From Porter Stansberry in the S&A Digest:

We have long mocked the intellectual depravity of the "deflation camp." How, we asked these soft-minded people, could you honestly expect paper money to enjoy a sustained increase in value? And why, upon watching the enormous expansion of our money supply, would you expect anything but a matching decrease in the purchasing power of that paper money? Everyone ought to know slicing a pizza into 16 slices instead of eight doesn't increase the total amount of pie. It could only influence how many people get some pizza...

And ever since we saw the Fed turn up the presses in the fall of 2008, we knew it was only a matter of time before the economy boomed, prices soared, and our creditors began to question the legitimacy of the dollar as the world's currency.

Intel's results today should cause even the most cross-eyed deflationist to re-examine his premise: Intel's fourth-quarter profit soared 10-fold this year and revenue jumped 28%. Gross profit margin hit an all-time high of 65%. My friends, business is booming in certain core industries and prices are rising – fast.

What companies make a lot of money during periods of high inflation? Banks. To save the banks, the government is going to sacrifice the U.S. dollar. So if I'm right about a big, looming inflation, then you'd expect to see outrageous profits coming from U.S. banks. The best-run U.S. bank, JPMorgan, did even better in the fourth-quarter than Intel. It quadrupled its fourth-quarter earnings to $3.3 billion. The majority of earnings, $1.9 billion, came from the firm's investment banking division.

Crux Note: The S&A Digest comes free with a subscription to Porter Stansberry's Investment Advisory. In PSIA, Porter has detailed his absolute favorite ways to profit from inflation. In his latest issue he details the trades he calls "the two biggest trends of the next decade." In fact, he says if you haven't already made these two trades the backbone of your portfolio, you're missing out on a huge profit opportunity. To learn more, and get access to all of Porter's inflation trades, click here.

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