Inflation

Up, up and away [in my] my beautiful, my beautiful balloon
-lyrics by the Fifth Dimension

In recent years the U.S went through an odd economic period where some price indexes actually fell (deflation). Last year inflation was officially just 1.6%. But the times they are a'changing. Inflation is on the rise around the globe and may soon hit our shores. See Can the U.S. Sidestep Growing Global Inflation?,

"Inflation in Britain hits 4%, double the official government target. China reports prices accelerating at 4.9% in January. And Spain says its inflation measure shot up 3% last month. ... the inflation scourge [is] now sweeping countries as far away as Brazil, India and the U.K."

From Forbes.com, America, poised for a hyperinflationary event?

At Instapundit.com, "I'm going to wish I'd listened to Glenn Beck and bought a lot of gold."

To which an Instapundit reader responded, "You’re going to wish you had some food storage first before you wish you had gold. In Weimar Germany there were people in the cities that starved because they had no food. [Could not afford to buy it with hyperinflation] Sure you can buy food with gold, but gold denominations (even the 1/10 oz American Gold Eagle) are not practical for buying groceries or a sack of potatoes."

The same point is made at SurvivalBlog.com, "What would a full ounce of gold buy?  That Corvette that we saw advertised?  A half a dozen cows?  Maybe.  It certainly wouldn't do much good for someone trying to buy day-to-day necessities. "

Bottom Line

For protection against simple inflation, build a food storage now. To learn more about hyper-inflation see this post I wrote in 2009: HyperInflation

My post, Five unusual items for your emergency supplies, talks about stocking items for trade or barter in your food storage. Alcohol and cigarettes are valuable during difficult time but not something I would personally stockpile.  Consider items like diapers, aspirin & medical supplies, and nails which can be better than gold under the right circumstances.