"This Is A ONCE IN A DECADE OPPORTUNITY!" Jim Rickards How To Get Rich During Inflation

Added: 2026-05-27

[00:00:00]What's the best way to protect your wealth right now? And probably what are some of the things we need to look out for going forward as far as growing our wealth and you know really making the best of this crisis and this wealth transfer that we find ourselves in.

[00:00:16]Sure. And I that's that's a great question and I like to start with a real quick story. Uh go back to 1922 the German Weimar Republic hyperinflation. And that's that's a well-known story. Everyone knows what happened. We don't need to recite that. But there was an individual at the time. His name was Hugo Stinnes.

[00:00:35]And I talk about this at the end of chapter six. Sorry, at the end of chapter five of my book The New Great Depression. Uh Hugo Stinnes saw the hyperinflation coming. And he went out and before it hit and borrowed all the reichsmarks he could. That was the currency of the time. And he invested in hard assets. He bought coal, steel, shipping assets, railroads, etc. Then he just waited. And here comes the hyper super hyperinflation.

[00:01:00]>> [music] >> Well, he paid back all the debts. I'd like to say he paid pennies on the dollar, but it was a millionth of a penny on the dollar. They they were sweeping the currency down the sewers.

[00:01:09]But he went through the exercise of paying back his debt with this worthless currency. And he kept the assets. And he was to become the richest man in Germany. And I don't speak German, but his his nickname was the Inflationskönig, which means the inflation king. So, the point of the story, and it's a true story, you look up Hugo Stinnes. The point of the story is even in the greatest hyperinflation in the history of developed economies in history of the world, this guy became the richest man in Germany because he saw it coming and he did the right thing. So, the point I make to investors is that you're not helpless.

[00:01:43]Hard we're we're in hard times. Uh they may get worse in some ways, but you don't have to curl up in a ball. There's always something you can do to go out and at a minimum preserve wealth and even better prosper and and make some money.

[00:01:55]>> [music] >> So, let's get specific about that. The first thing and I hate clichés and this is going to sound like a cliché, but but it's important to explain [music] what it means is that you need to have diversification. Now, that sounds obvious. Every [music] economics teacher will say you have to diversify your assets, but people don't really understand it. I've run into investors and they say, "Well, I'm [music] highly diversified. I've got 30 separate stocks in 10 sectors. I've got semiconductors, consumer non-durables, utilities, you know, etc." And I go, "No, you're not You're not diversified. You may have 30 stocks, but you have one asset class.

[00:02:28]It's called stocks and they go up together and down together and you're not protected at all." So, by all means, have have a slice in stocks. That's fine. But, um have uh I I recommend a significant slug of cash. And people go, "Well, cash has no yield and why would you have cash, etc." But, cash uh first of all, if we have deflation, not inflation, [music] cash could be your best-performing asset because the real value of cash goes up in deflation. Your money is worth more even though there's no yield uh because it has more buying power. But, more to the point, here's what's not well understood.

[00:03:00]Cash has has embedded optionality. If you're the person Right now, visibility is poor. We don't know exactly [music] what's going to happen. I have a forecast, but uh you know, you you got to really constantly update it. But, as as visibility improves and we can see who's [music] going to win the tug-of-war between deflation and inflation. If you're the person with cash, you can pivot. You know, maybe you want to buy more gold cuz here comes inflation or maybe everything ends well and you want to buy more equities, etc. Well, you can do that if you have cash.

[00:03:27]If you throw all your money in private equity >> [music] >> um and you decide that's not such a good bet, uh you know, good luck getting your money back from Henry Kravis. I mean, he's he's a great private equity manager, but he's not going to give your money back early. You're stuck. [music] So, it's it's a good idea to keep some cash in reserve. Beyond that, um you know, some alternatives, uh you know, some room for private equity, room for venture capital, um >> [music] >> the uh I I highly recommend residential real estate in what I call go-to locations.

[00:03:56]Let me just explain that briefly. Right now we're seeing it in the United States, but I don't doubt you're seeing it in in Victoria, and Melbourne, and and elsewhere. Um people are getting out of the cities. I mean, cities have always been a trade-off. On the one hand, there's noise and pollution, a certain amount of crime, and high taxes, and all that.

[00:04:13]But, on the other hand, you have museums and cultures, and great restaurants, and and there's a lot of buzz, and people find it very attractive. [music] And on balance, people have accepted the trade-off. They'll say, like, "I'll take the excitement of the city despite the inconveniences." And they've always been magnets for talent. Uh you know, lawyers, bankers, artists, writers, um other professionals, actors, etc. Um but now, what's happened is we've got all the disadvantages, at least in the United States. Um >> [music] >> you know, the the dirt, the noise, the pollution worse. Murder rate in New York has doubled. The suicide rates have tripled. Drug abuse is up, you know, etc. So, we have the disadvantages are worse, but the benefits are gone. The museums are closed. Broadway's closed.

[00:04:55]Uh you know, etc. So, people are [music] just getting out of the cities.

[00:04:59]Um and so, residential real estate in places like Los Angeles, New York, uh San Francisco, Seattle, elsewhere, and I dare say Melbourne, are actually collapsing.

[00:05:09]>> [music] >> But, you say, "Where are they going?"

[00:05:12]In the United States, they're going to Miami, uh Nashville, Tennessee, Austin, Texas, Boise, Idaho, Phoenix, Scottsdale, and some other kind of magnet cities. Um and and so, uh so, basically, residential real estate in the places that where people are going, Miami is red-hot right now.

[00:05:30]Phoenix, red-hot.

[00:05:32]>> [music] >> Austin, same thing. So, there are good opportunities there. Commercial real estate, forget it. Uh it's nowhere near the bottom. Probably wouldn't even look at it for maybe another year.

[00:05:41]Um >> [music] >> and then finally, uh gold. I recommend 10% gold. Uh you know, people I talk about gold all the time, and people always want to put words in your mouth and they go, "Well, Jim Rickards has sell everything and buy gold." I've never said that. I don't believe that.

[00:05:54]I, you know, it's not the end of the world. We'll get through it. We'll muddle through. Uh, but 10% gold, yeah, that's that's a good piece to have. It [music] It's your inflation protection, obviously. Uh, it's also if it's physical gold, it's a non-digital [music] asset. If it's gold miners, it it's it's a leverage bet so you can make even more money. Um, but people don't understand that gold does very well in deflation.

[00:06:17]You know, in 1929 to 1933, the longest period of sustained deflation in US history, [music] gold went up 75% from $20 an ounce to $35 an ounce.

[00:06:29]There's a reason for it. That That's going back to what I said earlier.

[00:06:32]Governments [music] get so desperate in deflation that they devalue [clears throat] the dollar and raise the dollar price of gold to get inflation. So So, gold ends up being the vehicle to break the back of deflation, which they have to do. So, gold does well in just about every state of the world.

[00:06:48]In conclusion, as we navigate the complexities of today's economic landscape, [music] the wisdom of historical experiences guides us towards sound wealth protection strategies. The story of Hugo Stinnes during the Weimar Republic's hyperinflation serves as a powerful reminder that even in the face of economic challenges, strategic decisions can lead to [music] wealth preservation and prosperity.

[00:07:09]Diversification takes center stage as a misunderstood yet crucial aspect of building a resilient portfolio. Genuine diversification goes beyond superficially spreading investments. And our exploration has shed light on what it truly means to safeguard wealth. The often underestimated role of cash emerges as a key player, offering not only stability during times of deflation, but also the flexibility to pivot as economic conditions evolve.

[00:07:34]>> [music] >> Real estate in strategic locations, venture capital, and a calculated allocation to gold round out a comprehensive approach to wealth management. As we confront the uncertainties of the financial landscape, these insights aim to empower investors to make informed decisions, whether they're protecting existing wealth or seeking opportunities for growth. The path forward may be uncertain, but armed with knowledge and a diversified strategy, investors can navigate these waters with confidence and resilience. If you found value in today's insights and strategies for protecting and growing your wealth, don't forget to show your support by giving this video a thumbs up. Your likes and comments are not only appreciated, but also contribute to spreading valuable financial knowledge.

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