Yet another BRUTAL storm forming …

And the hits just keep on coming …

We know you’d like investing to be simple and drama free.  We do too.

But while real estate investing itself is a simple activity … the economics of real estate investing has become more complex.

There’s a LOT going on in the world.   Some things interconnect by cause, and others by effect … meaning they don’t appear to be related, but then converge.

As Jim Rickards points out repeatedly … economies and ecologies are complex systems.  They are difficult to understand and even more difficult to predict.

But even though no one can say with certainty what will happen, it’s still important to take precautions when it’s clear SOMETHING BIG is coming …

… just as Floridians watched Irma and prepared, not knowing fully what to expect.  Better to be prepared and not have a disaster than vice versa.

So let’s take a look at what’s forming on the horizon …

Hurricanes Harvey and Irma

While the total financial and human impact of these back-to-back disasters is yet to be calculated, one thing’s for sure …  it’s going to be expensive.

Short term disruptions to gas prices and orange futures aside, disasters like these redirect HUGE amounts of capital … which has a ripple effect.

For example, money insurance companies might otherwise put into financing NEW multi-family apartments in other markets …

… will now pour into re-building properties damaged and destroyed in Houston and Florida.

Federal money which might have been focused on infrastructure spending or tax cuts will also be redirected to damage recovery.

And it’s likely the demand for construction labor and supplies will rise, driving up total construction costs in many markets … not just those affected by the storms.

That’s because just as demand for concrete in China creates price increases in the U.S. … the demand for reconstruction resources will probably be felt throughout the United States.

Distressed inventory

Just like the financial disaster of 2008, there may be many problem properties coming out of all this … because many weren’t insured for flood damage.

Federal aid may help some of those homeowners.  It’s less likely such relief is offered to investors who were under-insured.

While it’s no fun to profit from someone else’s loss, there’s a role for profit-seeking capital to play in repairing damaged communities.

We wouldn’t be surprised to see tax breaks, loan subsidies or other incentives offered to entice investment capital to flow into affected markets … like when New Orleans was hit by Hurricane Katrina.

The Debt Ceiling  

In other news, President Trump and Congress managed to get the debt ceiling temporarily increased … while raising the prospect of simply eliminating it all together.

Talk about calling a spade a spade.  The ceiling hasn’t capped spending … ever.

Now billions of dollars are ear-marked for hurricane relief, and everyone can take a short break from “worrying” Uncle Sam might default on his debt.

So it looks like it’s back to over-spending as usual. Not surprisingly, the dollar’s year-long fall has resumed velocity.  

Then again … maybe the dollar’s fall (and gold’s rise) is part of a bigger story which has nothing to do with U.S. business-as-usual deficit spending …

Gold-backed yuan already finding friends

As we recently noted, China announced plans to settle its oil trade in yuan.

And to entice sellers to accept yuan, the Chinese are backing it with that “barbarous relic” … gold.

Days later, oil-rich Venezuela announced they’d start using yuan … and other currencies … to “free us from the dollar.”

It’s no surprise Venezuela would jump at this.  After all, just two weeks earlier President Trump signed an executive order sanctioning Venezuela … whose economy is 95% oil.

But as we note in our Real Asset Investing report, China began its plan to supplant the dollar way back in 2010.  So none of this is new.

And the first country to sign a bilateral trade agreement to “renounce the U.S. dollar” was … wait for it … Russia … followed by Brazil, Australia, and a LONG list of others.

We think this is a HUGE story that few in mainstream financial media are covering.  But we are.

In fact, we’re putting together an emergency conference call with Brien Lundin and Chris Martenson to discuss the ramifications … so stay tuned for that!

Is the U.S. dollar doomed?

This is the big WHY IT MATTERS … especially for Americans and everyone denominating wealth in American dollars.

Like Hurricane Irma, no one can say exactly if, when, or how disaster will strike.  And it’s possible the winds will change and the storm will miss your portfolio.

But what if it doesn’t?  Right now, the winds appear to be headed your way.

Are YOU ready?  Are you getting ready?  Many people don’t even know what ready looks like.  That was us 10 years ago.

It’s a complex problem so there’s no simple solution.  If there was, it probably wouldn’t be a problem.

Peter Schiff has been warning about this for years. As has Robert Kiyosaki, Richard Duncan, Simon Black, Chris Martenson, Jim Rickards, David Stockman … and the list goes on and on.

Each has their own ideas about when … and how to prepare.

There’s no one-size-fits all answer because everyone’s situation, portfolio, investing IQ, advisory network, access to deals, and investment objectives are different.

MISSION: POSSIBLE

Your mission, should you choose to accept it, is to get informed, educated, connected and activated … as quickly as possible.

And if you think getting educated is time consuming and expensive … it’s nothing compared to being ignorant and apathetic.

When storm clouds form on the horizon, some decide to pay attention and take pre-emptive steps.  There’s no guarantee of safety, but their odds are better.

Others only hope for the best, but don’t prepare for the worst.  Yet the higher the stakes, the more important it is to be preemptively cautious.

The storm warnings are loud and clear … for everyone paying attention.

But storms often approach slowly … and because most blow over … it’s easy (yet dangerous) to assume every storm will.

Slowly at first … then all at once

Longtime listeners know we’ve been watching this whole story unfold for years.

We talked about the very real possibility of China making a run at reserve currency status almost two years ago.  We said then we’d keep you informed and so we are.

Now things are picking up speed.  So if you’re new or haven’t been all that interested … NOW is the time to accelerate your understanding.

If you’ve read this far, we trust you’re interested and concerned … as you should be.

So we STRONGLY encourage you to SERIOUSLY consider attending BOTH Brien Lundin’s New Orleans Investment Conference (coming up FAST!) and The Real Estate Guys™ 2018 Investor Summit at Sea™.

These events each feature lots of big brains … with critical perspectives every serious investor needs to have to help understand and navigate these stormy times.

Sure, these events are capitalist ventures … we each make some money producing them.

But we’re not after your money … we simply use to it for event costs and to pay some bills along the way.  Your support makes these events possible.

We organize events so we can get brilliant minds in one place at one time.  And the only way to make it affordable for us … and you … is to share the cost with hundreds of others.

So yes, we need your help.  And in exchange YOU get access too!

With that said, these events are happening with or without you. Your absence or presence, while nice for us, could be LIFE-CHANGING for YOU … and that’s true of most important ideas, opportunities and relationships.

So with the winds of sea change blowing fiercely on the horizon, it’s a good time to consider carefully whether or not investing in preparation is a good idea.

We think it is.

Until next time … good investing!


 More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources to help real estate investors succeed.

6/5/11: Ask The Guys – Answering Your Real Estate Questions About Tax, Legal, Foreign, IRA and more!

One of the best parts of learning in a classroom is hearing the questions asked by other students.  Sometimes they ask things you would never think of!  And even if the question isn’t directly applicable to your current situation, who knows what tomorrow may bring?

That’s why every few weeks we dedicate an episode to reaching into the email grab bag and pulling out several of the many great questions we receive from our listeners each week.

In the radio schoolhouse for today’s Q&A:

  • Your host and headmaster, Robert Helms
  • Co-host and teacher’s aide, Russell Gray
  • Special guest and attorney, Mauricio Rauld

Not only do we get questions on a variety of topics, but through the power of podcasting, we get questions from a variety of locations – many outside the U.S.!

The collection of questions for this episode have us discussing what to do when you can’t find a good deal in your target market, how to get started with little or no money down, what to do when a property is underwater and you want to move, and how to find a great agent in a foreign country.  Plus we talk about landlording in tenant friendly states, profiting from distress without kicking people out of their home, and ideas for creating quick cash when you have the short term use of OPM (other people’s money).  Enjoy!

To submit your question to The Real Estate Guys™, visit our Ask The Guys page.

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The Real Estate Guys™ Radio Show provides real estate investing news, education, training and resources to helps real estate investors succeed.

12/12/10: International Real Estate for Resort, Investment or Safe Haven – Pros and Cons of a Changing Landscape

Whew!  That’s a big title.  But it’s fitting for a big topic – one that reminds us that the world is not only getting smaller, but is changing rapidly.

Money, jobs and people are moving around the world like never before. And while fewer people may feel rich coming out of this recession, there are other good reasons many are still looking at international real estate – both as an investment strategy and a safe haven hedge against inflation.

While we were at the International Property Congress in Miami Beach, in addition to talking big picture economics with National Association of Realtor’s Chief Economist Lawrence Yun and Federal Reserve Bank VP Thomas Cunningham (see our 11/21/10 show), we sat down and talked about who’s buying international real estate, where and why.

Behind our well-traveled microphones for an international chat-fest:

  • Your host, the internationally renowned Robert Helms
  • Your co-host and internationally obscure Russell Gray
  • The man who has seen more changing landscapes than a migrant farm worker, the eternally international Godfather of Real Estate, Bob Helms
  • Special Guest #1: International Property Journal reporter, Kevin Brass
  • Special Guest #2: Representative from SECOVI, a Brazilian real estate trade association, Flavio Amary

It’s no secret that every country in the world has it’s own unique strengths and weaknesses.  As the dominant economy in the world, Americans have long enjoyed a uniquely stable and high quality of life.  It wasn’t necessary or commonplace to travel abroad.  Even today, the  majority of Americans do not have passports.

However, the world is changing.  The US dollar, while still the dominant currency, is facing serious challenges.  Job losses, deficit spending, an aging populace and huge unfunded entitlements are all piling up on Uncle Sam.  Meanwhile, other countries are emerging as powerful economies in their own right – most notably China.

But this isn’t an episode about the woes facing the US.  These aren’t the first challenges and they won’t be the last.  Every country has its ups and downs.

This episode is about discovering how and why the dynamics of the world’s economies are changing the way people are approaching real estate.

While we’re more traveled than the average American, we took the opportunity while in Miami to connect with Kevin Brass.  Kevin has been covering the international real estate industry for over 20 years and his articles and analyses have been regular features in the International Herald Tribune and the New York Times.  Today, Kevin writes for the International Property Journal.  His work takes him all around the globe and keeps him connected with many industry leaders worldwide.  In this episode, Kevin shares his perspectives on the changing landscape of international real estate.

We also discuss some recent changes to the once vaunted tax and privacy advantages of Panama, who recently entered into an information sharing agreement with the United States.  Tax and privacy advantages are often a prime motivator for people to acquire real estate and move to a particular country.  Is what happened in Panama a portend of things to come?

Of course, what would an episode on international real estate be without an interview with someone with one of those really intriguing accents?  We were privileged to find someone who not only sounds really cool, but has some very useful things to share with us about the robust economy of Brazil.  If you haven’t been paying attention to Brazil, you may be surprised to hear about what’s happening there.  Hint: not everyone’s in a recession.

Buone Feste, Boas Festas, Felices Fiestas, Frohe Festtage, Wesołych Świąt, Bonnes vacances, Sarbatori Fericite and Happy Holidays!

The Real Estate Guys™ Radio Show podcast provides education, information and training to help investors make money with their real estate investments.

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