What is the best financial strategy in the case of inflation? Invest money so you don't have it sitting in a bank account? Spend it on big ticket items as they may hold their value better than the cash? Simply try to reduce costs?
The best thing you can do right now is refinance any long-term debt you have to a lower fixed rate, and possibly try to find whatever appreciating assets are still cheaply priced, i.e. low cap value stocks or something. But good luck there. Blue chips have been destroying everything for years and there way to know when the insanity will stop or if it will ever stop. The only sure thing is locking in low interest on things you have to borrow for anyway, or for anything you just want to maintain constant value on rather than looking for gains, buy TIPS. The only way those ever lose value is if the entire government collapses, at which point anything else you own other than seeds and bullets and land becomes just as worthless.
Equities do well in mildly inflationary environments, but when everyone is talking about inflation is when the Fed is most likely to make contractionary signaling, causing equities to drop.
I would focus on just investing in ETFs and not trying to time the market.
I might think about tweaking my investment strategy for the next year based on this, but not longer term.
Note well: I am not an investment advisor, and this is not investment advice. This is some guy on the internet who thinks he knows what he's talking about, but may well not.
Who cares if inflation is 5.4% or the money supply increases 40% when your ROI is 10,000%
Everyone worries about hyperinflation bread lines from 100 years ago when they need to look at what the capital class of the time was able to do: help wealth inequality by making it wider! Stocks went to the moon long before the Apollo!
Personal risk tolerance.
Trying to find the source for this, i think it was Piketty in Capital in the 21st century.
Now we have continental monetary unions, with transcontinental coordinated monetary policy, spearheaded by diplomatic relations as well as alumni from the same institutions implementing the monetary policy in every union.
Every major currency is increasing in supply similar proportions, masking imbalances and largely preventing the possibility of capital flight as there is no alternative for the size of capital that would need to find a new home. So all thats left are just assets, at any price.
https://www.treasurydirect.gov/indiv/products/prod_tips_glan...
I suppose investment managers can employ a variety of other tactics to protect against US inflation, including FX, commodities, picking stocks with low exposure to inflation / proven ability to pass-through rising input costs to customers, alternative currencies like gold or BTC (though in that case you're really just trading inflation risk for other arguably less well understood risks) and more.