Hyperinflationary Real Estate Risks: Seizing Gold’s Wealth-Building Potential

In this video, Lynette underscores the importance of strategic planning amidst market volatility. Leveraging her deep understanding of currency cycles, she advocates for diversifying into undervalued assets such as gold and silver. Additionally, she discusses the role of real estate as a hedge against economic uncertainty. With Lynette’s expert insights and historical perspective, viewers are equipped to fortify their financial well-being. Join her as she empowers individuals to navigate turbulent financial waters with confidence.

Links:
https://www.cato.org/publications/commentary/hankes-inflation-dashboard-official-statistics-misrepresent-real-inflation
https://www.imf.org/external/pubs/ft/wp/2001/wp0150.pdf
http://www.jchs.harvard.edu/sites/default/files/pickering_w00-3.pdf
https://scholarlycommons.law.northwestern.edu/
http://www.jchs.harvard.edu/sites/default/files/pickering_w00-3.pdf
https://scholarlycommons.law.northwestern.edu/
http://www.jchs.harvard.edu/sites/default/files/pickering_w00-3.pdf
https://scholarlycommons.law.northwestern.edu/
https://www.jstor.org/stable/4545563?read-now=1&seq=9#page_scan_tab_contents
https://books.google.com/books?id=sRXF0KFpSS0C&pg=PT23&lpg=PT23&dq=You+could+buy+an+entire+downtown+city+block+of+commercial+buildings+in+Berlin+for+25+ounces+of+gold.&source=bl&ots=WXxCifwmHt&sig=ACfU3U3HBKYcJ48am8ixY7U4WOOEMthBOg&hl=en&sa=X&ved=2ahUKEwjDqPHt_9byAhUWIjQIHYU7BVUQ6AF6BAgLEAM#v=onepage&q=You%20could%20buy%20an%20entire%20downtown%20city%20block%20of%20commercial%20buildings%20in%20Berlin%20for%2025%20ounces%20of%20gold.&f=false
https://www.dallasfed.org/-/media/documents/institute/wpapers/2014/0208.pdf
https://en.wikipedia.org/wiki/Hyperinflation_in_the_Weimar_Republic
https://books.google.com/books?id=sRXF0KFpSS0C&pg=PT23&lpg=PT23&dq=You+could+buy+an+entire+downtown+city+block+of+commercial+buildings+in+Berlin+for+25+ounces+of+gold.&source=bl&ots=WXxCifwmHt&sig=ACfU3U3HBKYcJ48am8ixY7U4WOOEMthBOg&hl=en&sa=X&ved=2ahUKEwjDqPHt_9byAhUWIjQIHYU7BVUQ6AF6BAgLEAM#v=onepage&q=You%20could%20buy%20an%20entire%20downtown%20city%20block%20of%20commercial%20buildings%20in%20Berlin%20for%2025%20ounces%20of%20gold.&f=false

[Music] welcome to the Lynette Zang YouTube channel where we support community and sound money globally now make sure you help us build this Channel please please please by clicking that subscribe button below and also hitting that Bell so we can let you know when we’re when we’re issuing another video which as you guys know if you’ve been watching do very regularly but we need to build this channel as quickly as possible because our goal is to create both local but even so Global communities and the best way to do that in my opinion is well this is a key way so please support us in that appreciate that a lot now I want to talk a little bit more about the strategy and it’s just my original strategy is based on studying currencies and currency life cycles and their pattern since 1987 and part of what we’re looking at doing is currently positioning into severely undervalued real assets this is a money issue right so this is a monetary life cycle issue so real hard money sound money and they revalue it against money Fiat money government-based money debt based money money that has no intrinsic value and right now as the value of these have gone down the value of those other assets like stocks and bonds and real estate and ETFs and all of that Fiat money product has floated up with all of the money printing That central banks have been doing right but that is you know the markets are cracking right now so that is Shifting and what we’re going to find is that where we’ve got gold and silver that are severely undervalued those Fiat money assets that are severely overvalued that’s going to flip flop and there will become opportunities and so today the opportunity that we’re going to talk about is with real estate because we can certainly see the tectonic shift that’s happening in that Arena let’s let that wash out all the garbage and if you hold your purchasing power which is Gold’s most most most important role and most important position if you hold your purchasing power then you’ll be able to convert this into income producing assets again today we’re just going to talk about real estate so let’s move forward this is going to be a fairly long video okay now there are a number of of risks that real estate run and so all you have to do is if you know what those risks are you just have to address them and put yourself in the right position one is immovable property tax now governments generate income through taxation and they know that you cannot put this house on your back and or this property rather on your back and walk away with it this is very movable property you can put this in your pocket and go anywhere but real estate is not and so governments generate income local governments generate income through property taxes and historically they go up a lot you have to be in a position to be able to pay your property taxes or you lose your house the next is Mortgage Debt if you have debt on this then as the interest rates that you locked in remain static they’re going to want you to convert into the new instrument if you’re holding this I’m going to show you this if you’re holding this then you as soon as we do that overnight reset and spot goes up towards its fundamental value you sell as much of this as you need to Boom pay off that mortgage you’re not subject to it rent capping so I know that a lot of people have become landlords but as we saw during the pandemic that the government can cap how much you can charge and that’s what they do during hyperinflation but your costs don’t are not capped so your costs are going up and your ability to generate that income to pay that cost is basically removed and you got a problem particularly if you have mortgage on there for those that are counting on this rental income if people can’t pay their rent because food becomes more important than rent that’s what happens during hyperinflation you need to be prepared to supplement that income so that you don’t have that negative impact and you’ve got to have the ability to deal with all of the inflated maintenance costs so there are a number of risks s that are associated with real estate but those also create the opportunity as well because in this environment in any environment wealth never disappears it just shifts location why not have that wealth shift your way it’s not rocket science it’s actually pretty simple because if you hold your gold then you’re holding your purchasing power steady so let me show you how gold addresses and it’s different kinds of gold that perform different kinds of functions that’s the importance of putting your goals first in the strategy and then working backwards doing what you need to do to support your goals all right but let’s start with those immovable property taxes because during the Depression even if you had your house paid off but you could not pay your property taxes guess what you lost lost your property so for that I’m just being really honest with you because I want everybody no matter where they are in the world to be protected right personally I like fractional gold coins this happens to be a rooster but it can be an American fractional coin it can be any country’s fractional coin as long as it’s pre-1948 cuz then it’s classified as a collectible you want to be in that c category what you’re looking at is inrease the immovable property taxes as a share of GDP now remember they went through a major crisis so it’s a really good indication of what we’re going to see here and of course what we’re seeing is these oops didn’t grab my little laser pointer these are the property taxes this is the spot Market on gold so even if this is a manipulated Market it still holds its value better now you can see that it went down in here because it’s easy to buy as much gold as you that as long as it doesn’t really exist the paper form of gold but over the Long Haul gold will maintain your ability to pay those property taxes and we can calculate out most likely how much you’re going to need and guess what for me I would always rather whe have too much then not enough cuz you can’t really have too much but that’s what happens to real estate taxes and that’s what happens to spot gold it can ensure your ability to pay your taxes and not just maintain your house but can you see how that opportunity for those that cannot do it then that opportunity presents and if you have if you’re holding your purchasing power you get to take advantage of it all right let’s look at the mortgage risk and how to prepare for it a great example is in uh Mexico wasn’t that long ago the Mexican the Mexico mortgage Market boom bust and bailout detriments of borrower default and Loan restructure after the 1995 currency crisis now remember too I put the links for all of this research below so you do your own due diligence you don’t have to take my word for any of it you can go much more deeply into all of these areas cuz I give you the L the links I mean I have lots more links too so you know I just wanted to pair this down a little bit but this is how it’s pretty typical of how they’re going to handle this the Accord for the assistance of the banking system not you not the public the banking system the ad program was the first in a series of government and individual Bank relief programs central banks are tasked with taking care of banks because in theory or in practice that’s how central banks distribute their policy to the public so they don’t really care about you you’re indirect you’re small enough to fail and they can support the banks through this the program was voluntary it’s always voluntary did you know taxes in the US are voluntary but what happens if you don’t pay them right so yeah that this was voluntary but it offered borrowers an interest rate subsidy if they signed new loan contracts and switched from peso denominated loans to loans denominated in an inflation adjusted accounting unit called units of Investments or Udi you always have to look at how they name these things yeah units of investment that makes absolutely zero sense because you’re PL you’re you’re working with an inflated and and an a currency that inflates at the same rate as their hyperinflation udis were created as an alternative currency for accounting purposes to allow yeah for accounting purposes to allow Financial products such as mortgage to maintain a constant purchasing power real value not for the public but for the bank okay in the face of inflation the value of the ud is published daily and grows in tandem with inflation so whose purchasing power is that keeping intact and oh by the way if you can only convert it into this stuff it doesn’t protect you anyway because you’re losing all value I mean the question that nobody’s been able to answer for me but we’re going to find out is what happens when you get to Z Z cuz they could keep it at increments of three cents which they have for like a decade right well guess what it’s only because there’s a level of confidence yet in that currency but that’s shifting so the new currency that they created for the banks is about keeping the banks intact not the public you are not too big to fail so tell me if you’re presented with this and by the way we have some similar to this that happened in 2008 right and all of those mortgages that reset restructured those two were in the best interest of the banks and not the borrower well let’s look at how the people reacted to that this is how the debt restructuring Works April 1st 1995 the Mexican Congress approved legislation permitting the use of inflation indexed unit of account for financial trans trans actions isn’t that nice it’s a Udi and inflation index unit of account for financial transactions restructurings this is reset they just don’t want to say reset but a restructuring is a reset restructurings of pre-existing loans could be denominated in Udi the value of the Udi and pesos is updated daily and it’s estimate it’s uh based on its estimate of the CPI so again protecting the banks and not the public who is not their income is not growing at the same rate of inflation and guess what that’s been by Design and that’s been true since 1913 shocker Udi indexing of nonfinancial contracts such as wage agreements commercial contracts was not authorized so just for the banks and just for the mortgages and they’re going to entice you by giving you subsidies for a minute to convert from the current currency local currency whatever that is into the new one that that goes up based upon the rate of inflation sounds like a deal to me what do you think it assures lenders a rate of return in excess of inflation lenders Banks that’s who they take care of the loan balance grows at the rate of inflation but the income does not right UD indexing of nonfinancial contracts such as wage agreements was not authorized shocker so are you going to fall for it if you don’t have gold to pay off that mortgage please tell me what options you’re going to have this is why I keep telling you it is so critically important become your own Banker protect your wealth with the True Flight to safety asset that is being suppressed even though it just had the breakout that does not reflect its true value all right let’s go on at the time of restructure most borrowers were faced with signing new Lo loan contracts for amounts significantly higher than their original loans because of the devaluation of the peso some in fact for amounts greater than the value of their homes because what happens during these periods of time is that the real estate values Plunge at the same time that everything costs you more so that’s what creates that opportunity as long as you can hold your purchasing power if you own have a mortgage and so I don’t care if you’re looking at commercials in your running a business or you’re looking at you know your individual mortgage there is a sound strategy that is historically proven that cannot just help you sustain your current standard of living but expand your wealth base and your future standard of living we will be talking a lot more about this over time borrowers were reluctant to restructure into udis because payments would increase on a monthly basis in nominal terms so they had to inspire you to participate cuz you didn’t want to participate many loans fell into delinquency subsequent to restructuring some claimed that because payments rose with inflation under the restructured contracts borrowers became delinquent again when they were unable to keep up with payment increases duh I mean seriously duh this is the overnight devaluation which doesn’t look that huge but it was pretty substantial as they were resetting the currency in Mexico so it just about they just about lost half of the value in the meantime this is the spot gold in terms of peso again it does not reflect the physical Market but it does reflect the spot market so the spot Market Market actually maintained enable you to maintain that and pay off that mortgage that is the historic Norm so Gold’s most important job in my opinion is to hold purchasing power over time the way that the C the system it is a cesspool but the system actually works is you know people they know that people marry the legal money of the state and they cannot help but think that it will regain gain some of its purchasing power but it never ever does never because that is the design and it’s a wealth transfer mechanism but you want to make sure that you have enough gold so that when that overnight reset occurs you have the ability to pay it off you know I I I can’t tell you how long we’re gonna have and and and to be honest with you I don’t really care if there’s a little bit more pickup afterwards because when they reset the currency you know you’ll we’ll have about I I don’t know how long we’re going to have but globally on average roughly nine months to make this transition I’m not going to wait until the last second to get that little bit of pickup when I get that overnight revaluation I’m going to be proactive and I’ll let you know when I’m doing it and then you do whatever you’re comfortable doing because that’s what you should always be doing but you can certainly see the overnight revaluation that was in in the way but it protected you and it certainly protected you ever since then as well as this is devaluing armed with a new currency backed by mortgages on Germany’s Agricultural and Industrial properties so now we’re going back to the 1920s and empowered by the rags to issue emergency decrees under a 1923 enabling act the government now reviewed its efforts to revive the housing construction industry the very inflation this is critical the very inflation which had left many destitute had provided a handsome dividend to those who paid off their mortgages with worthless currency so can you see I gave you a couple of examples of this I could given you many more but I’m trying to do this within a certain period of time you see that cup formation you see that breakout is the one that we’re going through right now the ultimate breakout it very well could be because personally with the shift in the monetary velocity that I showed you I do believe we’re at the start of it so this could be but I I’m not guaranteeing that one there was 1921 so if you saw gold gold kind of struggling spot gold kind of not doing anything a gold is not helping us and then B bam as the currency as people lost confidence in the currency had more value for as as as a notpad because they stopped printing on both sides of the currency had more value just to jot down a note so between 1921 and 1924 look at the speed of the spot Market that’s what we’re headed to make no mistake gold is severely undervalued and in a long-term positive trend I show you that on my videos all the time for Real Estate owners real estate chamber of Venezuela new monetary cone generates chaos in housing leases so let’s talk about that rent capping which we’ve experienced a few years ago in this country and many other countries it’s what governments do they point a finger instead of looking in a mirror don’t look in a mirror you might not like what you see right thousands of Venezuelan landlords who in the past struggled to become homeowners who later rented so people all get sucked in as they see the price of this go up right that’s happening all over the world see their assets depreciated even more after the implementation of the new Monet cone which eliminated five zeros to the bolard and therefore has made it unfeasible for tenants to pay rent leases that were already ridiculous because of the government’s control in the context of hyperinflation so right now and what we’ve seen you know previously is that people go in and buy houses because they think that real estate is an inflation hedge it is to a degree but when it is not a hyper inflationary hedge history shows that over and over again especially as they cap your income but not your costs right they they they capped your wages so to speak right but they didn’t cap your mortgage or your mortgage payments it it just happens over and over and over again so that’s why you’re it’s so critically important for you to be able to pay that off so that these things don’t impact you and also part of the strategy if you are at a point where you need income is how to supplement that income so that if they C if you are a a landlord and they cap your rent you’ve got to make sure that that doesn’t impact your ability to maintain that building and pay those property taxes and pay off a mortgage etc etc because the other part that we know is that real estate declines it’s it’s it’s um it depreciates even more when there’s nobody in there to maintain that so if you make sure that you have enough funding via different kinds of gold I mean it’s it depends on what we’re trying to accomplish right but if you have that set up then you can weather this storm have good tenants in there that help you keep it keep the property intact so that on the other side of this mess you have a lot more loyalty but you have a building that’s in good shape and you’re not subject to what they want to cram down our throats you see what I’m saying here property comes onto the market because people can’t afford this and that pushes down the nominal pricing but the reality is is that real estate has a function that it’s always had for thousands of years that’s your shelter part of it so you just want to make sure that no matter where you are in this trend or no matter what you’re trying to accomplish you put your goals first and then everything you do should support those goals that’s why I’m not a Trader I’m a long-term strategist that lack of income again we’re going back to Germany expenditures as a percentage of salary which does get capped salary is never going to keep paced with inflation that’s the design 1912 people paid right about as much for rent as they did for food but by 1923 boy had that shifted so even forgetting the Caps the ability of people to pay the rent is severely hampered in an inflationary period because you can live without paying the rent and what did we see during the uh during the pandemic is you couldn’t kick people out anyway even if you wanted to right so if you if you own the building and you’re the landlord it is so critical that you look at all the aspects of your business and you properly diversify to support your goals it’s critically important and even if you’re not it it’s critically important that you support your goals when Germany’s hyperinflation oops when Germany’s hyperinflation finally came to an end in 1923 the currency Supply had grown from 29.2 billion marks at the beginning I’m sorry I don’t remember his first name but just doing this right so hey weren’t weren’t German government bonds so safe did you have to worry about your principal no they just print the money to pay you back it’s just that they devalue everything that’s out there so the currency Supply increase 17 billion times and its value dropped 97.7% not in relation to Gold but if that’s what you’re holding 10 trillion time Z is still zero the poor were so before the crisis so they were affected the least the rich at least the Smart Ones Let’s us be the Smart Ones got a whole lot richer but it was the middle class that was hurt the most in fact it was all but obliterated and the reality is is we’ve been losing the middle class since 2000 but you don’t notice it it’s just like inflation at 2% you don’t notice it cuz it’s not so in your face but it’s in your face now isn’t it you can see how those companies the middle class companies the mom and pop shops I mean everything that they’ve had to deal with in the last 20 years is or so you know the rise of Amazon killed the mom and pops and forced them to work for Amazon I mean we’ve been watching consolidation to the Habs from all of us that have not but generally speaking as well 80% of the population when we go through a hyperinflationary phase 80% of it ends up in abject poverty most of those the middle class because they haven’t prepared and this is where local community becomes so critical I can’t encourage this enough and Morgan really is she knows how to create community so if you have any questions on that and your local you know send them to Morgan at questions linz.martin are starving it’s the middle class that feels it the most the wealthy typically have tangible assets and you know if well you remember the horse pictures I had one in Sea Biscuit which was racing during the Depression with a $100,000 uh prize money well back during the Depression $100,000 was many millions today equal to many millions well the the owner of seab biscuit put up that purse so the point is is that a lot of the wealth transfers the wealthy’s way because they’re holding on to assets that hold their value really critically important buying food definitely becomes a priority over overpaying rent during these periods because you cannot live without Buy buying food and whether or not you have to pay rent is going to be Li limited or at the minimum it’s going to be capped so the strategy protects from all of that and what happened to mortgages in wymer Germany Mortgage Debt was reinstated at much higher rates than government bonds so it’s all of these costs the reinstatement of some debts and resumption so right so the government says okay you don’t have to pay this for a minute but then they reinstate it at a much higher level so whether you’re the homeowner or you’re the landlord you need to be prepared to cover these extra costs which is what this fractional gold uh does for you and some silver as well it’s all part of the strategy but reinstatement of some debts and a resumption of effective Taxation and a still devastating economy triggered a wave of corporate bankruptcies we are in the process of seeing a lot of those zombie companies which are companies that have not been able to pay all of their interest let alone any other principle for at least three years so we are hitting debt walls right now and that we’re about to see a wave of corporate bankruptcies so I mean right now with the valuations in the stock market Market at like some of the highest levels historically ever but that fear of missing out and that greed pushes you in there fight it get to safety get to safety one of the important issues of the stabilization of hyperinflation is what that revaluation right that taking something that has no intrinsic value at you can’t eat those bills either and if it’s intangible you’re not getting any nutrition from eating that at least this might give you a little bit of fiber but they revalue this against sound money that is all intrinsic value because it is used across the globe so nobody has to say oh this is money it’s been money for thousands of years and it’s used in every single sector of the global economy so you have a very broad base of demand those other areas trying to back it they even tried to back it with wheat but obviously wheat has a shelf life so what you are looking at here are the mortgages and how they’re being reinstated 1922 so this is where that opportunity that I’m talking about lies that was the value of the mortgages 1924 it was minimized pretty dramatically and in fact real estate residential real estate dropped 84 a half% kind of similar to what happened in Japan’s real estate market in the early 90s where residential real estate dropped 85% commercial drop 95% so it’s just a repetition this is what happens so if you are holding gold right in 1919 200 marks equals 100 70 marks per ounce so in terms of gold weight 1.17 o by the end of 22 that 450 marks went up from 170 marks per per ounce to 396,000 Marks per ounce was it gold really going up to new highs or was it the currency dying was the currency dying it’s not gold that’s worth 2200 2300 40,000 whatever that number is that’s just a number it’s the currency dying we are at the end of the life cycle if you’re in the right place at the right time with the right asset guess what that in terms of gold now buys 1,31 times the index not too bad so one I’m sorry 25 ounces of gold in Germany could buy an entire city block buildings and all now we are going through a transformation that’s going to give us an opportunity right now to see what’s happening in the commercial real estate market and residential Market still has some things cooking but absolutely um this is a book that was written by my good friend Robert kiak and Mike Maloney and I have a lot of respect for Mike Maloney as well we’re all in this fight together and what does it say those who could quickly adapt to a world where they had never seen before a world turned upside down prospered why because they held their purchasing power intact at this time an entire city block of commercial real estate in downtown Berlin could be purchased for just2 5 ounces of gold were $500 equivalent those who held their wealth in the form of currency became poorer and poorer as they watched their purchasing power destroyed by the government those who held their wealth in the form of gold watched their purchasing power increase exponentially as they became wealthy by comparison during Financial upheaval a bubble popping a market crash a depression or a currency crisis such as this one wealth is not destroyed it is merely transferred why not have that wealth transfer your way that’s all I’m saying and so you know yes we’ve had this breakout in spot gold and yes it’s going to cost you more to do it but no it is not reflective of its true fundamental value it’s a flipping bargain It won’t always be a bargain but by the time it’s not you’re not going to have enough of this to convert into this the time for Action is now stop hesitating I know we’re not fully set up yet to really take care of you as the way we want to take care of you but we are working on it as quickly as we can so if you’d like to show us your support and I appreciate you know the comments I I mean really sometimes sometimes I get a little teary because I just can’t believe how much you care and I really appreciate that so give us a like help us push this information out to more people leave us a comment share share share and make sure you subscribe hit that Bell Bell we’ll let you know when we’re posting another video and make sure that you send your questions to questions at lyette zen.com cuzz we like to answer questions here and don’t forget to watch some of the other videos I I did one on the update a yahwa you asked we answered update on State’s legislation on gold and silver as money gives me a lot of hope my interview with Mario and EO was fabulous I really love him and of course watch as we velop our gwiz weekends with Emerald Fox she is such a good student I’m really excited we have some new stuff from her coming on board but understanding the bank of Japan’s interest rate hikes and understand what that’s really telling us make sure you watch all the other videos that we’re putting out and join us on the live stream every Tuesday at 10:00 a.m. Pacific time and 1 pm. Eastern Standard Time I do the presentation and then I take questions because together we can make a positive impact on a lot of people we can have you know locally we can help people through this globally we can maybe we’ve got a shot at retaining our choices we vote with our wallets this is my vote I hope it’s your vote too and until next we meet please be safe out there bye-bye