Is the U.S. Headed Towards a Post-Pandemic Deflationary Disaster?

In this series of posts, our goal is to explain economic concepts so you can better understand the risks to your assets, whether you hold them in cash, stocks, mutual funds, real estate, or gold.

In a previous post, we discussed how the trillions of dollars in new money being injected into the U.S. economy by the Federal Reserve have sparked fears of an inflationary disaster. But while inflation could become a problem in the not-so-distant future, economic history suggests there is a more pressing—and perhaps more dangerous—concern: Deflation.

In simple terms, deflation is a drop in the prices—as opposed to inflation, where prices rise. The economic phenomenon can be caused by an increase in goods and services, a decrease in the supply of money and credit, or—as is the case during this pandemic—a decrease in demand.  

If falling prices sound like an attractive scenario, think again. While a moderate drop in prices can promote consumption...

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The Stock Market Is Broken! Here's What You Should Do To Prepare.

In my last post, I wanted to ensure people understood the Monetary and Fiscal policy tools that can be used to help us out of the Covid-19 recession (or probable depression).

Today, I want to turn my educational post to the definition of what it means to be in either a recession or a depression:

Recession: a period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters.

Depression: an extended recession that has years, not quarters, of economic contraction.

For context, there have been 33 recessions since 1854. But the more relevant period to look at are the 11 recessions since 1945, the end of the Second World War. The average contraction period for those 11 recessions was 11 months from peak to trough. And it took, on average, just under 5 years for the expansion phase to play out post-recession.

For additional context, there has only ever been one depression, The Great Depression of...

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Covid-19 Investor Update Part 3: Impact To Our Multifamily Apartment Investments

This past week, we published Part 1 of our Covid-19 Investor Update, focusing on our Pineapple Farm in Panama.  In Part 2, we looked at multiple Agricultural investments in Colombia. Our Part 3 today is focused on a few of our Multifamily investments in the United States.

Multifamily (also known as Apartment Buildings of 5 or more units for newbies) investments are the foundation of our wealth from a Real Estate investment perspective.  We believe value-add multifamily investments are the best asset class for medium-term cash flow AND long-term growth of our overall net worth. For those of you unfamiliar with this investment strategy....quick education:

What is a Value-Add Multifamily Syndication Investment and why you should invest in them

Let’s break it down. A real estate syndication investment is a way for investors like us to pool our financial capital to invest in properties and projects much bigger than we could afford or manage on our own. I add my...

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Covid-19 Investor Update Part 2: The Impact To Our Colombia Agriculture Investments

A few days ago, we published Part 1 of our Covid-19 Investor Update, focusing on our Pineapple Farm in Panama.  In Part 2 here, we are looking at multiple Agricultural investments in Colombia. Our Part 3 update will be a focus on our Multifamily investments in the US.

Let’s jump in and understand what happened to our investments in Colombia over the last month.

Our Teak Sawmill Investment in Monteria, Colombia

Colombia's Covid-19 shut-down started on Monday March 15th when the government blocked entry to the country for all foreigners and closed the schools, quickly followed the following week by a 19-day quarantine which finished on April 13th.  On Monday March 23rd, the government also suspended international flights for 30 days, presumably after all citizens and residents had returned home. As part of Colombia’s nationwide restrictions, pet owners were authorized to take animals outside for 20 minutes and one person per family could leave to purchase...

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