As we recently discussed, the US is heading towards a depression, and given the nature of the proposed bailouts as well as restrictions on short selling, it seems as though the depression will be inflationary. The most notable characteristic of an inflationary depression is currency devaluation.

If that's the case, how can traders preserve their wealth? Below are 8 ETFs traders should consider looking into to prepare for an inflationary depression:

Foreign Bond ETFs. There are a number of foreign bond ETFs -- FAX, FAM, EDF, among others -- are also appealing to many seeking to diversify outside the US. In addition to providing stable income returns that bonds offer, they also allow for protection against dollar devaluation.

VEU. This fund seeks to replicate an index of 2,200 stocks in 47 countries outside the US. Because of its diversity, it is viewed as a great way to hedge against systemic risk in the United States. It is, however, down 10.08% this year.

FXE. The FXE ETF tracks the Euro. As regional currencies tend to proliferate, the Euro may be a particularly effective hedge against the US dollar. It is up 9.68% thus far this year.

GLD. This fund seeks to reflect the performance of gold bullion, less the Trust's expenses. At the time of this writing, GLD is up 10.98% this year, and 28.12% over the past three years. Given gold's status as a safe haven that preserves value, this ETF can help hedge against dollar devaluation.

GDX. This ETF invests in publicly traded companies involved primarily in mining for gold and silver. Currency devaluation increases demand for precious metals, which in turn increases demand for mining businesses.

SLV. While gold tends to be the primary precious metal of choice to hedge against currency devaluation, silver is often viewed as a backup store of wealth as well. The greater the US dollar devaluation, the more likely demand for silver will rise. Thus far, silver is up 19.28% this year.

USO. In recent history, oil and the US dollar have been inversely correlated; as such, dollar devaluation is widely regarded as the primary cause of higher oil prices. This presents an opportunity to invest in oil to hedge against dollar devaluation. The USO ETF seeks to reflect the performance, less expenses, of the spot price of West Texas Intermediate (WTI) light, sweet crude oil. USO is up 49.47% thus far this year.

DBC. A depression tends to result in a flight from financial assets to commodities. We've seen early signs of this in the United States, with food and gas prices rising. The DBC ETF invests in a portfolio of exchange-traded futures on the commodities comprising the index, or the index commodities. The index commodities are light, sweet crude oil, heating oil, aluminum, gold, corn and wheat. Thus far, the DBC ETF is up 42.84% this year.

Disclosure: I am long gold and silver.