Heresy Financial: How the US Will Inflate its Debt Away (and you can too)

With interest rates at their highest level in 15 years, those who are undertaking new debt today are paying a hefty price. However, inflation also remains above average.

In real terms, high inflation can reduce a debt burden. That’s because investors are paying back borrowed money that has a lower value compared to when they bought it. However, this trend may see more popularity in the years ahead.

That’s because debt levels are soaring, particularly government debt. The U.S. Treasury will pay out more than $1 trillion in debt for the first time in history this year. Low-yield debt from the past few years is now rolling over at a much higher rate.

Plus, ongoing deficit spending poses a challenge. The U.S. is closing in on reaching a high level of debt compared to its GDP. When debt levels become too high, the incentive rises to print money instead.

That could mean the U.S. may move towards measures designed to inflate away the debt. That would mean higher inflation, which weighs on assets such as stocks.

However, you could also benefit from this trend, as debts such as a mortgage become cheaper in real terms. And inflation would increase the value of assets bought with borrowed money, such as a home.

To understand how debt could be inflated away and how to profit, click here.