Would equity investing (stocks & mutual funds) protect you against ...

Yes. The entire definition of inflation is that the price of things go up (Well, actually, that's not really the definition, but that's what most people think the definition is). So if you buy almost *anything* -- stocks, gold, real estate, petrified wood, bubble gum, toothpaste, pretty much anything other than fixed rate bonds -- then in a period of inflation, the price of that thing will go up at roughly the inflation rate.

Of course, not everything inflates at the same rate -- some individual stocks might go up more than the inflation rate while others may go up less than the inflation rate, or even decline. But as long as you're diversified across many different stocks, stocks are as good a thing to own in a period of inflation as anything else.

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Last edited by doubled; 01-07-2013 at 03:13 PM.

Source: http://boards.straightdope.com/sdmb/showthread.php?t=678082

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