Inflation is here, folks.
Those economic contrarians who warned about the Federal Reserve’s loose monetary policies were right all along. When a central bank increases a country’s money supply, inflation invariably follows.
However, there’s levels to inflation. Some countries have manageable inflation rates, others experience more notable levels of inflation — usually in the double digits — that wreak economic havoc. However, even countries who face the latter, they can generally bounce back after implementing hard-nosed monetary reforms.
Some countries, on the other hand, aren’t so lucky….
In recent decades, several countries have experienced nightmare hyperinflationary episodes.
These four stand out for their ridiculous levels of hyperinflation:
- In the 1980s, Argentina experienced a nasty bout of hyperinflation. The government’s monetary policies got out of control in the late 1980s when hyperinflation entered the picture. Inflation skyrocketed to 12,000% at one point in this period.
- The collapse of the Socialist Federal Republic of Yugoslavia in the 1990s set off a chain of explosive political and economic events. Due to the Yugoslavian central bank not being able to put a lid on its money printing, inflation rose to 313,000,000% in the first month of 1994. In this period, a 500,000 dinar note could only purchase a loaf of bread. Further, a $1 million dollar dinar note.
- Under the rule of strongman Robert Mugabe, Zimbabwe embarked on several radical monetary and property reforms. The former created one of the most explosive inflationary episodes in modern times. According to July 2008 data from Zimbabwe’s Central Statistical Office, Zimbabwe’s month-over-month inflation rate was roughly 2,600%. In effect, this inflation rate was over 231,000,000% on a year-over-year basis. Plus, the Zimbabwean government issued a 100,000,000,000,000 Zimbabwean dollar bill!
- The last time Venezuela had inflation below double digits was in the early 1980s. Even in the 1990s, prior to the rise of Hugo Chavez, inflation reached nearly triple digits in 1996. But once Chavez took control and his successor Nicolás Maduro continued his legacy, inflation reached hyperinflationary levels. In 2018, hyperinflation reached north of 65,000%!
Mass inflation is not some hypothetical scenario that your economics professors are talking about. It’s a very real economic catastrophe that is capable of hitting any nation.
Now, the US is likely in the clear from a hyperinflationary collapse. However, higher than average inflation can still take place and make people’s lives miserable.
So it’s always good to be prepared.
In my humble estimation, the best way to protect yourself during inflationary episodes is by investing in an income property.
Here’s how it works:
You head to your local bank and tell the loan officer, “I have a proposition. I’m going to put down 20% of the purchase price for this property and you’re going to loan me the rest.”
If your credit history is sharp, the bank will likely agree to extend you a loan.
At that point, you’re stuck with loan debt that must be repaid.
But here’s how you game this situation to your benefit.
To start, rent out your property so that the tenant assumes the carrying costs of the mortgage.
In the meantime, the mortgage loses real value from inflation.
The big bad bank gets stiffed, but you receive a fantastic deal.
That’s the first benefit you receive from inflation.
Broadly speaking, assets like properties appreciate faster than inflation.
That’s Double Inflation Arbitrage in a nutshell.
It’s part of the broader benefits of inflation-induced debt destruction.
I teach this and other wealth-building secrets at the Empowered Investor Inner Circle.
By joining the Empowered Investor Inner Circle you’ll have access to a robust network of entrepreneurs and investors who will guide you along your journey to financial autonomy.
You’ll also get to hear about my most successful clients’ stories and see firsthand how they manage their investment properties.
Plus, you’ll learn how to break free from lousy property managers who are likely fleecing you of thousands of dollars.
With the Empowered Investor Inner Circle team at your side, you’ll be saving tens of thousands of dollars in the years ahead…. without having to do any of the heavy lifting.
In the meantime, your properties’ values will rise alongside your cash flow. And guess what? Your expenses will fall by 25% or potentially even more.
Having this income property investing strategy will make you anti-fragile in the face of whatever will be thrown at you in the upcoming decade.
Because if I’m going to be blunt here, the next decade is going to be a wild ride.
So it helps to be prepared for the worst.
It also helps you to learn how to make an economic crisis your best friend.
My team and I can teach you that and much more at the Empowered Investor Inner Circle.
Click here to get on the fast track to economic sovereignty today!
