How do invest when interest rates go up?

So the much predicted and awaited rise of interest rates MAY be in the process of happening now. It’s been thirty years since interest rates broadly went up instead of down.

What are good areas to invest in and why?

Insurance companies and banks should be a good bet given they should make more money when rates rise, but again there are conditions on that. If the bank or insurance company is one that has a mountain of possible bad loans from too much loans into property (banks) or too much asset allocation into property (insurance) they would need to be avoided at all costs. Also if the banks or insurance companies are linked to state players with large deficits they could be nationalised as cost of refinancing for governments explodes. I expect property prices to ultimately implode in Taiwan, China and other places as the cost of paying interest on loans rapidly rises catching out over extended investors and forcing foreclosures. Banks and insurance companies with too much exposure to property will also suffer. Some banks in Taiwan are also holding massive bad loans related to electronics companies bonds but they have been able to roll them over due to the very cheap lending environment and pretend they are not bad loans (even though they will NEVER EVER be paid back). This won’t be the case with rising interest rates.

So the best choice would be insurance companies with a smaller weighting to property than the average.

Some people also tie higher interest rates to higher inflation but I’m far from convinced that is going to be the case, as I believe energy and property and food costs are the biggest contributors to inflation (energy cost should stabilise and property markets should crash in many countries excepting the US as money moves to the USD and out of speculative markets due to rising cost of credit). I think US housing markets will hold up even with increased interest rates as long as the economy is getting stronger.

I don’t think commodities would do well in rising interest rate situation as people will also start putting their money back into deposit savings accounts.