Editor’s Commentary: The real estate market is in a state of flux. We recommend physical precious metals as a proper hedge against inflation, but more importantly as a way to protect wealth and retirement. So why would we post an article that argues for renting out property instead of buying precious metals? Because while there is usually more than one way to skin a cat, it makes sense for people with appropriate wealth or retirement to diversify whenever possible. In other words, protect your savings with precious metals and consider advancing your revenue with what Ken McElroy from our premium news partners at The Epoch Times recommends below.
While inflation and skyrocketing rents have been grabbing the headlines, there’s a bigger story that’s going on. With the poor and the middle class being forced to pay more at the grocery store, the gas pump, and to their landlords, they’re lining the pockets of the wealthy. There is a huge wealth transfer occurring right now.
While you may dismiss this as business as usual, right now that business is on steroids. Let’s take a look at what’s happening, and what you can do to safeguard your money.
One of the major ways that wealth is being transferred from the working class is in the labor market. Over the past 20 years, large U.S. companies have been outsourcing jobs at a fast pace. Roughly 4.5 percent of American jobs are outsourced every year. In 2021, when the United States created a record 6.4 million new jobs that were based domestically, it also outsourced about 300,000 jobs to other countries.
While giant corporations can save money this way, paying overseas employees far less, the net result for Americans is increased unemployment.
Outsourcing is especially common in the IT sector. The technology know-how in India and China is comparable to that of the U.S. labor pool, but it’s a lot less expensive to hire workers overseas. India is especially appealing to U.S. employers. The country has been rapidly modernizing in the digital age. The entire population of India is 1.38 billion, and 500 million of those people are online. As a nation, India is likely to remain a competitive talent pool for American companies for years to come.
Meanwhile, Americans are paying a fortune just to fill up their car to get to work. As of this writing, gas prices hit a national average of $5 per gallon and are expected to only move higher, an increase of about $3.07 from a year ago. According to Moody’s analytics, the average U.S. household is spending $160 more per month on gas than a year ago.
While the war in Ukraine has upended operations for companies like Exxon Mobil and Shell Oil, who have exited operations in Russia, they have passed their financial losses onto the customer. In fact, now would be a great time to invest in oil. Shell’s net income rose from $5.8 billion in the first quarter of 2021 to $7.3 billion in the same period of 2022. British Petroleum posted its highest quarterly profit in the first quarter of 2022 at $6.2 billion, compared to $2.6 billion a year ago.
There are many conclusions to draw from this, but what jumps out to me is that when there’s an increase in the cost of doing business, it gets passed on to the customer.
With gas prices rising, it’s expensive to go anywhere.
Meanwhile, for renters, the cost of staying home and doing nothing has also gone up. Rents have soared in pretty much every market.
Places that never would have expected a huge influx of residents, like Boise, Idaho, have seen a massive influx of new residents and rent increases. The average rent in Boise is now $2,085 per month, an increase of 33 percent year over year. In Phoenix, Arizona, it’s the same story: rents have shot up about 30 percent in the past year. If you’re a rental property owner, this is great news. If you’re renting, this is another financial pressure.
We know that wealth is being transferred from the bottom to the top of the economic ladder, so you might be wondering what you can do to ensure that you’ll be able to maintain your own solvency.
As someone who grew up working class, I can tell you that the best possible way to hold on to your money is by investing in real estate. I have been investing in real estate for over 30 years, and I started with nothing. Today I own numerous multifamily rental properties, and the beauty of real estate is that it has always acted as a strong hedge against inflation.
The way this works is that the mortgage on the property has a fixed rate, while the longer you hold your property, the more you can charge your tenants.
For many, the money for a down payment may be out of reach. However, I would urge you to get creative and find a way to make it happen, whether it’s your primary residence or a rental property. One solution that’s been popular with younger homeowners is buying a home with a friend or friends. While it may not be ideal, I believe that this wealth transfer will continue.
One of the basic principles of my friend and mentor Robert Kiyosaki’s book, “Rich Dad, Poor Dad,” is that the rich don’t work for their money. Unfortunately, the opposite is true for millions: that they’re working hard to stand still. If you’re one of the many who are just getting by, I hope this will spur you into action.
Five Things New “Preppers” Forget When Getting Ready for Bad Times Ahead
The preparedness community is growing faster than it has in decades. Even during peak times such as Y2K, the economic downturn of 2008, and Covid, the vast majority of Americans made sure they had plenty of toilet paper but didn’t really stockpile anything else.
Things have changed. There’s a growing anxiety in this presidential election year that has prompted more Americans to get prepared for crazy events in the future. Some of it is being driven by fearmongers, but there are valid concerns with the economy, food supply, pharmaceuticals, the energy grid, and mass rioting that have pushed average Americans into “prepper” mode.
There are degrees of preparedness. One does not have to be a full-blown “doomsday prepper” living off-grid in a secure Montana bunker in order to be ahead of the curve. In many ways, preparedness isn’t about being able to perfectly handle every conceivable situation. It’s about being less dependent on government for as long as possible. Those who have proper “preps” will not be waiting for FEMA to distribute emergency supplies to the desperate masses.
Below are five things people new to preparedness (and sometimes even those with experience) often forget as they get ready. All five are common sense notions that do not rely on doomsday in order to be useful. It may be nice to own a tank during the apocalypse but there’s not much you can do with it until things get really crazy. The recommendations below can have places in the lives of average Americans whether doomsday comes or not.
Note: The information provided by this publication or any related communications is for informational purposes only and should not be considered as financial advice. We do not provide personalized investment, financial, or legal advice.
Secured Wealth
Whether in the bank or held in a retirement account, most Americans feel that their life’s savings is relatively secure. At least they did until the last couple of years when de-banking, geopolitical turmoil, and the threat of Central Bank Digital Currencies reared their ugly heads.
It behooves Americans to diversify their holdings. If there’s a triggering event or series of events that cripple the financial systems or devalue the U.S. Dollar, wealth can evaporate quickly. To hedge against potential turmoil, many Americans are looking in two directions: Crypto and physical precious metals.
There are huge advantages to cryptocurrencies, but there are also inherent risks because “virtual” money can become challenging to spend. Add in the push by central banks and governments to regulate or even replace cryptocurrencies with their own versions they control and the risks amplify. There’s nothing wrong with cryptocurrencies today but things can change rapidly.
As for physical precious metals, many Americans pay cash to keep plenty on hand in their safe. Rolling over or transferring retirement accounts into self-directed IRAs is also a popular option, but there are caveats. It can often take weeks or even months to get the gold and silver shipped if the owner chooses to close their account. This is why Genesis Gold Group stands out. Their relationship with the depositories allows for rapid closure and shipping, often in less than 10 days from the time the account holder makes their move. This can come in handy if things appear to be heading south.
Lots of Potable Water
One of the biggest shocks that hit new preppers is understanding how much potable water they need in order to survive. Experts claim one gallon of water per person per day is necessary. Even the most conservative estimates put it at over half-a-gallon. That means that for a family of four, they’ll need around 120 gallons of water to survive for a month if the taps turn off and the stores empty out.
Being near a fresh water source, whether it’s a river, lake, or well, is a best practice among experienced preppers. It’s necessary to have a water filter as well, even if the taps are still working. Many refuse to drink tap water even when there is no emergency. Berkey was our previous favorite but they’re under attack from regulators so the Alexapure systems are solid replacements.
For those in the city or away from fresh water sources, storage is the best option. This can be challenging because proper water storage containers take up a lot of room and are difficult to move if the need arises. For “bug in” situations, having a larger container that stores hundreds or even thousands of gallons is better than stacking 1-5 gallon containers. Unfortunately, they won’t be easily transportable and they can cost a lot to install.
Water is critical. If chaos erupts and water infrastructure is compromised, having a large backup supply can be lifesaving.
Pharmaceuticals and Medical Supplies
There are multiple threats specific to the medical supply chain. With Chinese and Indian imports accounting for over 90% of pharmaceutical ingredients in the United States, deteriorating relations could make it impossible to get the medicines and antibiotics many of us need.
Stocking up many prescription medications can be hard. Doctors generally do not like to prescribe large batches of drugs even if they are shelf-stable for extended periods of time. It is a best practice to ask your doctor if they can prescribe a larger amount. Today, some are sympathetic to concerns about pharmacies running out or becoming inaccessible. Tell them your concerns. It’s worth a shot. The worst they can do is say no.
If your doctor is unwilling to help you stock up on medicines, then Jase Medical is a good alternative. Through telehealth, they can prescribe daily meds or antibiotics that are shipped to your door. As proponents of medical freedom, they empathize with those who want to have enough medical supplies on hand in case things go wrong.
Energy Sources
The vast majority of Americans are locked into the grid. This has proven to be a massive liability when the grid goes down. Unfortunately, there are no inexpensive remedies.
Those living off-grid had to either spend a lot of money or effort (or both) to get their alternative energy sources like solar set up. For those who do not want to go so far, it’s still a best practice to have backup power sources. Diesel generators and portable solar panels are the two most popular, and while they’re not inexpensive they are not out of reach of most Americans who are concerned about being without power for extended periods of time.
Natural gas is another necessity for many, but that’s far more challenging to replace. Having alternatives for heating and cooking that can be powered if gas and electric grids go down is important. Have a backup for items that require power such as manual can openers. If you’re stuck eating canned foods for a while and all you have is an electric opener, you’ll have problems.
Don’t Forget the Protein
When most think about “prepping,” they think about their food supply. More Americans are turning to gardening and homesteading as ways to produce their own food. Others are working with local farmers and ranchers to purchase directly from the sources. This is a good idea whether doomsday comes or not, but it’s particularly important if the food supply chain is broken.
Most grocery stores have about one to two weeks worth of food, as do most American households. Grocers rely heavily on truckers to receive their ongoing shipments. In a crisis, the current process can fail. It behooves Americans for multiple reasons to localize their food purchases as much as possible.
Long-term storage is another popular option. Canned foods, MREs, and freeze dried meals are selling out quickly even as prices rise. But one component that is conspicuously absent in shelf-stable food is high-quality protein. Most survival food companies offer low quality “protein buckets” or cans of meat, but they are often barely edible.
Prepper All-Naturals offers premium cuts of steak that have been cooked sous vide and freeze dried to give them a 25-year shelf life. They offer Ribeye, NY Strip, and Tenderloin among others.
Having buckets of beans and rice is a good start, but keeping a solid supply of high-quality protein isn’t just healthier. It can help a family maintain normalcy through crises.
Prepare Without Fear
With all the challenges we face as Americans today, it can be emotionally draining. Citizens are scared and there’s nothing irrational about their concerns. Being prepared and making lifestyle changes to secure necessities can go a long way toward overcoming the fears that plague us. We should hope and pray for the best but prepare for the worst. And if the worst does come, then knowing we did what we could to be ready for it will help us face those challenges with confidence.
