Read the assigned Forbes article and summarize in at least 100 words. Inflation has greatly accelerated from 1.4% to 8.2%. This affected the inflation hedges in a way there was no slam dunk but gold, mining, stocks and farmland should be considered, farmland turned out well. Gold performed poorly with it losing 15% of its value. For mining stocks, we can look at the S&P/TSX Global Mining Index, this includes companies mining a variety of metals as well as other minerals. That index fell four percent, so better than gold by itself. But when dividends are included, the total return was a positive five percent. An index focused on precious metal mining showed a fall of 40% over two years. Finally, let’s look at the farmland. Farmland Partners (FPI), real estate investment trust, was able to more than double their money. The other REIT mentioned is Gladstone Land (LAND), whose stock price had a 38% gain. The two farmland REITs were certainly the way to go back then. However we lack the data to know how over multiple inflation spells all the different assets would perform when used as inflation hedges.There’s also no assurance in that it will continue to be a valuable inflation hedge in times such as ukraine where there are many moving parts and chaos is everywhere. It could even have solid increases in price gain but it could not in the future even if the scenario is similar. The best lesson is that investors should stick with all the basic truths.
Reflect on what we learned in the course, find at least one chapter in the textbook where we discuss the related topic, and explain how the chapter(s) is related to the reported event in the article. Do this in at least 100 words. We can see connections to this in chapter 10 be prepared for trouble in your sector of th economy as we can see how a problem such as inflation can affect an industry such as farming and how you can then use your resource due to this change and being prepared. A takeaway like how to manage through the industry cycle as at the end of the day you’re in it good or bad you may as well learn how to deal with it best. Your industry may have failed in its inflation hedges but it may have other factors going for such as people still needing this product. A good way to make it through is Managers and capital intensive industries would be best off recognize their industries capital intensity Business leaders should understand the typical lengths of expansions within their industries. managers also should understand patterns of past business cycles.