Mineral Property Can be a Hedge Against Deflation and Recession

1 year ago
4

Income producing mineral property, such as oil and gas wells or mines, can be a hedge against deflation and recession for a few reasons. Firstly, the commodities produced by these properties tend to hold their value or even increase in value during times of economic downturn. This is because demand for these commodities does not usually decline significantly during a recession, as they are essential for industries such as transportation and manufacturing. Additionally, the income generated from the sale of these commodities can help to protect against deflation, as it provides a steady stream of purchasing power that can be used to buy goods and services.

Another reason why income producing mineral property can be a hedge against deflation and recession is that the value of the property itself is often linked to the price of the commodity it produces. For example, the value of an oil well may increase as the price of oil goes up. This means that if the price of the commodity increases during a recession or period of deflation, the value of the property may also increase, providing a buffer against the negative effects of these economic conditions. Overall, income producing mineral property can be a useful tool for diversifying a portfolio and mitigating the risks associated with deflation and recession.

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This video is meant for educational or entertainment purposes only. This video is not a solicitation. I am not a lawyer, CPA or financial advisor and I am not giving legal, financial or tax advice.

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