Inflation: The Silent Theft of Your Purchasing Power

Your $100 is still $100. But here’s the real question: How much can that $100 actually buy today?

Inflation doesn’t need to take money out of your bank account. It only needs to erode its purchasing power year after year.

Since 2019, cumulative inflation has significantly reduced the real value of cash across many economies.

The lesson for investors
A stable nominal balance does not mean your wealth has been preserved.

If your portfolio gains 10% while inflation runs at 15%, you made money on paper—but lost purchasing power in real terms.

That’s why investors should care about real returns, not just nominal returns.

Cash provides liquidity and optionality. But holding all your wealth in cash for years can mean watching your purchasing power quietly disappear.

This is why long-term portfolios often allocate part of their capital to productive or scarce assets such as:

• Equities
• Real estate
• Infrastructure
• Commodities
• Precious metals
• Private markets
• Inflation-protected bonds

Ultimately, the question isn’t simply:

“How much money do I have?” The better question is: “How much purchasing power will my wealth have in 5, 10, or 20 years?”

Because inflation rarely takes your money by force. It simply makes your money worth a little less every year.

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@RezaMacroEdge