E36: Hyperinflation, Cryptocurrency, and Infinite Banking

In this episode, we discuss the effects of hyperinflation on Infinite Banking policies. We also dive into the rise of cryptocurrencies and how you can remain flexible to navigate the issues that are on the horizon.

Hyperinflation, in a nutshell, is when a country’s currency becomes devalued. And people lose trust in the money, consequently.

We’ve seen hyperinflation in the US to a certain extent back in the 1980’s. But we’ve never experienced anything like what took place in Zimbabwe here in the US.

Some other countries, like Zimbabwe and the Weimar Republic, experienced hyperinflation to extreme levels. These are instances where the peoples of those countries were forced to carry around millions of dollars to fill up their cars with gas, sometimes trillions of dollars to do anything. So this is an almost foreign to us.

The problem starts when a government decides to print more money. That’s the number one cause of inflation: the increase in money supply. Just like anything in the world, when supply goes up, typically the price goes down. The same thing happens with money.

When the money supply goes up, the value of the dollar becomes less; especially when other countries start to stop accepting the money. Then it can go out of control. This is when hyperinflation is experienced: Rapid inflation.

This inability of governments to ‘help themselves’ can be said to be one of the contributing factors of the rise in popularity of cryptocurrencies.

The big question here is this: What impact does all this have on IBC policies?

We answer all this and more in this episode.

Hyperinflation, Cryptocurrencies, and Infinite Banking Topics Discussed

  • What is inflation
  • What causes hyperinflation
  • When governments and central banks lose the trust of the people they serve
  • The rise of cryptocurrencies
  • Crypto cryptocurrency confusion
  • The impact of inflation and hyperinflation on IBC policies
  • Is IBC as an investment or a bank
  • Why we need to keep money in motion
  • Giving money lots of jobs to make it work for you

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Episode Transcript: Hyperinflation, Cryptocurrency, and Infinite Banking

Nate: In this episode, we will discuss the effects of hyperinflation on Infinite Banking policies, also the rise of cryptocurrencies and how you can remain flexible to navigate the issues that are clearly on the horizon. She’s Holly, and she helps people find financial freedom. 

Holly: He’s Nate. He makes sense out of money. This is Dollars and Nonsense. If you follow the herd, you will be slaughtered. I think, Nate, before we jump in, really into even hyperinflation, most of us, we hear the word hyperinflation, but maybe we don’t truly understand what that is. What’s a real simple way of saying this is what hyperinflation is?

Nate: We’ve seen it in the US to a certain extent back in the 80’s, but you look at some other countries like Zimbabwe, a lot of African countries especially, where they have to carry around millions of dollars to fill up their cars with gas, sometimes trillions of dollars to do anything, so it’s almost foreign to us. We’ve never experienced anything like that in the US, but it’s really when a country’s money becomes devalued, and people really lose trust in the money.

A lot of it comes when the government decides to print more money. That’s the number one cause of inflation is really the government printing money, the money supply going up. Just like anything in the world, when supply goes up, typically the price goes down. The same thing happens with money. When the money supply goes up, the value of the dollar as seen by everybody gets lower and lower, especially when other countries start to stop accepting the money. Then it can really go out of control.

Hyperinflation, we’ve seen it around the world many times, and that’s why it’s a concern to us, because we know our system is doing the same. We just live in America, for those of you who are listening to this in America, and we happen to be the world’s reserve currency. We’re very blessed to have that at this point in time. Of course, some of us are a bit concerned that may not remain. But, yeah. Hyperinflation is just the value of your money drastically dropping. Inflation is something we all are aware of. It just happened in our lives, Holly, but hyperinflation is when it happens rapidly. 

Holly: You can look and see, even in Zimbabwe currently today, it’s not just to buy gasoline. It can be as simple as buying a roll of toilet paper. The reason I know that is we even have some Zimbabwean dollars in our house, like a million-dollar bill. 

Nate: You’re a millionaire in Zimbabwe. That’s great. 

Holly: It’s used to, you know, go buy some toilet paper. It’s not even filling up gas anymore, because they’ve created so much money. It literally is worthless. Probably the paper it’s printed on is more valuable than the actual note itself.

Nate: Yeah. I even heard that in times of hyperinflation, the dollars you have in the morning won’t even buy the same things as they will in the evening. The money loses value so quickly that you can buy something in the morning that you can’t buy in the evening, because the money loses value so quickly. It’s amazing. 

Holly: Yeah. Many of us, we think, “Hey. We’re in a hyperinflation state,” yet we honestly don’t know the reality of what truly hyperinflation is, although if something doesn’t change, I would say we’re totally headed there, absolutely, 100%. 

Nate: The world as a whole … and that can kind of bring us into the cryptocurrency kind of discussion, which is on the rise today, these cryptocurrencies. The world is seeing that the governments entrusted with controlling the money supply is a dumb idea. It’s not going to work. They don’t know what they’re doing. They’re just printing money and hoping it works out at the end, and there’s nobody with sound money anymore. So, that’s why the crypto market has become a thing, is a decentralized money that is not controlled by government I think is a great idea. 

Holly: Or a central bank. It’s the simplicity of hearing about … It’s not just in the US, but over even in Germany, and China, and Japan, and England, Bank of England, all those have gotten away from even a gold standard, but have you heard of the term ghost cities in China, where basically they’ve built all these cities, because they had to create money, right?

Nate: Jobs. Yeah. 

Holly: And create jobs, and nobody’s living in them. They had to create the economy, and they had to create jobs. They had to create money, but they had to put that money towards something, as asset, right? They build all these cities with buildings, and nobody lives in them.

Nate: Yeah. It’s amazing. 

Holly: They’re literally empty, and it’s called ghost cities. Don’t just take our word for it. Look it up online and see why a lot of people are looking at something that is decentralized, because they basically have lost hope or trust in the government or one group of people controlling the money in the world.

Nate: It’s a revolutionary idea, and I think it can work. Some people would say gold is a great tool to kind of guard against your currency’s value going down, decreasing, hyperinflation occurring. That was kind of the old way of thinking. Now, people are saying it’s not just gold that can protect against that. It’s actually this cryptocurrency that can replace typical currency that we would know and use today, dollars, euros, and things like that. I find it, due to the liquidity issues that happen with gold, it’s one of the best ways out there. 

The problem is, as most of you know … and I am not well versed, Holly, in the crypto world. I haven’t done nearly as much research as probably a lot of our listeners have even done. The issue at this point in time, why people may not be jumping in, is because there’s so many options of cryptocurrencies, and everyone has their favorite one for this reason, this reason, this reason, and people are kind of concerned of getting in, at least what I’ve heard, or at least going all out, because they have no idea if their cryptocurrency will be there a month from there or be valuable, because it’s like the gold rush. There’s a lot of fool’s gold out there. People think they’re about to make a whole bunch of money, and then it drops out. 

But there will I believe rise a currency that will be accepted around the world, decentralized, and I think people are going to flock to it, if one of them will take control of that. I mean, right now, as we’re talking, Bitcoin is the largest, but it may not be in the future. There’s some issues with the programming there, but regardless, I do see the future as potentially being in the crypto world, due to the liquidity issues with gold. If you’re kind of comparing the two, you may find that the crypto may be better.

Holly: Well, and I think too that Bitcoin is the one we hear about, because it was the first one out there. It was created in 2009. They did set a limit on it, how much Bitcoin there is. There’s only so much Bitcoin. They basically … somebody just can’t create more. So, I think that it is the most popular currently, just because it was the first one out there, but I think even with issues of the Bitcoin, what we’re going to start to see is there’s going to be better solutions, or as technology and things advance, a better way of doing that. One of the biggest things, I think even you mentioned it, Nate, but I’ve heard even from several clients is sometimes it takes a couple days to do a Bitcoin exchange per se. With that, some of us, we’re used to dealing with instant satisfaction or I’ll say gratification. We’re an instant economy. First world problems. I want it now. 

Nate: I think we can take a quick break and hear a message from our sponsor here, but we’d like to involve Infinite Banking into the equation, how it can be effected in hyperinflation, how we can use it, along with crypto, and just some ideas that Holly and I wanted to share with you from the Infinite Banking perspective as well. First, we’ll just hear a message from Living Wealth, our sponsor. Then we’ll get into kind of IBC and how it can be impacted with these things. 

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Holly: Welcome back to Dollars And Nonsense. We are talking today about hyperinflation, cryptocurrencies, and Infinite Banking. Where we left off is how you actually can use Infinite Banking in regards to hyperinflation and cryptocurrencies. I’m going to turn it over to Nate to have him start. 

Nate: Sure. Well, a question I’ve been asked, Holly, when dealing with people and their concerns, what happens if the dollar loses value? What happens in hyperinflationary period to these policies, these IBC policies that we have? It’s a very common question. I thought we could address it and kind of tie it in here with the things we’ve spoken about, but as we’ve already mentioned, hyperinflation is a concern. There are certain avenues that people are setting themselves up to hopefully not get impacted with it, whether that’s buying some gold, whether that’s buying into various cryptocurrencies, real estate, some things that they’re hoping can help secure, to a certain extent, from hyperinflation. When they hear these IBC policies that are in dollars, it can be a concern to them about hyperinflation.

I guess the first thing I wanted to do to open up the conversation is just bring us all back to the truth of Infinite Banking and really what we’re trying to do here. IBC is the original sound banking system. We’re actually going to talk about that in our next podcast in more detail, but what we’re trying to get at today is this is not an investment. It’s a bank, and so the main question that they get asked is, “Well, should I get in there if I believe the dollar’s going to lose value?” I said, “Absolutely, you should, but don’t let the money just sit in a policy. We need to keep money in motion.” 

If you’ve listened to our podcast at all, you know we’re trying to keep money moving and have it do more than one job. Could it be that you funded a policy and that you’ve borrowed against the policy to buy gold, or you borrowed against the policy to buy crypto? That way you have both working for you at the same time, so if hyperinflation occurs, we own the gold, but if it doesn’t, we have the money growing in the policy. If the currency collapses, the cryptocurrency, or the gold drops in price, well, the policy won’t. I always find that the more jobs your money can do, the better, so go ahead and do whatever it is you were planning on doing, since you were worried about hyperinflation. Don’t let the policy distract you from the ability to do that, because that’s just something we’ll put on your GPS and we’ll accomplish with it.

Holly: Well, and I think the key there, Nate, is that often we get stuck on we’re talking about a bank, or life insurance, or an investment. Really we’re talking about money and keeping money in motion. Money really is just a means of exchange, whether that’s cryptocurrency, whether you’re using it for gold, whatever it is. If you’re going to buy a policy and just leave the money sitting in there, that’s not the best solution for you. We want you guys to keep your money in motion. We want you to have control of that money. 

Whatever that exchange looks like, whether it be in dollars, whether it be in cryptocurrency, whether it be in gold, whatever that is for you, it’s always better to put it into a vehicle that it actually is growing tax free for you, but that you actually can use that money again. That’s the key is that that money is never sitting, that we don’t just leave it out there just collecting dust per se, because that’s what it is. If you’re not going to use it, somebody else is. Would you agree, Nate?

Nate: Absolutely. We really desperately want you guys to keep it in motion and moving, and we have people investing in all types of things with the policies, and we encourage it. We don’t just want people sitting on a ton of money in the policies if there’s better things. I mean, some people just say, “Nate, you know, I just love the guaranteed growth and the no risk. I don’t want to do anything with it, you know, investing elsewhere, because I’m content with what the policy’s doing.” That’s great. I’m not going to tell you that you’re wrong, but for those of you who have other investment opportunities, and ideas, and desires, let us show you and make sure you know how to use the policies to supplement and even improve what you’re doing.

Holly: I think that’s the key is improving on what you’re doing. It doesn’t mean you have to pick one or the other. You don’t just have to put the money into a life insurance policy. You can actually put it into your IBC policy, creating cash for you, and then go and take that cash and use it for cryptocurrency, use it to buy real estate, use it to buy gold, use it for what you believe in, instead of somebody else telling you what to do. I think that’s one of the freedoms that you have is us wanting you to be in control of your money, but also allowing you to make those decisions instead of somebody else telling you what to do and how to do it with your money.

We often say the biggest mistakes we make is when we give our money to somebody else, because we thought they could do better with it than we ourselves could do. Really ask yourself, what is it that you’re passionate about, and what do you want to see with this money? Hey, if it’s just a guaranteed growth inside of the policy, great, but if you want to see how cryptocurrency works, or you want to invest in gold, or you want to buy that real estate property, do it through a policy, so that there’s some security when you’re actually going to make those purchases. There’s security in the fact that you have control of your money. 

Nate: Yeah. Any time I’ve found that you can have your money doing multiple things, it’s worth investigating and profiting multiple ways. If I can have my money growing in the policy with no taxation, I can have it funding a death benefit in the policy, I can borrow against it to buy Bitcoin, I’m having my money do three things at the same time. That’s always better than just buying the currency itself, the cryptocurrency, or the gold, or whatever it is. What I wanted to kind of wrap up and just let everybody that don’t forget what IBC’s all about. It’s not about just the power of life insurance, and the policies, and how they can work and profit you. 

It’s also about how you can use the policies as a banking tool to fund other things. Whether it’s a vacation, whether it’s a wedding, a car, Bitcoin, gold, real estate, it really doesn’t matter. It’s just money. We still need money today, even though in the future maybe we won’t be using US Dollars anymore, but today we still need it, so if we can help you be profitable today and be flexible to be able to use the policy to fund the things you want to fund, then let’s do it, and let’s profit and a little bit more than we thought we would by investing directly into those types of hyperinflationary safe guards.

Holly: I would say, on that same hand, Nate, it’s just like if any of you guys do do cryptocurrency-ing, you followed Bitcoins, we all saw how it rose in December, the highest it’s ever been, right? To 18. Then it dropped below 10, right? It was such a drastic change, yet if you’d actually put that money into a policy first, irregardless of what happened with the Bitcoin, it would have been successful, because you’d put it into a life insurance policy first. That was the key that Nate was talking about. Let your money do more than one thing for you. Don’t just get the money. Have it be deposited into your bank account, and leave it sitting there, or into a retirement program, and do nothing with it, and let somebody else do it with it. 

Actually keep your money in motion, and don’t just take it just to pay your bills. I mean, Nate talked about weddings. He talked about real estate. He talked about vacations. He talked about death benefit, all the different things your money can do for you, but it’s you being in control and saying how it’s going to work for you, and somebody has to take control. Don’t just give control over to somebody else to make it work for you.

Nate: Absolutely. Well, that wraps up our episode today. This has been Dollars And Nonsense. If you follow the herd, you will get slaughtered.

Holly: For free transcripts and resources, please visit LivingWealth.com/e36.