Step 6 of 7 - Money Stewardship

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How to turn times of economic trouble into wealth

Wealth is never destroyed, only transferred.

Market crashes send money to those who get out first.

Housing wealth go to those who get in when it's low or who gain on shorted loans.

Understanding the Past to Predict the Future

Rome, in 301 AD had economic uncertainty. People stopped buy and started saving.

1 in 5 were fend by government each day. Today 1 in 4 of US children are on food stamps.

Devalued coins by mixing with other lesser metals.

7 steps to predict the financial future.

Today

  1. Housing bouble
    Incredible boom, followed by debt being collateralize.
    1/3 money supply in Great Depression dried up thanks to foreclosures, and caused deflation in prices. Repeated in 2008 Great Recession. Real unemployment today is twice official number due to not including those who stopped looking or found part time work.
  2. Record Debt Levels
    Debt level is now more then national GDP. We'll owe more then we produce.
    China has started selling our debt and slowed down on buying.
    Federal Reserve is now purchasing 80% of new debt, by printing new money.
    Debt Monitization.
    Creates Inflation of the Money supply, and thus the cost of goods.
    Already seeing devaluation of Dollar due to inflation.
    First time in history has every major country had to print more money to keep there currencies from appreciating in value to prevent their exports from being damaged due to a strong currency.
  3. Social Entitlement
    $113 Trillion in obligations coming due over the next few decades.
    Inflating the currency will allow for obligations to be met, but at the downside of the currency being worth less.
    By 2030 only 2 workers per retiree
    1974 the 401K was created to replace dieing pension plans, created large demand for stocks and mutual funds.
    Baby Boomers will start to sell off their investments causing value of stocks to disappear.
  4. Peak Oil
    Cheap easy oil is necessary for most of the economy we have today.
    Not running out of oil, but it's becoming more difficult to get to, causing a point of demising returns.
    Amount of new oil discovery is declining due to profit issues with finding it.

What to do

About to live through the largest wealth transfer in history:

Mike Dillard is doing this:

  1. Expecting deflation followed by hyper-inflation.
  2. Protect what you have
    1. Gold and silver start to re-value based on how much money has been created.
      People don't spend their money, they save it so it doesn't show up right away.
      Eventually the cash becomes worthless.
    2. Poor were still poor, rich were still rich because of there assets, but the middle class was destroyed.
    3. Every Fiat currency created has eventually been destroyed.
    4. It's a matter of getting into the proper investment during the appropriate cycle (not against the cycle).
  3. Today Silver is highly undervalued.
    1. Eventually the Gold and Silver bubble will burst.
    2. Determine what to do next, what to invest in when the precious metals bubble bursts.
  4. Invest the Money how the Rich do.
    1. The Elevation Group cracked open the "black box".
    2. Get inside information, not mass marketed information.
    3. Get Knowledge and skills you need to invest in what you choose to invest in.
    4. Who you know is also important, to create a team with those who know and have the skills.
  5. Be your own Bank, by banking on yourself.
  6. Teach your children to also know how to use wealth properly, or it will disappear within years after you are gone.

Back to 7 steps to Financial Freedom | Forward to Step 7