Trump’s Return Could Mean More Inflation: Here’s How To Protect Your Investments

Remember the wild ride of 2020? Stock market swings, skyrocketing prices at the pump, and a pandemic that upended everything? Well, experts say a Trump victory in 2024 could bring back some of those turbulent economic conditions.

The key word here? Inflation.

And if you’re an investor, that’s a serious concern.

Here’s the deal: Trump’s economic policies, particularly his penchant for tariffs and trade wars, are seen by many as contributing to the inflation we saw in recent years.

Let’s look at the numbers:

• The Consumer Price Index (CPI) soared 7% in 2021, its highest annual increase since 1982.

• The price of gasoline jumped 49% during Trump’s presidency, according to the Bureau of Labor Statistics.

While the current administration has made progress in bringing inflation down, a Trump victory could reverse those gains. His focus on protectionist policies could again disrupt global supply chains, leading to higher prices for everything from groceries to gas.

So, what can investors do to protect their portfolios from the potential impact of a Trump victory?

1. Diversify: Don’t put all your eggs in one basket. Spread your investments across different asset classes, such as stocks, bonds, real estate, and commodities. This helps mitigate the risk of any one investment going south.

2. Invest in inflation-resistant assets: Gold has historically been a safe haven during periods of high inflation. Consider adding some gold to your portfolio as a hedge against rising prices.

3. Focus on value stocks: These are companies that are trading below their intrinsic value and have the potential for growth. Value stocks tend to perform well in inflationary environments.

4. Consider short-term bonds: As interest rates rise, the value of longer-term bonds falls. Short-term bonds offer less risk during periods of economic uncertainty.

5. Stay informed: Keep up with economic news and stay informed about how political events could impact your investments.

Investing during times of uncertainty can be stressful, but by being proactive and taking steps to protect your portfolio, you can weather the storm.

Remember, this is not financial advice. Always consult with a qualified financial professional before making any investment decisions.