Why You Should Invest in Dollars and Gold in Uncertain Times

The global economy is currently facing an uncertain environment, fluctuating between scenarios of low growth with high inflation and low growth with low inflation.

The global economy is currently facing an uncertain environment, fluctuating between scenarios of low growth with high inflation and low growth with low inflation. In such a setting, relying solely on traditional assets like stocks and bonds may not be enough to protect your portfolio. Thus, investing in assets like the dollar, which is strong during times of crisis, and gold, which is effective against inflation, is gaining attention. This article explains why investing in dollars and gold is important and how to do so effectively.

The global economy is becoming increasingly uncertain. In a scenario of low growth and high inflation, both stocks and bonds struggle. However, there are assets that continue to shine even during such times—**the dollar and gold**.

1. Why should you invest in the dollar?

The dollar acts as a "crisis-resistant insurance" asset. This characteristic comes from its status as the world's reserve currency, which is widely accepted and used internationally, even outside the United States. During economic crises, when most assets decline, the dollar tends to rise, serving as a safe haven.

For example, remember the sharp rise in the dollar during the 2008 subprime mortgage crisis. As the stock market collapsed, the dollar soared. This unique feature makes the dollar an important insurance tool to protect your portfolio.

However, predicting when the dollar will rise is very difficult. Therefore, it is more effective to invest in the dollar regularly, using a small, manageable amount each month. Think of the dollar as insurance, preparing for an uncertain future.

2. Why should you invest in gold?

Gold tends to move in the opposite direction to the dollar. When U.S. economic growth slows, and interest rates fall, the dollar weakens, while gold becomes stronger. This highlights gold's role as a hedge against inflation.

If the U.S. economy slows and inflation rises, gold tends to increase in value. Since the price of gold generally moves inversely to the value of the dollar, gold is likely to rise when the U.S. economy weakens. Therefore, investing in gold as a long-term insurance strategy is also wise.

Just like with the dollar, gold investment should also be approached as a way to prepare for future uncertainties by gradually purchasing small amounts over time. Gold is a powerful asset when the U.S. economy is weak, so consistent investment is key.

3. Why include dollars and gold in your portfolio?

Dollars and gold are assets that can protect against two different economic scenarios: recession and inflation. The dollar serves as a strong asset during economic downturns, while gold can protect against inflation. Including these assets in your portfolio allows you to prepare for various economic scenarios.

Investing in dollars and gold can play a crucial role in uncertain economic times. Rather than trying to predict their prices, it is wiser to understand their characteristics and take a long-term, insurance-like approach. By consistently investing small amounts, you can build a resilient portfolio that stands strong against crises. This strategy will help safeguard your assets against future uncertainties.