Now that commodity prices have plunged, the inflation risk has dramatically receded across the rich world.
Since equities are a claim on corporate revenues, surely they ought to be a hedge against inflation risk?
In creating this sustainable portfolio, the investor faces three paramount risks: longevity risk, inflation risk, and investment risk.
The Fed worked hard in June to increase the awareness of the inflation risk, causing interest rate expectations to rise.
You have no credit risk, no inflation risk and you can compound your money at just under 4% per annum.
The value of our money is exposed to at least one of two financial risks: market risk and inflation risk.
Wall Street, he thinks, is wrong to worry about inflation risk because it is wrong to expect a sharp economic rebound.
Borrowing costs would shoot up to reflect higher currency and inflation risk.
Or to put it another way, there is a big inflation risk to the OBR's forecast of falling interest-rate payments by the government.
If all a wealth manager does is keep longevity and inflation risk in check for a client, the manager is covering important bases.
We think this indicates plentiful liquidity and an inflation risk, but also too high a probability of a premature Fed pause or cut.
If we prefer to have our central bank do our defaulting on our behalf, then eventually inflation risk premiums will reveal themselves throughout the yield curve.
FORBES: Why Interest Rates Tell Lies About Inflation, Growth And Just About Everything Else
The safer path, and likely the growth-maximizing one, is to take this opportunity of robust growth to stabilize the dollar and get ahead of the inflation risk.
During his tenure at the central bank he often cited the labor market and potential upward pressure on wages as the most important factor in determining inflation risk.
That said, even if an investor has longevity and inflation risk under control, an investor still faces investments that can be volatile, even over longer periods of time.
Despite the inflation risk, and the longer term likelihood of rising interest rates, Main Street investor exposure to low yielding bonds is likely to increase and become more concentrated, Dehn said.
This may also explain why Treasury bond yields have recently been rising at the long end, as the world's investors demand a higher return as a hedge against future inflation risk.
While Naercio believes inflation risk -- currently at 6.5% in Brazil -- is one of the biggest threats to Brazil, with easy lending from public-sector banks hitting consumers if the economy fails to grow.
CNN: Brazil's middle-class boom -- but are they tempting a bust?
What that means is that it could eventually increase the inflation risk if the U.S. economy starts to rise because the larger the reserves are, the harder they will be to pull back in.
FORBES: FOCUS: Fed Likely To Increase Balance Sheet Funding At FOMC Meeting; Supportive To Gold
The initial phase of inflation is low bond yields, then as the boom reveals itself to be false and price inflation begins to work its way into the system, rates rise to reflect inflation risk.
FORBES: Why Interest Rates Tell Lies About Inflation, Growth And Just About Everything Else
We prefer not to second guess the Fed, but we are wary of the prospect of taking big inflation risk down the road for what appears to be limited upside with jobs in the short term.
While a good retirement income plan should recognize inflation risk, the strategies highlighted in this article cannot completely protect against drastic increases in the cost of living over a retirement that may last 30 years or more.
Put simply, after an equity bubble bursts, it takes years, decades even, for investment, inflation and risk appetite to recover.
This could risk inflation rising which would necessitate, ultimately, a sharp increase in rates.
If central bankers raise interest rates to curb inflation, they risk driving up the currency further.
ECONOMIST: Latin America's economies: Waging the currency war | The
In times of falling equity or commodity markets, rising bond yields, inflation or increasing risk aversion, gold shines.
FORBES: FOCUS: Financial Market Break Revives Memories of 2008
Its level reflects all sorts of things, including demand from investors for bonds, expectations of future inflation and a risk premium for holding longer-term assets.
While manning the monetary policy dials, Bernanke agreed to forgo impartiality and err on the side of accepting inflation rather than risk upsetting the recovery.
应用推荐