You are living through the greatest wealth transfer of our time and the way that you react to this will determine whether or not you end up financially secure in the future or if you struggle to survive.
If you position yourself well, you could very well 10X your wealth in just the next 10 years. I’m going to show you how this could very well be the most important personal finance article that you have ever read. I’m not going to try to scare you by talking about some crash and I also don’t have anything to sell you.
We’re going to learn together, be sure to read this until the end and you will own a completely new credential. It’s an attribute of owning some vital information that even the top 1% don’t know rather than becoming impoverished by crushing inflation.
You’ve got to do more than just hedge yourself against inflation. The credential that you’ll own is the specific knowledge on how to profit fantastically from inflation. And this is a lesson that will benefit you for the rest of your entire life.
It’s not just your trader Joe’s Bill that slaps you in the face every week. It’s inflation in the price of homes, rent, utilities, transportation, labor, almost every facet of your life. And I’ve got something mind blowing for you to share shortly where we’ll see just what the price of gas homes and rent will be in 40 years. I’ll show you those galactic jaw-dropping prices shortly because that’s where we’re going. And then it’s about how specifically you’re going to profit from all of this.
I was grocery shopping recently and I saw this:
A wildly overpriced offering of dented bottles of what’s marketed as a health drink for $6.59 each. Remember this image, later you’ll learn why this is important.
Now… sometimes the mainstream media down plays inflation. Come on. We’ve all felt what it’s like to pay for health drinks like that or an $8 coffee here. The inflation scare doesn’t match reality though. I’m a Forbes contributor myself. That was definitely not my article.
Inflation looks bad but now it’s sticking to the script. Sheesh.
What does that even mean? Why the inflation we’re seeing now is a good thing.
That’s complete nonsense.
And inflation is your fault.
What a joke inflation comes from the government. It means an expansion of the money supply with the rate we’re going here is what’s of dire concern.
Once upon a time in the fifties, a family could own a home, a car and send the kids to college all on one income with a family of four.
It took one working parent to be middle class.
Then it was two parents by 1990. Now two parents working is getting to be less than enough. Even two is not enough.
So each wave of inflation makes living profoundly harder. This woman filled her shopping cart with $20 worth of groceries before going home to her $15,000 house in 1960.
Well, the reason that inflationary waves make life hard is because salaries and wages don’t keep up with the real rate of inflation.
And that is the crux of the crisis here.
The true diminished purchasing power of the dollar.
That rate is greater than the phony. All too low estimates in government reported measures like the PCE, PPI and CPI.
Then between the big waves of inflation more subdued 2% inflation eats away at the lifestyle of the saver and of the 401k investor. And yeah, meet the new $1 bill because a century ago just $1 had as much purchasing power as a 100 dollar bill today.
Just astonishing. All right. So, well, where are we headed next?
Well, inflation over the next 40 years could make the last 40 years seem like a pick. Get ready for this all based on the Consumer Price Index stats from the BLS.
If the last 40 years repeats itself by the year 2065 which is the next 40 years, we’ll see these prices gas at $13.38 per gallon.
The home price at $1.88 million just the average home, the average rent at $59,000 per year and the average salary at $104,000. And note again how the salary does not keep up with the prices. And this is all really frustrating.
I mean, this is how your quality of life diminishes and you know, that manifests itself in different ways for some people.
It’s downgrading from Ruth’s Chris Steakhouse to rock the noodles at home for others. It’s not being able to afford school supplies for your child for some. It’s selling your car and using the bus for others. It’s getting evicted and living in a cardboard box today, you will have a plan to ensure that this never happens to you.
No downgrades in lifestyle.
Well, where can you invest any excess dollars in a world that has been and will keep being inflationary. Mean stocks aren’t considered in inflation heads, let alone anyway to achieve the holy grail of actually profiting from inflation.
Ok? If inflation is 10% over whatever period of time one year, two years, whatever. Well, if stocks are up 10% with 10% inflation, you’re right back to where you started. Subtract out taxes, emotion and volatility and you aren’t getting ahead with stocks.
Bond yields don’t really outpace inflation. High inflation has made residual income from real assets more vital, not less.
Well, gold is real.
I mean, it’s the classic inflation hedge 2000 years ago, one ounce of gold would have bought you a nice toga today. It buys you a nice bespoke Italian suit. But see, a hedge means that you don’t gain any purchasing power.
So forget about hedges. You’ve got to play to win and not just tread water. Bitcoin’s track record only goes back 15 years in inflation.
Savers are losers.
Look at all these denominations of dollar bills.
Do you know what every one of them has in common? Any idea they’re all worth less now than when you began reading this article and every one of them are going to be worth less tomorrow.
A million bucks under your mattress a year later. Ok. Yeah, it is still a million bucks.
But if 5% inflation, it has just $950K of purchasing power. After one year, your government is then stealing $50K worth of your prosperity every year. And now we’re getting into the actionable solution here.
All right, your strategy, the credential that you are going to earn today. Well, then instead of saving you wanna do the opposite you want to borrow? Well, doesn’t that mean that you take on debt?
Yes. But you don’t have to be the one that pays back your debt. For now, remember that inflation transfers wealth from savers to borrowers.
Let’s just say that a person is wealthy enough to own a million dollar home, completely paid off.
All right. Well, 10% home price inflation, it means then that his home goes up to $1.1 million. But here’s the thing; that wealthy person didn’t get ahead because now he’s got 10% more dollars, but each dollar is worth 10% less. He’s right back where he began. So he only hedged no profit.
There, here we go. Say that over the next few years, you obtain $1 million worth of real estate in the form of rental single family homes.
And yes, if you’re new to real estate, I know that might sound like a lot of million dollars, but it might just be four $250K properties. And here’s the difference between you and the wealthy paid-off.
You’re only making a 20% down payment on your $1 million worth of property. So, you get just $200K invested of your own and you borrow $800K from the bank if you don’t know how to do this.
All right. Now what happens to you in say 10% inflation over time?
Well, with your million dollars in real estate, with 10% inflation, it goes to $1.1 million or you right back where you started because you’ve got 10% more dollars, but each one’s worth 10 percent less.
The answer is no, because you got a loan for $800K,… you only have $200K of your own equity or skin in the game in this deal. So your $200K of equity goes to $300K, you just got a 50% return because you had a loan, you leveraged the bank and inflate.
So you got a benefit that the wealthy paid off guy didn’t get because you’ve got that 50% ROI.
And this is how we begin to narrow this widening wealth gap between the untouchable halves and the people that weren’t born with a silver spoon in their mouth. And this is only the first of three benefits.
I’m showing you here this benefit of asset price inflation with the leverage benefit.
Leverage just means owning with debt. Well, what about the interest payments on your four $250K rental properties? The tenant pays all the interest for you get the debt and then reliably outsource the payments.
The second way that you benefit is on our example, you had $800K in debt well, over time, 10% inflation, that only means you owe back the bank $720K after one year and after two years, you only owe the bank back $640K in inflation adjusted dollars.
Because over time wages, prices and salaries and rents, they all go higher over time.
Yeah, see the bank doesn’t ask you to repay them in real inflation adjusted dollars only these nominal dollars nominal means in name only. And now not only are you outpacing the wealthy guy in the million dollar paid off home, you are also leveraging the bank for your gain.
Now, you are really starting to shift the power structure from the wealthy and from institutions into your coffers. And that second of three simultaneous benefits is called debt debasement. But so far as attractive as this is all right.
Well, this only increases your long term asset value.
What about your short term liquidity? The money that you’re going to feel in your pocket every single month, the third crown in this specific inflation profit strategy, it covers this too.
Of course, numbers are going to vary but just say that in one of your typical rental, single family homes,… you could very well have a $2000 rent income, $1200 for your mortgage payment and $600 for the other operating expenses like vacancy, homeowners, insurance, maintenance, property taxes, and paying your property manager.
In order to make this strategy mostly passive for you, you would have $200 in leftover income cash flow, monthly money in your pocket.
After 10% inflation, what happens? Your rent rises up to $2200 and your mortgage payment stays fixed.
Inflation can’t touch that mortgage payment because you get a conservative 30 year fixed rate loan and your $600 in operating expenses goes up to 660 bucks do the easy math. That’s now $340 of monthly liquid cash flow in your pocket. And with 10% inflation, your cash flow just went up 70% extrapolate that effect across all of your properties.
And this third crown, this third way that you’re winning is called cash flow enhancement.
The last of the inflation triple crown.
Now you just got a specific road map on how to get ahead.
You understand the credential of winning the inflation triple crown.
And the amazing thing is that this is available to everyday people that just have a decent credit score and it doesn’t take any high flying risk of investing in some stock initial public offering or start up crypto project.
And you also don’t need any degree or certification or even a real estate license or a license of any kind.
In order to do this, we’re just talking about buying houses with plain loans and you can get good conventional loans at the best rates in terms of them if you’re single, 20 if you’re married? All right. Well, this sounds like an amazing blueprint. But could there be any cracks in this awesome inflation triple crown armor?
I mean, it’s always prudent to do a SWOT analysis. What are the weaknesses and threats? The W and the T where could it break down? Where could it fail? All right. Well, what if, say housing values go down? I mean,… I had it happen to me when I owned four PEX buildings with loans in 2008.
Well, this strategy still works. Long term. Housing values have always rebounded after they fall. And you know what happens in the short term, your cash flow often goes up in 2008 to about 2011.
I found out that I could charge more for rent when no one wanted to buy houses in a real estate recession.
Well, hardly mattered to me that my properties were temporarily suppressed in value when tenants are paying me more on a monthly basis than they had before. I mean, really, that’s two reasons not to sell.
All right. Well, what about a second threat to the inflation? Triple crown deflation? Yeah. What if instead of inflation, we have the opposite and the dollar actually gets stronger over a number of years.
Although that is possible, deflation is extremely unlikely on a sustained basis. I mean, just look at the long term history of the dollar’s debasement.
The fed will move heaven and earth to make sure that we have at least a low rate of inflation, the powers that be want inflation. And of course, they’ve long even been transparent about it.
They’ll either print more dollars or lower interest rates in order to keep inflation buoyant. And also with our $35 trillion in staggering national debt, we have got to keep printing massive amounts of dollars to pay back all of our foreign creditors.
Massive dollar printing, dilutes the dollar’s value.
That is inflation.
And the big lesson in thesis statements so far is that you win the inflation triple crown when you strategically buy income properties with loans.
If you’ve got a paid off home, like the wealthy guy with the million dollar home, you only benefit from one of three.
Really. It’s a mere hedge against inflation. If you have a loan on your primary residence, you benefit from two of the three, both asset price inflation and the debt debasement. And the only way to get all three is with income, property with loans.
In fact,… let’s bring it back to the wildly overpriced dented bottles of Rebel health drinks. When you see that in the store today or something like it, that might be a bad sign.
Prices are up.
But you know what? To me, a leverage real estate investor myself with millions of dollars in debt that’s outsourced to my tenants. That’s actually a wealth marker, not a poverty marker. It’s not threatening.
That’s feedback to me. Oh That there must be high inflation out there. And I know then that I’m benefiting from this across all of my properties. With the inflation triple crown turn a negative into a positive live in an upside down world where the entire economy tilts toward you, not away from you like it does for most people.
I don’t wanna be like most people. And now look if you’re new to this, this could sound novel and actually rather simple. At the same time, it really is fairly simple. I mean, sheesh, even the math we’ve done is just addition, subtraction, multiplication and division, no exponents, no calculus, no trigonometry here.
This is both a mindset and a specific road map for you to not only 10x your wealth in the next 10 years, but build a residual income stream outside of your job.
So you might eventually be able to quit your job. If you only do ordinary stuff, you’re only gonna get an ordinary result.
Middle class financial advice is designed to keep you middle class.
I mean, talk about a wealth transfer here.
It’s about more than from the government and big banks to you. It’s also generated.
If you don’t come from money, it’s about money coming from you and it’s up to you the individual to educate yourself and act and break the cycle.
And it’s really all by design to tilt against you.
So, unless you stake your claim and make your breakout moment, they’ll only keep paying you just enough to live comfortably sometimes. But they don’t pay you enough.
They don’t let you keep enough and they don’t educate you enough so that you can live free. As I’m fond of seeing, don’t live below your means.
Grow your means.
Learn how to protect your hard earned money by following the tax code.
Learn how to generate income on your own and learn how to take advantage of inflation instead of being robbed and learn how to make your money work for you rather than you working for money.
You can either complain about how the game is rigged against you or now that you know how to win a rigged game, go out and win it.
It really is your choice.
Now, maybe you wanna get four $250K properties right from the beginning or whatever it is.
But if you’re new to real estate, you can just start with one property and see how it feels kind of with the mindset of start small and think big.
