Today the circumstances are different as we will soon be faced with a much more serious inflation problem in the US. Additionally, unlike the 1970's when most of the investment demand came from the U.S, this time around, the demand ( as we have already begun to see) is coming from all over the world (Europe, India, Russia, U.K., China).
Also unlike the inflation witnessed in the 70's, there are much more lucrative vehicles giving one exposure to the price appreciation in precious metals. By this I don't mean ETF's such as SLV, CEF, GLD, SIVR. To me, this makes absolutely no sense as I can't imagine why one would own electronic PM's as opposed to the physical metal. These are insurance policies, thus unless a bubble is forming in PM's, it is best to keep them in a safe, safety deposit box or offshore at places such as the Perth Mint. I am referring to royalty trusts ( Franco-Nevada, Gold Wheaton, Royal Gold, Silver Wheaton). These give one leveraged exposure to precious metals absent the majority of mining risk.
Aside from precious metals, one should also have some exposure to Agriculture and Oil as they both rise much faster than inflation. For Agriculture, unless you play the futures market, a prudent yet rewarding investment in RJA ( replication of Jim Roger;s commodity Idx) is the ideal vehicle. When it comes to Oil, there are numerous trusts as well ( pennwest , penngrowth, enerplus, etc) with my favorite being Canadian Oil Sands Trusts.
1) Hold no U.S government bonds ( as you are asking to lose money) - simply because yields have to rise, which they have been doing since early 2009 and will continue to rise faster as more time passes. Rising Yields mean bond prices drop and given that rates are at 0-.25%, bonds have no room to rise in price, thus there is no reason to own them. If fixed-income is desired, consider government bonds in other countries. Australian Bonds look particularly attractive yielding >4%.
2) Have at least 10%-25% of your assets in physical precious metals ( the allocation of which should favor gold for the more conservative).
3) Hold at least 10%-25% divided between SLW, RGLD, FNNVF.PK and/or mining stocks.
4) Hold at least 10%-25% divided between agriculture and Energy.
Following this allocation would still leave one with between 25%-70% to allocate elsewhere.