income yields could be as high as 80 percent or more per year capital appreciation and exceptional income for up to 60 long years could be an absolutely brilliant investment the pass on to future generations for more information qualified accredited investors should email coconuts and real estate guys Radio dot com diversify wisely with direct ownership of fully managed coconuts on prime farmland close to the beautiful Costa Rica border email coconuts and real estate guys Radio dot com this announcement does not constitute either an offer to sell securities or a solicitation of an offer to purchase offering made my prospectus only for more information e-mail coconuts and real estate guys Radio dot com. Welcome to the real estate guys radio show and here I'm Robert Helms with me as usual most financial strategist Russell Brand Hey Robert you know how to play through January there's a lot going on at our means and goals of bent in the 1st of the year out like Las Vegas and people are just buds and things are great and everyone wants to know what's this year going to be like. No I mean there's a lot of things changing this year we get a new tax law we are now one year into the trumpet ministration we've got a new Fed chairman coming on board and so we don't exactly know what that's going to look like we have stock markets that have been hitting record highs and there is a lot of buzz about the creation of jobs and the rebirth of manufacturing in the United States and of course there's the drama and turmoil with regard to international issues geopolitics and in trade deals in particular which has a more direct impact certainly military spending can have an impact on real estate investors in the economy and you know if we end up going to war or get further involved in skirmishes you know you're you're going to see some impact from all of that so there's a lot of different things coming in a lot of variables it isn't steady as she goes that's for sure but it's really best as we have to look at more than just the real estate market we're in because lots of things feed the very need for real estate housing retail office agricultural and so it's kind of a big picture time a year and we thought a great thing to do out of the gate would be to interview some folks who have an opinion nothing else in the rules that guides for Unlike the time you recognize a couple things 1st of all we like to look larger than just real estate so we have folks on the show we're not pigeonholed into real estate but look at a broader picture economically look at it this way if you look at your real estate holdings as floating in an ocean an economic ocean and the ocean has waves and currents and things that affect it if you're paying attention to that you're not going to be able to navigate your real estate portfolio like a ship through the changing seas which is why we do it so that's the 1st thing is that we look broader than just real estate the 2nd thing is that the vast majority of all the interviews we ever do are face to face right we work really hard to get in front of people because that's where the connections are made that's where relationships get formed and you usually get much better interviews now it's subtle not just take anything away from folks that have 100 percent call ins it's much more efficient to be able to sit in your studio and take calls but Relationship wise and get into the real information and for. The conversation before and after so we worked really hard to get face to face there was no way we could do this and write the amount of information we're going to bring you in the next couple of weeks so we reached out to our network and you're going to it this week and next week here are a few folks that maybe you've heard before and definitely a few that you haven't as we asked some of the smartest people we know in different areas of the economy and the world what they think about what's going to happen it's part one of our predictions panel that's going to be a lot to learn a lot more next week it's going to be fun today on the real estate guys radio program. For Griffin the 3rd The Creature from Jekyll Island 2nd look at the Federal Reserve and you're listening to real estate we're going back to the most the guys radio program thanks for tuning into the program it's a brand new year and we're trying to figure out what the year's going to look like from a real estate perspective the gentleman about to join us really pays attention to what's happening in terms of what builders and developers are looking at I've been following this for a long time from John Burns consulting Let's welcome John Burns Hello Sir thanks and Happy New Year to you I know why you are often looking down the road for what we're seeing in terms of trends and so forth and tell us some of the big picture stuff you see for the new year well the economy is continuing to grow supply of new homes coming to market continues to be extremely stagnant and back. We count all the other community counts all over the country and are flat year over year so the homebuilders have not been able to grow their businesses more than just a little bit and in that industry we're expecting a little more and A we've actually seen some foreign capital come into the industry by a company so that's pretty interesting and we think that the new tax package is going to be a boost to the economy particularly that entry level buyers and homes priced around the median home price so we're expecting to see some more activity there have where you are well sir this is your number 9 now of the economic expansion so we're keeping an eye out our what risk. 6 are out there they could cause an extra special you know we're finding quite a few but none of them are really in the real estate industry they're there and other industries you know that's interesting Greg is always looking for what's the event that's going to trigger the next downturns in the look like and no one knows for sure but from a housing perspective last time a lot of it was centered around lending obviously this time who knows but what are some of the things you're looking at in terms of real estate that would be that kind of canary in the coal mine if you will Yeah there's really not many canaries in a coal mine in real estate but I don't want to sound Pollyanna because you know the real estate is the number one important thing is the economy and if we have a health care industry collapse or a stock market collapse or those sorts of things that impacts real estate that's what we're looking at him we get a white paper on all the industries out there the health care industry has grown dramatically over the last 20 years you know built on a good theory that the demographics are going to be good for healthcare and biotech but I think they've grown too fast and borrowed too much money so I would keep my eye on a lot of the health care companies clearly the valuations of the tech companies are just insane in my mind even the ones that are making money are being valued at 3 times that revenue. So we're getting teed up there for maybe some sort of a stock market correction but when I looked at those type of Corrections in the past when housings in the current state that it's in which is still a relatively low level of construction volume the downturn has been mostly a hick up and housing is not really a downturn so that's what we're quoting our clients and say there's a lot of risks out there in other industries so just proceed cautiously and frank I thought industries not the housing industry is not taking a lot of risk right now guys are not levering up they're running a business very carefully everybody remembers the last downturn I think we're set up for a pretty good run here even even though there may be some hiccups along the way well that's a great point because obviously housing is one of the things that is serves a basic human need I can sit out the stock market for a couple of years but I can't sit how housing I've got to interact financially with housing one way or another a lot of our listeners will buy houses for you know rental purposes in the course there's more tenants today than there have been in the past but at the same time they look at long term appreciation those kinds of things when you have this this was a housing shortage but we're headed that way right if we don't build more houses the numbers kind of show that we're going to be in trouble that regard I don't think that's right so a little bit of plug for a book we wrote a year ago on housing demographics called big shifts ahead where we get we spend 9000 hours of research getting under some of the pent up demand if you will and just to share a few things to the I agree with what you just said but we got clearly very overbuilt and 05 and 06 to the point where during the downturn we had 3 and a half 1000000 more housing units and argue that we needed in the country and we still have about a 1000000 more than we need now you go to places like Texas and Arizona and that's not the case at all but you go to the Midwest in the Northeast and there are still some Texas they could see so it is pretty Geographic specific. But to your point I think we need $13700000.00 housing units built over a 10 year period we're only building $1.00 right now per year so we're under that average and we're really struggling to get to the average and one of the other things I think that your listeners may want to know is get construction costs have gotten some out of control and I'm not talking just about a lumber and materials I'm talking about local regulations and the difficulty getting land entitled that it really has become extremely hard for new homes to be built under 200000 or even under 250000 many areas so that's keeping supply back because the heart of the demand is around $250000.00 so particularly in the lower price point I think you've got very little risk of overbuilding and what do you think about the demographics you know there's a lot of talk about the millennium goals and what their demand will be for housing I know you've written about the baby boomers and how that is changing how might that affect what we see in terms of you know the retail buyer if you will Yeah so that that's why we wrote the book because it was all so confusing and the generational definitions like millennia old as they go from 1904 to 2002 depending on what your definition is so so Mark Zuckerberg is a millennial and my daughter in high school is a millennial so right it's hard to make a generalization but what we did is we broke the population down by decade born so you can compare 10 year periods to 10 year periods to 10 year periods and we laid it out pretty clearly in the book but I'll tell you what I believe is happening is those born in the 1980 S. Call them early in the one there was if you will more educated by far than any group before them but have the student debt to show for it graduated right into the Great Recession so of course they had to delay a lot of wife's advance but they're getting through this and starting to have families. Later in life now and although they may be saddled with some student debt they're far more likely than ever before to have 2 college educated people who are working in the house so we're actually seeing a rise in entry level buying by that profile of homes that are pretty expensive $3350000.00 or maybe even higher than that you go to California could be $7800000.00 but they're choosing to buy something closer to work closer and closer to the things to do that might be a resale home that might be a brand new town home rather than spend an hour and a half on the road that's that profile there is the profile that's not quite as affluent as I just mentioned canasta continue to drive to to qualify to be able to buy something and interesting when they want to shift that we've seen is that there's more couples now saying OK you stay at home with the kids and I'm going to work so what we're seeing is a decline in dual income households there and that's driving some of the outlying areas younger and I was born in 1900 they're forming their households and they're renters today but I'll give I'll give you an analogy and then I'll ask you a question they have a lot in common with those born in the 1930 S. Who saw the Great Depression in food rationing and World War 2 They saw the great recession they're behaving very conservatively financially and the best example of that is they're using debit cards not credit cards while they want to become homeowners they're just not going to lever up and take the risk that their parents did because of what they saw early in their or really in their teen years all right good stuff the book is called big shifts ahead demographic clarity for businesses in the course that's any type of business but what John does with most of the sign is that John Burns most a consulting you've got a great team there and just always a really enjoyed the the angle you guys take in the research that you do we've had a chance to hear from some of your teammates out there on the road events and so forth but. Tell us for you know your client someone who's building something like that who is the who's the target client Ford the work you do John you know we work for all the big public college builders I mean literally all of them they subscribe to some research reports that we put out to monitor how the market and then we're helping them plan their business and allocate capital on their own peace building on their new development and then we also do a lot of work for the building products companies to put the right products in a house and they'll banana factories in the right places and an interesting lead we've gotten really big in the single family rental business recently which didn't even exist 6 years ago well it did exist but not well fires that are around 5000 or more homes and I know a lot of their clients do that I'm a big believer in that as this going forward I think some of the technologies have changed the game there to make it easier to manage the properties and I think a lot of people set for the for the same reasons I mentioned earlier about that there's just going to be a percentage of people who just don't want to be saddled with a 30 year mortgage they would like to be homeowners but when push comes to shove they're going to stay rafters and I'm talking about people that make good money yeah good stuff Well we sure appreciate your input today and happy New Year to you if you Robert thanks there's John Burns from John Byrne's real estate consulting more with the back. 2018 year old Robert our real estate investment advice like yours it's sign up for the free real estate guys newsletter real estate guys Radio dot com. If you love real estate and of gentleman is a guy who never fails to impress me when he does a present. We've been honored to have him on the show several times but it's been too long Welcome back to the real estate guys radio program The C.E.O. Of U.S. Global investors Mr Frank Holmes say Frank Good day my friend and how are you I'm just fine I'm excited about a new year and I know we've got lots to look forward to you know you're looking at a ton of stuff and of course you guys invest in lots of different places an asset classes and so forth and before we're done I want to talk about what you've been recently sharing with us on the block chain and all that but let's talk big picture we've got a new year come in we've got a new Fed chair coming in what are some of the big big strokes the big picture stuff that you see for the new year well the numbers bad news is always been good news as governments panic and try to stimulate the economy and so although U.S. Payrolls rose stronger than expected 220000 November the annual percentage growth rate this year and every year since 2010 has been below the average change for non recession years as 1968 so how far rates will go before this starts to have an economy we just have to have to faster fiscal policy streamlining of regulations or regulators and the fact that we have a 75 percent drop in I.P.O.'s we have more indices than there are public companies we have what's called I C O's initial coin offerings bring in almost 3 have 1000000000 dollars in a 1000 new coins this year usurping money away from junior capital markets because they're so difficult to deal with. I think there's some real change in the formation of capital and so I think the government will be able to raise rates too much and still probably by June this will be a peat and we've got into a fight yield curve so I'm not as Barry says that most people are because there's some real headwinds and the governments will do everything to try to do to maintain economic growth they sure will and you know it's interesting where they we always see when there's a lot of doomsday and a lot of those things out there but in the meantime this is the longest you know recovery and we still see some vibrancy out there obviously a lot of our our listeners are real estate in. Fasters and they're looking at not only the markets in terms of real estate but financing interest rates those kinds of things what do you see on that horizon you know it's a great question because the crowd funding model is estimated $50000000000.00 when they're outside of the stock market and a lot of money has gone into real estate and private transactions and I believe that the F.C.C. Is cleared that you can do crowd funding up to $50000000.00 and make an asset liquid and I'm not sure they exactly but someone told me that this also includes real estate so I think the real estate could remain very attractive the cost for borrowing this is really not punitive I 1st got this business it was rising from 12 to 20 percent it's a very different world today and as I said earlier I think that if we can get some real fiscal restraints and stimulation and then then you can have this raising rates and that would have a bigger impact negatively on real estate so I'm bullish on real estate I really am syntactic good stuff Well let's talk a little about crypto currency and block Jane you have more than a cursory knowledge of this because you've been involved in addition to your work at U.S. Global investors you've been involved with the high block chain technologies and in fact that's a really interesting part of all this is not just a crypto currency as you mention a 1000 new coins give us the the nickel Tron on block chain when I went to try to launch a product and basically the regulators say no candidate us because they're very concerned about any money laundering laws and and that supersedes all new regs and the same thing with K.-Y. Issues and risks so I sat back and said which was a conference call consensus in New York and saw Abigail Johnson the C.E.O. Of fidelity speak and she doesn't speak an investment conference but she's speaking at a block chain conference you know they have 2.5 trillion dollars in assets they've always been is able to remain competitive because they remain in innovative they have all their employees on bitcoin wallets I should say. Things happening bigger than I really knew and then I find out that the York Stock Exchange because I'm launching my go away you buy a smart beta gold E.T.F. Which based on regression studies or performs a G.D. Exchange 94 percent of the time and rolling 12 month periods for a decade and is doing exactly that since we launched it in June they tell me in the New York Stock Exchange that they invested in coin base and so did USA up the street the insurance company and and on and all this and I find out that you can open that counted at Fidelity National Securities which is the 2nd biggest discount brokerage firm in the country in the world and you can have money in Coinbase and it can it can show up in your fidelity accounts and the same thing with US A So something big happened in the space but I couldn't launch a product and my friend called me and said you know my young guys like this T. Have any what do you think about his investing and I said Yes let me do some to diligence and I said immediately I became the chairman I put in $5000000.00 and I'd basically took grow as a which is a public company which manages the mutual funds a share of hide behind each share grow and and hive took off me hive went up tenfold from its investment because it was the 1st company to what they call mine coins and we mined coins in Iceland where you need to have cheap electricity geothermal good energy and so I said well we're going to we're going to basically be mining virgin coins that means we don't have any M.L. Problems and what they call the 1st coin is called Genesis and the partnership funny enough is with with high base with Genesis mining who is the largest crypto currency miner in the world bunch of mathematicians from Germany they have a multibillion dollar private company the ladies of technology so it was it was a sort of a triangle here you have a hive you have the Genesis which is private which is the biggest mining entity share in their electoral capital they own 30 percent of hive and US Global was a perfect triangle and everything took off so if you would look at stocks like that you have to buy them in Canada and the ticker is H I V E and then. When you go to those places with these facilities where they mind these coins they sound like a beehive So I'm very bullish gal and you know it's hard not to just pay attention to what's happening price wise with Bitcoin but to your point the 100 line technology is really so much different than that it's not about any one cryptocurrency what's your kind of long view on this idea when it's been really as you know a different idea different thinking about crypto currency and the future well think of the an Internet never took off until e-mail came along and blotchy never took off until Bitcoin of a sudden went through a $1000.00 and you saw all the major banks in the financial institutions maybe talking negative regarding Bitcoin except for A but they have filed 2700 patents of how to use Block same technology and that's the real big backbone of this you're able to drop down the cost tremendously that the New York Stock Exchange said they could be embarrassed by this because you could all of a sudden have block chain exchanges that you can trade 247 and every transaction settles in 10 minutes and you never have failed deliveries so the whole concept of how the Protocols of the law change technology are very significant for real estate for insurance your title to your company if you want to move money it's becoming very expensive and I believe a lot of the banks like the way they make their money but they're going to arise with this blocks in technology with new startups coming like Air B.N. B. Is done to real estate and over is done to the taxi cab medallions around the world and I think that that's where we were moving in that direction so there's a lot changes there's some good articles that are out there that those who've arise are M. And Ms and I's 18 different industries Yeah amazing stuff Hey before I get let you get out here Frank it's always great to talk to you about gold because you mentioned your gold E.T.F. Certainly but but every time you've had this show you've had an interesting and sometimes different opinion about gold and where it's headed and some of the reason . And why what's so what should we look for in the New Year when it comes to gold the biggest headwinds going to be the toxics such as coming through in America and making America so competitive on a corporate basis globally and that could be a strong tailwind for the for the dollar but I don't think it's going to be really long lived I think I'm very bullish on the Gold we've got peak supply and the world continues to print money at rap at rates and that's $1.00 reason for Bitcoin taking off because it is only $21000000.00 coins will eventually be out there and have back to a sudden loss coins and ones not produce there's only 10 millions coming flocked so you this one of the reasons why because you can't print more than soap there but so many pay money it's in the global in the scenes of printing money by the trillions of dollars I mean are you aware that the Swiss have been buying Apple and buying stocks in America because they go to raise a 1000000000 this was francs and and only $100000000.00 is bought by the public $900000000.00 the government buys so now they get all this cash they create paper to anywhere they go buy stocks and they now own 15 percent of the stock market the same thing as in Japan the same thing in South Korea so you're witnessing a cartel of the G 20 countries which are basically not consumed with global trade as you are with synchronized tax and regulation and guess what Trump is a disrupter and just like natural for ours I had lunch with I was a couple weeks ago in London and spoke on a panel with him they look at themselves as being great disruptors like Amazon is if you're a consumer venomous on's products you love it but if they go into your business now they're going to drop the cost of make you basically irrelevant and you don't like it and that's what's happening in the capital markets so I think this could be lots of positive changes taking place for next year there's going to be good for gold I think that we're going to see negative really interest rates we're going to see inflation pick up very easily and I think we have peak supply in gold so that's an important factor Judy. Remember the Chinese currency tracks the trend of the dollar the dollars down this year and you can't believe gold is up gold is up over 10 percent and it's almost like it's done nothing and so I was it to remind readers this is the year 2000 gold has done 2 times what the S. And P. Has died hard to believe long term and then short term this year is still up double digit so I remain very bullish on gold and the other last thing is that the Chinese to go and raise money to have currency trading with the Saudis guess what they had a collateralized debt with bullion So they've been buyers of bullion a slowdown just recently but they've been buyers of 1000000000 they got the platter lies or their bonds or their money against if they if they want the Saudis have take their paper so that's comes back that gold is a very important asset class All right great stuff Frank Holmes is the C.E.O. Of U.S. Global investors are easy to find on the web at U.S. Funds dot com They've got great mutual funds E.T.F. So that's excellent research and it's always a pleasure to hear from you my friend thanks so much for joining us on the program and a Happy New Year to you thank you and same with all of your listeners happy investing you to the rules the guys radio program I'm your host Robert L. . P. To help with your real estate investment portfolio the resources page at real estate guys Radio dot com. 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Us are OK at real estate guys Radio dot com This portion of the real estate guys radio program is brought to you by international coffee farm where you can own a parcel of land in your very own specialty coffee farm in Panama Brazil is My America to say the German a country is a researcher you're listening to the real estate getting back to the real state guys radio programs heard every week on this great radio station all the time in real estate guys Radio dot com A new year is just about here and we're taking a look at the 2018 some predictions and we're going to talk a little bit about the Federal Reserve some changes there let's welcome back to the REAL see guys radio program Danielle de Martino booth how are you I'm doing great how are you fabulous always great to have you on the phone with us and we're going to talk today a little bit about of course all the things happening that the folks see in the future but you've spent lots of years as a Federal Reserve insider and we've got a change in the Fed right so what is that going to look like in the in the coming year Danielle you know it's really difficult to say I mean there's still a dearth of warm bodies on the Federal Reserve board still has 3 people 3 vacancies to fill so it will be all eye on the White House in $28.00 King just as it was in 2070 but what we do know is that of that district bank presidents that are rotating on to voting that we've got a little bit more hawkish contingency than what we want had and we know that Randy quarrels and that MARVIN GOODFRIEND assuming that he is confirmed have a little bit more of a disciplined approach to monetary policy making that will negative interest rates thing with with good friend aside pray God we don't go there and then I you know I have been very. Public in dissenting against this consensus opinion that Jay Powell himself is some kind of a Janet Yellen clone I pushed back on that he publicly stated that he had regret it voting for the last iteration of quantitative easing and I'm hoping given some of the things that we're seeing out of the European Central Bank that we don't see our Federal Reserve go that way if 2018 does see a slowing economy yeah and it's so hard to tell and that's part of the thing is none of us really have crystal balls we're just trying to take what we've learned and look forward you know any time there's a change we don't know what's going to happen but reading the tea leaves if you will there's definitely what they state and what the media expects in terms of you know the Fed raising rates and that kind of thing and yet then they see what happens you know how the reaction is in the economy and make adjustments so it's hard to tell what's your feeling about what we're going to see in terms of the Fed interest rates for the coming year you know it's really interesting the December rate hike has been so well broadcast that everybody has got that kind of baked in their cake but you can't make up walkable argument right now that anything is baked into the cake in terms of $28.00 rate hikes you know we got the massive 2017 was clearly the year of the natural disaster they just label the one that's going on in California as the 5th worst in modern California history so we'll continue to see a lot of the quote unquote sugar high from the rebuilding efforts in Puerto Rico in Florida in Texas and California but you're starting to see signs that the U.S. Help hold simply is buckling under the strain of the inflation that the Fed refuses to measure properly that housing inflation and we're seeing an increase in defaults and delinquencies that suggest that we're at the end of this economic cycle and I you know I put it on Fed Federal Reserve policymakers to pay close attention to what they're seeing in the data and not just go with what the headlines are telling them because they could overcome the economy easily into recession. In 2018 well and this quote unquote recovery has been one of the longest on records and if you just follow the logic at everything that goes up must come down and we are starting to see those cracks in the dam and course a lot of folks today are sharing with us what they see in terms of what that may manifest like nobody put a timeline on it but one of the things we'd be looking for if if that path was that continue Well I think that you would look for the celebration in capital expenditures few people appreciate put the tax reform chatter aside few people appreciate that companies really have been investing capital expenditures these last few quarters so we're going to see if that's going to continue but for me after hurricane Harvey and this temporary blip the car sales one of the things going to be watching the most closely in 2018 is car sales to see where this economy is headed we're already seeing it pick up we think it's a couple months in auto loan delinquency but now we're starting to see it in on the mortgage side as well and the credit card side as well I'm going to be keeping my eye on that inflection point which I think car sales will tell us a lot about and that you Curt the difference between the 2 year Treasury in the 10 year Treasury yield it's at the lowest since 2007 and it is broadcasting a very clear message again I hope the Fed is paying attention to good stuff you know last time on the on the show we talked a bit about that commercial real estate that's one of the many things you follow and of course for real estate investors most of our audience what they're concerned with when it comes to interest rates is how that manifests on the lending side I want to get a loan on a house and apartment building those kinds of things any insight into what we might be looking for there well I think that I think that 2017 was probably the year that we saw a lot of blood shed in in brick and mortar retail I think what real estate investors in particular are not paying attention to. Is the fact that we have equally over built restaurant chains in this country and we've built too many hotels so it's going to be make or break for a lot of restaurant chains in the 1st half of the year and I think some of the bankruptcy announcements that we'll see not not going for hyperbole here but I think some of the bankruptcy announcement that we see are going to take investors by surprise but when you begin to add up all of this empty space you're talking about deep implications for commercial real estate and you're going to have to see whether or not lenders are going to open up those loan books or not right now I would have to say again I see commercial real estate at a turning point you have a good piece on that in your newsletter but the restaurant industry in fact that money strong you will put out a bunch of great stuff and you talked recently a little bit about crypto currency you can't turn on the news anywhere and not hear something about Bitcoin now because in futures and all of that what do folks need to know about crypto currency moving forward well they need to know the exchanges of the world are not their friends I think that it was one of those were proto Blee irresponsible acts of some of these exchanges to start listing futures on big coin because what we see when that happened we saw yet another surge I was listening to bubble vision and they're calling it an asset class that's a bit of a stretch I mean maybe they need to put asset class in quotes because it's not and investors need to be very wary of chasing this is so reminiscent not of 20062007 but it is so very reminiscent of 198-1989 when we saw anything that put a dot c away after there after their name could do an initial public offering and away we go but again there wasn't any collateral there wasn't any asset that was backing this and I draw a parallel between what we saw in the gogo late 1990 S. To the mania and speculation we're seeing in Bitcoin. All right good stuff let's get out here I know why nobody knows for sure what's going to happen next but at some point we can say there will be an economic downturn how is that going to show up or do you think that might manifest like that I know you have some thoughts on what we'll see when and if I'm going to say when we do get that downturn you know I'll be looking overseas I think well look back on history and remember that day that a South American company blew up and we woke up one day to find out that Mario Draghi and the European Central Bank had bought a bond just months before that would now work pennies on the dollar you know we we forced our banks to clean up after the financial crisis and to raise capital and we find them to kingdom come it wouldn't surprise me terribly especially given all the geo political tensions if the catalyst was to come not from within the United States but from outside of our shores this has been a very global experiment in quantitative easing 2017 we saw a record run rate it is if Lehman went out of business yesterday and by this time next year we will be talking about a trillion dollars less flowing into the markets between the Fed reducing the size of its balance sheet and the European Central Bank tapering its purchases I don't think that we necessarily are strong enough to withstand the liquidity the methadone if you will being taken away from the patient but I would look for the catalyst to potentially come again from overseas there is. The author of fed up an insider's take on why the Federal Reserve is bad for America that's a book you should definitely pick up and read in the new year and of course puts out great stuff at money strong you can find that at De Martino booth dot com Danielle thanks for your input and a Happy New Year and the same to you Happy New Year take care of the state guys radio program more from our predictions family we come back I'm your host Robert Helms. You're listening to the real estate guy. Find out more investors summit at sea don't miss the boat. By This is Patrick Donahoe C.E.O. Of paradigm life Wall Street banks spend billions of dollars per year in advertising with the goal to convince you that they are the solution but take a look around none of their advice has worked if you're listening to this odds are pretty good that you're already a real estate investor or at least becoming one so why do you do it is it to hedge inflation the tax benefits or maybe it's to get your money away from Wall Street it's because of these benefits and so many more that I created the real estate investors guide to the perpetual strategy when you combine successful real estate investing with the perpetual strategy you have the recipe for what has helped the wealthy to establish their financial wellbeing for decades you can download the real estate investors guide to the perpetual strategy today by clicking the resources tab on the real estate guy's radio home page don't we go download it now . Good matter I listen to the real estate guys and so she will come back to the real estate guys radio program I'm your host Robert Helms there in a brand new blank here always an exciting time of year and we thought for today we get out the crystal balls and take a look at what might happen in the New Year and no one knows for sure but the gentleman we're about to talk to thinks about this stuff an awful lot please welcome back to the real estate guys radio program The amazing Chris Martenson Hey Chris Hey Robert really good to be back with you today well good to have you on it seems like you were just on the program talking about the 8 forms of capital which is a fascinating topic today we're really talking about what we can expect in 2018 and you know an underlying message you guys always have unanimous about being prepared so I would say what one of the big picture things you think we need to be prepared for in the New Year Well I think 2018 is the year where the oil story really begins to change and it's going to change from one where there's a lot of oil to one where people start to recognize that there's just about enough and then it goes into the future where oh there isn't quite enough to 2018 is that transition year for me all right well I can remember you know when I was a petroleum transfer agent for a little while there in the eighty's that you know we had gas rationing and all those kinds of things and it was predicted we were going to run out of oil but then of course you know technology comes in and those things and then kick the can down the road a little bit but one of the things you point out so brilliantly is anytime you're talking about a scarce resource it cannot just continue to grow geometrically Well absolutely and oil is the master resource everything else kind of flows from that if you say we want more wind towers you really you need more oil to put them up and if you want more solar Well you need more oil to transport and manufacturing installed well is how more than 95 percent of everything moves across the globe and of course we have a just in time global economy stuff that's manufactured in China but the components made it come from Taiwan the raw materials from Africa that. It's the world so oil is really important and yes we've been supplied for a while but that little complexity in this market I like people to educate them so they can begin to understand the complexities because of course as you know it's a real estate investor you don't just buy buildings you buy this building a commercial you know rental of multifamily they're all different well isn't just this one thing it's Friday of things it comes from really heavy and sour to light and sweet and there's a lot of interesting details under there but the summary is this we're kind of swimming in a kind of oil that the world has plenty of and we're running out of a different kind and that's really where the story is shaping up and it's beginning to have huge geo political realignments across China Russia Saudi Arabia very interesting what's going on yeah and you know I don't know that we all are tuned into it and certainly the major media is reporting the same things that say you guys talk about well no it's I think too complex for the mainstream media you know they really like their stuff simple you know look at for example Puerto Rico is already completely out of the news cycle even though their whole portions which are still without power clearly it's a very big story to the people who are living there but mainstream media's move done so this is where of course I make my living and I love explaining things to these things to people and we live in a complex world so the details is where this story really comes alive and it's just fascinating fascinating what's the transformation that's about to take place in the oil business why let's talk about some of that because I think when we think about gas prices I mean that's where the that average person stops what they want to have to pay for gas this week this month oh gas is going up gas is going down and the changes in the summer and then we look at the airline tickets and all those things but you pointed out a point on people miss and that is there is the price of energy in every single thing we consume practically it is a big factor in moving anything physically Well it is insults a factor in growing things so if you look at the price of food over time in the price of oil. The price of food tracks the price of oil not the other way around even the National Association of Home Builders recently released a nice chart showing the cost of doing business for them from an inflation standpoint and they finally noticed opes if you overlay that with the price of oil chart they line up perfectly so everybody from homebuilders to farmers to people who move clothing everybody has to track the price of oil because it's such a critical input to either manufacture or move whatever it is that you're selling and buying and that is likely to continue right so I guess there's 2 parts of it one is that there's the supply side there's a fixed amount of it and we're going to have more demand and then there's what does that do to pricing is it just a fact the fact that everything seem to go up in value and how do we rethink our use of oil now this is where I think the story gets just super fascinating oil is a global commodity it doesn't really matter how much you produce in Oklahoma the price for it is set for how much that tanker is going to sell for that's shipping out of Oman or it's coming out of the North Sea in the Brant fields or you know the Brant pricing contract whenever an international commodity so whoever is willing to pay the most for that for a seaborne shipment or a pipeline shipment of oil they are the person who sets the price so if you're sitting there at the gas pump wondering why your prices are going up or down in California you need to understand it's because of what people are paying halfway around the world for for the next barrel that comes out of the ground it's called the marginal barrel so when we look at that story here's the the most important data I've got which is that China the Beijing petroleum university it's state funded it's a very big place it's filled with a lot of very technically gifted people they looked at China's oil imports and their supply their own domestic production Robert and they said Hey big study came out just a few months ago they said hey we're going to be peaking in oil in 2018 and we expect our imports to continue to climb both because we're growing as an economy. And because our domestic supply is going down China is all ready the number one importer of oil in the world by far and they're going to be consuming more and more and more now they are of that marginal buyer out there but so is India growing their consumption very rapidly as well most people don't know this but a lot of the oil Petroleum Exporting Countries OPEC they're experiencing both rising demand domestically and kind of flat output for their production so so they have less to export so you put all of this together 2013 is the year that the oil markets rebalance supply and demand come right back into balance if they are already when supply is exceeded by demand in the oil space that's when you see the marginal price drive the barrel it's very what they call in the last take a little bit of shortfall in supply you see big big swings in price that's what we saw in 2008 I think we see something like 2008 again in the future I'm not sure it hits in 2018 but that's where we see the set up for it all right good stuff Hey before we get you out of here let's also talk a little bit about cryptocurrency completely different than Oriole right course for on the panel about that in New Orleans and we talked a bit I know you guys put an article about out about this recently Take us through you know what what your thoughts are on Bitcoin and cryptocurrency So the technology itself we're completely in love with we're just not smart enough to know who's going to win that particular battle I.D.M. Reasonably confident saying Bitcoin is one of the 1st entrants out of the gate hey it's fantastic I love the proof of concept I love words going on is that going to be the piece of of cryptocurrency that is the survivor and 10 years from now I don't know Robert a little early for me to say because it's kind of like the idea of recording movies and being able to play them back at home I love the technology but was it Beta Max was it V.H.S. Oops no wait it was D.V.D.'s wait now we have blockbuster up that Netflix was the winner right it's a little hard to predict who's going to be that winner at the end I can tell you I love the technology but if people are in bitcoin or 3rd in theory I'm one of those . Feel free to do that understand you're speculating and have just the speculative portion of your of your investable money in that this is not investing at this stage it's really more speculating Kris and Adam get their minor all kinds of stuff in if you want to find out more about what they do at a peak prosperity dot com where they talk about energy the environment because all kinds of stuff occasionally in real estate and anything else for the new year that you guys are watching or thinking about as we prepare for 2018 Well yeah you did the biggest thing is the central banks are starting their online process we'll see how far they go but this is going to start creating headwinds in the markets so just watching for that and watching the credit markets very very carefully this is a long expansion a lot of things out there saying hey this you know we're watching carefully to see where this unfolds so staying in ball lots of good investment opportunities out there we think still but you're going to have to do your homework All right good stuff there is Chris Martenson author of the crash course and of course. Always great to hear from you Chris we appreciate it and Happy New Year to you Thank you Happy New Year to you as well so there you have it our protection panel part one for 2018 lotsa stuff out there man so I guess if we're halfway through then we haven't done a 360 and we're only at a 100 down a one a trade so your mission of course is to assemble all that and the big question what does it mean to me I'm going to blast that question because the rest will happen If you're a small business 1st impressions can make all the difference with grasshopper you get all the features of a professional business phone system on your mobile phone choose a business phone number make calls and Centex to stay connected and work from anywhere with features like wife eye calling and our desktop app set up your account in minutes with no long term contracts in 247 Customer Support make your small business big now get 20 dollars off your 1st month when you visit grasshopper dot com slash radio that's grasshopper dot com slash radio you're up before 0 Dark 30 you don't ask for metals or even a pat on the back but if all your hard work is indeed its own reward and consider the new RAM limited tungsten edition as a bonus which are a plus leather CD premium projector headlamps suede headliner packaged in the highly capable hard working truck you'd expect from RAM keep doing what you do but who says you can't do it in a nicer truck the new RAM limited tungsten the most the curious Ram truck ever RAM is a registered trademark of F.C. 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Without star in news I'm Gordon Griffin mudslide cleanup continues in Montecito California this afternoon the orange markings left on doors tell crews the homes have already been searched some have mud as high as the roof or in one of the hardest hit areas a silver Mercedes Benz its front and rear fender is completely destroyed said a topic tree stump the only thing left where a home once sat her windows of the home completely blown out in the mind of mud halfway up the front of the home marks the destruction of her rescuers say they will continue to sift through every piece of debris and level every pile of dirt until they find those who are missing my call some month to see how California officials in Peru say this morning's powerful earthquake so far has caused one reported death and 57 injuries and a magnitude 7 point one quake also knocked down adobe homes in small rural towns and forced closures of some roads also That's our news dot com People in Hawaii will never forget Saturday the day that they got a false ballistic missile learned it was easier to just say Oh dear think that wasn't really a serious human rights or a way to listen to lawmakers have a lot of questions the Hawaii Legislature will hold hearings on the false alarm later this week and the Federal Communications Commission says it will launch a probe of its own a commercial airplane it's getting off a runway after landing in Turkey dangled precariously off a muddy cliff with his nose only a few feet from the sea images show the Boeing 737800 on its belly and an acute angle just above the water the incident created panic among the 168 people on board the Pegasus Airlines flight but they have all been evacuated safely and the Turkish province of tribes on soda States banding together to promote civil rights tourism across the region 14 states including all the deep south joining to promote the U.S. Civil Rights Trail this is as are a news. That old expression has never been truer than it is today Time is money Hi this is Alan Wilson managing partner of a recent book also the company at our C.P.A. Firm we see you both whether you're selling a business preparing for an I.P.O. On the brink of bankruptcy I just need solid tax and financial advice and your best interest is what matters to us most at Roco we give you the personal attention you can find at national C.P.A. Firms that's why we've been trusted advisor to the media of Silicon Valley's most successful entrepreneurs over 40 years if the iris is coming after you or you're just tired of paying more than your fair share of taxes give us a call.