VIDEO — Dr. Nomi Prins: Permanent Distortion is Here, Which Sectors Will Benefit?

Dr. Nomi Prins: Permanent Distortion is Here, Which Sectors Will Benefit?youtu.be

The US Federal Reserve has been at the top of investors' minds as it tries to tame inflation, but according to Dr. Nomi Prins, this is not where market participants should be focusing their attention.

"The Fed and other central banks basically pumped a lot of money into the system over a lot of years, and went into overdrive post-COVID," she explained at the Rule Symposium, noting that this has distorted asset values. "You can't underscore enough that we have to avoid the noise of the markets and the Fed and everything else."

Dr. Prins is a geopolitical financial expert, investigative journalist and best-selling author, and she explained that what's important is to understand where money is flowing in these circumstances.

The new energy sector is one place she pointed to — this is an area that includes familiar commodities like copper and silver, as well as lithium, cobalt and others.

For those who are already positioned in quality companies, the best approach may be to simply stay put. Dr. Prins used the example of major copper miner Freeport-McMoRan (NYSE:FCX), noting that the company had to close one of its mines due to low prices, but will likely bring it back into operation as demand rises.

"It takes more money and it takes longer to open a mine than it takes to close it," she explained. "So as long as the demand for construction that relates to copper still exists — and that's predominant in the energy sector, in the new energy sector — we have a situation where they will have to come back online."

Dr. Prins suggested a gradual approach for those looking to establish new positions or build on their holdings.

"What you can do is you can have a strategy that wades in," she said. For instance, US$1,000 could be invested in a stock in US$100 increments every week or two.

"You might not get the perfect dip, you might miss the bounce. But what you're doing is you're you're solidifying the base of that investment for your portfolio," Dr. Prins said.

Aside from investing strategies, she gave her thoughts on the Fed's latest meeting and its path forward. Watch the video above for more, or click here for the full Rule Symposium playlist on YouTube.

Dr. Prins' new book, "Permanent Distortion: How Financial Markets Abandoned the Real Economy Forever," will be available in October; click here for more information.

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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.

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