How Inflation Affects Stock Owners

Read the full article at: http://barelkarsan.com/2008/06/how-does-inflation-affect-stock-owners.html
(via barelkarsan.com)

Upon first reflection, it would seem that in inflationary times, companies can charge more for their products, and thus should have a natural hedge against inflation. Unfortunately, companies in such times are forced to invest their profits in the companies JUST to keep returns at ordinary levels, resulting in real costs to equity holders.

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