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Warning: 5 Reasons the 2020 Recession Will Be Far Worse Than 2008

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Nervous businessman peeking over desks

Based on historical and current data, we are on the precipice of one of the largest economical shifts any of us have experienced in our lifetime. There are a multitude of indicators and variables that I’m going to share with you that point heavily in that direction. It seems we’ve arrived at the eleventh hour before this economical shift comes to fruition.

But first, let me tell you what this article is not:

  • It’s not what you’re hearing about on the top news channels or radio stations.
  • It’s not what everyone else is talking about.
  • It’s not a regurgitation of hearsay rumors that are floating around the mainstream that have not been fact-checked.
  • It’s not financial, legal, or tax advice.
  • It’s not the be-all or end-all of information on how to position yourself to best suit your specific needs.
  • It’s not an opinion on whether things are fair or unfair.
  • It’s not an opportunity to blame anybody or point the finger.
  • It’s not to be taken lightly.

Here’s what this article is:

  • It’s a compilation of information I’m passing along that comes from top economists, currency experts, investors, hedge fund management, historical/economic cycle buffs, and bubble experts.
  • It’s educational information that you can use to fact-check and come up with your own analysis and viewpoint.
  • It’s information we can tie together to get a deeper understanding of where we are economically and where we are likely heading in the coming months and years.
  • It’s a possibility to become even better informed, so we can stay ahead of the game and protect our wealth.
  • It’s a chance for us to not only survive but also thrive, as well as provide massive value as this economic landscape unfolds.
  • It’s jam-packed with links to even more information, so you can further educate yourself. (Do it! Go down the invaluable rabbit hole.)

With that, let’s begin.

The State of Economy

In March 2020, it was declared publicly that the U.S. was officially in a recession.

The Bad News

Many of the most reputable economists, investors, cyclical experts, and billionaires are saying that a recession is "best-case scenario." We are more likely to be heading into a depression.

Yes, that’s right—a depression. Some say it will compare to the 1929 Great Depression; some say it’ll be worse. More on this later.

caution spray painted in yellow on cement

Related: Recession Prep 101: Investing in Real Estate During a Financial Crisis

The Good News

We still have time to reposition ourselves before the most dramatic economic impact is expected to hit. (More on this later, too.)

What? But isn’t everything going to go back to normal as soon as the “virus lockdown” is over?

I mean, this virus thing isn’t going to last forever, right? It’s gotta get back to normal.

I’m sure the government doesn’t want the economy to collapse! I’m just gonna focus on the now and hope that everything is going to be alright sooner than later.

Unfortunately, based on what I’m hearing from the general public, this seems to be the sentiment of many people. Their plan about how to best position themselves and prepare for the economic landscape is to wait and see how it unfolds. This really concerns me, as it indicates that most of the general public has no idea what’s really happening economically. They don’t know where this is likely heading.

Warren Buffett, Google, and Apple are sitting on a mountain of cash. One can only assume they are privy to understanding the massive economic decline ahead and the opportunity that lies within.

Buffett is not a gambler; he makes well-thought-out and historically wise investment decisions.

I’m going to provide a ton of data and links to more information below, as well as things we can do to best position ourselves.

But before we do that, let’s take a deep breath and have a quick practical “think” about what the domino effect will be (economically) given that most of the world has been shut down for a few months.

Much of manufacturing and production has either dramatically slowed down, changed its focus, or stopped. Companies have not only laid people off, many of them have also permanently shut down—never to open again.

China has had the largest decline in manufacturing ever. The port of Los Angeles (the largest container port in the United States) has seen less than half the quantity of shipping containers coming in. And this is not even current data, it does not reflect the recent impact in April.

The New York Empire State Manufacturing Index tumbled 56.7 points from the previous month to -78.2 in April 2020, the lowest level on record. It’s fair to say manufacturing is dramatically down at record rates worldwide.

Does that (I mean from a rational and practical standpoint) sound like everything is going to get back to normal as soon as the “virus lockdown” is over?

Don’t get me wrong. Normally, I’m an optimist. That doesn’t mean, however, that I disregard or ignore circumstances and possibilities.

In fact, as an investor, I explore all possibilities and evaluate them (aka do my due diligence). I evaluate worst, best, and probable case scenarios (further due diligence). Then, knowing that I'm in the position to handle the worst-case (evaluation of due diligence), I close on the deal and proceed to expect the best-case.

I’m putting this article together, not so we can explore all the possibilities of “doom and gloom.” Not so we can dwell on how deep of a hole we are digging and how bad it’s going to get economically.

Instead, my hope is for us all to be mentally, physically, and financially prepared for a large economic shift. We should all be open to new thought patterns, so we can be ready to help ourselves, our families, and those in our local, national, and global communities.

If properly understood, what is expected to unfold in front of us (and what has already begun to unfold) could be the most abundant opportunity in our lifetimes.

real-estate-recession

Unfortunately, most people won’t be in the position to be on the advantageous side of this—which therein lies the opportunity for us as investors to be creative and provide value by solving problems and filling the needs of those most negatively affected.

Again, I’m not an economic expert. I’m not giving financial, legal, tax, or investing advice. I’m simply passing on information that I believe is imperative to take into consideration.

Research what I’ve put together here. Do your own fact-checking (due diligence) and figure out what you think are the worst-case, best-case, and most likely scenarios. Determine on your own what makes the best sense for you (evaluation of due diligence).

We still have time to educate ourselves and prepare. However, top economists are of the opinion that the clock is expected to strike 12 in the very near future—likely within the next few months—at which point, those who were not prepared are unlikely to be in the position to effectively save themselves.

I wish you all well in the present, as well as in the near- and long-term future. And I hope you all get value out of this article!

How the Economy Works

Many of us understand how our asset class or niche in real estate works (micro). We can’t, however, say we are generalized real estate experts (macro), as there are so many different things to learn about and master.

Same goes as business owners. We can know the economics of our business (micro), but most of us don’t understand how economies as a whole work (macro).

To give you a little refresher (or to bring you up to date with the basic fundamentals of how economies work) please refer to this 30-minute video “How The Economic Machine Works” by Ray Dalio, billionaire and founder of Bridgewater Associates, the world’s largest hedge fund. Ray Dalio has a knack for giving basic explanations of complex topics.

In fact, Ray and his team predicted the 2008 financial crisis.

Ray predicts that what is to come in the near future is bigger than what happened in 2008. He believes we are heading into a depression more like, or worse than, 1929.

In recent interviews, Ray has spoken about where we are in our global economy currently and where we are headed. Here’s one such Bloomberg video:

Yes, he gives political two cents here, as well, but don’t miss the point. Focus instead of his economic commentary. Check out a couple other videos here and here.

For further insight, Ray has some books available on Amazon and some well-done informational videos on his YouTube channel.

Economic Downturns: Past vs. Future

We are about to look at some statistics from 2008 compared to 2020. Before we proceed, here are a few quotes to ponder:

“History doesn’t repeat itself, but it does rhyme.” —Mark Twain

“Learn from yesterday, live for today, hope for tomorrow. The important thing is not to stop questioning.” —Albert Einstein

“You cannot escape the responsibility of tomorrow by evading it today.” —Abraham Lincoln

“Education is the passport to the future, for tomorrow belongs to those who prepare for it today.” —Malcolm X

“Every financial worry you want to banish and financial dream you want to achieve comes from taking tiny steps today that put you on a path toward your goals.” —Suze Orman

“Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be a more productive than energy devoted to patching leaks.” —Warren Buffet (This will be relevant for many-a-folk in the real estate game.)

“Today was good. Today was fun. Tomorrow is another one.” —Dr. Seuss (C’mon, we can still have fun!)

Related: Why Real Estate Beats Stocks During a Recession

How the 2020 Recession Will Differ From 2008

1. Statistics From 2008 Do NOT Compare to 2020 YTD

2008:

  • National Debt: $10 trillion
  • Unemployment: 5.8%
  • Quantitative Easing (aka “printing money”): The first round began in 2008 and created $2.1 trillion of new currency/new debt.
  • Interest Rates: The Fed slashed rates to 0% as a last-ditch effort to save the economy from collapsing.

When doing so in a recession, it can “save the day” so to speak, which it arguably did in 2008.

2020 YTD:

Yes, that means the U.S. has more than doubled in debt since 2008. With unlimited money printing, we can only expect to double this again by the end of this decade. That would put us at $50+ trillion by 2030.

  • Unemployment: 20.2% (and counting!!!)

There is much talk of extended lockdowns. Scientists keep saying this is only round 1 of a multiple-round coronavirus (aka we could potentially be facing longer and additional lockdowns). Think for a moment of how that will play into unemployment as we move forward.

Here is a quick video on quantitative easing. It’s chapter 10 of a 27-part free educational video series called “The Crash Course.” More on this course later in the article.

  • Interest Rates: The Fed slashed rates to 0% almost straight out of the gate as a frontline defense.

Typically, this is a last-ditch effort. Doing this so early in this economic decline means we are trying to run our engines on the last few drops of gas. There’s not much left in the tank once interest rates are at zero and once they are printing money like it’s going out of fashion.

Related: The Fed Cut Interest Rates to 0% — What Does This Mean for You?

The U.S. dollar as “the” currency could indeed go extinct in this decade and be replaced by a new currency. (More on this later.)

Jeffrey Bergstrand, professor of finance at the University of Notre Dame, Mendoza College of Business, said there are two notable differences with the way in which the Fed is responding now compared to the financial crisis of 2008:

“The Fed is acting more quickly to try to ‘ward off’ layoffs and is using all available channels to generate liquidity—Treasury, commercial paper, corporate bond, municipal bond markets—by buying assets across the board.

“It is the speed of the expansion across a broad array of assets that is unprecedented.”

We are only getting started here. Again, I ask: Do you thus far think everything going to get back to normal as soon as the “virus lockdown” is over?

The facade of the Federal Reserve Bank.

2. Unlimited Quantitative Easing, Fractional Reserve Lending, & Loss of Purchasing Power

The 1913 Federal Reserve Act, signed into law by President Woodrow Wilson, gave the 12 Federal Reserve Banks the ability to print money.

Some say the creation of the Fed has given us stability within the economy; others say the creation of the Fed gave the major banks and major corporations a new and easy way to get bailed out. Regardless of your viewpoint on this, the ability to print money (along with fractional reserve banking, which we will dig into shortly), has contributed to the decrease in the U.S. dollar’s purchasing power.

On June 5, 1933, the United States went off the gold standard, a monetary system in which currency is backed by gold. This means that money printing can really start taking off.

As mentioned above, in 2008, the Fed started Quantitative Easing #1 (aka QE1), which sounded pretty soothing yet resulted in $2.1 trillion of new currency/new debt.

In 2020, the Fed called for unlimited quantitative easing/printing of money. This consequently means unlimited debt.

Since 1913, the purchasing power of the U.S. dollar has decreased by over 95 percent, and this is not taking into calculation the recent unlimited printing of money. The U.S. dollar purchasing power will most certainly decline further—and at an astronomical rate!

With unlimited money printing and the velocity of decline in the purchasing power of the dollar,  I think it’s a fair question to ponder: “What does this mean for the longevity of the U.S. dollar and the U.S. (and world) economy?”

Let’s explore the word “hyperinflation,” its relevancy today, and some key takeaways as mentioned on Investopedia:

“Hyperinflation” is a term to describe rapid, excessive, and out-of-control price increases in an economy, typically at rates exceeding 50% each month over time.

Hyperinflation can occur in times of war and economic turmoil in the underlying production economy, in conjunction with a central bank printing an excessive amount of money.

Hyperinflation can cause a surge in prices for basic goods—such as food and fuel—as they become scarce.

While hyperinflations are typically rare, once they begin, they can spiral out of control.

Here’s a little more info on hyperinflation and countries recently affected by it.

I’m assuming most people in Germany, Zimbabwe, and Venezuela did not see hyperinflation coming. I think it’s wise as investors to be aware of these things and keep our finger on the pulse of our economy so we can best be prepared.

Look outside of the news that’s being spoon-fed to you. Forage for further information. Attempt to fully grasp what I’m bringing up here.

I’m going to say something that may shock many of you. It certainly shocked me when I first learned about it.

Our banking system creates money and credit out of thin air.

Yep, that’s right.

“Wait, money and credit can’t simply be produced out of thin air! Can it?!”

How Money and Credit Come Out of Thin Air

Step #1: The government creates glorified IOUs (aka bonds). This increases the national debt and puts the public on the hook to pay it back in the future (via taxation as mentioned in step #5 below).

Step #2: The bank swaps IOUs to create currency. The treasury sells these bonds to the banks. The banks then sell national debt for a profit to the Federal Reserve. The Fed buys this debt using blank checks and creating more IOUs on a checking account that has a $0 balance. The Fed gives these checks to the banks, then currency springs into existence. This process repeats and builds up bonds at the Fed and currency at the Treasury (and, of course, builds up debt). The Treasury then deposits the money into the various branches of the government.

money-matters

Step #3: The government spends the money on public works, social programs, and military/war. Then, government employees, contractors, and soldiers deposit their pay into the banks.

Step #4: The banks multiply the money deposited by creating more IOUs by way of “fractional reserve lending,” where they lend roughly nine times the amount of reserves held in the bank (the multiplier varies based on the type of loans created). They lend this to borrowers by way of creating loans with interest, which creates even more currency. This new currency gets deposited in the banks, and the fractional reserve lending cycle repeats itself over and over, magnifying the currency (and debt) exponentially.

Fractional reserve lending is how banking works here in the U.S. and throughout most of the world. For more info on fractional reserve banking, here is “Fractional Reserve Banking Explained in One Minute.” Here is yet another video on it.

I highly recommend that you research fractional reserve lending and quantitative easing so you can understand how they work and how that affects the economy.

Step #5: The general public works for money, then gives a portion of the money earned in the form of taxes to the IRS. This goes to the treasury. Then, the treasury can pay the principal plus interest on the bonds that were purchased by the Federal Reserve with a check from a checking account that had a zero balance.

Sounds ridiculous, doesn’t it? How could this be possible?

As mentioned, I’m simply providing information here. You do the research yourself.

For a much clearer and deeper explanation of this money creation system, please see this 30-minute video “Episode 4: Hidden Secrets of Money” by Mike Maloney.

I highly recommend you watch the entire 10-episode series of “Hidden Secrets of Money” (roughly five hours), as it’s a very valuable look at how money works and how that affects us in current and near-future times. Here is a link to that video series.

A lot of the things the aforementioned series explains and warns us could happen either already has happened or is happening as we speak.

Related: 12 Influential Investors Weigh in on How to Survive the Coronavirus Crisis

Whether the process outlined above is fair or unfair is not what we are discussing here. You can make your own judgment about whether or not it’s fair or ethical. The reason we are discussing this is because it’s one of the “rules of the game” in the U.S. (and many other major countries for that matter). We need to be aware of its consequences on the economy.

When currency is created, debt is created. And with fractional reserve lending, new interest (also new debt) is created. It’s a simple mathematical equation.

Once you understand currency creation, quantitative easing, and fractional reserve lending, you will understand that the debt we have here in the United States (and the debt in most countries in the world) can never and will never be able to be paid off with the currency we have in circulation—there is not enough in existence to ever pay it off.

Once we grasp this, it becomes clear that at some point, we will reach so much debt, the currency and economy will collapse, at which point it’s likely the currency will be replaced. (More on this later.) This is essential to know given our current debt and unlimited money printing. It simply cannot go on forever.

This has an astronomical effect on our economy. Many have predicted we are very close to the U.S. dollar being at the end of its workable cycle.

Equipped with the information you have attained thus far, it’s worthwhile to go back and re-watch “How the Economic Machine Works.” That way you can accurately gauge where we are in the economic cycle currently. This will allow you to better understand how the same tricks that were used to save the economy in 2008 simply cannot work for us in 2020.

If you want to take a deeper look at how the financial system works, who created the fed, and why, check out this book that’s jam-packed with information: The Creature From Jekyll Island: A Second Look at the Federal Reserve by G. Edward Griffin.

Now, let’s take a deeper look and compare 2020 to the 1929 Great Depression.

Graphs representing the stock market crash caused by the Coronavirus

3. Comparing 2020 to the 1929 Great Depression

1929 Great Depression:

  • Wealth Gap: In 1929, the top 0.1% of Americans had a combined income equal to the bottom 42%. That same top 0.1% of Americans in 1929 controlled 34% of all savings, while 80% of Americans had no savings at all.”
  • Stock Market: Increased 4X in the 1920s
  • Warren Buffet Indicator: 141% (This measures market cap to GDP ratio.)
  • Dow Jones Industrial Average: Dropped 8%

2020 YTD:

  • Wealth Gap: According to Forbes, the top 20 wealthiest people in the world are worth $1.3 trillion. According to the Federal Reserve, the lower 50% of the entire world population (3.75 billion people) are worth $1.3 trillion. This shows the wealth gap today is even more extreme than in 1929.
  • Stock Market: Increase 4X since 2010
  • Warren Buffet Indicator: 141%
  • Dow Jones Industrial Average: Dropped 35%

Based on many statistics, it seems we are worse off now than in 1929. It doesn’t seem this is going to change anytime soon.

Adam Baratta says the economy “resets” (aka deflation/depression) every 90 years. Economy cycle expert Harry Dent says 80 years and Andrew Pancholi says (also a cycle expert) says 84 years.

Dent comes from a strong “doom and gloom” perspective, although he does have a track record of solid predictions. Yet (of course), he’s not right all the time.

As mentioned on Wikipedia:

“In the late 1980s, Dent forecast that the Japanese economy, then the darling of the world, would soon enter a slowdown that would last more than a decade. In the early 1990s, he predicted that the DJIA would reach 10,000. Both of these predictions were met with much skepticism, and yet both eventually came to pass.”

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Robert Kiyosaki seems to think that Harry Dent is correct on 90 percent of his predictions. Here is an interview from March 2020 with Kiyosaki and Dent.

Dent has been writing books for a long time. Many are available on Amazon.

Robert Kiyosaki is arguably the most renowned real estate educators. His “Rich Dad” brand encompasses a plethora of educational real estate books.

Kiyosaki has released a ton of videos on YouTube over the last few months, talking about his expectations of what’s to come and things we need to take into consideration. Check out his YouTube channel here.

4. The Silver Tsunami, Stolen Pensions, & Millennials’ Sentiment

Baby boomers represent nearly 20 percent of the American public. By 2030, all baby boomers will be age 65 or older. This will have a significant impact on the economy now and in the following few years. It certainly will add a layer of complexity.

Here’s why…

Silver Tsunami

Due to baby boomers retiring, downsizing, and liquidating estates at the end of their life cycle, within two decades, more than a quarter of current owner-occupied homes in the U.S. will become available.

Let me repeat this: More than a quarter of current owner-occupied homes in the U.S. will become available.

Here is some data showing which markets will be affected the most by this.

Sounds good, right?

Close up details of the folded hands of an elderly man resting on a walking cane in a mobility and health concept

In some ways, yes, as it will likely be a buyers’ market. Having that said, the sentiment of millennials is significantly different than that of the baby boomers.

Baby boomers were hard workers, spenders, and homeowners, who bought medium to large houses and lived in a generally up-trending economy. Plus, in the U.S., there are more baby boomers than millennials.

Millennials are more drawn toward renting than buying. They desire smaller homes and prefer travel and leisure over work. There are less millennials than baby boomers in the U.S. We are not in an up-trending economy.

What does this mean?

When you match all this together, it’s hard to see how millennials will buy all these homes that will be sold by baby boomers. As such, there will likely be markets with large unsold home inventories.

The areas most affected by this are the areas with the highest concentrations of boomers and lowest concentration of millennials. Therefore, house pricing will likely plateau, potentially decrease, or best case very slowly increase. The next 10 years will be heavily impacted by this.

Baby Boomer Pensions

The above silver tsunami, of course, means mass amounts of baby boomers retiring and relying on pensions. The sad thing about this is, many of those pensions will be significantly smaller than expected, as many of these pension funds were invested in poor-performing assets (because of poor fund management). As a result, the money that is supposed to be there to pay out to pensioners is either not there or significantly smaller than needed.

This can be pushed onto millennials, as that generation can provide some of the compensation by way of taxes. The problem with this is it likely won’t be enough to cover what’s needed—remember, there are fewer millennials than boomers.

The recent unemployment increase is another straw on that horse’s back.

Robert Kiyosaki has a five-part podcast touching on this. He also wrote a book titled Who Stole My Pension?: How You Can Stop the Looting. His book explains why this has happened and provides some solutions and ways for retirees (or soon-to-be retirees) to best position themselves given the state of pensions.

This will affect all of us from all generations in the U.S. In fact, it’s a problem worldwide, too.

5. Additional Factors New to the 2020 Economic Landscape

Dead Cat Bounce

Dictionary.com defines the meaning of “dead cat bounce” as a temporary recovery in stock prices after a steep decline, often resulting from the purchase of securities that have been sold short.

The general public seems optimistic that things will go back to normal once the “lockdown” is over. Many economists predict that with unemployment insurance and stimulus package payouts, along with the ending of the current stay-at-home orders, we may see a brief spike in the economy (for roughly three to five months).

Directly after that? We are expected to head into the largest economical decline anyone has seen in this lifetime.

Lengthy Decline Likely on the Horizon

Here is a video of the potential way things could play out in this crisis:

The interesting part? The creator of this video came up with this in early 2000s. Watch closely, and consider we are—economically speaking—already at the point he mentions by time mark 3:15.

What Does It All Mean?

If the dead cat bounce and the coming economic decline come to fruition, this means we only have a short time (expected to be only a few months left) to sell off risky assets and investments (while real estate markets are still high) and position ourselves for the coming years of recession/depression ahead.

  • Best Case: If we prepare for the worst and the economy picks back up and ends up performing like sunshine and lollipops (highly unlikely), then at least we were prepared if it didn’t.
  • Worst Case: If we do experience this expected impending downturn and did not prepare ourselves, by the time it hits, it will likely be too late to prepare or sell anything off. Those in this position will likely sink with the ship.

Oil-Mageddon
Literally the day I penned this article (April 20, 2020), oil prices ended at an astronomical and historical low of -$37.63 a barrel (yes, negative). At negative $37.63 a barrel, this means those holding the oil are paying $37.63 for someone to take it away!

Related: How Coronavirus Could Harm the Real Estate Market With an Oil Price War

Ten years ago when Mike Maloney predicted oil dropping to $10 a barrel sometime in the next decade, everyone thought he was crazy. Here’s a quick video on the oil crash and what Mike Maloney has to say about it.

Countries where oil is a significant part of their revenue will be most affected by this.

Top oil-producing countries include:

  • United States
  • Russia
  • Saudi Arabia
  • Iraq
  • Canada
  • Brazil

We could almost guarantee this means massive amounts of money printing as a means to compensate for losses. Which consequently means more debt that—a simple mathematical equation can prove—can’t be paid off.

What will it mean for gas prices in the future? What if it no longer makes financial sense for trucks to ship goods due to massively inflated gas prices?

What does this mean for cargo ships and supply chains? Could it start a war or a revolution?

The irony of the latter comment is that Harry Dent has predicted an upcoming civil/political revolution based on the historical 250-year revolution cycle that aligns with the current day. He mentioned this in his book Zero Hour, which came out in 2017.

Would oil be that catalyst? One could only assume.

And one can only speculate the immense adverse effects that could stem from this historical oil crash.

Something we can say for sure is that this will most definitely contribute to the intensity of the economic downturn we are experiencing.

5,000-Year Record High in Gold-Silver Ratio

When the gold-silver ratio rises, it means that gold has become more expensive compared to silver, and the cheaper metal might offer better value. When the ratio falls, it means gold has become less costly relative to silver.

As a result, America’s top-known “silver guy,” David Morgan, predicts a worse financial crisis ahead.

What Now?

How is the United States (and the world) planning to mitigate all of this? There’s no set plan in place as of yet. But here are a few things that are being discussed.

Universal Basic Income

This is being proposed. Sounds good, right? Free money from the government! About time they took care of the people!

Some could say that. I chose to look a little deeper and question what might happen if the government were to pay the people for a given amount of time. What does that say about where they think the economy is going to be during and shortly after that time period?

We’ve seen it before.

Paper check from the United States Treasury

They could say 12 months of compensation now, then in six months extend it to two or three years. If they told everybody up front that they would provide this for years on end or indefinitely, I’m pretty sure that would call attention to how severely the health of our economy is failing.

The fact is, they did not provide this in 2008, and this is a pretty extreme step—furthering the argument that we are not in circumstances anything like 2008.

Wondering how they’d afford to pay this?

Let’s refer back to the unlimited money printing. This is how they could pull that off (at least for a little while).

I’ll let you decide what universal basic income means for the state of the U.S., its people, and the economy. It’s fair to assume it will have a heavy impact.

Replacing the U.S. Dollar With a New Currency

With the aforementioned economic conditions and with what’s expected to unfold, there is much talk about a new currency to replace the dollar, which is only headed for the worse. Regardless of how or with what this currency is replaced—and if or when this takes occurs—there will for sure be a period of financial disruption and panic, which will only further impact the economy.

We can’t say this is happening for sure, although I think it’s important to take into consideration.

How Long Will It Take to Recover From This Economic Turmoil?

Following the 2008 Great Depression, we saw a V-shaped uptrend in real estate pricing, stock market values, and the economy in general. Basically, this means the market bounced back—and relatively quickly.

Every single economist and expert I’ve listened to discuss this topic has said that our economy is going to need to heavily re-correct itself after we hit rock bottom during this next expected downturn. It’s predicted we won’t even hit rock bottom until 2021 to 2023 and that rock bottom will last for about two years. Then, it will take at least a decade to come out of it—if not two decades.

What does this mean?

It means that if we are expecting fixing and flipping to be a top way to make money this time around, we will be sadly disappointed. House prices are anticipated to plateau for quite some time once they have sunken as low as they'll go and to come back up at about the rate of inflation.

At that pace, we cannot bet on buying for X in January and selling for X in June at a significantly higher price. Remember the silver tsunami and it’s anticipated impact on house pricing?

This time around, we need a new game plan. This time we need to think:

  • Who needs help?
  • How can we help them?
  • What needs can we anticipate filling in the current and near future?

How Can You Best Prepare?

Look to Provide Value

Affordable Housing: This is going to be a critical space, this year and the years to come. New and creative ways to provide affordable housing will be of value. Mobile home park and self-storage will be good anchors during and out of this downturn.

Housing for Baby Boomers: Assisted living and alternative housing for baby boomers will be needed as they retire, downsize, and/or need nursing assistance.

Housing for Millennials: As the landscape unfolds, millennials will become an important demographic to cater to. What are their needs? What types of housing are they looking for? Figure out how to fill that gap.

Position Yourself Appropriately

It seems we have only a few months left to sell off risky assets/investments. We are likely at the top of the market, and this is not expected to last for that long. If/when the market drops, it could be too late to do anything to set yourself up for success (or at least minimal harm).

Make sure you and your family and friends are positioned to be able to weather a long winter ahead. Even if that doesn’t happen, it’s better to be safe than sorry.

Liquidity could be very advantageous when the market hits bottom. It will be hard to liquidate while experiencing a down-trending market, so consider positioning yourself now.

Take a look at silver as an investment and/or hedge against declining currency. Do your research, and determine what’s best for you. Demand for silver is very high right now. It may not be available in the near future due to extreme demand.

Stay ahead of the game. This is not like what we have seen in recent downturns.

Think of worst case, best case, and probable case scenarios. Are you positioned to survive? Or to thrive?

Are you mentally, physically, and financially prepared?

Related: The Essential Importance of Cash Reserves in a Crisis

Grant Cardone gave a great and vulnerable interview recently on London Real TV. Cardone covered what he is doing to prepare for what’s to come, what he thinks is coming, and what we can do to get ahead of it.

I read a very interesting book a few years ago that spoke to how to best prepare and position ourselves for times of disruption or turmoil—times like we are experiencing now and times we will likely experience in the near future. It’s called Prosper!: How to Prepare for the Future and Create a World Worth Inheriting and was written by
Chris Martenson and Adam Taggart. The book is full of action steps and solutions. I highly recommend it, as it may help think outside the box.

As mentioned earlier, I suggest checking out the free online video series “The Crash Course,” also by Chris Martenson. It’s comprised of 27 chapters that are between three and 29 minutes in length. Altogether, it takes around 4 hours and 36 minutes to get through. This course offers real hope.

Looking for a quicker summary? He also put together an hour-long accelerated version.

Those who take informed action today, while we still have time, can lower their exposure to these coming trends.

Summary

Prepare for the worst, but plan for the best. The next few months may be your last chance to position yourself appropriately.

Don’t rely on others to tell you what to do. Do your own research, and stay ahead of the game. Only you can decide what’s best given your own personal circumstances.

It’s an ever-changing landscape, and the velocity of change is unlike anything we have seen before. Keep a cool head, and know that with crisis, there is abundant opportunity.

Think as this unfolds: what are people’s needs right now and how can I best provide solutions and value to address those needs?

I wish you all well, and I hope you have found this article to be helpful!

Recession-Proof Real Estate book blog ad

How will you prepare for what’s to come? How will you help those in need? 

Join the discussion below.

Bryce Robertson, your "Real Estate Mate," purchased his first mobile home park in 2015 with a net worth of -$50,000, with unseasoned credit and a mere $2,000 in the bank. Once Bryce closed that see...
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    Craig Kamman Rental Property Investor from Plymouth, MN
    Replied 9 months ago
    There a couple important distinctions between now and 2008. 2008 was from a decade of bad lending practices, and then when it started to fall apart the administration passed Dodd Frank which crushed what was left of the financial industry crippling their ability to lend money. That led to even more rapid decline in values. 2008 we had an oversupply of housing, today we still have a shortage. Today, we are experiencing major supply chain disruptions because of all the manufacturing overseas. This has become evident as a national security problem. There will inevitably be a wave of manufacturing headed back to the US, which brings Jobs. Jobs create demand for housing. I think we are more in a position of right after WWII, production will be shifted back into civilian pursuits. Even carrying massive debt, the economy grew rapidly. The years following the War became the golden age of housing. There was a shortage of housing then, there is a shortage of housing now. As far as printing of money, that is a major problem. The only saving grace we have is that we are the only safe place to put your wealth. As much as our currency sucks, it is still better than other currencies. Time will tell, we will certainly experience lots of ups and downs during this timeframe. I agree we need to be nimble and able to adapt quickly.
    Layla Sewell
    Replied 9 months ago
    Wow! Overwhelming amount of info and extra research to look into!! If you have a lot of cash reserve, will that help save you or no? Of course diversify, don’t put all eggs in one basket.
    Bryce Robertson Rental Property Investor
    Replied 9 months ago
    G'day Layla, glad your getting value out of this article. I appreciate your question on reserves. As mentioned, I'm not giving investing, financial, legal or tax advise, simply education. You may have noticed me mentioning "liquidity" could be of value. That could that help with weathering the storm, so to speak, it could also position oneself in advantageously should great value deals become available as this unfolds. Weather or not ones liquidity is held in cash or other liquid assets is up to the individual and their advisors. As mentioned in the beginning of this article, I provided a link to more info on "Warren Buffett, Google, and Apple are sitting on a mountain of cash" (although that article mentions "cash" it seems to be placed in liquid assets.) It seems pretty clear to me, that if they are highly liquid right now, then they are intentionally positioned to take advantage of whats to come. If we find ourselves in a hyperinflation or a currency change, then "cash" wont be very valuable. This is why we need to be aware of our surroundings (remain educated) and keep our finder on the pulse of this as the landscape unfolds. There are many variables involved here and each individuals case will be different. This article was designed to create a better understanding of some important economical foundations, create new thought patterns and open doors to further explore and research on this topic. I wish you well on this journey and that fact that you are being pro-active, will put you well ahead of those who are not yet informed.
    Nancy Roth Investor from Washington, Washington D.C.
    Replied 9 months ago
    Yeah, I find the comparisons of this crisis to those of 2008 and 1929 to be cherry-picked, and that undermines the thesis. The housing industry, while not perfect, is reasonably healthy and operating and is definitely not the cause of our current crash, unlike in 2008. We have yet to understand the full effect of COVID-19 disruption, which will be profound on many parts of the economy. But I don't see the housing market caving in. We have under-supply and pent-up demand for housing in most cities. That need is suddenly going to disappear? As for comparisons to 1929, it's just too much of a stretch. The world is in such a different place socially, politically, and technologically, our whole money system, and the speed and access to information (and disinformation) characterizing our era, all these things are just going to create different problems and solutions than what happened in 1929. Also that scenario of all the baby boomers leaving their homes at the same time, and leaving a housing surplus? With no accounting for differences in supply and demand in different markets? And millennials will never want to buy any houses? Please. Yes a recession is overdue, that's just part of the cycle. We do this every decade or so, though it's a little different each go-round. What worries me more than any of the scenarios spun out in this article is the impact of climate change. I don't think we've even begun to calculate the economic impact of, for example, the megadrought in the Western US (https://phys.org/news/2020-04-west-megadrought-worst-modern-age.html) or the increasingly violent storms hitting the south and east coastlines. I was a little surprised not to see any mention of this in the article.
    Bryce Robertson Rental Property Investor
    Replied 9 months ago
    Thanks for your input Nancy. 2020 is a unique landscape on to it's own. The comparison of 2020 to 2008 and 1929 are to help show how 2020 economy (generalization) is closer to 1929 (Depression) than 2008 (Recession). Part of this highlight is to display that this "cycle" it clearly not like out typical 7-12 year cycles. 2020 has come with significant impact, due to the circumstances mentioned in the article. We are literally breaking economical records, creating history, and many things are coming together at once this time round. Seems this may be the first you are hearing of "silver tsunami" or "pension crisis". I invite you to further explore those topics on a deeper level. Of course millennial's will buy houses, although as a generalization they are interested in smaller houses than baby boomers possess / will be selling, and buying such houses at a later age than baby boomers did. As you mention, on top of whats happening directly to our economy, there are outside variables like weather (and health) that add layers of added complexity.
    Nancy Roth Investor from Washington, Washington D.C.
    Replied 9 months ago
    I'm part of the Silver Tsunami, my friend. This is the healthiest, most fit, and most engaged generation of retirees we have ever produced. Many boomers of my acquaintance are working well into their "retirement" years, even starting new businesses and second (or third) careers. We are also perfectly set up to participate in the gig economy, and lots of us do. That's not a bad thing for the country and world, it's a good thing. Prolonged do-nothing retirement is the bad thing, both for the economy and the healthcare system. It seems this may be the first you are hearing about this, and I invite you to explore these topics on a deeper level. The pension crisis as described in this report especially struck me as out of touch. Pensions started disappearing from the private sector decades ago. Boomers have had plenty of time to prepare. No one who has been reading the news since the 1980s is going to be shocked by their suddenly diminished pension, that is, assuming they ever had one. I had to wonder where that sad couple in the video had been, on Mars? So not to be a denier of the grim economic stresses ahead, this thing is real. But this generation of "retirees" are way more informed, resourceful and resilient than this account gives us credit for. So are their millennial kids.
    Sylvia Theisen Real Estate Agent from Denver and Aspen, CO
    Replied 9 months ago
    Good points, Nancy!
    Sergio Altomare Rental Property Investor from Greater Philadelphia
    Replied 9 months ago
    I can only suggest that you honestly consider what was discussed as a real possibility. I f you think shutting the world economy down for 2 months is not going to result in long term and catastrophic repercussions then you will likely be one of the people who wakes up with your wealth slashed in half or less. He has included a wealth of research and resources. Use your time to watch, read and listen. I was an insider on many of what he talks about, so consider that. Be well!
    Nancy Roth Investor from Washington, Washington D.C.
    Replied 9 months ago
    Thank you. I absolutely do take it seriously and yes, this is very scary because of the unprecedented scale of the crisis. But should I deny my own experience as a segment of the population the author discussed? That part of the article simply did not ring true to what I see, do, and live every day. I also thought what was said about the Millennials did not accord with what I know. Yes, they have been slower to buy houses and start families than previous generations, but I think that's because they came of age in the 2000-2010 period, when we had 911 and the economic shock of 2008 that drove up unemployment and destabilized housing across this country. That plus new student debt realities, and the gig economy (that helps their parents, but not them) have made it harder for them to achieve economic stability than previous generations. Yes, they do want houses and families--many are buying houses in my neighborhood and it's a stroller brigade out there. But they are in their mid to late 30s. It's just taking them longer. They should not be characterized in a formulaic manner. So I don't think the article fully succeeded in what it set out to do.
    Lauren Kormylo Rental Property Investor from Phoenix, AZ
    Replied 9 months ago
    Nancy, I agree about the Silver Tsunami. I have heard about it before, but don't believe it's going to be anywhere near as dire as predicted. I am a Baby Boomer too, a younger one, living in a 1400 sq ft home. I am not going to voluntarily live with the kids, in a retirement community, or assisted living home if I can help it. And I don't know any Boomers who intend to give up their homes and do that either. Both of my 83 and 86 year old parents live independently in their own homes (that they've owned for 40+ years) with a little help from us kids, and I expect the same to happen to my generation. What's strange with the Tsunami theory is that I constantly hear about younger people buying 2000 + sq ft houses. I don't see where they want to live in smaller homes like mine. "Millennials" is a narrow age range and I think too much is being attributed to them.
    Paul McHale
    Replied 9 months ago
    The current Silver Tsunami isn't the healthiest. On the contrary - medical issues plague the entire population much more now than ever. Medication use by medicare participants is growing every year. And l They are working in the gig economy - because many have to. Due to the pensions, due to the economy, due to the hidden inflation. This isn't a good thing - this removes jobs from the younger people within the economy. Healthy retirement - is another issue. Agree wholeheartedly - we aren't designed to sit and watch TV and eat all day in retirement. But - driving someone to the airport as an Uber driver is NOT imparting your years of wisdom and knowledge onto the upcoming generation, like it would if that same person sat on a board of a small company. (Exceptions are not the rule..) I applaud the author for digging into and giving out a tremendous variety of information - all free - and frankly from a huge variety of authors. Demographic shifts are very slow to occur. Monetary policy & fiscal policy can slowly erode once stable empires. Appreciate the effort to bring an article that is a little bit more pessimistic, and provides alternative thoughts than the usual buy the dip/rental real estate cant go wrong/etc. None of it prevents you from going on with your current situation. But perhaps it causes you to prepare or add some form of insurance while it is still possible.
    JohnandJordin Horn from Montrose, Colorado
    Replied 9 months ago
    @Nancy Roth, Can you share something to support your statement that, "This is the healthiest, most fit, and most engaged generation of retirees we have ever produced."? My knee jerk reaction as an RN with a BSN is the disagree but I'm curious what evidence you have to support this view? All the best
    Derek Smith Rental Property Investor from Waco, TX
    Replied 9 months ago
    You didn’t see anything about Climate change because it’s all BS. Best wishes, Nancy...!
    Chris Prichard from Birmingham, Alabama
    Replied 9 months ago
    Kind of like the COVID 19 hoax.
    John Szpara
    Replied 9 months ago
    Uh, no. NOBODY said Covid is a hoax. What was said was it was and is being used for political purposes beyond the reality of the virus’ actual scope and impact.
    William Tait
    Replied 9 months ago
    Yep Trump did, but this is not political it is a social and economic change on a grand scale. Have you missed the point that none of this has been tried before? Yes we are in a different place than 2008 or 1930, but the numbers are staggering. We are in the middle of the longest real estate boom in recent memory, and the demand is still outstripping the supply, But it can flip and fast. Just because we are not "junk lending" in real estate doesn't mean it doesn't exist. Anyone seen the short and medium term business debt load numbers lately. Scary. Even if purchasers were a good financial risk at inception doesn't mean that they can't be downsized out of that. Then the properties become upside down for the lenders and the bowers who can no longer afford the notes. Low interest rates are touted as the golden whip, but you still have to pay it and the principle. Now with mortgage abatement, home owners and investors can ask for a 3-6 month hiatus from paying. And then the lender can ask for all of it plus the current month. Poof with the investment. Or they can make a repayment plan substantially higher payments until repaid abated payments are replaced. Oops can't make those so Poof to the investment. Many investor landlords are prevented from taking action against persons for failure to pay rent. No income or reduced income plus abatement and now what? Yes it is all new and uncharted territory. We are going for a reduction in risky (short term vacation rentals) for a cash position aimed at affordable housing in urban markets where it is needed. Help some one and you will see the rewards.
    Evan Loader Rental Property Investor from Ann Arbor, MI
    Replied 9 months ago
    Please look at the video again about POTUS calling it a hoax, he didn't. He called the attack against his administration's handling of the virus a hoax. That is not calling the virus itself a hoax. There was a political ad that was sent out that spliced his comment about a hoax and the virus together to make it sound like he called the virus a hoax. Please look into this further before commenting. Thanks. https://www.factcheck.org/2020/04/democratic-ad-twists-trumps-hoax-comment/ btw I didn't vote for POTUS. j/s.
    Brian Gray
    Replied 9 months ago
    Derek and Chris, based on all available information; you're both correct.
    Sam Roselli
    Replied 9 months ago
    Climate change? Whenever I ask how increasing taxes is going to keep the world cooler... Crickets...
    Patricia Sweeney from Leesburg, Virginia
    Replied 8 months ago
    "climate change" is straight up junk science
    Mark Broadway Real Estate Agent from Springfield, MO
    Replied 9 months ago
    I would add to Nancy's observations that 1929 vs 2020 has two different societies. 29, there was much less metropolitan living and much more agricultural. The majority of people were self sufficient. Many of those people never felt much of the depression because there was less dependence of money. Now society is opposite so the impact of any downturn will be felt much differently. That said, the cause of this 'downturn' affects everyone so we're all in the same boat and the effect is the same but the impact is different depending on how financially strong each individual/business is. Those on the very edge of survival before this happened in February was likely pushed over the edge. Out of adversity and disaster comes renewal. Those that survive will see opportunity with those that collapse. Time will tell but bottom line, the economy will always be survival of the fittest. Who's the most fit?
    John Szpara
    Replied 9 months ago
    BS. The so called mega-drought, according to your linked article, is based on “computer modeling”, not on any real data. From your article: To quantify the role of global warming, researchers used 31 computer models to compare what's happening now to what would happen in a mythical world without the burning of fossil fuels that spews billions of tons of heat-trapping gases. They found on average that 47% of the drought could be blamed on human-caused climate change. Other things said in the article undermine its sensational conclusions. Relax. The biggest issue to water in the western United States is human *population*. California is up to 40,000,000 people with inadequate water supplies.
    Patricia Sweeney from Leesburg, Virginia
    Replied 8 months ago
    thank you for calling out junk science
    Mark Stedman Investor from Nashua, NH
    Replied 9 months ago
    Well said and a very reasonable rebuttal to many of the references used in this article. The fact is that nobody knows what exactly the future holds, just as scientists still can’t even decide whether eggs are good for us or bad for us. And if the “Green New Deal” were to ever be enacted, it seems the world’s economies would go straight down the toilet...but some polar ice formations might be saved.
    Patricia Sweeney from Leesburg, Virginia
    Replied 8 months ago
    thank you
    Andrew Syrios Residential Real Estate Investor from Kansas City, MO
    Replied 9 months ago
    Well that was depressing...
    Costin I. Rental Property Investor from Round Rock, TX
    Replied 9 months ago
    Andrew, you are pretty knowledgeable and write good articles - do you concur or have a rebuttal or different perspective on all this? Please write an article on all this.
    Bryce Robertson Rental Property Investor
    Replied 9 months ago
    G'day Andrew. I get it. It is pretty depressing. I supposed that's why they call it a "depression" (pun intended). This is also why I jammed this article with valuable information so we can become better informed and be equipped with information that can help us not only survive, but thrive by staying ahead of the game. I hope you gain value out of exploring some of the solutions discussed in this article. As mentioned "we still have time to reposition ourselves" to a more advantageous position. I wish you well in health and prosperity as this unfolds!
    Mark Stedman Investor from Nashua, NH
    Replied 9 months ago
    It’s interesting that just a few months ago most articles on BP was about how we should still be buying RE even at its peak, and that BRRR is the absolute key to financial freedom.
    John C. Investor from New York, NY
    Replied 9 months ago
    As my friend says all the time about how this whole thing will play out: “If there is good news, the market may go up. But, if there’s bad news, the market may go down.” And he’s serious about it. He saved himself tons of money by getting out of the market in 2007, right before the crash. Unfortunately, he never got back in. And, when the DOW reached 19,000 a couple weeks ago, he didn’t go back in. He was sure it would go to 2008 levels. He’s hoping and praying with all his might that the market goes way lower than it is today (DOW around 23,500). There are way too many factors to consider. Nobody can predict the future. Esp my friend. I’ll put my trust in the American people and our system. Most of us want are willing to work out asses off and make as much money as possible. Give us the opportunity and there is no limit to what we can do.
    Bryce Robertson Rental Property Investor
    Replied 9 months ago
    I too believe that there is no limit to what mankind is capable of. Wishing you all the best!
    John C. Investor from New York, NY
    Replied 9 months ago
    BTW, thanks for putting together all the info. Will definitely look into some of it. Good luck to all!
    Mark Stedman Investor from Nashua, NH
    Replied 9 months ago
    My father was certainly NOT a college educated economic expert. But one observation he made from the 1970’s was “inflation will get you out of debt.” Think about that.
    Steve T. Real Estate Investor from Colorado Springs, Colorado
    Replied 9 months ago
    I agree Craig. I just don't see the doom and gloom scenario. I see many reasons for a fairly quick and powerful rebound, but I am cautious. It won't be a 6 to 8 year recovery like last time. America is ready to work, and this shutdown has been ill-conceived. The so called "stimulus" or "rescue" is quite concerning. This excessive spending will lead to higher taxes and devalued currency. Right now, I have heard stories that people are not going back to work because they are getting more by not working. Absurd that the pay out was not set to 70% of your previous monthly income. I have also heard that people who didn't even lose their jobs are getting a check. Even more absurd. The only good news in all of this is for landlords... assuming you are not over leveraged. Real estate is anti-inflationary and everyone needs to live somewhere. Despite all the horror being pushed right now, people will be back to work on a very wide scale in short order. Yes, the second wave will come. Hopefully when it does, we will treat it like Sweden did with the initial wave... keep working, live life as usual, and isolate all vulnerable populations. They are actually developing herd immunity in Sweden while we flatten the curve. Flattening may be wise, but it will come at a cost. Finally, I agree this will push some manufacturing back to the US, and when not direct to the US, we will diversify some of our supply chains away from China. That is good for many reasons. The issue is that it will not happen overnight. That is a 10-20 year process that hopefully we have the resolve to follow through with. Short memories... but China's importance on the world stage really should be marginalized. We share our economic might with them at our long term peril.
    Matt Rachow Investor
    Replied 9 months ago
    Steve, I agree with your points on bringing (some) manufacturing back to the U.S. We should have a long list of industries to rebuild. Especially those that primarily do business with the government.
    Mark Stedman Investor from Nashua, NH
    Replied 9 months ago
    When you say “it will come at a cost” that’s the understatement of the century. The cost will be bigger than anyone imagined. Sweden handled CV19 brilliantly. Trump probably would have done the same left to his own devices, but the deaths of the sick and elderly would have all been blamed on him. He would have been crucified even more than he has been already.
    Pete Tam from Folsom, California
    Replied 9 months ago
    Real estate is very solid this time around. I still see solid buyer in this top notch peak market. Let see what happen in next few months as we find out the fact about COVID-19 turmoil to our economy and others.
    Wenda Kennedy JD from Nikiski, Alaska
    Replied 9 months ago
    I want to spend more time to study the information in this article. This virus problem is a Black Swan that none of us could have predicted. In spite of that fact, something was bound to happen. It's the normal flow and ebbs in the RE market. This is my 4th business cycle since I started my RE career in 1976 and the 5th since I became an adult. Each downturn has been eerily unique. We lined for gas when OPEC first raised their head in the early 1970s. The economy crashed. By 1980, we had runaway inflation. Interest rates went from 12 1/2% to 21%, then 22%, and finally settled in at 23%. Around 1990 it all fell apart again. I was in Los Angeles. We had a RE meltdown that lasted the whole decade. It was so severe that it took down the Saving and Loan system, and the Thrift Industry. Then 2008 rolled around with a bone-jarring crunch. That time it involved international banking and shifts in the RE markets. So, why are we all so surprised this time? I've been preparing for this moment for years.
    Barry H. Investor from Scottsdale, AZ
    Replied 9 months ago
    We are mostly real estate proponents on BP. Though not alive in 1929 and only knowing the Great Depression from the stories of grandparents, I do believe this will be different as respects to real estate. As for the stock market and hedging with commodities (gold/silver), there have already been anomalies in the economic cycle. Commodities have been in the tank for way too long (relatively speaking) and with the Fed printing money to infinity, it is hard to say in today's world where true safety lies....Food commodities? Inflated equities (stocks)? Crypto-currency? Real Estate? Nothing? It seems pointless to "wait and see" as suggested by Mr. Robertson, but unless you are in the top 1% and/or a politician holding all the cards, I am not sure the answers will be clear, even in the next decade. Depressing, yes - but we are pretty much all gonna be in it together.
    Davido Davido Rental Property Investor from Olympia, WA
    Replied 9 months ago
    Well Said Bryce. Thank you for posting. In my view our economic and political situation is even worse than your article suggests might be possible. Our situation is worse because there is an intentional element to the coming depression -as in it is not only a natural cyclical downturn but a designed, intended systemic financial restructuring. Our situation is worse because neither we the people, nor our elected representatives, are in control of the direction and policies of the nation. And we won't regain control without a fight. Corrupt people have obtain power behind the scenes through bribery, extortion, murder and mass murder. The corrupt can not be swayed by demonstrations, and they will not yield their power in the political process. We can not vote them out. The corrupt yield only to superior power. We the people will regain control of our destiny only if we fight for it. The tree of Liberty must be watered with the blood of tyrants. Thank you for posting. You have raised a more than valid caution.
    David A.
    Replied 9 months ago
    This is BiggerPockets. You aren't supposed to point out reality, you are only supposed to say positive and encouraging things about REI and how it can't fail and only goes up.
    Sina Ranje
    Replied 9 months ago
    Zing!
    Matt Rachow Investor
    Replied 9 months ago
    Bryce, Thanks for putting the effort into creating this very detailed post. Something that was not mentioned, that I see as being a major factor going forward is societal behavior. Recent years have seen divisions increase with every small issue or differing perspectives. With the rise in social media, alt news sites, and governments outside of our country reinforcing our (mostly misplaced) anger towards each other adds an extra challenge to overcoming obstacles and evolving. We're also in an age where government leaders (regardless of party), news outlets, and key public figures appear willing to sacrifice the overall health and well-being of a collective society for there own gain or popularity. In decades past we had enough equality with opportunity to allow for a level of unity. My concern is that will continue to erode, with an emotional based population ready to consume whatever hateful rhetoric comes their way.
    Derek Smith Rental Property Investor from Waco, TX
    Replied 9 months ago
    This is gold. About time someone else has been doing their homework. I feel like this is exactly where we are headed. Seems like the majority are still in denial. My wife and I are well positioned, cash, Real Estate, residual income, and now I’ll be buying Gold or Silver to hedge against the declining dollar. That video from Mike Maloney?, pretty much summed up how I feel based on the research I’ve been doing. Also, I feel like the Baby Boomers will definitely sell their houses, thus increasing the supply of houses ten-fold. And that will drive prices down, along with everything else. Thanks again for this, it really helped me make a few more decisions that I was on the fence about. And for anyone reading, I’m not doom and gloom, but I always prepare for worst case scenarios and this article validates my thoughts and plans, precisely. Love all of this. Stay blessed!
    Colin March Rental Property Investor from Portland, ME
    Replied 9 months ago
    Derek, do you think gold is a better inflation hedge than multi-family real estate? Not much data to support that.
    Davido Davido Rental Property Investor from Olympia, WA
    Replied 9 months ago
    @Colin March, for an analysis of whether gold or multi-family real estate is a better inflation hedge consider where your location is in the "wealth cycle" as discussed by Mike Maloney. See "What Is A Wealth Cycle? The Difference Between Price & Value Explained by Mike Maloney" https://www.youtube.com/watch?v=l-knwwD-PZc Each asset class moves in a cycle. Real Estate will outperform gold at one point, and gold will out perform real estate at another point in their cycle. Maloney's company www.GoldSilver.com sells precious metals. He believes that we are still in the early stages of gold outperforming. Consider also the excellent work of Daniel Amerman http://danielamerman.com/ See particularly Amerman's chart "Asset Prices as a Percent of Means" Showing the cyclical preeminence of Stocks, Bonds, RealEstate, and Gold
    Jake Dafni from Freeport, ME
    Replied 9 months ago
    So you prepare for the worst, but also deny climate change? Interesting.....
    Paul Ellis from Jacksonville, FL
    Replied 9 months ago
    This article is a great read, unknowingly i had already watched the 45 min Ray dalio video on YouTube and his 30 min video on how the economic machine works is great. All the links are great if not a bit overwhelming, and this was the first time i had ever heard of the "Silver Tsunami" idea which is worth looking into as i live in Florida. The only thing i can take issue with is Mr. Mike maloney and his videos, its hard to take everything he states as fact given his is pushing a narrative that helps his business, which looks to be his book or website on buying Gold. Ill say one other thing, the debt levels we are at in the US and going to be at in a year scary the crap out of me!
    Seamus Harper
    Replied 9 months ago
    Interesting to see no one really mentions commercial real estate. I think housing (single family, multi-family, etc.) might actually come out of this not too badly but I'm thinking commercial real estate is going to get destroyed. Restaurants will struggle for many months, movie theaters, malls, gyms, the giant mixed-use properties being built all over the globe that are heavily focused on socializing.
    Bill Cunningham
    Replied 9 months ago
    Sadly my thinking about Commercial also. I hope we're wrong but I can't see how many businesses will reopen.
    Aaron Stewart Residential Real Estate Broker from Manteno, IL
    Replied 9 months ago
    I like Mike Maloney and have a customer number with him below 150. Before you buy into all that stuff do your own math, he has been saying the same stuff since what 2005? Will a lot of what he says come true eventually yeah probably in some form but before you join the gold bug community with the constant doom and gloom articles do the math on investment in silver from 2005 till today versus investment in real estate or stocks. If you start now and we get hyperinflation and a new currency and a world depression...etc maybe you will strike it rich but in that doomsday scenario will you need precious metals? This is not an article on preparing this is basically the same speculative precious metals investing article you can find on any of the dealers websites. If we get a “silver tsunami” I do stand to gain but at this point silver needs to go to world ending prices for me to be better off than if I had invested in more real estate from 2005-2009 when I was buying silver. My advice take doom and gloom articles in small doses and realize they are usually worst case scenarios.
    Bill Cunningham
    Replied 9 months ago
    Some good points are made in this article but the 2007-2012 collapse of the Real Estate market was largely due to bad paper flooding the lending industry. People were stating incomes as 200K a year when they were really only making a fraction of that because they had good enough credit to state the ridiculously higher amount as their income and the lenders allowed it. They were qualifying for way too much of a monthly payment. ARM's were resetting and interest rates and monthly payments were jumping due to the reset which made the already unaffordable home totally unffordable to the owners. Areas where housing is made up of service industry workers and retail workers will likely see some kind of dip but hopefully it won't be a big one. There is still alot of housing demand and little supply in many parts of the country.
    Alex Forest Rental Property Investor from Henrico, Va
    Replied 9 months ago
    And if you jump ahead from 2008 to 2009, the unemployment was above 10%. The comparison to 2008 was too simplistic.
    Boris Harhaji Investor from Washington, DC
    Replied 9 months ago
    Interestingly enough, I have been following a number of experts mentioned here (including Mike Maloney whose video you referenced). I do agree that the US is in worst shape than 2008, but perhaps I disagree that COVID-19 has much to do with it. Most of the world economy has been running on borrowed time with only option of sustaining itself until the balloon has enough capacity to absorb the toxic fumes. Now Coronavirus is just one "item" which enabled us to see how fragile everything is. We can open the economy tomorrow. Likely the worst case scenario is 1% of human population will die. I believe many people have it, un-confirmed, and the death rate is a lot lower than 4-5%. Nevertheless - I did bought 100lb of silver about a month ago, and have stashed enough cash for the depresatory market should it go down (plus liquidoty). I did however, also bought 2 rental houses few months ago which are rented well, but I do worry if my tenants lose their jobs. We'll see... I'm ready for the worst, but still hope for the best (not sure what the best is though :-) )
    William Hochstedler Broker from Logan, UT
    Replied 9 months ago
    The biggest similarity to 2008 is the vast majority of people think that there's nothing to see here and our economy is fine except for this virus thing. Bear Stearns collapse was a harbinger to no one.
    David Cockrell
    Replied 9 months ago
    Extremely hard to follow. You wrote 20 articles under the title of one. This piece is a maze of info with minimal focus.
    Sonny Rodriguez Investor from Corpus Christi, TX
    Replied 9 months ago
    Wow, I thought it was Great!!! The article was full of “educational information that you can use to fact-check and come up with your own analysis and viewpoint.”
    Joe Pitrolo Investor from Morgantown, West Virginia
    Replied 9 months ago
    Excellent and informative, one to read and reread and check the sources. I am 40/60 stocks and Real estate and feel I need to liquidate my stock to at least 50/50 stocks- bonds, but it is hard to pull trigger. We have a brief window According your article. I am amazed the market is holding up. Areas of RE I would recommend , trailer parks, self storage , hud homes, at least 60 % ARV. Honestly if you are a Democrat or Republican, I can’t see a scenario where taxes won’t hAve to be raised , property taxes , inheritance, RE deductions.
    Susan Maneck Investor from Jackson, Mississippi
    Replied 9 months ago
    I'm not sure we can compare the present situation ever existed before. As Krugman put it, the economy is in a drug-induced coma right now. We don't really know what will happen when it wakes up or even when it will wake up. So far I've only taken out money from one mutual fund and that is my REIT because it hadn't yet gone down much but in the end I'm guessing commercial real estate might suffer the worst. Besides, I've got so much invested in real estate with all my SFR anyhow. So far I'm only $500 behind collecting my usual rents for this month.
    Joseph Chan from Jersey City, New Jersey
    Replied 9 months ago
    Good article, but I should point out that your point 4 banks have unlimited leverage as the Fed says they don't have to hold any reserves against loans (https://www.federalreserve.gov/monetarypolicy/reservereq.htm). This in effect puts even more leverage and risk into the banking system. I would also argue that the USD being the reserve currency of the world is able to be printed more than all other currencies (not indefinite) but can probably absorb several trillion more. Since other central banks will also be printing money all things being equal (we saw this in 2008) which is why we didn't get the currency inflation we expected but rather real asset inflation in the forms of high prices in stocks, bonds, and real estate.
    Jackie Young from Castro Valley, California
    Replied 9 months ago
    I’m sorry, but this article is terrible. Rambling, unfocused, and projects a poor understanding of statistics. For one thing, you can’t compare the richest Americans to other Americans in 1929 in terms of percentages and then compare the richest Americans to the world population in 2020 in terms of dollars, and then conclude that we’re worse off now. It’s comparing apples to oranges. And then the author makes unsupported claims that are simply untrue or dated—eg that millennials have less interest in homeownership than prior generations (that is proving to be false as millennials are aging), or that there are fewer millennials in America than boomers—also not true anymore. Just a ton of inaccuracies and nonsense.
    Alex Forest Rental Property Investor from Henrico, Va
    Replied 9 months ago
    Or how about defining the age group assoctiated with the demographic. Some use the term millenial to incorporate gen y,z very broadly, others do not.
    Mike Lindsey
    Replied 9 months ago
    While I won't go full throttle doom porn I do agree on the dead cat bounce. I could slap myself because I called a DOW top at 29,800 and was going to pull my assets to cash but got greedy and got caught in the first leg down. I believe the market will fall to just below 15,000 and pulled my money to cash Friday while it rode high. If I'm wrong I guess I'll pay for it (no pun intended). That being said, market corrections are both necessary and normally, aside from this time, happen around every 7 years (79, 87, 93, 99/01, 08). To add one more point, everyone always has this nightmarish thought when a Great Depression comparison is made. What made the Great Depression so awful was the fact the vast majority of nightmare scenarios were people who had bought highly leveraged positions on margin, and without the necessary security to cover losses due to lax and nonexistent security laws in that time. Unlike now, when positions can be liquidated in microseconds by computer scripts within brokerages, everything was done person to person back then. People who had leveraged positions 2X, 3X, 4X their account sizes not only lost their entire life savings, but 2X, 3X, 4X etc. the amount they didnt have because the companies went bankrupt and they had leveraged multiple positions sizes if their actual funds. This, for the most part (though not in all cases), can't happen now with all of the security measures and computer triggers in place to prevent such occurrences. There's a reason the vast stories of people jumping off of buildings were so prevalent after the crash, and not today or 2008 or other recessions. Imagine going from a retirement of $5,000,000 to owing $20,000,000 and having your home, vehicle, furniture, and every asset you possessed suddenly liquidated with a debt you would never be able to pay. THAT was the Great Depression. Good article though.
    Jay Murakami
    Replied 9 months ago
    Of course, all these issues will be solved through hyper inflation, and then most of these predictions will be false. Still, terrible fiscal management by the US for nearly a century.
    Adam Peacock Rental Property Investor
    Replied 9 months ago
    tldr; Warren Buffet said it best: Be fearful when others are greedy. Be greedy when others are fearful. When an investor says the world could end soon and you might not have time to sell your real estate in time, that is a sign the writers are positioning themselves to profit off the panic they're trying to instill in you. They're called hucksters and they are the scourge of the investment world. Irresponsible/unfocused writing and I pray that no one takes any of this seriously.
    Eric Hathway Investor from Southern, New Hampshire
    Replied 9 months ago
    Hey Bryce, amazing article! It is just what us investors are wondering about. Do you feel the powers that be will use the money printing capability to the extent that it avoids a depression?
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Eric. Good question and it seems like that is their intention. Weather or not that will work is up to question.
    Derrick StClair Investor from Los Angeles, CA
    Replied 9 months ago
    A recession can only take place after TWO CONSECUTIVE DECLINING QUARTERS. I Just can’t read an article that has bad information from the first few sentences.
    Alex Forest Rental Property Investor from Henrico, Va
    Replied 9 months ago
    Agreed. The "official" call comes painstakingly later. Well after it's already abundantly clear.
    Nathan G. Real Estate Broker from Cody, WY
    Replied 9 months ago
    Great article. I'm not nearly as smart or studied as you when it comes to the economy but I'm also not wet behind the ears. One thing I know: when government starts printing money and passing it out like candy, we're going to suffer the consequences. I think we'll see a pretty strong bounce this summer, maybe even as high as 80% of the losses. Then, just as everyone is lulled into a false sense of security, the Piper will come to collect.
    Brian LeBlanc from Brooklyn, NY
    Replied 9 months ago
    I’m an Economist at bank on Wall Street. Not saying this piece isn’t well researched, but I can say with certainty that the vast majority of economists and firms on Wall Street view a depression-like outcome, let alone worst than a depression outcome, as an extreme tail event. It’s a almost certain that we are already in recession, however what distinguishes a recession from a depression are duration and deflation. Consensus view is that we’re likely to see a faster uptick in unemployment than we’ve ever seen, but it’s also consensus view currently that we will likely have one of the fastest recoveries on record. For perspective, what made the depression a depression was three consecutive years of contraction. Even if we have a 2nd round of infections in the fall, it’s unlikely that this coming contraction will be occurring three years from now. A 2nd point: this notion of hyper inflation is not something any market Economist is taking seriously. Being honest, it’s probably the quickest tell whether or not someone understands the current monetary policy paradigm and realities we live in. The bigger and most likely fear we’re facing is deflation. Look at the experience post 2008 recession here, and more importantly the experience in Japan. Their QE and easing policies have trumped and will continue to trump ours by a long shot, and not only did we not see hyperinflation there, they had a hard time preventing deflation
    Phil Davies
    Replied 9 months ago
    Two other things I think will protect the US Dollar from hyper inflation: 1) The US Dollar is really the world's currency. We are in the unique position to be able to distribute currency dilution throughout the entire world economy rather than feeling the full inflationary effects within our own borders. 2) The US maintains (by far) the largest and most powerful military in the world. We can pretty much start a war whenever we want to boost the economy and shake up the world's financial dynamics. And, if things get really bad, we can just start taking resources if we really want to. I know we all like to think we live in a civilized world where geopolitics is decided on by cooperating international consortiums, but when SHTF, might still makes right.
    Alex Forest Rental Property Investor from Henrico, Va
    Replied 9 months ago
    Brian, this is what I saw being part of the push for QE and other similar stimulus measures in the 2008-2014 era...in addition to keeping the financial mechanistic gears from locking up, a fight against deflation. And similarly here, with the massive influx of cash into the system, I think I can see what you're saying. Question for you: say there is so much printing of money that occurs, that it does lead to an inflationary environment, eventually if not right away 1.) Wouldnt that together with low interest rates for a time lead to higher asset values (homes), as the currency becomes less valuable (I'm not saying now, but years from now)? And 2.) Assuming there will be a lot of printing, what do you see happening with the massive balance sheet that is the fed's? a) Will it just sit there for a really long time, b) Will the Us raise taxes eventually and/or cut to pay for the debt to keep everything whole c) or would portions of the debt ever in essence be forgiven ? One factor I haven't read in this article or comments is that the Us borrows in dollars. Its other countries that borrow in their non native currency that have fewer options. That is a strength... and also I think what speaks to such aggressive actions of the fed. They would rather see inflation than deflation. And will err on that side, which would lead to decreased value of the Us dollar. Which for real estate could mean that for those that own and have a physical asset (assuming they make it through this period), it will take more money in the distant future than today to buy.
    Bill F. Rental Property Investor from Boston, MA
    Replied 9 months ago
    Under appreciated comment Brian. Thanks for taking the time to make it. I agree 100% with your comment about hyper-inflation. Exhibit #1 that the author is out of his depth when it comes to basic econ principles.
    Alan F. Flipper/Rehabber from Placerville, CA
    Replied 9 months ago
    Thanks so much for bringing this to light. The economy is like a Monet, real estate is but a dot. Aside from the "globalization" and the central control issues the only way for the u.s. to be sustainable and prosperous is D. All of the above. We need to produce more than we consume. I know that's antithetical to the leverage mentality of investors. Knowledge based industries can not support a diverse and well balanced economy. The Japanese proved this. I also hate the stupid labels of Boomer/millennials et al. Its intellectually lazy and also extends itself into our self-imposed caste system and divides us more. Education, knowledge, determination and ability are all equally important. It will take multiple engaged people over different generations to bring the USA back up...and we will. I've been around manufacturing in the bay area since the late 70's screamed loudly about exactly where this is going. Americans need to roll up their sleeves, not view anything as being "beneath them" give a damn about each other, be solutions oriented and become vested in everything. Using plausible deniability as a way to demotivate the motivated will not serve everyone well. There's an amazing opportunity in all of this to build an even better country and can only hope I get to work with people who have the vision and grit. FWIW I don't work to retire (haven't had a w2 job since the 80s) I work cuz I love it. Be well and thanks for letting be part of BP. It's very entrepreneurial.
    Mark A Good
    Replied 9 months ago
    If you are a baby boomer like myself and are not concerned about what will happen to your equity how about a reverse mortgage that will allow you to live in your home as long as necessary. If real estate holds its value then you have equity later if you need to sell. If real estate crashes because so many people have lost their jobs then you have a place to live and they cannot take the house away from you. If you have any positive cash flow rentals then hold onto those as rents didn't go down in 2008-2012 and it will generate some income. Rentals in mobile home parks may make sense in some parts of the country. Self storage - its amazing what people will pay to hold onto their "stuff" even if they downsize their living quarters. Good if you own the self storage building, bad if you are the renter. The last few years the owners of self storage have increased rents, I won't what they will do in a recession/depression.
    Wes Salous
    Replied 9 months ago
    Great points Bryce about inflation and printing currency effects. No solution to our massive deficit. I am still optimistic about the short supplies of affordable housing in the US. I agree with you on us the Baby Boomers & Millenials housing future trends. Currently, looking to invest in Sr Housing projects with minimum lot size. Yes...on the climate change and the increasingly violent storms need to addressed. I appreciate your info and May GOD help us and guide us to survive the Panedimic peacefully.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    You're welcome Glen. Wishing you a prosperous and fulfilling 2020!
    Terry Madden Investor from Jersey City, New Jersey
    Replied 9 months ago
    Although I think the author of this article makes very valid points, every time there is a crisis in the world or country, things rebound. I get the fact that there is a major disaster going on right now with regard to so many people out of work and the economy coming to a screeching halt, but this is completely different from 2008. Regardless if you like/support our current political team in office, change of events happened so fast, you almost couldn't predict it (and I get it, most people would argue with me on this... "Didn't you see China when it all went down,etc.). We really went from champaign times to drinking Miller Highlife (even though that's not a terrible beer, but a 12 pack goes for $6.99 in the expensive states ;)) Point being, pandemics have occurred in history. FACT. There will be a vaccine for this. There will be an opportunity to come back stronger. The economy will not be back to normal once social distancing is over. That's obvious, but the good news is, it can only go up from here. I've been investing in real estate for a number of years now. If you have a mortgage that is so outrageous and you borrowed against all of your properties to scale, you had to have seen this crisis as a reality. If not, you didn't do your due diligence before investing. I think the BRRR method is a great investing strategy, however, I was always skeptical about that strategy in downtimes. Luckily, for the mortgages I currently have on my properties, I can afford to float them in bad times. Too much credit and leveraging is always a bad idea. Bottom line from me, who is a smaller investor, when times become good again, make sure you have a solid amount of equity in each property you own, and don't extend yourself to a point where you can't figure a way to cover all of your properties. If you are a property owner/financial investor and can be wiped out financially a month into a global/national financial crisis, you were a gambler, not an investor. I hope I did not offend anyone with what I mentioned above, but spent a good 3 hours on this page and wanted to offer my opinion. I wish you all the best and look forward to better times...
    Dennis Adler Rental Property Investor from Augusta, GA
    Replied 9 months ago
    Good comments. Vaccine will be developed. Small investor in the housing market with reasonable debt ratios might fair well. I appreciated your perspective. Commercial real estate may have much harder time.
    Sonja Sevcik
    Replied 9 months ago
    Terry - Very nice comment. I haven't been able to be so nice. I spent a lot of time reading or listening to a lot of his sources last week and am very disappointed in his use of those sources in this article. Click bait 1st Amendment at it's finest.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Thanks for your input Terry. Glad to hear you are already well positioned to weather the storm so to speak. Just to clarify, I'm not at all saying that the "virus" is the cause of the problem here, actually quite the contrary. I'm pointing out that the underlying economy is due for a major detox and this virus is more of a pin that popped a bubble rather than a cause. It seems that there are a few more bubbles to pop as things unfold, and the affect of those could be quite impactful. I agree, there comes a point where we have gone through the worst and things will eventually uptrend for the better. It's my belief that we have a ways to go before we reach that point. With taking all things into consideration, it seems quite unlikely that things will "go back to normal" after all this. We have quite a few large challenges ahead of us, one of the first is getting people back to work. The combination of lack of income and lack of production create a challenging environment, of course full of opportunities with abundant needs to be filled. I'd like to think that BP reader will be on the value providing side of that equation as we are all obviously on here wanting to improve as investors and create better circumstances. Thanks again for your input!
    Tanner Gers
    Replied 9 months ago
    Boom. We are so in alignment here on so many things. I'm so precious and so clean right now... Appreciate the thoughts on the changing needs of the younger populations. I might be wrong, but I believe mobile homes will be a thing of the past. Or just widely, significantly unpopular as compared to today. Why? You outline why in this post. People are there because that's what they can afford, but much more will be more affordable in the future. Storage facilities? Same thing. As older people pass away, so will the demand for such facilities. People will probably always need somewhere to store their stuff, but if the next generation is about minimalism, travel, and not being tied down... They probably are not into accumulating a bunch of material possessions today that need to be stored somewhere tomorrow. Nor will they want to for their parents' things. I've been wrong before, but I've seen more since I got started. I am aware of psychological responses, but that doesn't mean I'm immune to them. And neither is the next person. It's evolution. And we're all human. There will always be the trailer park boys and hoarders, but I think those assets will be looked at how we look at Blockbuster 20 years from now. And based on your timeline of correction / recovery, who knows? Thank you for such a deep, deep valuable post.
    Phil Davies
    Replied 9 months ago
    Hey Tanner, I'm not sure that the new generations are that different from the older generations in terms of broad wants and needs. Millennials were said to value "experiences" over possessions and they supposedly love urban living. But guess what - as soon as millennials started earning more money and having families, they began buying cars and moving to the suburbs. Sure, they may like organics and worry more about climate change but their money is largely going to the same things the boomers spent theirs on.
    Tanner Gers
    Replied 9 months ago
    Thanks Phil. I've certainly evolved over time. I am a completely different person now than I was 10 years ago. I am much more conservative. And fearful. That's why I didn't get back in the market of RE when I could have in 2015, or 2016, or 2017. And if I would have, I would have certainly realized larger gains than I have in other asset classes, and possibly may own more stuff. My scar from buying at 23 in May of 06, then losing my job 4 years later, and the house, changed my perspective. And those emotions caused me to do what I just described. I am incredibly excited though for this upcoming L as I am still in a strong position to capitalize when the time is right. I won't wait for the "bottom", but I am thinking of an incredibly more diverse strategy than my previous buy and hold gameplan. There will be tremendous white space to be filled when the invisible hand wipes much of the landscape away clean. Appreciate the reply. More than happy to brainstorm, discuss, and connect over the phone. CreativeSuccess at Cox . Net
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    You welcome Tanner. Thanks for your feedback. Thanks to both Tanner and Phil for your "2 cents." All the best!
    Jason K. Powers from Denver, Colorado
    Replied 9 months ago
    Awesome collection of information. Thanks for backing all your statements up with sources too! Really appreciate this wealth of information.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    My pleasure Jason. Enjoy your path of education and decision making this year. all the best!
    Joe Cassandra Flipper/Rehabber from Woodstock, GA
    Replied 9 months ago
    Do you write sales copy, Bryan? Your lead is great :). If you do write sales copy, send me a DM as I wrote financial copy
    Jeffrey Grieshop New to Real Estate from Coldwater, OH
    Replied 9 months ago
    well shoot, it sounds like the best investment at this point might be knives, guns, and hand grenades.
    Sandy Sciales Rental Property Investor from Wilmington
    Replied 9 months ago
    So much great coverage, blessings to you and yours
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Thanks Sandy. Glad you got something out of it!
    Max Newbe Retail from Woodland Hills, California
    Replied 9 months ago
    Thank you Bryce for this amazing article you have put a lot of time and valuable research in this so thank you. My question is, assuming the hyper inflation is a fact and will happen. How do you protect yourself? The precious metals are already scares and not widely available...what are other alternatives to protect against huyperinflation. Bitcoin comes to mind but Iam not a big fan ..what to do?
    Sonja Sevcik
    Replied 9 months ago
    Oh man. Real estate. Google home values in the 1970s.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    G'day Max. The intention of this article was to open the eyes of those who where not aware of our underlying economical issues. The question you are asking is something only you can answer. The cool thing is that I've provided a ton of links in this article so you can continue with your own path of research and come up with educated answers to your question based off your individual circumstances. Hyperinflation is one thing to take into consideration, other things to consider are deflation and inflation and how they play a role in our economy. For more information on this, I'd refer you back to Ray Dalio's "how the economic machine works" video in the earlier part of this article. I wish you all the best on this exciting path of education!
    Nina Rosen from New York City, New York
    Replied 9 months ago
    Hi Bryce, thank you for this valuable, eye-opening article. I learned a lot, and I plan on re-reading and spending more time on the links provided. You had mentioned a social revolution which unfortunately seems to be coming, along with the depression-like climate that is happening as a result of covid-19. I live in NY and I am seeing a social/political shift here which is affecting my small business and the businesses of others, Personally I began noticing and feeling it about a year ago, as the market has become progressively more tenant friendly/landlord unfriendly. For that reason I was thinking about investing out of state, although I don't know that this sentiment won't spread nationwide. My question - do you have any investment suggestions that are not only depression-proof but also socialism proof? Thanks, and thanks again for this very informative report.
    Phil Davies
    Replied 9 months ago
    Hey Nina, I hate Socialism as much as the next person but, unfortunately, I think the pendulum is swinging in that direction. Too many young people don't have direct experience with failed socialist policies. They buy into the promises of free stuff for everyone and a communal spirit of love, peace, and companionship. They don't realize that this simply allows charismatic predators to take advantage of their naivety and consolidate totalitarian-like power for themselves. I would assume nation-wide rent control is coming at some point and plan your investments accordingly.
    Sonja Sevcik
    Replied 9 months ago
    Phil - A.) we are a socialist country (free public education, medicare, SSN, government agencies that help finance housing, police, fire, and defense to just name the biggies). B.) So the kids are tired of being lied to. C.) What we all agree on is we would like the capital dispersed more efficiently ... we just can't agree on what that is! Basically, in the last decade and in this new decade massive amounts of capital are being dispersed in times of crisis (one man made and one god made) ... in between we fight and cut taxes without raising revenue. So yes - - something has to change ... but it really doesn't have anything to do with socialism, capitalism, or communism it just has to do with our own stupidity.
    Vaughn K. from Coeur d'Alene, ID
    Replied 9 months ago
    A. Is exactly the problem!

    This country has been slowly but surely going down hill for a long time, as great "empires" usually do. That we've made all those mistakes is not a reason to double down on them! Obviously some aspects like police etc are not unreasonable, but SSI and all the other socialist nonsense? All they've done is screwed things up worse.

    I'm not a big fan of the wealth concentration that has happened, but half of it is BECAUSE of government interference in the market, not true market forces. I'm opposed to crony capitalism every bit as much as socialism. BOTH need to be eliminated to the greatest degree possible.
    Nina Rosen from New York City, New York
    Replied 9 months ago
    Hi Vaughn, Thank you for your response. When I mentioned socialism, I wasn't being cute and talking about established social programs like Medicare and the police - I was talking about new powerful political movements like the Justice Democrats (behind AOC and "the squad" among other young socialist politicians) who are promoting the end of private property ownership in favor of a hard core socialist regime similar to Cuba, the former Soviet Union, or Venezuela, under the guise that this is what is necessary to help the environment. It is a shame about crony capitalism and unconscionable that 20 individuals hold more wealth than 60 % of the world's population, or whatever the quoted statistic was, but somehow I think people like us, who work like dogs so our family can have a modicum of comfort are going to be much more affected than the likes of Bill Gates or Bezos. Anyway, I am off my soap box :). Interesting, I was thinking of investing in Texas, but now I will think twice! Best, Nina
    Ricardo Paredes Investor from Gardena, California
    Replied 9 months ago
    Well said Sonja. "Socialism" has become a hot political buzzword, but the reality is that we all have benefited from federal government subsidy of the services you mentioned. Throw in tax breaks and subsidies for large companies and entire industries and it's hard to take seriously any argument against "socialism" that isn't delve into the the nuances of the proposed policy.
    Vaughn K. from Coeur d'Alene, ID
    Replied 9 months ago
    The semi decent answer to a socialism proof investment is: Idaho! Or other similar states. Please note that Texas and several other traditionally Red states are highly likely to become leftist states in the near future because of demographic trends. So keep that in mind. The thing that's so depressing is that the USA overall is shifting slowly but surely to the left... But the entire rest of the world is 100x worse. In short the last, best hope for freedom is going downhill too... But there are areas where it is being resisted and more freedoms will persist for longer. Personally I'm a big fan of the USA splitting into at least 2 countries, because leftists have no interest, love, or intention of supporting any of the things that made the USA the greatest nation in history. They're against every single thing that made the USA special historically, nowadays including free speech and free expression if you don't agree with them! So going our separate ways is the only way we'll ever truly avoid it... Otherwise I fear a civil war eventually. We'll see how it all goes down...
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    G'day Nina, thanks for your comments. As far as investment suggestions, I don't have any as this is for educational purposes only and I'm not giving any investment advice. I did mention some asset classes that I feel have needs that need to be filled now and in the near future. Of course even those types of investments will need thorough due diligence on part of the investor to evaluate the market, the investment itself and those involved in managing the investment. Regarding a "socialism proof investment" that is an interesting question. Seems like you have started an interesting conversation here...
    Justin Sherwood from Las Cruces NM
    Replied 9 months ago
    So much good info here. Whether or not you agree with things said we should all appreciate the time and effort put in to share the info. Looking forward to studying this all out and doing my own due diligence on how to approach the future.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Thanks Justin. That's exactly the point of this article. Wishing you all the best on your path exploring whats a good fit for you and your investments!
    Rick Goddard
    Replied 9 months ago
    I'm trying to put this in perspective in the same way others are trying to do here, that is, what should the real estate investor do? My plan is to stay the course. As an owner of rental properties, there may be some necessary adjustments in the short term. I don't expect them to change in the long term and expect normalcy in 18-24 months. Fortunately, I'm not leveraged to the hilt. This may even be an opportunity if there are some new property availability at slightly distressed prices. This isn't a long term systemic problem that was built on years of mispricing and misallocation of risk as it was in 2008. It is a purely unplanned event. It is an event that we will recover from once there is a cure and prevention. Maybe it won't be the same because some of the weaker businesses are going to fall out and there will be changes in the work people will do. That is more of a sign of progress and the elimination of inefficiencies more than a general flaw in the economic model. Even now we see that those businesses that feed off of high tech, internet based work systems, financial technologies, virtual commerce, and home based entertainment are doing well. These changes may stay, thus shifting how we continue to provide goods and services. This is not to say there will be bumps. But I expect a fully functioning economy sooner rather than later even if it does look a little different. For those living on the edge in terms of property liabilities, that is the risk of extreme leveraging. Even then, some accommodation is available via debt restructuring and small business continuation loans. It's not like there are no lifeboats. Use them to power through. Meanwhile, don't take the sky-is-falling voices with their messages of elongated downturns seriously.
    Jason Atkins from Belle Vernon, Pennsylvania
    Replied 9 months ago
    Bryce I’ll admit I was skimming the article. One important thing is you CAN NOT compare the wealth gap between AMERICA in 1929 and then the entire WORLD in 2020. The world is different. I’m in the top 1% in the world but I. The u.s that’s not the case
    Hugo A Cardona Sr from Miami, Florida
    Replied 9 months ago
    Hi, I believe there is a massive difference between 1929,2008 and now. The economy fundamentals. Today the economy did not crash due to its imperfections, it did because of external factors and self inflicted slow down. With this in mind I think reactivation will be easier....not easy...easier. IN addition, the opportunities will be abundant as society realize the dependency on China. Other countries with cheap labor see this as an opportunity to step up and take Chinas role. South America, South East Asia, India etc...as production sources. What will China do? Russia is very quite...are you implying they will not attempt to do something? Finally and on the issue fo the currency, the questions would be who will control the currency. Today, we , the US control the Dollar and it has taken years, blood and sweat to get there. If we attempt to replace the currency, the Chinese, Russians and all these world powers wannabes will try to replicate the model or use it to their advantage. Will we allow them? For a minute just think about this and you realize how shallow this article is.....kust replacing the currency is a topic with massive ramifications and implications that is benign thrown in here as if nothing... I feel this articles takes ideas to extremes with no other benefit than inviting panic and some people pretending to know much by predicting the worst. Several of the articles and sources quoted are Internet Influencers which are the product of cyber marketing and not necessarily the product of solid and stable knowledge and thinking. At the end this article is nothing different from a doomsday sci fi movie attempting to cover too much horizontally and vertically, discounting the reactions of the players, interest and stakes, and the geopolitical influences. Too shallow..beware!
    Joe Smith Real Estate Agent from Geneva, ILLINOIS
    Replied 9 months ago
    Well, he got what he wanted. A lot of responses. Look, I'm even responding. I didn't want to read the article after I saw the garbage click bait title. It was what I expected! I'm going to scare you beyond belief with a one sided worst of the worst scenario. Thanks for wasting everybody's time! Like Dennis Green said of the Bears many years ago. " They are who we thought they were." This article is what we thought it was going to be. The good news for the reader is you have a timeline to work off of. You have 2 months to liquidate everything before the world ends. Apparently, you can time the markets despite popular opinion that you can't. I hope you have invested in a great asset class such as mobile home parks like the author. If you were wise enough to do so, you should be fine! Everyone else worry though, you are done. Please be sure and follow up with a 19 page positive article when none of this comes to fruition!
    Hugo A Cardona Sr from Miami, Florida
    Replied 9 months ago
    Hi Joe, I could not agree more with you!! As I mentioned in my comment above, This kind of articles mislead investors and should be vetted by someone. Seems to me that their only intent is to promote Cardone's books and other famous "instagramers" promising to cure old age with creams and potions. What surprises me the most is how many people say the found the article "useful" or serious at least.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    One thing I'll say to you Joe and Hugo is that it seems you have clearly misinterpreted this article (or perhaps not read it in full detail.) I hope you are truly well positioned and ready to provide massive value to those in need as things unfold. As mentioned below, there are no incentives for us to add links to other peoples books, videos or articles. It's simply for the reader to gain further education on if they so chose. I'm not recommending anyone sell any assets. It's simply a time for us to evaluate our assets and if we do feel we want to liquidate any of them, then now could potentially be a better time to take action rather then later while it may no longer make sense or be possible. Full economic effects take time to come to fruition. Let's check back in on this at the end of 2021 as see where the economy is by then. Of course things could happen sooner than that or even a little later, although one thing I'm confident on is that we will be facing significant economic challenges and changes between now and then and there will be abundant opportunities for those well positioned to provide massive value to others. That's the advantageous position I wish for all readers.
    Tracy Parsons
    Replied 9 months ago
    Wow- I'm tired!
    Gail W. Rental Property Investor from Running the Earth, watching the sky
    Replied 9 months ago
    It's like no one has read the Bible or something.
    Sonja Sevcik
    Replied 9 months ago
    Social media is by people who: A.) aren't reporters with editors, B.) aren't experts in their field (i.e. this is a real estate person talking about economics, capital markets, and government spending), and C.) have a profit agenda that is based on clicks. This is why they use information in very perverse "cut" and "paste" ways to paint rainbows and unicorns or doom and gloom. One of the things that is interesting about Dalio in his Bloomberg interview is he says we all need a new vision - a new way, a unifying way to embrace a new American Dream. He believes that that is our fundamental problem - all the numbers be damned. This is correct. In the meantime it is anyone's guess and Dalio's, specifically, haven't been accurate this year. Every week we will know more; but, we wont know what we all want to know for 12 more months. Yes - liquidity. Liquidity; but, beyond that don't feel too bad about what you can and can't prepare for. Find your village, support your village, and your village will support you. We will create a New American Dream and we will get through this too!
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    G'day Sonja. Just to clarify; bloggers on Bigger Pockets are not financially incentivize'd. This is a common misunderstanding. We write these articles for free as we chose to provide value to the real estate investing community. Ray Dalio has good information on how economies work and how things could look as they unfold. These links are meant for educational purposes and we can all make your own assumptions. I don't necessarily agree with the political standpoint some of the people in the links have, it's simply information on the economy from which we can come up with our own assumptions. I wanted to give links to different people for a few different perspectives here. Keep in mind what we are facing is longer term than "weeks" we are looking and months and years of effect as this unfolds and things take time to react (i.e. real estate markets). And again there is nothing to fear here, it's simply prudent to be aware, prepare, then get ready to provide massive value and solve problems. I wish you the best in 2020!
    Ryan Schwartz
    Replied 9 months ago
    Thank you Bryce. I feel like I need a bottle of Maker's Mark after reading the article though! :) I will definitely be going through all of the links, and resources you included. I'm curious, and not to be overtly political, but did you ever read Ron Paul's book "End the Fed." It covers a lot of these topics you mentioned such as fractional reserve banking, hyperinflation, financing of endless war, Bretton Woods, the Gold Standard, etc. If you haven't already, I highly recommend it. That's for all BP members too. Thought I'd reciprocate since you left us with so much good info. It seems like the two major political brands have boxed us in to a bunch of presumptions about the other side, and never ending arguments over even the tiniest of issues. While the R's and D's fight it out publicly, project a vast unbridgeable chasm between the two, and use ad-hominemsto describe any argument from the other side, we haven't noticed none of the biggest policies ever change no matter who is in office. Foreign, fiscal and monetary policy are all largely the same and are never a hot button debate topic but affect each and every one of us. It also truly amazes me that this entire system is built heavily on debt and consumption. I'm hopeful and optimistic that this won't be a doomsday that takes decades to recover from, and that while the RE market will definitely slow, we won't see a substantial loss in value. 3 of the past 5 recessions saw marginal increases in value, one had a marginal decrease in values, and obviously 2008 saw a huge decrease. Lending has been tighter than this past decade, and we aren't seeing the complete insanity of numerous people having loans like negative am's, for instance. I'm hopeful enough people will wake up to the things you have pointed out and advocate for more economic freedom and individual control and if the current Kenesyian don't land quite as hard on us that will buy us time to right the ship. BUT, you're article is helpful in preparing for the worst. Hope for the best, prepare for the worst!
    Ryan Schwartz
    Replied 9 months ago
    revision to above. meant to type "If the current Keynesian/demand side policies"
    Edwing Hernandez New to Real Estate from New Jersey
    Replied 9 months ago
    Wow, what an ARTICLE!!! just thanks so much to take the time to write this and compile all this information in one pill, really balanced and great (make your own decision) Article.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Glad to hear this has positively affected you Edwing. All the best as you piece this all together and make educated decisions moving forward!
    Rebecca Jackson Rental Property Investor from Dallas, TX
    Replied 9 months ago
    Very dark article, indeed. All I would say is this- In life, you must be able to adapt and overcome.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Yes, we need to adapt and overcome. There was a great (and very short) book written on this topic called "Who Moved My Cheese" by Spencer Johnson M.D. https://www.amazon.com/Moved-Cheese-Spencer-Johnson-M-D/dp/0743582853
    Vaughn K. from Coeur d'Alene, ID
    Replied 9 months ago
    Uh oh, somebody else who gets the "big picture" stuff! I can't say I agree with all the assertions, but I've long known about central banking, how fragile fiat currencies are (100% historical failure rate, what's not to love???), and all the other similar stuff. I think this particular hiccup still depends on how quickly we reopen. We might just be in a 2008 scenario if it's quick... If not... It could be more 1929. But I think the idea of it being a perfect V recovery with no long term pain is out the window.

    For those of you who keep repeating "This is different than 2008, the underlying fundamentals are good this time!" You clearly don't know any of the numbers... Our entire economy is drowning in debt, and little more than a house of cards. By some metrics we're a little better than 2008, but by many others we're far worse off. We have every bit as much systemic rot, if not more, now vs then. Not trying to knock anybody for not knowing stuff, but you better start educating yourself on the debt loads industry is holding, how overheated the stock market was based on traditional metrics, personal debt, national debt, etc. It's fine if you come to different conclusions than the author or myself, but if you don't even know the facts you can't possibly make a reasonable assessment, and many of you CLEARLY don't know the facts.
    Katie Rogers from Santa Barbara, California
    Replied 9 months ago
    How did you make paragraph breaks? I haven't been able to make paragraph breaks for a long time in BP.
    Vaughn K. from Coeur d'Alene, ID
    Replied 9 months ago
    Yeah, it broke at some point in the past.

    You can use HTML tags in between paragraphs.

    The code is a "<" with "BR" in the middle followed by a ">"at the end to close it, with no spaces in between any of it. Two sets of those will make a full break, one will just force it down to the next line but without a blank line in between. < P > might also work on BP, which is the direct HTML code for a paragraph break. I'll try it before this paragraph actually and see if it works... You can just google HTML line break code or something to that effect in the future if you forget it too.

    Vaughn K. from Coeur d'Alene, ID
    Replied 9 months ago
    < p > code didn't work for some reason... So use the < BR > without spaces...
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Thanks for your input Vaughn. In fact, that lack of investors awareness of our underlying economy and some of the reasons that its built on a "house of cards" is the main reason I wrote this article. So many people where saying "but real estate is great right now" etc. and this was a massive concern for me as it became very clear that although we may be well educated on our asset class or investment model, not that many investors seek additional education in understanding the macro of our markets and economy. I believe that the more educated we are on this topic, the more we can see things coming or be prepared for potential happenings as they unfold. So many people say "We don't have a crystal ball" although those who are well researched (although perhaps not foreseeing the exact trigger or exact set of circumstances) can anticipate the general direction of things economically, hence can generally predict future happenings and prepare for them in advance. There are some people that say "I never saw that coming" (not prepared) and at the same time always a handful who say "Wow, here is it, that thing we were expecting!" (prepared). I'm hoping this article could be the catalyst for many readers to switch from being not prepared to being prepared.
    Tyler Brunette Accountant from Tacoma, WA
    Replied 9 months ago
    How does liquidity help battle hyperinflation? If prices of goods goes up, and funds liquidated would have less purchasing power.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    G'day Tyler. Good question. The reason most people are talking about "liquidity" right now is to be best positioned for when the value of our real estate markets fall (and other markets for that matter.) Once pricing is low, that is when we as investors want to move in and purchase heavily discounted properties. As for how to hedge against infatuation or hyperinflation, that's a separate topic. This is where many people chose to hold their liquidity in gold and silver and other assets with similar characteristics where those assets typically hold value as opposed to the value of an inflating or hyper-inflating currency. "Deflation" and the "velocity of money" are also important topics to research right now. I'd suggest watching the Ray Dalio video on "how an economic machine works", then watching the 10 episode series "the hidden secrets of money" by Mike Maloney. Both these video links are above in this article. Watching those will give you a sound understanding of economic cycles etc. This way you can tie things all together as there are a lot of variables, as while one thing is happening over here, there's also something happening over there. So there are many factors to bring into the decision making equation. Of course, I'm not giving any investment advice here, simply recommending topics that would benefit you to research so you can make you own educated decisions to suit your individual needs and circumstances. I hope this helps!
    Jack Martin Specialist from Scottsdale, AZ
    Replied 9 months ago
    Bryce, great compilation of what could occur as a result of COVID-19. None, some, or all of this could happen, but it is always smart to color the whole picture so one can prepare. I would echo your comment about affordable housing as a place to invest. As an example, our portfolio of mobile home parks continues to perform on par with a normal market, even in the face of this pandemic. The demand for affordable housing is going to dramatically increase. The fundamentals of MHP and well located RV parks that can serve as permanent affordable housing are extremely strong and will favor those who own/invest in them.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Indeed. Glad your also having success in the MHP space. Affordable housing is a very important asset class this year.
    Katie Rogers from Santa Barbara, California
    Replied 9 months ago
    You did a good job explaining how sovereign entities create money out of thin air. But this paragraph is debatable "Once we grasp this, it becomes clear that at some point, we will reach so much debt, the currency and economy will collapse, at which point it’s likely the currency will be replaced. (More on this later.) This is essential to know given our current debt and unlimited money printing. It simply cannot go on forever." There are countries all over the world whose currency is still viable. 2000 yen per month used to be a living wage in Japan. Now its more like 300,000 yen. What happens is that the smallest denomination (the one-yen coin) falls into disuse. You maybe should have broken this up into parts. It is really too long to read on a screen.
    Vaughn K. from Coeur d'Alene, ID
    Replied 9 months ago
    Well, massive levels of inflation have implications too! It can be good or bad depending on your situation. Think of all the people who held fixed debt in the 70s/early 80s, especially if it was at lower interest rates from earlier time periods. That horrible inflation helped them out financially, while crippling others.

    I think the thing is though, to a large degree we're in a slightly different position than Japan or other nations who have had this, because we're the defacto international currency, and if WE go down that road... The repercussions could ripple through a lot worse than a smaller and less important country. But even if we just have crazy inflation that could have a LOT of negative consequences for most people, especially if it gets into outright hyperinflation.

    One more thing to consider is that 100% of fiat currencies have eventually failed. You must keep in mind we only fully decoupled from gold during the Nixon administration, which is a big part of WHY we had the horrible inflation in the 70s and 80s. In other words we're only a few decades into having a 100% fiat, debt based currency. That's actually a pretty decent run by historical standards, as many fail extremely fast. The difference this time is EVERYBODY has gone fiat, so instead of being able to just switch to using a real currency backed by gold/silver like in the past, everybody is pretty well forced to try to find the "One eyed king in the land of the blind," which for now is still the USA... But for how long?
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Not sure I understand what you are saying here Katie. Are you using Japan as an example of a good economy? As Vaughn mentioned, we are on a "fiat" currency (as are many other major countries), and all fiat currency's have failed historically. It's not a question of if we will chance currency, it's a question of when.
    Tana Oscanyan Rental Property Investor from Provo, UT
    Replied 9 months ago
    Great article! Seriously such a good article! I can't agree more and just like Vaughn commented earlier it's nice that someone else sees the "big picture". Fiat currencies can so easily be abused. Keynesian economics just perpetuates the problem. I have followed Mike Maloney and his videos for years, it's so nice to have someone with a background in real estate tie it all together and expound on that. This article has so much helpful and well-researched information. The comparisons you made between 2008 and 2020 as well as 1929 and 2020 were really helpful. It's those facts and figures that really help paint a much clearer picture of where we are at.
    Bryce Robertson Rental Property Investor
    Replied 9 months ago
    Thanks Tana. You seem quite well researched yourself based of the language you're using here. Feel free in these comments to share any links of things you have found to be of great value (books, you tube videos, people to follow etc.) so all readers can gain from it. It's soothing to hear from people who are working hard to get well educated and stay ahead of the game. I truly believe those who are well researched will have an upper hand on those who are "crossing fingers, hoping for the best, and waiting to see what happens."
    Peter Ramirez Real Estate Agent from Los Angeles, CA
    Replied 9 months ago
    Wow kickass article! It makes me eager to learn more about cryptocurrency and learn as much as I can about the coming pension crisis as both my parents are looking to retire in the next five years, and I'd love to be able to help guide them to make the best possible decisions.
    Bryce Robertson Rental Property Investor
    Replied 9 months ago
    Excellent. Glad to hear Peter! I like that your keen to take action. If you want to get up to pace quickly with crypto, research "the halving" that is happening in May 2020 (wont happen again until 2024) among other phenomenons happening in may in the crypto world. Things to consider taking advantage of if you can wrap your head around it all quick enough (there quite a bit to learn if its all new to you.)
    Jessica Cress Realtor from Arvada, CO
    Replied 9 months ago
    Bryce, Thank you for this article, it sums up everything I have been seeing, hearing and thinking about for the past few years. I have read the majority of the books you mentioned and follow all the people that you mentioned in this article. I know Adam Taggert and Chris Martenson on a personal level and find them amazing people. If you have not read or seen Chris Martenson's Crash Course, I highly recommend it. Adam and Chris also go into lots of details on how the economy is linked to the environment in their book "Prosper" and how it will all play out. That's where you will get some environmental information, whether you believe it or not. Also I have followed the "silver Tsunami" and I am apart of RALA, which is the residential assisted living academy created by Gene Guarino, a baby boomer himself and he has tons of stats on this area if you want to research it more. His book is "Investing in Senior Housing." It's not all sunshine and rainbows and a lot of people are not fortunate enough to age in place. I understand because I invest in Residential Assisted Living. I am right on the cusp of being a"millennial" and a "Gen Y" the statistics out there are staggering and to think that the "millennials" as a group are going to be able to save the economy is interesting, only time will tell, but the statistics are interesting and the friends, family, neighbors I know, speak a different tone than mentioned above and when you follow Harry Dent, all the cycles come into focus and the generations don't match up, in terms of helping each other economically, because the "millennials" are doing everything so much later in life or not doing it at all, like getting married, buying a home or having kids. The sad part is that most people project their situation or what they see as the norm and not the exception. Maybe you do know what is happening or have been "in the know" or live in an area that isn't affected as badly, but that doesn't mean it isn't happening elsewhere. Maybe you know about pensions, but people that I have talked to didn't know or don't know what is going on and people that don't have a pension don't even know there is a problem. Unless they do the research and educate themselves. Like what exactly is going on with the yellow vest protests in France and why does it matter? Again thanks Bryce for putting out an article to make everyone rethink what is happening and the possible outcomes of it and to push us to educate ourselves about what is going on from every angle, because the entire world is linked now, unlike in 1929, as we see it playing out with COVID-19. So when one house falls the foundation gets a little weaker. We, the US, may be the nicest house on the ugliest block, but that doesn't mean it can't change in an instant.
    Bryce Robertson Rental Property Investor
    Replied 9 months ago
    G'day Jessica, it's great to hear you are doing a ton of independent research. Very wise and prudent of you! I have, Chris Martenson's Crash Course book, and It's on my list of books to read in the near future. I loved their book Prosper, and gained a lot from it. That's great you know Gene and are involved in assisted living. Thanks for your input here and keep up the good work!
    Dan Miner
    Replied 9 months ago
    Bryce, great job on this article. I've been following Chris Martenson for many years, so I appreciate that we have a common frame of reference. And also, your commentary is much more likely to be accurate than that from more conventional folks. Even if writers on this platform have extensive experience in real estate, their narrower and less complete perspective means they're more likely to guess wrong in this extremely uncertain time. I hope that you are able to publish more updates through Bigger Pockets with guidance on RE investing. In mid-March, I was about to close on a two family rental property in upstate NY, but an industry-wide change of funding conditions led to my hard money lender pulling funding so the deal vanished. Perhaps it was a blessing in disguise.
    Bryce Robertson Rental Property Investor
    Replied 9 months ago
    G'day Dan. Glad you're getting something out of this article. Yes, I will continue to write here at BP so follow along and keep an eye out for future articles. Yes, financing landscape is changing rapidly. I've seen the same thing in the Mobile Home Park space, where we have to adjust in our underwriting to compensate.
    George Lui Investor from Palo Alto, CA
    Replied 8 months ago
    A very thorough, great, useful, (and libertarian) article Bryce! I enjoyed it very much!
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Great to hear. Wishing you all the best as the year unfolds!
    Dan Wickland Rental Property Investor from Columbus, OH
    Replied 8 months ago
    PHENOMENAL ARTICLE! Thank you so much.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Glad you got something out of it. All the best!
    Hank Hebel
    Replied 8 months ago
    Do you mind addressing my comment below? thanks!
    Hank Hebel
    Replied 8 months ago
    Great article. I'm actually already familiar with many of these sources referenced, so glad to see I'm not alone. Here's what I can't wrap my head around: my mom and I bought a piece of rental property this past November. Initially, we were renting it via AirBnB, but due to the pandemic, travel bookings have all but disappeared. Currently, I'm getting interest from tenants in renting, but curious whether we should just sell. On the one hand, I think we bought at the peak of the market and we'd be wise to sell and invest the money elsewhere until a correction. On the other hand, I'm starting to think that central banks of the world won't allow for deflation and we may just be heading straight into the hyper-inflationary phase, in which case paying off the debt would be much more manageable. I'll also mention that I think we live in a relatively stable housing market. What I can't wrap my head around is the idea of who will be able to afford to rent, regardless of the price, if no one has jobs. One other factor is that in a free market, the banks and mortgage companies would also go bust, but we don't seem to be allowing that process to play itself out. Interested what others think about this topic. No one has a crystal ball, but I'm starting to lean towards holding onto the property and let the Fed inflate the debt away.
    Bryce Robertson Rental Property Investor
    Replied 8 months ago
    Hank, I feel for you and your concerns. This article was written to open up peoples eyes to some underlying economic factors that many people are not aware of, and I provided many links for further research on this topic should the reader so desire. As mentioned various times in the article and in my comments, I'm not giving financial or investing advice. This is simply education and it's up to the reader and their advisors to decide what to do given their specific needs and circumstances. I'm glad you have found this article valuable and I could only advise you to consult with your own financial, tax and legal advisors. Wishing you all the best!
    Account Closed
    Replied 6 months ago
    How does immigration reform fit in with more people being added and paying taxes into the system?
    Andrés Usma Silva
    Replied 6 months ago
    I'm impressed with this article, it can help us prepare financially, I will surely read it again, it's very complete and should be digested slowly.
    Bryce Robertson Rental Property Investor
    Replied 6 months ago
    G'day Andres, glad to hear this article is helpful! Thanks!