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HOT TOPIC Hyperinflation starting? What's happening in your area? Post your ground reports.

Timmy C

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Ok, so we've kind of came to agree that there's hyperinflation.

What now? That's the only important question. How do we protect our assets?

Gold? Silver? Real estate? Crypto?
How about dividend paying stocks?
What else?

Also, which fiat currency do you deem the safest/most stable? I keep most of my fiat in EUR.

I heard that dogecoin is a good inflation hedge.

The Shiba spirit will protect you.

I donno man, we all are hoping we make the right calls.
 

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Mike Partee

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I've put a lot in the Swiss Franc and allocated to both physical and proxy real estate.

btw, for anyone reading this and want an easy way to do this:

Set up a Transferwise account.

You'll be able to convert your USD and hold in other currencies from there, and easily convert back to USD when you need it.

I have an equal amount in a dozen or so currencies, including the Franc.
 
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thechosen1

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I’ve read the best currencies are Kuwait dollars, Singapore, and Switzerland. Never owned foreign currency though.
 

Antifragile

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Ok, so we've kind of came to agree that there's hyperinflation.

What now? That's the only important question. How do we protect our assets?

Gold? Silver? Real estate? Crypto?
How about dividend paying stocks?
What else?

Also, which fiat currency do you deem the safest/most stable? I keep most of my fiat in EUR.
@VentureVoyager - You may find the attached report useful.
My personal strategy (and I am biased) is real estate.
 

Attachments

  • Review of Emerging Trends May 4 2021.pdf
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Matt Sun

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Inflations is a great way to lower salaries into oblivion "without actually doing it".
It's a great way of stealing savings.

I guess that's why we have so much inflation in Hispanic - America and countries ruled by criminals in general. OFC politicians would always say it's multi causal and doesn't have to do with the money printing AT ALL.
Later they blame the bad capitalist that "speculate" with prices and implement... more communisms, like stating maximum prices, which brings shortages of goods, poverty and yes, even more communism.
 

thechosen1

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The biggest issue I see with inflation is that the end result will be assets that can’t be afforded by even the biggest investment firms, and people with income or salaries that are so poor that all they will do is riot and freak out.

Imagine a single family home being $1 trillion and minimum wage being $1 million

The end result would be the government declaring the only solution is for them to own all the major assets...

Could this happen or am I way off base and too pessimistic? Is this the government’s plan?
 

MJ DeMarco

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Spoke to an HVAC guy today, he said the cost of all new systems went up 6% in April, and another 7% in May. This is manufacturer pricing, which of course, gets passed on to the consumer.
 

Timmy C

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A single unit in my home town which is 40km from a major city is going for $550,000 a pop in Melbourne.

Homes in the same area going for now up to 1 million.

A mere few months ago it was $100,000 less at least.
 

socaldude

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I guess that's why we have so much inflation in Hispanic - America

I knew COVID was gonna hit those third world Latin American countries hard. Especially where corruption and organized crime is rampant. Look at Colombia or Venezuela. I heard they had paper money scattered everywhere in Venezuela because of hyper-inflation. The media hardly covered it.
 

Timmy C

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Conversation with a friend:
$100,000 deposit and still struggling to get in.

What will you need in 6 months, $200,000?

Property are going for even more than listing prices.
IMG_20210508_155326.jpg
 

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Envision

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Read Big Debt Crisis by Ray Dalio.

In the book he describes exactly what is going on and how deleveraging will need to occur.

The scary part is what normally happens through a deleveraging is war and social unrest.
 

23Infinity

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I've put a lot in the Swiss Franc and allocated to both physical and proxy real estate.

Hey MJ, what is your rationale behind purchasing the Swiss Franc? Is it really a good hedge in an inflation / hyper-inflation scenario?

I was checking out their M2 money supply data and it looks like they've been printing money as well, although perhaps not as much as the US and others.


Also, by proxy real estate, do you mean ETFs or REIT stocks?
 

Timmy C

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Read Big Debt Crisis by Ray Dalio.

In the book he describes exactly what is going on and how deleveraging will need to occur.

The scary part is what normally happens through a deleveraging is war and social unrest.
I feel like people have been saying this for the last 10 years in Australia and property just continues to hit record highs.
 

VentureVoyager

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It's getting more and more ironic as 1M usd used to be considered a fortune not that very long ago, while now it doesn't even buy you a nice house in many parts of US and Canada. It's not even like it buys at least one kick-a$$ mansion or a seaview villa and then you're out of money. Just a nice house.

"lol" - anon, 2021
 

MJ DeMarco

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Hey MJ, what is your rationale behind purchasing the Swiss Franc? Is it really a good hedge in an inflation / hyper-inflation scenario?

It comes down to a matter of which government/banks do I trust the most, especially in a crisis, when in reality, I trust none of them.

Kinda like choosing which criminal do I want to partner with? What a choice!

All G7 currencies are trash and COVID exposed these governments and their politicians as untrustworthy, authoritarian, and unable to make decisions based on logic over emotion. The Japanese government is the only G7 government I have a smidgen of faith in, and hence, the Yen and the Franc seemed to be better places for a cash conversion.

Also, by proxy real estate, do you mean ETFs or REIT stocks?

Yes. I own a ton of LEAPS on REITS and ETFS, as well as REITs.

Risk wise, I'd rather "buy at the top" and lose money, than have reckless politicos and bankers use inflation to turn my fortune into nothing while they continue writing blank checks to citizens who produce nothing, and contribute nothing to society other than a good retweetable tweet.
 

MoneyDoc

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I think some of us are thinking too much about this whole inflation situation.

Yes, for those that have millions of dollars in the bank, it makes sense to stress over inflation and figure out the best strategy to protect the value of your money.

With that said, for those that are nowhere near "FU money", does it really matter? If you weren't able to buy a house before, what difference does it make?

I guess what I'm trying to say, it seems to me some people are way too worried about inflation when in fact, they should strive to be in a position where inflation or not, it wouldn't make a difference. Having your $100m worth $50m, is still better than making $50k/year.

There's so many opportunities right now for entrepreneurs, I just don't think it's worth stressing over something you can't control. Inflation can't stop entrepreneurs from making 8-9 figure exists in two years from brands they bootstrapped.

Again, just my opinion.
 

socaldude

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Risk wise, I'd rather "buy at the top" and lose money, than have reckless politicos and bankers use inflation to turn my fortune into nothing while they continue writing blank checks to citizens who produce nothing, and contribute nothing to society other than a good retweetable tweet.

Here is one of my favorite quotes from one of my favorite documentaries. Money Masters 1996.

"The central bank scam is really a hidden tax. The nation sells bonds to the central bank to pay for things that it does not have the political will to raise taxes to pay for. But the bonds are purchased with money the central bank creates out of nothing. More money in circulation makes your money worth less. The government gets as much money as it needs, and the people pay for it in inflation. The beauty of the plan is that not one person in a thousand can figure it out, because it's usually hidden behind complex-sounding 'economics' gibberish."
 

Kak

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I just bought a CZ75B handgun and an AR-15 with my inflationary profits. Checking and savings accounts are for bag holders. LOL :innocent: :halo:
But you lost them in a boating accident right?

You aren't armed until you have to scour the house for an hour before little kids come over. And THEN lose them in a boating accident of course. :rofl:
 

MJ DeMarco

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It's getting more and more ironic as 1M usd used to be considered a fortune not that very long ago, while now it doesn't even buy you a nice house in many parts of US and Canada. It's not even like it buys at least one kick-a$$ mansion or a seaview villa and then you're out of money. Just a nice house.

"lol" - anon, 2021

Here ya go...

I nice 2,300 square foot house in Jackson Hole Wyoming, a place far from the city life drama, you only need $3M to get it.

 

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WestCoast

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We're going to do our first 'mid year' price increase, I think ever, next month.
Everything has gone crazy, and we keep raising prices to keep up.

--
I have left a lot of money in cash the last few years, waiting for an opportunity.
Lost 3-5% a year, easily, on it for 2-3 years.

About to use all that cash, lever up.

After that, assuming the purchase delivers as expected, I have NO idea what I'm going to do with any future cash.
I am not convinced US Dollars are the right store anymore.

My physical gold investments have gone nowhere in 10+ years.
Only thing I make money on is business - so, got to imagine I'll just keep investing in those.

Crazy times. But the best, adapt and move forward. (even if they have no idea how right now)
 

Bruno Calisso

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I think some of us are thinking too much about this whole inflation situation.

Yes, for those that have millions of dollars in the bank, it makes sense to stress over inflation and figure out the best strategy to protect the value of your money.

With that said, for those that are nowhere near "FU money", does it really matter? If you weren't able to buy a house before, what difference does it make?

I guess what I'm trying to say, it seems to me some people are way too worried about inflation when in fact, they should strive to be in a position where inflation or not, it wouldn't make a difference. Having your $100m worth $50m, is still better than making $50k/year.

There's so many opportunities right now for entrepreneurs, I just don't think it's worth stressing over something you can't control. Inflation can't stop entrepreneurs from making 8-9 figure exists in two years from brands they bootstrapped.

Again, just my opinion.
You need to rethink that bro.

Minimum wage in Portugal is 665€.

Lets say I manage to save 266€ (40%) per month.

In 2.5 years I'll have €8K saved.

Now, suppouse I have €20K in my bank account and the annual inflation rate is 2% (the usual "official rate").

I'll be losing about 400€ per year.

In 20 years I've lost €8K, that is about 40% — half of my savings... This is pure theft.

Twenty years ago it took me 2.5 years of life sacrifices to save those eight grand.

That's what's fuc*ed up about inflation, those 2% might not seem much of big deal now, but in the long term they will steal your precious years of life.

If you are poor it's even worse, by the time a slowlaner retires the Mafia State has already eaten half of their retirement savings.

CASH IS TRASH, INFLATION IS THEFT.
 

MoneyDoc

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You need to rethink that bro.

Minimum wage in Portugal is 665€.

Lets say I manage to save 266€ (40%) per month.

In 2.5 years I'll have €8K saved.

Now, suppouse I have €20K in my bank account and the annual inflation rate is 2% (the usual "official rate").

I'll be losing about 400€ per year.

In 20 years I've lost €8K, that is about 40% — half of my savings... This is pure theft.

Twenty years ago it took me 2.5 years of life sacrifices to save those eight grand.

That's what's fuc*ed up about inflation, those 2% might not seem much of big deal now, but in the long term they will steal your precious years of life.

If you are poor it's even worse, by the time a slowlaner retires the Mafia State has already eaten half of their retirement savings.

CASH IS TRASH, INFLATION IS THEFT.
Right so you're just going to sit around for 20 years with that 8k in your account doing nothing?

My point was exactly that. Put yourself in a position where inflation or not, it doesn't really make a difference to your life.
 

23Infinity

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Right so you're just going to sit around for 20 years with that 8k in your account doing nothing?

My point was exactly that. Put yourself in a position where inflation or not, it doesn't really make a difference to your life.

I agree with what you're saying about make enough wealth via business such that inflation isn't an issue, but it's still pretty bad if the 9-5 average joe, without the entrepreneurial capability of the typical FLF person, is getting f*cked as the way Bruno describes it, and it can have long term secondary/tertiary consequences for businesses/entrepreneurs as well. And from independent inflation trackers such as Chapwood and Shadow stats, real inflation for the past few years due to all the money printing hasn't been 2% but easily above 5%, some even say 9%...if you count the prices of things that actually matter where production can't be easily outsourced to control costs (i.e. housing, healthcare, education). And this is all before 2020.

I hope governments find a way to reign in the money printing and hence inflation, but I wouldn't bet on it.
 

Bruno Calisso

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Right so you're just going to sit around for 20 years with that 8k in your account doing nothing?

My point was exactly that. Put yourself in a position where inflation or not, it doesn't really make a difference to your life.
No, your point is absolutely right, but neither is wrong the fact that in the long term no matter how much you have in your bank, you'll be losing a big chunk of your wealth that took you lots of hard work and time, so worrying about losing them is not losing focus at all, it's smart to worry about inflation and taxes, 2% is being optimist this days and politicians will always want to finance themselves out of your pocket.
 

23Infinity

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My physical gold investments have gone nowhere in 10+ years.
Only thing I make money on is business - so, got to imagine I'll just keep investing in those.

Crazy times. But the best, adapt and move forward. (even if they have no idea how right now)

Don't want to derail this thread into a debate but *cough cough* crypto *cough cough*.
 

Antifragile

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@MoneyDoc
Entrepreneurs must always worry about economic conditions. Inflation isn’t just bad because you have too little cash or no business. It’s bad even if you are a billionaire. Eventually the wealth gap gets too wide and we have civil unrest. Wealth re-distribution occurred in the past because of wars. It’s not to say we can’t have more in-country conflict if the situation for a regular worker gets too dire.
What I’m saying is this - you are a successful entrepreneur driving a luxury SUV and chatting with like minded friends here. We get what you are saying. But there is that other side - for your business to be a success, you must have a good economy with plenty of regular working Joe’s having money to spend. Inflation hurts all but helps politicians!
 

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