There are 6 ways to get money
- Borrow it
- Steal it
- Gamble it
- Marry it
- Inherit it
- Earn it
My experiences about ways to get money
I have in depth-first had experience in all these except for 2. Have never married it or inherited it but I am very familiar with those categories from people I know who have. So today’s blog will be on how to borrow money. Since I have many years of experience in this category for both personal and business borrowing.
You may want to understand what money is, who has it, and how they loan it. First off, money doesn’t really exist since it is created out of thin air. I have operated a very large publicly traded regional bank called IBC (International Bank of Commerce) several years ago. So I can tell you from first-hand experience that banks carry very little money. I have opened my bank many times and had to do “the count” with at least one other person, usually a teller.
The count is recorded in the morning when we opened and at night when we closed. So all this is in a locked back room under the Seeing Eye camera, which is always on. The amount we carried in this bank was about $40,000 on average. When we became short, we ordered more cash, and when we were over a certain amount in excess of $40,000 we removed it. Cash would be deposited daily from our drive through or removed the same way through our ATM. We usually receive counterfeit money about 2 to 3 times a month on average. So this was reported to the authorities in charge of monitoring.
The amount of actual cash paper money in our economy varies. So I can tell you that it represents about 3% of the total money created. Making digital currency about 97% of the total currency created.
How money is created
How then is money created? Banks create money when you take out a loan. So when I purchased our new 2018 Toyota Highlander a few years ago for about $45,000 I decided that my wife needed to show more credit history so we put half down and loaned the rest at 3.1% from the bank which the dealer recommended because of the low rate.
This $22,500 loan was created as the result of the purchase of the Toyota and the car and loan were out into my wife’s name. She owns the car and the loan which is paid on the first of every month through automatic withdrawal as her credit has now increased because of other lending activity and is approaching 800 on her FICO score (will explain credit and FICO in another blog and how to increase yours).
But what about the loan the bank made? Where did that come from? Did the bank loan the money from the Federal Reserve where all banks get their money? Or did the bank create this loan from thin air as a transaction on their computer systems? The answer is they created the loan out of thin air.
Therefore the $22,500 loan my wife received and was used to pay to the dealer where we purchased the car was created by the bank as the result of her buying the loan and assuming debt. The bank now has a loan out at 3.1% to my wife, the Toyota is collateral against the loan in case she defaults they can take the car back and sell if, for cash to someone else, the dealer has been paid in full for the car, and we now have beautiful care we can drive around and the wife’s credit score has increased because she pays the car on time.
There is no money
So what’s the point of telling you this story? The point is there is NO money. It is created from nothing by a bank, literally. Therefore there is a limitless supply of money. We know this because our government created trillions of dollars, out of thin air and gave it to the American people and in the form of government loans to small businesses to carry us through the COVID pandemic.
So we think money is in short supply and you can’t get any of it. So if this is the case why do we need credit scores and why do we have banks if it’s created any time it’s needed? Because that’s how the system keeps us all working our asses off to get it! Bet you didn’t know that right? It’s a big game we chase money, that doesn’t exist and is created by banks out of thin air, and if you try to create money on your own, and I am not talking about cryptocurrency which is also created out of thin air, then you will be thrown in jail forever.
So what does all this have to do with loaning money any way you ask? It’s important to know the game before you enter into the loaning of money.
The Big Banks
Let’s look at my bank first and see how they lend us a line of credit and in what amount. We bank at 3 of the largest banks which are Bank of America, Wells Fargo, JP Morgan Chase, and the 4th is Citibank, which we currently do not bank with. At the time of our application for a line of credit for our company, I had deposited into the bank well over $1,000,000. We had savings in this bank in the corporate account of about $250,000. The bank loaned us $15,000 in the form of a line of credit. That’s it, just 15K.
This is with an A+ credit rating and a perfect record of no overdrafts and 5 years of doing business with this bank. Therefore the bank just loaned us back our own money. Why only 15K, when they gave us $50K in a credit card? Because the amount they make on the line of credit is really not much, and maybe 6% on any outstanding balance. You see banks are in business to make money too. Even though they can create it, they still need to show their stockholders that they can earn money too. The more they can earn, the higher the value of their stock, the more they can pay out in dividends, which are the result of their profits every quarter, or 3 months.
But how do I get loans if not from the bank? You can get loans from Fintech companies. Fintech companies are middlemen that loan money from the banks and resell it to you at a higher rate. But I want the lowest rate? Then you have to get money from the source, which is a bank.
My Fintech of choice is Paypal Capital. I have loaned over the years about $500,000 from them and paid them back on time. These loans where all about 2 years on average and were for business only, not personal. They do not use your credit to give the loan but base it on the amount of money that flows through Paypal the results of our business which generates about $100,000 per month.
So I have a history with Paypal for borrowing money and paying it back on time. Today I can loan $100,000 in about 10 seconds. That’s all it takes is about 10 seconds or less. Now I can loan money from Paypal for different businesses too as long as I have different EIN numbers or federal tax ID numbers because loans are based on the tax number you have for your business. Or you can use your social security number if you are a sole proprietor, but I have C corporations which are corporations that issue stock and are controlled 100% by us.
So what if you don’t have a company that makes money? You need to open one and start earning money so you can show people you have ample income coming in all the time. I like businesses that generate cash daily. This income combined with your good A-plus credit will allow you to get as much money as you need. Based on course on the income you generate.
There are many ways to loan money and we will look at them in-depth with future blog posts.