Inflation!

Consumers are confronted with the effects of inflation every day. A shopper in the grocery store recently belted out “six dollars for a bag of chips!” We all get it. How about the cost of a decent car? Services are also more and more expensive. From green fees to plumbers and electricians, much has changed over the past few years. Unfortunately, once inflation is suppressed, prices are not coming down. If your income has not kept up, then you are poorer.

The value of your savings has also eroded. One hundred thousand or even one million dollars is not worth as much. Unless your stake has grown as fast as the inflation rate, then it simply will not go as far as a few years ago. Keeping up, much less growing your wealth, is an ongoing challenge.

Investments in companies has been one of the best ways to keep up. Good businesses can respond to inflation by raising prices and improving efficiency. Instead of having to take higher prices, it is better to be on the other side of the counter collecting them. There are other assets that also benefit from inflation. However, the living, breathing business run by smart people can continually adjust in ways that static assets cannot.

Yes, stocks go through bull and bear cycles. However, look at the long- term trend and the returns are remarkable and have far exceeded inflation. The Bull and his partners believe that we have already begun a new bull market cycle. Protect yourself, invest, and stay steady my friends.

The Lonely Bull