Commodities to Profit From Schiff’s Currency Crisis

QE3 was announced on Thursday and it is by far the most aggressive action that the Fed has taken in years. Rather than set a specified amount of money to print, Bernanke and company have pledged to invest $40 billion per month in MBS until they see material growth in the economy. That means that this QE is open-ended and could potentially drag out for a while. If the program were to be in place for just one year, we would print $480 billion. For two and three years, we would add another $960 billion and $1.4 trillion respectively [for more economic news and analysis subscribe to our free newsletter].

While there is no guarantee of how long this program will extend, it can be said with certainty that the U.S. dollar will suffer for as long as the Fed chooses to dilute the money supply. In fact, Peter Schiff went as far to say that we are moving towards a currency crisis with the rampant printing. “This is a disastrous monetary policy; it’s kamikaze monetary policy” said Schiff. Mr. Schiff went on to state that he feels that what our economy truly needs is less money printing and higher interest rates, although Bernanke’s pledge to keep rates at near zero levels through 2015 leaves little hope for that.

As the dollar continues to weaken, one asset class in particular will begin to look very attractive, commodities. These hard assets are among the best in the financial world at providing a hedge against inflation as well as a weakening dollar. It is widely agreed that at some point in the near future, all of the money printing combined with our massive debt will lead to hefty inflation, making commodities a great long-term buy right now. Below, we outline several funds to help you take advantage of a flailing greenback [see also Why QE3 is Just Delaying the Inevitable].

PowerShares QQQ Trust, Series 1 (ETF) (QQQ)

PowerShares DB Com Indx Trckng Fund (NYSEARCA:DBC):This fund invests in the 14 most heavily traded commodity contracts in the world, giving you exposure to assets like gold, crude oil, and corn among others. The fund has more than $6 billion in assets and trades over 2.4 million times each day.

PowerShares DB Agriculture Fund (NYSEARCA:DBA): Many feel that inflation will hit food prices the hardest, making an agricultural play ideal to keep up with runaway prices. This fund invests in a variety of agricultural futures and has enjoyed a return of nearly 25% in the last three years [see also Jim Rogers: The Agriculture Industry is Doomed].

ETFS Precious Metals Baskets Trust (NYSEARCA:GLTR): Precious metals are another commodity group that are expected to soar with more QE, and already have done do. This fund invests in physical gold, silver, platinum, and palladium. Its trading volumes are relatively low, but note that as an ETF, the creation process allows for instant liquidity no matter how low trading volumes go.

This article was originally written by Jared Cummans, and posted on CommodityHQ.

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

The 10 Most Peaceful Countries in the World

5 Big Reasons Communism Failed

The 15 Most Famous Carl Icahn Quotes

10 Scary Animals that are Actually Harmless

The 8 Most Famous Singer-Actors in Entertainment

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!