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PLT: Who borrows to the hilt before inflation kicks in?

October 15, 2010

I do, borrowing is the key for poor people to open the door into wealth,  as described in my book The psychology of Investing. You see, the US will soon have to live with the inflation it had created by borrowing and printing money to bail out everyone! Huge money liquidity creates inflation. People spend their savings before prices go up like crazy (called Price Level Targeting in Academia), but they don’t borrow to invest and make a fortune while paying back with cheaper dollars. Why? Are people dummies? Not really, they just don’t think! They do what they were taught to do, work hard save-spend-work harder-spend more-complain-retire-die! People don’t live their life making tons of money with few different smart calculations. Kids watch their struggling parents, and grow up to do the same stupid calculations. I did it for many years, even as a psychologist! Nevertheless, I got to tell yah, with age you finally get it.  Inflation is coming to town and it you borrow now you’ll pay back with cheaper dollars! Bingo! But, here is the catch, and there is always a catch: Do you know how to borrow? Very few folks do! Save the $20 my book cost if you can get it from my next sentence (I doubt it): “Borrow the grand total of cash that they’ll give yah, for the maximum number of years they will give it to yah, at the lowest interest per year that’s available (do your homework), at the lowest payments per month possible. You don’t need a PhD to do the calculations, just new thinking. When I got to California in 1964 as an immigrant, I came without money, had no PhD, nothing, but I had the right kind of thinking. My first loan was the celebrated Fed’s NDSL, thousands upon thousands of tax payers dollars to live on while attending UCLA, payable back at $30 per month, 3% per year interest, starting in 1978!

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