Hedge your wealth against stagflation

Political risk, high oil prices and rising inflation look like they are here to stay. So it makes sense to hedge yourself against the stagflation that is bound to come, says Merryn Somerset Webb. Here's how.

Back in 1962, a writer in one of the UK's political magazines lamented the fate of US oil companies. In the face of US oil stocks that were priced way too high and oil prices that looked far too low (oil was $2.80 a barrel), they were nothing more than a group of "Kings Canute" hopelessly trying to turn back "the flood tide of oil" tipping into their refineries.

Refinery output was at an all-time high, and so extreme was the oversupply that the major oil companies were accused of "petrol dumping". They were giving up on their more expensive high octane "exquisite fuels" and instead creating economy grades that they were selling at cheaper and cheaper prices. It was, said the 1961 report of California's Richmond Oil, "the most prolonged price war in the history of the Pacific Coast oil industry".

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
Merryn Somerset Webb

Merryn Somerset Webb started her career in Tokyo at public broadcaster NHK before becoming a Japanese equity broker at what was then Warburgs. She went on to work at SBC and UBS without moving from her desk in Kamiyacho (it was the age of mergers).

After five years in Japan she returned to work in the UK at Paribas. This soon became BNP Paribas. Again, no desk move was required. On leaving the City, Merryn helped The Week magazine with its City pages before becoming the launch editor of MoneyWeek in 2000 and taking on columns first in the Sunday Times and then in 2009 in the Financial Times

Twenty years on, MoneyWeek is the best-selling financial magazine in the UK. Merryn was its Editor in Chief until 2022. She is now a senior columnist at Bloomberg and host of the Merryn Talks Money podcast -  but still writes for Moneyweek monthly. 

Merryn is also is a non executive director of two investment trusts – BlackRock Throgmorton, and the Murray Income Investment Trust.