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How investors should respond to inflation
April 21, 2022
Amid a period of high inflation, Vanguard Global Chief Economist Joe Davis discusses the importance of staying the course and balancing inflation concerns with a long-term investment focus.
Video transcript:
Producer: How’s it going?
Joe Davis: Hi everyone. It’s going well. We’ll see how well I do on the short and sweet (laugh).
Question (on-screen): How should investors respond to inflation?
Joe Davis: Inflation is the biggest question I get today. It shouldn't be a problem, or it won't be a problem if policymakers keep it under control. I think for long-term investors, the appropriate response is really staying the course. Over long periods of time, stocks and even high-quality bond investments have returns higher or in excess of inflation. And so that’s the really key point to keep in mind in today’s environment.
Notes:
All investing is subject to risk, including the possible loss of the money you invest. Investments in bonds are subject to interest rate, credit, and inflation risk.
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