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Tuesday, November 17, 2009

Is Gold Really A Hedge Against Inflation



the folks over at inflationdata.com present some strong evidence that it has failed to be an inflation hedge over long periods

See that in the graph the nominal price of Gold is flat but the inflation adjusted price is not. If Gold perfectly hedged inflation the inflation adjusted price of gold would overlap the nominal price.


In fact over most of the last 20 years oil has been a better inflation hedge than gold.

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