams with wealth-killing costs and headaches — here are 10 'must-haves' when choosing a trading platform (and 1 option that has them all)
