Last week we were chatting about what our late Teta Eva would be doing in today's economic climate to make money. Click here for the first post on this topic.
By this time she would have concluded that, the value of the dollars in her pockets became less and less valuable to her.
To her, it would be simple.
She had lived through crazy times before and the 1990's were the last big economic event of her lifetime.
Prices for food and supplies ended up going through the roof on her because the monetary policy at the time was "print more money to pay for things we can't afford".
So Teta Eva has seen this game before.
It's funny when you talk to Canadians and Americans who believe such a thing can never happen here. Those people have their heads stuck firmly in the sand.
And we don't need a Yugo style hyperinflationary event to cause your standard of living to drop.
Four percent inflation for ten years cuts the purchasing power of your bank account in half. Read that two or three times.
To protect herself from "mild" inflation, if there is such a thing, or even 3% to 5% a year we imagine Teta Eva would have this advice...
"Money is cheap. Borrow it...borrow all you can of it! But be smart and lock in your interest rate for as long as humanly possible. Put the money into land and real stuff like metal, oil, gas and wheat ... even buy fine art if you can't find any of that other stuff. Real stuff goes up in value when money is cheap to borrow."
Sound too simple to be meaningful?
Ah, we don't think so.
She was obviously a risk taker but weighed her options very carefully before making any money moves. Without a proper team and the right knowledge around you, we're not promoting the idea of borrowing to the max - but we don't want to hide what we truly believe she would say either.
What we're trying to do with this is show you the thinking of someone who has lived through strange economic times and increased her modest wealth in the process.
She definitely would not think of paying off good debt on investments or saving money in the bank during this economic climate.
Why are we sharing any of this? Because headlines like this in the Financial Post a couple of days ago scare us...
They don't scare us because of the message around property prices.
If you're over-leveraged on your personal home that's a problem at any time ... not just right now.
And Mark Carney's message is appropriate for those people.
But if you're reading this that's likely not you.
Nah, these types of headlines scare us because we feel a lot of Canadians may read this stuff and "freeze".
They'll just park their savings into fixed-income investments and into low paying savings accounts.
Many people right now are scared of the stock market so they won't go there.
They've heard horror stories of rental properties so they won't go there.
And they don't know much about buying gold and silver and wheat and corn so they won't go there.
The result? With the super high debt loads going around right now higher inflation is very likely here to stay and putting your money in real things is one way to out pace inflation. Go back in history and look for yourself.
We can all debate if it will be 4% a year or 14% a year but there's no doubt any longer that power players in the Federal Reserve want it.
And they're working hard to make sure they get it.
The only question left for us ... is what are you doing about it?
And if we can help in some small way we want to. Learn about cash flowing investment properties.
Find a friend who isn't complaining about them but is mastering them.
Go hang with him or her ... a lot.
Research the history of commodities during times of economic crisis like this.
Educate yourself on the money game. Want a really quick summary of some global monetary current events? Here's an article to check out.
You can prosper during these times ... and you will!
Our message to you is this: there are huge opportunities for you in any market ... take action on them. Don't sit still - especially in times like these when sitting still may actually mean you're falling behind in your wealth creation.
There really is opportunity everywhere even when the Greek's are rioting, China's inflation is exploding, the U.S. debt is at its ceiling and the Bank of Canada is warning of a housing rush. Don't sit still - get busy.
And if our Teta Eva could create wealth for her family during even crazier times we can all surely do it ourselves.
Until next time ... here's to Your Life on Your Terms!