CW 507 FBF – Defending Investments Against the Demons of Risk and Inflation with Doug Utberg
04/24/15 • 57 min
Jason Hartman starts this episode with an update on and new fixed-rate mortgage financing program for IRA investors and foreign nationals. In addition, you’ll hear about a change the RSS feed for this podcast in hopes that the change will be seamless and you won’t even notice it; however, you know how technology goes sometimes. You’ll get an overview of a few properties, a few thoughts on the greater Atlanta, Georgia real estate market and an update on Jason’s “Meet The Masters of Income Property Investing” event slated for October at The Hyatt Regency in Irvine, California visit: http://www.jasonhartman.com/meet-the-masters-of-income-property-investing/for complete details.
The main focus of this episode of The Creating Wealth Show will be: Defending Against The Demons of Investing.
The world of investing involves many considerations. Chief among these are the two “Demons” of investing that must both be defeated in order to realize success. The first demon is risk, and the second is inflation. Risk comes from the fact that future returns are uncertain, and it is not possible to foresee all future events. Investments that seem ‘safe’ may turn out to have hidden dangers that we did not notice. Risk can never be eliminated, it can only be managed. The best way to do this is by properly diversifying your investments so that they are not all subject to the same market shocks. The second demon of investing is inflation. Inflation is especially difficult because it erodes the value of your dollars. Defeating the demon of inflation requires investment in multi-dimensional assets that are optimized to defeat inflation. Income properties meet this criteria well because the property itself holds real value by nature of the replacement cost of the structure, the loan allows you to have a fixed cost of capital for three decades, and the cash flow is pushed up by inflation while you cost structure remains flat because of the fixed-rate financing.
Jason Hartman starts this episode with an update on and new fixed-rate mortgage financing program for IRA investors and foreign nationals. In addition, you’ll hear about a change the RSS feed for this podcast in hopes that the change will be seamless and you won’t even notice it; however, you know how technology goes sometimes. You’ll get an overview of a few properties, a few thoughts on the greater Atlanta, Georgia real estate market and an update on Jason’s “Meet The Masters of Income Property Investing” event slated for October at The Hyatt Regency in Irvine, California visit: http://www.jasonhartman.com/meet-the-masters-of-income-property-investing/for complete details.
The main focus of this episode of The Creating Wealth Show will be: Defending Against The Demons of Investing.
The world of investing involves many considerations. Chief among these are the two “Demons” of investing that must both be defeated in order to realize success. The first demon is risk, and the second is inflation. Risk comes from the fact that future returns are uncertain, and it is not possible to foresee all future events. Investments that seem ‘safe’ may turn out to have hidden dangers that we did not notice. Risk can never be eliminated, it can only be managed. The best way to do this is by properly diversifying your investments so that they are not all subject to the same market shocks. The second demon of investing is inflation. Inflation is especially difficult because it erodes the value of your dollars. Defeating the demon of inflation requires investment in multi-dimensional assets that are optimized to defeat inflation. Income properties meet this criteria well because the property itself holds real value by nature of the replacement cost of the structure, the loan allows you to have a fixed cost of capital for three decades, and the cash flow is pushed up by inflation while you cost structure remains flat because of the fixed-rate financing.
Previous Episode
CW 506 – Dan Mitchell – Fiscal Policy, Corporate Taxes & America’s Economic Progress, Senior Fellow at the Cato Institute
Jason invites Fernando on to the show and answers a couple of his questions on lease renewal. Dan Mitchell is also today's Creating Wealth guest. Dan is a senior fellow at the Cato Institute and talks about high corporate taxes, the fiscal policy, and recommendations on how a country's economy can grow instead of collapse.
Key Takeaways:
1:40 – Fernando shares his opinion on the mastermind group he and Jason are currently attending.
5:50 – Fernando has two questions about upcoming property renewals and wants to pick Jason's brain on what he should do.
15:20 – Jason introduces Dan Mitchell.
20:05 – Taxing US citizens world wide is a nightmare.
26:05 – The US understands that it can't go down the same route as failing economies like Greece.
33:58 – We can no longer view the government as a sugar daddy.
Mentioned In This Episode:
cato.org
Next Episode
CW 508 – Local Market Specialist Brad – Jackson Mississippi Real Estate Investment Market Profile
Jason would like to remind his audience that the Memphis property tour is coming up and there's still a few seats left. Jason invites Brad, a market specialist for the Jackson, Mississippi market to give an extensive market profile on the area and why it's a good time to invest there.
Key Takeaways:
2:40 – There will be a Venture Alliance mastermind meeting in San Diego.
4:25 – For the mastermind meeting in June, you can come as a guest to get a feel for it.
5:35 – Jason welcomes Brad.
9:20 – Brad sold some of his properties in 2005 and regrets it.
15:40 – You can buy a house in Jackson for $50k and have it rent for $750.
18:10 – Brad shares his thoughts on section 8 tenants.
21:40 – Brad lists some key things he likes about Jackson.
29:10 – There will always be people who will have a renter mentality and not purchase a home.
Mentioned In This Episode:
JasonHartman.com
VentureAlliancemastermind.com
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