Real Assets Debasement Hedge
Shashank@shashank
+3.5%
since Oct 3
The idea
I believe growing deficits will keep pressuring the dollar, so I want to own real assets that reprice with inflation rather than cash or fixed-dollar contracts. This basket holds inflation-indexed pipelines, farmland and timber, railroads with pricing power, and land royalties, skipping anything locked into long fixed-dollar leases. I keep 10% in cash to buy into sharp dips, and I'm building this for a one-to-two year horizon rather than treating it as a permanent holding.
What it owns
- Pipeline tariffs are regulated to adjust upward with inflation, so revenue rises automatically when the dollar weakens. · Enterprise Products PartnersIts pipeline tariffs are indexed to inflation by regulation, so toll revenue resets upward when the dollar weakens., Energy TransferIts sprawling pipeline network has inflation-indexed fee contracts that reprice automatically as the dollar loses value., Williams CompaniesIt operates the backbone pipes feeding US gas demand, with fees that reset upward rather than staying in fixed dollars., Kinder MorganIt moves natural gas through take-or-pay contracts with escalators, so revenue rises when the dollar weakens., ONEOKIt collects tolls on natural gas liquids moving through its system, fees that reprice with inflation instead of eroding.31%
- Crops and timber are priced in dollars, so the land producing them gains value as currency weakens. · WeyerhaeuserIt is the largest US timberland owner, so the land and timber on it reprice upward when the dollar weakens., RayonierIt is pure timberland with no manufacturing, so physical acres gain value directly as the dollar loses purchasing power., Farmland PartnersIt owns row crop acreage whose value tracks crop prices, and crops priced in dollars rise when the currency weakens., Gladstone LandIt collects rent on farmland growing fresh produce, and farmland prices historically rise when the dollar weakens.19%
- Irreplaceable rail networks have pricing power to raise freight rates faster than inflation for decades. · Union PacificAs the western rail monopoly, it has proven power to raise freight prices faster than inflation erodes the dollar., CSX CorporationIts irreplaceable eastern freight network lets it reprice shipping rates upward as the dollar's purchasing power falls., Canadian Pacific Kansas CityIt runs the only rail line connecting Canada, the US, and Mexico, a network that cannot be rebuilt with pricing power to match.17%
- Royalty owners collect a percentage of commodity and land revenue with minimal costs, capturing inflation passthrough directly. · Texas Pacific LandIt collects royalties on oil, gas, and water crossing Permian acreage, so revenue rises directly with commodity prices., LandBridgeIt collects fees on water, power, and drilling activity across West Texas surface acreage, pure land income that reprices with activity.14%
- Cell towers are scarce infrastructure with annual lease escalators that keep pace with inflation. · American TowerIt leases cell towers worldwide with built-in annual escalators, so rents step up while the dollar steps down., Crown CastleIt collects rent on US cell towers with built-in annual increases, so income steps up while the dollar steps down.9%
- Cash10%