not really great news; even though it's lower than previous months' 9.1 percent, that's

still a lot.  In fact, at this rate, the economy can't

function properly. Thanks to the chairman of the fed, J Powell, who kept telling us

that inflation is not an issue and kept printing trillions of dollars. Look at this chart.

Inflation kept climbing month after month. The Fed knew for sure that we were going to

have massive inflation but decided to keep the public in the dark.

Of course, they had a good reason to do that. We had a virus that was spreading across the

globe. We couldn't risk letting people get back to

work, so we printed trillions of dollars. But the moment Russia invaded Ukraine, the

virus somehow disparaged, and we longer print trillions of dollars. Look at the number of

cases. Before the invasion, there was a huge spike right before the invasion, and the number

of cases dropped significantly. People are back to work, and we no longer are worried

about the pandemic as if it's just another disease like the flu.

I am not a conspiracy theorist or a supporter of Trump, but they made such a big deal out

of Trump when he treated covid like the flu. If the government decided to open the country

and get the economy back to work instead of printing trillions of dollars, we certainly

wouldn't have such huge inflation in the first place.

Regardless of what happened, it's what it is, so the question we should be focusing

on is - how do you profit from inflation? We have to adapt to the circumstances and

learn how to profit from the crisis. There are millions of opinions and millions of experts

on the internet, but I suggest we take the advice of the greatest investor of all time,

Warren Buffett. This is not the first time the country has been going through a crisis,

and definitely not the last. War ren Buffett is almost a century old, so he has been in

multiple inflationary periods. So let's find out warren Buffett's strategy to make millions

of dollars when there is such high inflation. If you are ready, give this video a thumbs

up, and let's get right into it.

Warren Buffett's first most important advice is “be exceptionally good at something”.

That doesn't sound like a piece of advice you would like to hear. You probably expected

something like investing in this company or buying that stock. But the truth is that most

people don't have the kind of money that they could invest and are comfortable watching

how millions or even at least hundreds of thousands of dollars would fill their bank

accounts. But here is what people are usually good at, trading their time for money. It's

what we have been taught since primary school.

That's, of course, not the best way to make money since your time is limited, but your

time is the only thing that you have absolute control over, and no one can take it away.

So the best way to hedge yourself against inflation is by investing in yourself and

being exceptional at something. Be it a doctor, engineer, teaching, whatever. Because no matter

what crisis we are going through, even if it's inflationary, the demand for basic skills

will always be there. People aren't just going to stop visiting doctors just because it's

expensive. People will visit doctors regardless of the price, and during high inflation, people

with skills can raise their prices easily without affecting the demand much.

The only problem is that you should do this way before inflation hits. Which means it's

a bit late now since inflation has been around for over a year now and reached almost double

digits last few months. So if you want to be ready for the next inflation, think about

investing in yourself, in your skills, in being the master of your craft. Be the best

surgeon, teacher, or lawyer. If you have done that, here is what warren

Buffett suggests next.  According to him,

The second best protection is a wonderful business,” which means a company in which

the products are in demand even if the company does have to raise prices.

No matter how badly we hate inflation, it's just part of the economic cycle. It's going

to happen regardless of whether you like it or not. Another fact is that not all businesses

are going to survive. A lot of businesses are going to suffer when they start raising

prices, and if they don't, their profits will shrink since the cost of their products

or services is going to rise due to inflation. So what are the businesses that can withstand

inflation? In a 1981 letter to shareholders, Buffett

possibly spelled this all out as clearly as ever, writing that companies that tend to

withstand an inflationary environment “must have two characteristics: (1) an ability to

increase prices rather easily (even when product demand is flat and capacity is not fully utilised)

without fear of significant loss of either market share or unit volume, and (2) an ability

to accommodate large dollar volume increases in business (often produced more by inflation

than by real growth) with only minor additional investment of capital.”

He is basically saying that if a business is selling a necessity like bread, it can

increase its prices and people will keep buying the bread. It's not going to change anything.

Secondly, the business doesn't need extra huge capital investment to grow or adjust

to the circumstances. For example, if it's a railway business, it takes massive initial

capital to build the railway. However, if its an online business, serving an extra client

isn't going to cost anything extra like the app store. An extra user is not going

to cost apple anything. Even an extra million users isn't going to require apple to make

any significant investment in the app store to manage it.

So what are the companies that Buffett invested in during the current inflation?

Buffett didn't reveal everything he bought but did mention several highlights, including

boosting Berkshire's stake in oil giant Chevron to $26 billion, up from $4.5 billion at the

beginning of the year to make it one of the conglomerate's four biggest investments. Berkshire

also spent billions buying up 14% of Occidental Petroleum's shares in the first half of March

and added to its already massive investment in Apple stock.

Oil prices are rising due to reasons we have explored previously. And people aren't going

to stop using oil. The demand will keep only rising regardless of the price. What's going

to happen at the end of the day is that the increase in oil prices will just influence

everything else. The business will pass that cost to consumers.

Secondly, Apple is the type of company that has turned technology into a necessity. Just

because we are going through such a huge crisis, it doesn't mean people will stop buying iPhones

or MacBooks. iPhones are an essential part of the global economy. People have built entire

businesses around them. People might stop buying cars but not iPhones or MacBooks. They

are not going to get rid of their apple subscription. This is a new reality that they have built,

and that's why despite the fact that Buffett avoids tech companies, he gladly invests in

Apple, and his investment has paid off very well.

But even if you have this information in your hands, you still can't do much about it. What

are the chances that you can pick a great company? Even though these are important characteristics,

you still have to go through their financial statements to make sure that they have enough

liquidity. They are not drowning in debt. They have great profit margins. They are not

one stop away from bankruptcy. The management is wise enough, and the company has a visionary

board. I mean, these are all indicators that you look at to make sure that the company

you are investing in is a great investment. But most people aren't capable of doing

it. It's not an insult. It's just a fact because people are busy mastering their own

craft. Most people simply don't have the time to master the art of investing. That's why

Buffett has an advice for everyone.

“I do not think the average person can pick stocks,” and recommends the S&P 500 index

fund to “have for a long, long time to people.”

We have enough data to believe that over the long run, the SP 500 has made great returns.

It has outperformed most of hedge funds and proved to be a great hedge against inflation.

But you have to be patient. Because over the short run, sometimes SP 500 has done pretty

bad, but over the long run, at least 10 years if not longer, the index has proved to return

around 10 percent annually.

So if you are NOT into stocks. Or you think you are a better investor than Warren Buffett

when in reality your portfolio is significantly down after Fed's rate hikes. You are much

better off listening to Warren Buffett and just throwing your money into an index fund.

To be honest, despite the fact that I pick individual stocks after analyzing them carefully,

I still follow this advice. A big chunk of my investments is in index funds, primarily

the Vanguard s&p500. It's actually up by at least 15 percent since its bottom line

back June.

Thats it for today thanks for watching, and see you in the next one.