How to Hedge Against Inflation

Those who call themselves economists while cleaving to Modern Monetary Theory (MMT) are analogous to the tailors in the story of The Emperor’s New Clothes with one exception, the tailors in the story were not deceived. They were the deceivers. Today, Modern Monetary Theorists blather on and on about how our currency is backed by faith in the United State government and therefore is immune to inflation. This they do because they actually believe what they are selling.  They even go as far as to praise deficit spending, which has been going on in the United States over the last 58 years, as proof that printing more money doesn’t lead to inflation. But they live in a fairy land of make believe and make believe never annuls reality.

In reality $100 back in 1963, 58 years ago, would have purchased 8.65 times more than what $100 can purchase today.  In other words, Modern Monetary Policy (MMP), has destroyed 765% of the purchasing power of the U.S. dollar since 1963.

Contrast the inflationary results of MMP with wages, which have only increased by 480% since 1963, and there is a 63% gap between inflationary costs and real wages over the past 58 years.  This gap is responsible for fueling the rapid decline of upward mobility in the middle and lower classes across America.  In fact, MMP encourages the transfer of wealth from the lower and middle classes to the upper class, especially to the top 10% of the wealthiest.  In 2020 the richest 1% of Americans captured 35.2% of the wealth generated nationwide, while the next 9% of America’s richest, captured 34.8%.  Combined, this accounts for 70% of all wealth generated being transferred to the top 10% of the richest class in America in 2020.  This is why Modern Monetary Theorists believe in their fairy tale so heartily.  It actually makes them lords and aristocrats over the rest of the population, until it all collapses.   You can only dilute a solution down so far until it is no longer measurable.  Then it becomes worthless.

So how do we combat this fatal system?  Do we roll over and accept MMT and MMP without a fight? Or is there a way to win this monetary game even though the deck of cards has been stacked?

Contemplate for a moment on making a purchase over time, where the periodic payments remain the same indefinitely, and the value of what is being purchased increases indefinitely, being guaranteed to increase in value which will be greater than the total cost of all periodic payments received.  This purchase, if started in 1963, would still have payments equal to prices charged in 1963 yet would in reality be costing 765% less because of the inflation due to MMP.  This is because the 1963 purchase plan locked in the 1963 dollar amount due for each periodic payment, but inflation has reduced the value of the dollar amount being paid over the last 58 years by 765%.  Yet, and here is the clincher, the value of this purchase is greater than all the combined payments which have been made for it since 1963.  This growth in value above and beyond the cost basis of this purchase is a real hedge against the inflation caused by MMP.  Furthermore, this value increase is tax-preferred, meaning it can be accessed without having to pay taxes.  Accessing this value and using it to create even more value further increases the hedge which can be constructed to protect against MMP and its inflationary results.

Of course, the purchase described here is Participating Whole Life Insurance (PWLI). A purchase which those who believe in and propagate MMT deride and scorn.  They do this because PWLI keeps money (your money) from being controlled and managed by them.  And one must never forget that those who control the money rule the world.

Keeping your money in PWLI, allowing it to grow tax-preferred while hedging against inflation, reduces the rate at which wealth is transferred to the top 10%.  PWLI ownership is the only way for 70% of wage earners to build an estate.  Yet, Modern Monetary Theorists continue to rant and rave against PWLI ownership because it checks their fundamental objective…to control the money and therefore the masses.

There is nothing new under the sun.  Malicious and immoral people have always worked to devise ways to rule over those whom they regard as inferior.  Unfortunately, many of the masses have been led to believe a lie.  The lie that MMT and MMP will create a utopian of equality for all. Yet in reality MMT and MMP is just another evil plot to enslave and destroy the majority.

Be smart.  Don’t play the MMP, MMT game.  Build an estate for yourself using PWLI.  Begin today by calling 702-660-7000.  We can help you.

Dr. Tomas McFieDr. Tomas P. McFie

Most Americans depend on Social Security for retirement income. Even when people think they’re saving money, taxes, fees, investment losses and market volatility take most of their money away. Tom McFie is the founder of Life Benefits which helps people keep more of the money they make, so they can have financial peace of mind. His latest book, How to Build Sustainable Wealth, can be purchased here. 

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