Day 5: JPMorgan’s Warning: America Is Going Broke — Here’s Why Real Estate & Alternative Investments Are Your Shield
By Rodeen Rahbar, MD Board-Certified Physician and Entrepreneur in Real Estate and Wealth Creation
“The U.S. is on an unsustainable fiscal path… the longer we wait, the greater the risk of a fiscal crisis.” — JPMorgan Asset Management, 2025 Outlook Report
The alarm bells are ringing. One of the world’s largest banks just issued a stark warning: America is running out of money. With federal debt surpassing $36 trillion, annual deficits topping $2 trillion, and interest payments now rivaling defense spending, JPMorgan warns that a fiscal reckoning is no longer a question of if — but when.
For investors, this isn’t just macro noise. It’s a direct threat to traditional portfolios built on stocks and bonds. But there’s a silver lining: real estate and alternative investments are uniquely positioned to not only survive this storm — but thrive in it.
Here’s why.
1. Inflation Is Coming — Real Assets Win
When governments print trillions to plug fiscal holes, inflation isn’t a side effect — it’s the plan.
JPMorgan predicts persistent 3–5% inflation over the next decade as the Fed is forced to monetize debt. That’s a silent tax on cash, bonds, and even growth stocks.
Real Estate: The Ultimate Inflation Hedge
- Rents rise with inflation → cash flow grows
- Property values appreciate with replacement costs
- Fixed-rate debt gets “inflated away” over time
A $500,000 rental property with 4% annual rent growth compounds to over $900,000 in 15 years — even before appreciation.
2. Bonds Are Broken — Yield Curve Control Looms
The 10-year Treasury yield? It’s no longer set by markets — it’s set by political necessity.
As debt servicing costs explode, the government cannot afford 5%+ rates. JPMorgan warns of yield curve control (YCC) — the Fed capping bond yields artificially, just like Japan.
The Result?
- Negative real yields (you lose money after inflation)
- Bond prices crushed if rates spike before YCC kicks in
Alternatives Fight Back:
Asset
Direct Real Estate
Private Credit
Infrastructure
Real Yield Potential
6–10% (cash flow + appreciation)
8–12%
7–9%
Correlation to Bonds
Near zero
Low
Negative
The Dollar Is Diluting — Hard Assets Hold Value
A broke nation = a weaker currency.
The U.S. dollar has lost 18% of its purchasing power since 2020. With trillions more in stimulus and debt likely, the trend accelerates.
Real Estate: A Dollar-Proof Store of Wealth
- Priced in real assets, not fiat
- Generates income in depreciating dollars
- Global demand (especially from foreign buyers fleeing their own currencies)
Multifamily in growing Sun Belt cities? Still trading at 4–5% cap rates — and rents are up 40% since 2019.
4. Stocks Are Overvalued — Real Estate Offers Better Risk/Reward
The S&P 500 trades at 22x forward earnings — near dot-com bubble levels. Meanwhile, cap rates on stabilized real estate are 5–7% with built-in growth.
Compare:
Metric
Current Yield
Earnings Growth
Volatility
Tax Advantages
S&P 500
1.3%
8–10% (optimistic)
High
Capital gains
Class B Multifamily
6.2%
4–6% (rents) + 3% (appreciation)
Low
Depreciation, 1031, cost seg
5. Alternatives = Income + Control + Tax Alpha
The wealthy aren’t panicking — they’re reallocating.
Top Alternative Plays for a Fiscal Crisis:
Strategy
Self-Directed Solo 401(k) Real Estate
Private REITs / Syndications
Farmland / Timber
Gold-Backed Real Estate Funds
Why It Works Now
Buy rentals with pre-tax dollars, defer taxes, avoid UBTI on leverage
Passive 8–12% preferred returns, quarterly cash flow
Inflation-protected, non-correlated, tax-advantaged
Hard asset + income
The Math: $1M Portfolio in a Fiscal Crisis
Scenario
Inflation
Bond Real Return
Stock Real Return
Real Estate Cash Flow
10-Year Outcome
Traditional 60/40
4% annual
-1%
3%
0%
$900K real value
50% Real Estate + Alts
4% annual
0% (TIPS/infrastructure)
4%
6%
$1.8M real value
Assumptions: moderate inflation, no crash, taxes ignored
Action Steps: Protect & Grow Your Wealth
- Audit your allocation — How much is in cash/bonds earning <2% real?
- Open a Solo 401(k) — Even $10K in side income unlocks $70K+ in contributions.
- Buy cash-flowing real estate — Focus on essential housing (workforce multifamily, medical offices).
- Diversify into private credit & infrastructure — Lock in 8–10% yields before YCC.
- Use tax-alpha tools — Cost segregation, 1031 exchanges, opportunity zones.
The Bottom Line
JPMorgan isn’t fearmongering — they’re reading the math. America’s fiscal path is unsustainable. But for those who act now, this crisis is an opportunity in disguise.
Real estate and alternatives aren’t “nice-to-haves” — they’re necessities in a world of printed money, broken bonds, and diluted dollars.
The time to build your ark isn’t when the floodwaters are at your door.
Start today. Your future wealth depends on it.
Click on the Contact Button below or at the top right of this page and learn how you can take your first step towards building sustainable wealth through multi-famly real estate ownership.