Are you concerned about the current state of the market? Are you wondering how reduced interest rates due to banks collapsing, the impact of the US-China war on the global economy, and inflation might affect you?
If so, I’ve invited Erwin Szeto, the OG investor specialist Realtor since 2010 and 4X Realtor of the Year, to answer all my burning questions. In this conversation, we discuss the collapse of a regional bank, rate hikes announced by the US Feds, and predictions of future interest rates. You can catch our hilarious yet informative conversation below
5 Updates You Can’t Afford To Miss
A Comprehensive Economic Update
In a recent market update, we discussed banks collapsing and countries decoupling from the US dollar, along with the benefits of investing in real estate for intergenerational wealth. Erwin shares his experience in managing a portfolio of 11 properties with eight figures and helping clients invest outside of the Greater Toronto Area for better cash flow and to scale portfolios.
The US Losing Status as World Reserve Currency
The US is also losing its status as the world’s reserve currency, with more countries opting to use their own currencies for trade instead of the US dollar. This may lead to the US having to rely on other countries for debt and printing money, which could lead to inflation.
The Benefits of Investing in Gold, Bitcoin, and Real Estate
Amidst this chaos, Investors can benefit from diversifying their portfolios with gold, Bitcoin, and real estate. The US dollar debt and treasury may face issues due to over-refinancing, and quantitative easing may continue indefinitely, causing power struggles between countries.
Impact of a US-China War on the global economy
Higher interest rates do not help the economy, and a war between the US and China would have a negative impact on global business relationships. These two countries are major trading partners with many nations, and any conflict between them would lead to a decline in international trade. The loss of trade opportunities would have a severe impact on the economies of many countries.
Inflation and Interest Rate Hikes
Inflation is a major concern due to the chaos in gas supply and production, with an increase in inflation observed in Europe and worldwide. The best way to combat inflation is to generate more income, own assets that generate income, and invest in hard assets like real estate. Reduced interest rates due to banks going under can lead to a flight to safety and lower fixed rates on mortgages. Banks going under leads to central banks reducing interest rates. This causes bonds to go up and yields to go down, leading to lower fixed rates on mortgages.
In conclusion, staying ahead of the game in the current economic climate requires investors to be well-informed and diversified in their investments. The information we discussed in this update may provide a good starting point for those looking to grow their wealth and navigate the current economic landscape successfully.
Until next time, happy Canadian Real Estate Investing.
Cherry Chan, CPA, CA
Your Real Estate Tax Accountant