How can ordinary people hedge against the risk of currency depreciation?

At the end of the article on September 26, a reader left the following message:

I am the first type of person in this article. I still have some spare money now, and I am not going to invest in the A-share market again. My question is: after the big release of money, cash will definitely depreciate. If I don’t invest in the A-share market, I dare not take on real estate. The currency circle is so depressed. As a small leek, what strategy can I adopt? How can I preserve the value of this little life-saving cash that I have accumulated with great effort?

"After the big release of money, cash will definitely depreciate"---it depends on what angle you look at this statement from.

First of all, I believe that the central government will definitely take various measures to stabilize various risks and cover various bottoms. Of course, we will not consider whether it can be stabilized or covered. What we consider is what will happen if these measures can really cover it.

It is obvious that after taking these measures, money will definitely overflow to certain areas.

At this time, several situations may occur:

The first is to directly overflow to daily necessities, raw materials, basic materials, etc.

The second is to overflow to places where the economy really needs it, such as companies that are in urgent need of relief, businesses that lack liquidity, etc.

The third is to overflow to markets with financial attributes.

Among these three situations, the first is direct inflation. In this case, cash will definitely depreciate significantly.

This is definitely not what the central government wants to see, but the final result is not subject to subjective will.

I think this situation is likely to happen, but it is hard to say how likely it is.

What if it really happened?

As ordinary people, the ways we can fight inflation are actually very limited: probably buying precious metals, buying investment products in niche areas, and buying real estate.

Among these ways to fight inflation, buying precious metals can make some arrangements, but it is only symbolic, and the actual effect is not great, because:

- Precious metals (including gold and silver) are no longer cheap now, and the risks contained in them must be weighed when buying.

- Of course, the industry predicts that gold is likely to reach $3,000 by the end of the year or next year. But even if this prediction is true, from the current $2,700 to $3,000, it is only a 10% increase. This 10% increase can almost be ignored in the protection of ordinary people when encountering real inflation.

Buying real estate was effective in the past, but now and even in the foreseeable future, I don’t believe it can resist inflation. Although the country has introduced many measures and may introduce many more measures in the future, it is already quite remarkable that all of these can stabilize housing prices and prevent them from falling further. It is unlikely to reverse the trend and let it rise to resist inflation.

The overall appreciation of the real estate market to resist inflation has become a thing of the past in our country.

Investment products in niche areas are meaningless to the general public, let alone feasible, so I won’t go into details here.

So when we really encounter a big inflation, for ordinary people, if they don’t have their own investment methods, in addition to investing in some precious metals, the only thing left is to put their money in the bank.

Although it seems that this is letting money depreciate, it is more reliable than investing randomly to try the so-called "value preservation".

I guess many readers will not be able to accept this conclusion, but this is actually the cruel fact.

In this situation, everyone is sinking collectively, competing to see who can hold on to the end and who can live longer. As long as you live one more day than others, you can have a glimmer of hope.

The second situation is what the country wants to see most.

If this situation happens, ordinary people don’t have to worry too much. Our future situation will get better and better, so there is no need to worry too much about the depreciation of money. It is better to wait optimistically and wait for your own new hope to come.

But I don’t know how likely this situation is to happen.

In my opinion, the third situation is also more likely to happen. It is not as good as the second situation, but it is definitely better than the first situation, and it is also a situation that the country can accept for a certain period of time.

If this happens, then looking at all the financial fields in the country, which field can absorb so much money released by the country?

I don't think it's possible in the real estate market.

It's also impossible for this money to flow to overseas markets on a large scale (RMB has not achieved free convertibility).

Which other fields are left for readers to think about.

"The currency circle is so bad again", it depends on how you look at it.

It's hard to say in the short term, but I have always been optimistic about the long term and have never doubted it. Some time ago, when Ethereum was below $2,500, I was still investing in it.                           sp;