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Always keep an eye on where the money is going. In the world of investment, increasingly dominated by a small group of big fund managers, the moves of the truly smart money often generate truly self-fulfilling prophecies.
First, you can buy emerging currencies and wait for them to rise.
Second, you can dive into US farmland. The logic: agricultural demand is rising and will not go away. The febrile situation in developing countries rules out their farmland as an option – the chance of political disruption to supply is just too great.
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So buy US farmland – it is a real asset, and it can only grow more valuable as the shortage of agricultural commodities grows more acute. And, indeed, last year the price of good farmland in Iowa rose by 18 per cent, according to the Federal Reserve Bank of Chicago, with plenty of anecdotal evidence that prices are continuing too increase.
Finally, there is gold. It is no longer merely the “goldbugs”, convinced that the shiny metal is the one true currency, who buy gold. Many other investors who are not normally happy about investing in a commodity that produces no yield, and costs much to carry, now see it as the best way to hedge against a likely generalised inflation. This is a bet on the herd – they expect others to pile into gold, so they are doing so too.
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Source: FT.com