Investing one’s surplus money to beat inflation and preserve purchasing power has become a full-time job in 2022. Equities, Bitcoin
BTC
NEW YORK – AUGUST 14: People shop at a Fairway grocery store August 14, 2008 in the Brooklyn borough … [+]
Converting savings to hard assets, which appear to be gaining at a similar, if not faster, rate than inflation, appears to be the only method to preserve purchasing power in 2022. In this high-inflationary environment, tangible assets such as land, property, and commodities are acting as safe havens.
The significant increase in the price of hard assets reveals a broader issue with global economies. That is, polarization in the economy. This refers to the problem of inequality in which the 1% possess the majority of the hard assets that the 99% must continue to pay for.
During the pandemic (2020–2022), most economies employed the trickle-down economics rationale to distribute stimulus packages, which resulted in new money being pushed to banks and other financial institutions in exchange for mortgage-backed securities and bonds. These institutions were unable to invest the new funds efficiently in economic units that were still subject to COVID-19 constraints. As a result, they purchased more hard assets, knowing that the new money would cause inflation.
As the pandemic restrictions were relaxed, the employees who supported the economy returned to work in a completely different…
