HELP - National Factor #2 - Inflation

HELP - National Factor #2 - Inflation

Page 36 - determining if the market is in hyperinflation or deflation

Dean wrote:
The easiest way to determine the inflation rate is to go to www.Inflation-data.com and look at where the rate has been and where you think it is going. Most of the time, inflation won't be applicable when determining the cycle you are in. But you must know the general inflation rate in case there is an extreme swing one way or the other.

Then you are asked to pick whether the cycle is Top, Down, Bottom, Up, or NA not applicable at this time.

Dean states that hyperinflation is a time to stay out of RE investing.

Going to the site mentioned, I found that rate was 4.03% at Feb 2008 where it was 2.42% same time in 2007.

How do I read this in relation to the passage above? Are we in hyperinflation or deflation?

Confused.....

__________________

Deb


I think neither. There IS

I think neither. There IS inflation, especially in oil/gas and food products but I would not say we are in hyper-inflation.

We certainly are NOT deflating in general.


Many thanks Mark

Thanks for that. How do we read it though? I am not sure how to see how we stand in this area?

__________________

Deb


hyperinflation

I was wondering the same thing...it is now November and inflation has been steadily going up...with the mess in the economy right now, it is very hard to guess...www.inflation-data.com has stated that the US might be bankrupt and we may be heading for hyperinflation...what do you gurus think? :0

__________________

There is no fear in love, but perfect love throws fear outside...1John 4:18


Hyperinflation/Deflation Debate=Staying out of RE investing?

After reading various articles on inflationdata.com, seems that we're either heading towards hyperinflation due to the bailouts, or working through deflation. Regardless, Dean advises severe precaution under both circumstances, so what to do?


Hyperinflation/Deflation Debate=Stay out of RE investing?

After reading various articles on inflationdata.com, seems that we're either heading towards hyperinflation due to the bailouts, or working through deflation. Regardless, Dean advises severe precaution under both circumstances, so what to do?


Not to worry

We are not in hyperinflation....yet. When hyperinflation hits millionaires are created almost overnight. We may never see hyperinflation or it could be around the corner...no one knows. But I do know this, if you own a home that has a locked in interest rate and hyperinflation hits you will be able to pay off that mortgage with much cheaper dollars...that is when wealth is transfered at a very, very fast rate. For example, lets say you buy a house today that is worth $100,000. Now lets say tomorrow hyperinflation starts to go into gear and the price of a gallon of gas goes from $2 a gallon to $20 a gallon, milk goes from $4 a gallon to $40 a gallon, and your pay goes from $500 a week to $5000 a week. The payment on that mortgage still stays at $600 per month. The value of the house is now $1,000,000. The rent you charge goes from $500 per month to $5000 per month. Now you have a lot more money to pay off that mortgage! That is hyperinflation and that is how you become super wealthy BEFORE hyperinflation hits. Keep your rental contracts on a "month to month" standard and put your mortgages into a "fixed" rate and you can become super-wealthy during hyperinflation. Buy as much as you can before it too late!

__________________

You've got to find your obstacles and call them out! Unsheath the sword, and do battle with whatever it is that holds you back!


Not to worry

We are not in hyperinflation....yet. When hyperinflation hits millionaires are created almost overnight. We may never see hyperinflation or it could be around the corner...no one knows. But I do know this, if you own a home that has a locked in interest rate and hyperinflation hits you will be able to pay off that mortgage with much cheaper dollars...that is when wealth is transfered at a very, very fast rate. For example, lets say you buy a house today that is worth $100,000. Now lets say tomorrow hyperinflation starts to go into gear and the price of a gallon of gas goes from $2 a gallon to $20 a gallon, milk goes from $4 a gallon to $40 a gallon, and your pay goes from $500 a week to $5000 a week. The payment on that mortgage still stays at $600 per month. The value of the house is now $1,000,000. The rent you charge goes from $500 per month to $5000 per month. Now you have a lot more money to pay off that mortgage! That is hyperinflation and that is how you become super wealthy BEFORE hyperinflation hits. Keep your rental contracts on a "month to month" standard and put your mortgages into a "fixed" rate and you can become super-wealthy during hyperinflation. Buy as much as you can before it too late!

__________________

You've got to find your obstacles and call them out! Unsheath the sword, and do battle with whatever it is that holds you back!


Hey, newyorker.

Welcome to the DG family.
You've GOT to appreciate CBR's post. If that scenario occurs, all the more reason to be out there buying now! And if not, all the more reason to be out there buying now! What does THAT mean, you say?
Well, if you are buying properties cheap right now, it doesn't matter WHAT inflation does. You've got a strategy for each part of the market cycle, like Dean teaches.
I may be very naive when it comes to what's happening nationwide (I mostly depend on this site for info, to be honest), but it doesn't matter. If you're paying attention to your local market, you will know how to play it. I've had people shaking their heads at me in the last couple weeks saying, "How can you be smiling and doing so well when everyone else is struggling?" (I almost felt guilty) I just explain what I'm doing with the REO opportunities and what I've learned from Dean, and I tell EVERYONE that now is the time to be taking advantage of it! They all agree, but are too scared to try! They think they need to wait it out! How wrong!!
I know it takes courage to step out there and DO IT, but we've got all the support and information a person needs right here! You just need to take action!

I hope that wasn't too "lectury". And, of course, it wasn't aimed at you. Just me venting. Smiling There's just SO MUCH success to be had right now. Let's take it!!

Rina

__________________

"Obstacles can slow you down, but they can only stop you with your permission." Dean Graziosi (BARM pg 101)

"For I know the plans I have for you," declares the Lord, "plans to prosper you and not to harm you, plans to give you hope and a future." Jeremiah 29:11

For a little about me, welcome to the site, and a few tips for new DG family members, click on this link: http://www.deangraziosi.com/user/3249


God Bless you and give you endless blessings!

thanks for that verse I love God thank God for you!


It's official! We are in DEFLATION (but just slightly)...

According to the site Dean mentions on inflation rates... I followed it to this link...

http://inflationdata.com/inflation/Inflation_Rate/CurrentInflation.asp

Look at the table. See the figures in red? That means DEFLATION, which is where the US economy is this month. It is when the ARV of real estate usually plummets. But if you look at the rates for each month, the negative (deflation) figures are getting smaller, which means nominal inflation might be around the corner. Please note this table and its figures are based on the CPI (Consumer Price Index), which reflects values and prices in all industries across the board.

When I reached this part in BAREM, I was torn between putting BOTTOM or DOWN because I had no way of knowing if this was the end of the cycle or just a ledge before falling further. I thought the economy and RE market have been so poor for so long that they might actually outweigh the effect of this slight deflation (so you'd put "N/A"). Eventually I put BOTTOM because the figures are slowly climbing again, and there are still a lot of ARM's in good standing, and much of the national market is already underpriced because of stagnant sales rates. Hope this helps answer your question... Smiling

__________________

Paul: "I must not fear. Fear is the mind-killer. Fear is the little-death that brings total obliteration. I will face my fear. I will permit it to pass over me and through me. And when my fear is gone I will turn and face fear's path, and only I will remain."

Duke Leto: "I'll miss the sea, but a person needs new experiences. They jar something deep inside, allowing him to grow. Without change something sleeps inside us, and seldom awakens. The sleeper must awaken." - "Dune."


Syndicate content