Dollars will be worth less at an alarming pace. In this episode,
I'm going to give you my prediction about the future purchasing power of the American dollar.
Get ready, I'm a realist, I'm not an alarmist. But the cost of living is going up dramatically.
So, my name's Doug Andrew, I've been a financial strategist now for more than 48 years and I've
been very blessed in my career to have authored 11 books thus far. I'm working on my 12th and
we are extremely grateful for the receptivity of these books. We've gone through over a million
copies several have been best sellers and in 2007 we actually were blessed to have a new york times
and wall street journal number one bestseller. In my books and also on my national radio show
that's been running now for 13 years and on this Youtube channel where I have over 500
educational videos. Many times people will ask me as I go through the country speaking
to give my predictions especially at breaks and so in this episode, I'm going to give you my
prediction about the future purchasing power of the American dollar and where I think we're headed
due to inflation which is at a higher rate than it's been in decades. So, this is not a political
agenda but I'm going to simply shoot straight with you if that's okay because people always ask
you know, "Please shoot straight", and I say, "Would you prefer I'd be honest or gentle?", and
they say, "We want you to be honest even if it's not gentle", it's really about what's going on
and what's causing inflation and what's that mean for us in the long run down the road. So, let's
talk about the real rate of inflation compared to what the government is reporting as the inflation
rate. So that you're aware that the CPI which means consumer price index is way less than the
real rate of inflation. So, let me simplify this. I started as a financial strategist in 1974
and so, back then as we went from you know Nixon and so forth to the Carter years. Carter
went up to as high as 13% inflation and I remember back then when inflation hit double digits at 10%.
I was teaching my clients how to earn a rate of return greater than the inflation
rate how to outpace inflation. In fact, I've always earned about five and a half
percent greater than the inflation rate at the time and I'll show you how you can learn how
to do that at the end of this episode. But because inflation topped out at 13%
the federal government said, "Golly, we cannot afford to pay social security recipients an
annual raise or increase at the true inflation rate. It'll break us."
And so, they decided to change the way they report inflation, the CPI. In a nutshell,
they used to compare every year a basket of goods to the same basket of goods, the price increase
apples to apples. Well, they basically changed it through two major pieces of legislation in
the 80s from apples to oranges so to speak. Which now means they can actually compare the
price of something like a filet mignon steak last year to hamburger this year if they choose and
people are not aware of this. So, I'm recording this episode in October of 2021 but it applies
no matter if we're talking about 1980 or 20 years from now. When the CPI is calculated based upon
their new method smoke and mirrors is what I call it. They will give social security recipients an
increase and just a week before the recording of this episode the government announced the largest
increase raised to social security recipients is going to be paid this year 5.9 percent. Well, that
means they are reporting inflation at just under 6 percent. Well, earlier this year in April they
were shocked because they said, "Oh, it's 4.2%. That went up to 5 and now up to 6", folks,
it's really about two and a half times that at least because of the true cost of inflation.
So, for example, a year ago a used car was 21,000 the same car now is 28,000.
Some things like cooking oil, vegetable oil, is up 60%, TVs are up 8%,
furniture 11%, washing machines are up 30%. The gas pump most people are paying at least a dollar
more per gallon and they used to pay around two dollars now it's three dollars. That's a 50%
increase some states are even higher than that. You see it every time
you go to the grocery store a pound of bacon has gone up a couple of dollars from five something
a pound up to seven dollars a pound for bacon and so the true rate of inflation is more like
15 to 20 percent and this is very detrimental especially to the middle to lower-income
people. Because they have set incomes and even if they had a raise the minimum wage went up most of
that raised maybe all of it was gobbled up at the gas pump or the hamburger stand. So, when we talk
about the real rate of inflation it's more in the 15 to 20 percent range and it's out of control.
What causes inflation? Well, generally, the printing of money. When government spends
more than they bring in when their outgo exceeds their income their upkeep becomes their downfall
and so the government has been bringing in between three and a half to five trillion a year in income
and revenue. That's how much the irs collects in taxes and in 2020 they spent double that
9.2 trillion Covid19 whatever. But nonetheless, they spent twice as much as they brought in. Now,
if you made 100,000 and you spent 200,000. How long can you do that? Instead of
tightening their belt in 2021 they added at least another five trillion possibly ten trillion on top
of that and so here they are maybe collecting five-six trillion dollars they hope in revenue
but they're going to be shelling out 15 trillion or more because of these initiatives that are
passing and so, if you were making 100,000 and you spent 200,000 last year and this year you say "Oh,
I'm going to try to make ends meet by spending 300,000 or 400,000 and I'm going to do that by
printing more money and by raising taxes", well, folks, that's what the government is forced to do.
They have to either print more money or raise taxes and of course, they're having to do both.
How much are they printing? Are you ready for this? The federal government has been printing
about 100 billion dollars of money every single month for several months. They said this was
going to be temporary because of Covid19. In April of 2021 the federal reserve met
to discuss how to start tapering that down and they said, "Oh, let's keep going." In summer of
2021, they also said let's put it off, let's keep going. This is not going to end up well.
So, they're printing money like crazy that's over a trillion dollars in 10 months that's
going in. That's one-fifth of the income they receive and they're just printing it in money.
Maybe their motive is to be able to pay off the national debt with discounted dollars
which is what happens when you owe money. You like inflation because you're paying off
your debt with future dollars which are worthless. It's been speculated that Biden wants to change
the whole monetary system by the year 2025. If he makes it through his four years as a tenure
as president of the United States. If they were to change the monetary system it would require the
international monetary fund IMF for this reset. Maybe you've heard of that term reset and that
there will be an international currency. They're looking at doing digital and there's nothing
backing digital currency and so forth. That's what cryptocurrency is and everything else.
This episode is not about that but there's nothing backing any of that and so it could all come down
and fall apart in one day which I think is going to happen someday at the end of the day. Well,
let's go back to my prediction about the purchasing power of the dollar in this interim
period. It's going to get less and less and less. The cost of living is going to go up by how much?
I am not going to be an alarmist to say it's runaway inflation where there are periods
in history not particularly in America. But they were taking wheelbarrows of money out of the bank
because within a matter of weeks or months the dollars or the currency in that country was cut in
half or down to one-tenth of what it was. I don't know if we're going to go there but we will see
inflation continue in this double-digit range. Now, at 10% inflation, do you know what the rule
of 72 is? See, normally people think of the rule of 72 when you're calculating how much
your money will grow to at a given interest rate. So, you take an interest rate like 5%
and you divide 5 into number 72 and your money will double every 14.4 years about every 15 years.
If you're earning 8%, 8 into 72 your money doubles every 9 years. Now,
this isn't monthly deposits this is like 100,000 will double to 200,000 in nine years if you're
earning 8%. In eight years if you're earning 9%. If you're earning 7.2% it doubles every ten years
If you're earning 10% it doubles every seven point two years. Are you getting it?
So let me ask you this, using the rule of 72
if you could get by on 50,000 a year a little over 4,000 a month today to buy the same gallons of gas
and loaves of bread. Let's say 15 years from now at an average inflation rate of five percent.
How much will you need and people go hmm... Well, you divide five percent inflation into
72 and the cost of living will double every 14.4 years. You'll need 100,000
to buy what 50,000 buys today in 15 years. Now, that's been sort of the average inflation rate.
Now it's 10% or higher. 10 into 72 means the cost of living will double every 7.2 years.
Inflation at 12% it doubles every 6 years. That means 6 years from now
you're going to need 100,000 to buy what 50,000 buys today. Well, another 6 years
from then in 12 years from today you will need double that again. You're going to need 200,000
to buy what 50,000 buys today. Let's add another six years to that
in 18 years you're going to need 400,000 a year to buy what 50,000 buys today.
This is what causes a lot of people to outlive their money. So, what I'm going to do
is share with you a term which is called quantitative easing. But before I explain that
let me invite you to subscribe to this channel and here's why. I post in-depth
answers to financial questions almost on a daily basis on this three-dimensional wealth channel.
But I also love to give predictions like this one. If this is resonating with you
and you can think of somebody that ought to hear this be sure and share
post a comment click like but subscribe. Click on the link below and click on that little bell
so that you'll be notified every time I post a new video which I do almost on a daily basis.
It's free. But stay with me to the end of this episode and I want to gift you a copy of one of
my most recent best-selling books to help empower you to protect yourself from the negative impact
of taxes inflation and so forth. I feel like the U.S treasury is undermining what they're trying
to accomplish. They're sort of going down the highway with one foot on the gas pedal
and the other foot on the brake pedal and they don't know they're doing it. Do you know
that the U.S treasury started in 1913 for two primary purposes to basically make sure that
you know people had jobs and the economy was flourishing with jobs and also price
controls to keep prices under control and they're sort of undermining that. So, what's
been happening recently is the federal reserve printing this hundred billion a month. This is
what they call quantitative easy and wall street sort of even jokes about it quantitative easing,
they call QE. They say QE infinity it looks like it's going to go on forever. Let me tell you,
if it keeps going on and they don't slow it down the purchasing power of the American dollar
will be worth less and less until it's worth less totally worthless and maybe that's their goal by
the year 2025 to justify a great reset. I don't know. I'm not an alarmist but I am a realist.
So, whatever they're trying to do you need to be able to take ownership of your future. So,
I've always taught my clients as a retirement planning specialist to outpace inflation unless
we run into runaway inflation by linking your returns to the things that inflate
and I say that and a lot of general financial advisors go, "Huh, how do you do that?", well,
I explain it in the books that I want to gift you. So, when I say link your returns to the things
that inflate I set aside my serious cash into my favorite instrument I call it the laser fund
and the laser fund is one of my favorites because it's tax-free. So I'm immune from taxes going up
because the growth is tax-free. I only have to earn you know 8% or 10% to
net what most people have to earn 15% in a tax-deferred IRA or 401k. Then you pay tax
when you take out the money to net 10. I only have to earn 10 to net 10 because it's tax-free. I link
my returns to the things that inflate. Which basically means, if inflation the cost of
living goes up 10, I've usually earned at least 15. If inflation goes to 15, I usually earn 20.
In this very year that i'm recording this episode 2021 we've had many clients lock in gains of 25%,
32%, even 61.33%, why? Because they've linked their returns to the things that are going up.
But here's the deal. When we have a market crash. When the economy goes down they will not lose the
money they made this year. We actually have a client who started out in March of 2020 with
850,000 in his laser fund without adding a dime it grew by over half a million. By March of 2021,
he ended up with a million three hundred and eighty two thousand. Now, if the next year the
market crashes forty percent he will not lose one dime of that million three hundred and eighty two
thousand. He may not make much of anything if the market crashes but he doesn't lose.
If the market goes up he gets to participate with a rate that's usually equal to or greater than the
inflation rate. But when the market crashes he doesn't lose and that's a strategy called
indexing. Now, I have other videos on this very channel that talk about that. You can
search indexing but here's what I want you to do. Not only to subscribe to this channel
but I want you to study and read one of my books. Now, I'll gift you this
it retails for $20 on Amazon. I'll pay for the book. You simply go to laserfund.com...
and contribute a nominal amount towards the shipping and handling. I'll cover the rest of
that cost and I'll fire out a hard copy of this 300-page book to you. It's two books in one.
This white covered site is 200 pages and it has all the charts and graphs and explanations
telling you, teaching you, how to diversify and create the foundation for a tax-free
retirement. How to have inflation work for you instead of against you and also,
protect yourself from market volatility. If you learn more by stories there's 62 stories on this
side you flip it over and you read about 100 pages 12 chapters here and these are 62 actual client
stories who have utilized the laser fund for all kinds of financial goals not just retirement.
So, that's about the money. Now, if you want to learn how to take ownership and teach your
children and grandchildren that instead of relying on what the government does or hoping that you'll
survive. I would also recommend you claim your free copy of this book entitlement abolition.
You can go to entitlementabolitionbook.com same thing. You contribute a nominal amount
towards the shipping and handling and I'll pay for the book. I would love for you to get both
copies and you can do that. There's options there to listen and learn watch and learn.
There's even 18-hour master classes that you can watch on each of those two concepts. But
this is about your brighter future and so my prediction about the future purchasing power the
American dollar is it's going to be cut in half probably every five-six years at least. I don't
want you to be hurt by that. I want inflation to help you not hinder you because most people are
going to be devastated if they do not learn how to protect themselves from the negative impact
of taxes inflation and market volatility. Don't be one of them. Join me on this educational channel.