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them all: inflation. According to the government, the consumer price index (CPI) was approximately 7% last year. Does anyone believe that real estate, food, health care insur- ance, and gas at the pump went up only 7% last year? No way! The government wants to keep the CPI index number low, so they don’t have to pay the higher rates to Social Security recipients. A man named John Williams founded a company called ShadowStats. He calculates inflation the way the government calculated the CPI index years ago. These days, every time something goes up too much, the government throws it out of the basket of goods used to calculate the CPI. John estimates the real inflation rate last year was 14%, and I agree with him. Think about that, if you had $100,000 sitting in the bank last year, the best you got was 2% on it. That means you lost 12%

the boom and fantastic rise in the values of real estate throughout the country is the federal government keeping interest rates artificially low. Back in the 1980s, rates were 12% to 18%. Today, the rates are in the 2.5% to 4.5% range. I estimate the federal government can’t raise interest rates too much, because they can’t afford to pay it on our national debt. During my almost four decades, I have never seen such a shortage of affordable housing throughout the country as there is today. I am in several mastermind groups with some of the top real estate invest- ment companies from coast to coast. Everyone says the same thing: “There is little to no affordable hous- ing in their market.”

of purchasing power, or $12,000 of true wealth disappeared. Inflation is a stealth tax and, in my opinion, it’s the worst and cruelest one of all. I foresee inflation only getting worse, not better, in the coming years. WHATARE THE OPTIONS? So, what should we do as inves- tors? Where should we have our money if I am right and the crash occurs this year? Obviously, we all must decide that for ourselves; I’m certainly not going to tell you what to do with your money. But, I’ll tell you what I’m doing with my money. I am going to be 100% in hard assets, outside of the cash I need to run my business and personal life. My asset allocation will be 10% gold and silver (which has been a great hedge fund against currencies and inflation since biblical times) and 90% real estate (only affordable

INFLATION Finally, let’s talk about what I believe is the biggest problem of

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