Bank of Canada is Worried & Florida Here We Come!

Message from Tom & Nick

OK, so I love going to the Leafs games. I mean both Nick and I have been cheering for the Leafs for as long as we can remember.

And they bring me nothing but very brief moments of hope and happiness...

...and very long moments of sadness and pain.

So what better way to share this than going to a game with my daughter!!

We went to the Tampa game this past Monday.

It was wild. They were down 4-1 in the first period, the Leaf's goalie was pulled, and I was chatting with my daughter about the vast depth of the suffering I had endured for a lifetime.

And then they pulled a classic Leaf's move...

They came back and won the game!! And we celebrated each comeback goal together like we were winning the Stanley Cup!!

We are going to with the Cup this year...it has been written. LOL!!

Go Leafs Go!!

That night will be a memory with my daughter I won't soon forget, good times!

OK, let's move on to much more serious matters...

The Bank of Canada and Florida investment properties.

First the BoC...

This week, the Bank of Canada shared that it's worried about continued inflation.

And they pointed out that it's not their fault of course, it's the government's fault.

Here's a quote from a Financial Post article this week with their comments about upcoming government spending plans (source):

“If all those plans are realized, this would contribute materially to growth over the next year,” the statement of deliberations said. “By adding to demand at a faster pace than the growth of supply, government spending could get in the way of returning inflation to target.”

Last week, we discussed "fiscal dominance".

The concept that high debt and interest payments with high government spending perpetuate more and more inflation.

So much so that even higher rates can't bring it down to the 2% target.

Now we see the Bank of Canada explicitly calling out this idea of "fiscal dominance".

So even though inflation is cooling and rates could be coming down next year...don't be surprised shortly afterward to see another round of high or higher inflation with high or higher rates!!

This isn't last decade.

This new decade is likely going to be a roller coaster of "high then low then high" inflation and "high then low then high" rates.

At least that's what we're preparing for.

Remember, with real estate your biggest variable are interest rates.

So it's worth it to study this stuff and plan for all probability.

And, in our opinion, the one probability not many are planning for is that 24 months from now, after rates come down next year, they could go up again.

You can have double digit interest rates as long as inflation is higher than the rates (e.g. rates of 12% and inflation of 16%).

With that combo, the government still gets "negative real rates" which allows them to manage all their debt via financial repression.

In a world where inflation is consistently higher than rates you want to own hard assets.

We've talked about income properties and Bitcoin in this regard.

And we just announced something brand new to Rock Star Inner Circle members:

We now have access to Florida income properties all across the state!!

We have a long time friendship with a builder down in Florida and have been waiting to do something together for a long time.

And that time is now.

He builds 600-800 brand new, purpose built rental properties a year.

Single family homes, duplexes, and quads (4-plexes).

He also does property management!

The properties are in places like Jacksonville, Palm Coast, Sarasota, Fort Myers, etc.

So we finally have a relationship with someone who we've known for years, we trust, is doing brand new "build-to-rent" properties and has all the right building codes for Florida's weather, insurance contacts, and foreign buyer financing contacts.

It's a big deal and we feel pretty fortunate to know him.

We're doing our very first "Florida Fast Start" educational tour with Rock Star investors in December.

Not only can we find cash flow down in Florida, we get exposure to both the U.S. dollar and to sunshine with them!!

Who doesn't want an excuse to go to Florida? LOL!

We'll be sharing more as this journey evolves.

Rock Star members have asked for this for a long time and we never felt like we had the right relationship to share. That's now changed.

Sunny skies ahead!!

(with the usual bumps and bruises that come with all real estate investments, of course!!)

Adding Florida investment property options to Rock Star investor choices feels like a big accomplishment.

We'll be going through this step-by-step and sharing videos and updates over the next few months.

We still feel like our 3-bucket strategy is going to serve us well over the next few years.

🪣 Bucket #1: Have liquid fiat dollar reserves (i.e. cash savings)

🪣 Bucket #2: Hold longer-term savings in Bitcoin (or gold if that's your thing)

🪣 Bucket #3: Hard assets that produce income streams (aka, starter home rental properties)

You can do other things like start your own business too, of course.

The bottom line is you want to outpace M2 (money supply) growth with your income and savings. That's the name of the game.

We'll talk more about that in a video we have planned for next week.

Until then,

Your life, your terms!

Tom & Nick

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