On hedging inflation with gold

This is not where it’s at

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Over the sample period, the real price of gold (nominal price / CPI) falls all over the place, belying its reputed ability to hedge against inflation.

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If gold did function well as a hedge of unexpected inflation, we would expect to see a positive relationship between changes in unexpected inflation and gold returns, but the graphic displays nothing of the kind.


HedgeHound

Hedge…everything.

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