My Interview With Robert Kiyosaki
This Robert Kiyosaki interview covers entrepreneurship, macroeconomics, and finance through entertaining stories and in a way that everyone, including the average Jane and Joe, can understand.
He also shares the insights and secret strategies he's used for decades to achieve success.
GREAT NEWS? Rumors say FED may buy $1.5 trillion in STUDENT LOAN DEBT. BAD NEWS: Taxpayers and unborn will pay. WHY? Currency War. FAKE US $ too strong. FED breaks laws needing to find ways to weaken FAKE $. Students win. We all lose. Desperate Fed now criminal organization.
— therealkiyosaki (@theRealKiyosaki) May 10, 2020
If you're interested in gold, silver, bitcoin, inflation, and increasing your financial freedom, then this is a must-read interview. Enjoy!
The Story Behind Rich Dad Poor Dad
George Gammon: All right guys.
It gives me a great deal of pleasure to bring someone to The Rebel Capitalist Show that I have a tremendous amount of respect for.
I am so excited he is here. He is a man that needs no introduction whatsoever.
His name is Robert Kiyosaki. Robert, welcome to The Rebel Capitalist Show.
Robert Kiyosaki: Well, I am honored, honored, honored, honored because I am your biggest fan.
I am not blowing smoke. Anyway, I'm so honored to be on your program, so thank you, George.
George Gammon: No problem.
Thank you for being here and thank you for the kind words.
I've been listening to some of your more recent interviews where you've had the opportunity to dive into your background prior to writing Rich Dad Poor Dad.
And I think it's just such a fascinating background that people could learn so much from it.
They could apply it to their lives today in 2020. So can you fill us in on your backstory prior to Rich Dad Poor Dad?
Robert Kiyosaki: Sure.
You know we're about talking about our educational background is similar, without a doubt.
I flunked out of high school twice because I can't write. And it's not that I can't write.
It's the teacher who didn't like what I was writing.
So for a long time, I thought my middle name was stupid. And that was hard to take because my old man, the poor dad, was the head of education for Hawaii, a Ph.D. from Stanford, Northwestern, University of Chicago. And his oldest son, me, is flunking out of school.
It's not that I … I love learning. I just hated school. I think you understand what I'm saying.
So with that, I knew I was a surfer. That was my biggest problem.
And when the surf was up, I wasn't in class.
Something told me, and it was both, my both fathers said, “If you don't get disciplined,” you know what I'm talking about, there's self-discipline and external discipline.
And if you have no self-discipline, the world disciplines you.
I had no self-discipline. So both dads recommend I joined the Marine Corps to do something intelligent.
But I still needed to go to college.
And my poor dad, the head of education said, “I'm not going to waste my money paying for you to go to school.
“So he said, “You're going to have to find your own way. The day you graduate, you're on your own, from high school.”
I applied to my senator for a military scholarship to US Merchant Marine Academy, United States Naval Academy, and although my grades were horrible, my SATs were really high.
So I was accepted to both Naval Academy and Merchant Marine Academy.
And I took Merchant Marine Academy simply because they're the highest paying graduates in the world. And I really wanted to sail to Tahiti anyway.
They have a good surf spot out there.
You know how if you're 18 years old, you're not thinking through straight.
So there was a surf spot in Papeete called Ins and Outs. And I wanted to be the first of my goofy classmates to surf Ins and Outs. So I wasn't very serious.
And then when I graduated, I got a job with Standard Oil, very high paying.
My classmates in '69 were making like 120,000 a year, which was a lot of money back in '69.
But the Vietnam War was still on and my conscience got to me, and I had a teacher at the Academy. His name was Aloysius A. Norman, and he was a B-17 pilot.
He got shot down twice in World War II over Germany, and he was captured once and escaped once.
So I asked. I said, “What was that like?” He says the greatest experience of his life.
I went, “Wow.” So he started talking to me about life being this experience. It was very philosophical.
This guy was great … And he was my English teacher which I flunked out of school from.
So I got Bs from him because I loved learning from him. He inspired me to learn.
So with that, I joined instead of sailing for Standard Oil which I had the job, I joined the Marine Corps, I went flying in Vietnam.
And that was the best. And I was horrible at times. Your best friends don't come back.
I was a carrier pilot so there were times you stand on the deck and your friends don't return, you know what I mean.
There's a loneliness that is beyond description. And then our job was a horrible job too.
We had to kill people.
George Gammon: Yeah, yeah.
So this was in February '72, and he took off the gold standard August 15, '71.
And he says, “Watch the price of gold.”
And at then it was about 35 an ounce, and it was, I think in January or February was pushing almost $45. And that's what we were talking about earlier, the trend.
The trend was moving.
With that, my goofy copilot and I climbed in our helicopter and we became gold hunters.
And we flew in. And we came off the carrier, turned right, and it's worse, North Vietnam. And there was one problem.
The gold mine we were after had already fallen into enemy hands.
So we had to go in behind enemy lines. And this is not bullshit.
I actually did all these stupid things. I went looking for gold and we fly into this Vietcong …
They weren't Viet … That was bullshit I mean.
One day they're friends, next day they're not. So we walked through this village.
I go up to this gold mine, and this little Vietnamese woman is selling gold.
I wrote about my book Fake, this was when I tuned into our world which is macroeconomics. She turned me on.
So I'm standing in front of this little bamboo shack and this woman was about 5 foot 1.
She's got a red tee and my co-pilot and I were now business partners.
We're unarmed because we didn't want to piss off the Vietcong, you know what I mean.
We say, “Hey, we come as capitalists, not as Marines,” and we're negotiating for gold.
And the trouble is back in '72 it was illegal for Americans to own gold.
I didn't know that. She shows this little plastic vial and it looked like little raisins painted gold.
And I turned to my business partner, my co-pilot, and I said, “Is this gold?” He says, “I thought you knew.”
You know the feeling, right?
That you have an idiot for a business partner.
So there were two idiots standing in front of this woman who's laughing at us because we're the big Americans with the Yankee dollars and we don't even know what gold is.
Robert Kiyosaki: So we're standing there. And he's, “I thought you knew the gold.”
“No, I thought you did.”
“FU, you son of a bitch. I thought … We're going to die today.
You don't even know what gold is.”
So, that's how it became a gold bug, and that's how I got interested in macroeconomics because that woman.
I don't think she went to Harvard, you know what I mean?
I tried to knock her down from … I wanted to get the gold at about $42.
She just laughed. She just laughed at me. She says, “Spot 48.” I said, “What's spot?”
And that's the price of gold all around the world in dollars every day.
I mean, she knew more about the macroeconomics of life, of the markets, than I did.
George Gammon: She knew more about real money.
Robert Kiyosaki: Yeah. And that was … You've had your wake-up calls.
I've had my wake-up calls. And that's why I said my middle name was stupid.
Well, I found out how stupid I was. And then we had to run back to our helicopter because my crew chief was screaming and he was screaming at us.
I thought, “Oh god, we're going to die today.” And I could see the NVA.
We'd be like this, I'd get shot. And what happened is I parked my helicopter on the rice paddy and I didn't know it. And my damn helicopter was sinking.
George Gammon: Oh, you're kidding me.
Robert Kiyosaki: No. And so my little crew chief, he looked like Woody Allen, a little tiny guy. And he's holding up the tail boom and he says, “Lieutenant, we got to get out of here.
We're going to sink.” I said … We the pilots were bigger than the crew chief, so we get behind and push on the tail boom.
Another crew chief jumps in.
He starts the engine, and all this mud surface fly and we get covered in mud and we're rocking the tail boom to get it out of the mud, and it finally gets it into a hover and we jump in and we fly back to the carrier.
And we're covered in mud, the aircraft's covered in mud. My business partnership was dissolved.
We land back on the carrier and everybody says, “Where the hell have you guys been? This thing is completely covered with mud.” We're covered.
“Don't ask us,” and we ran back in. But that's where it started George.
And then the carrier sails into Hong Kong, and in Hong Kong I started looking for gold.
You could buy gold in Hong Kong, but Americans couldn't buy it.
That really twigged my brain. I mean it's just, I was curious.
So I found a Krugerrand and I paid about $50 for it.
I still have that Krugerrand today. It's now worth about 2000 or 1850 today.
So that's how I understood money, that gold is real money, God's money, and the US dollar is fake money.
That's what happened in '71 when Nixon took the dollar off the gold standard.
Today they're printing money like there's no tomorrow.
Can you believe that? And people are still trying to save money.
I say, “Are you nuts?” So that's why in Rich Dad Poor Dad I said, “Savers are losers.
Your house is not an asset.” And what else I said? Oh yeah, “Rich don't work for money,” and all those things.
But we don't teach our kids anything about money at school.
And when I retired, I retired at 47. Kim was 37. And I thought it the best way to give back what we learned.
So I wrote this goofy little book Rich Dad Poor Dad, which was turned down by every publisher on planet Earth.
They said, “You don't know what you're talking about.”
I said … And two years later Oprah had me on her show.
The rest is history. All of a sudden I became a genius. So I went from stupid to genius.
What was your motivation to write that book?
I didn't realize you wrote that after you had retired.
I started writing this in 1999 because I was in Thailand for the Thai Baht crash.
And then I could see the trend coming.
From '71, you know what I mean, that money had become fiat money, and it was they were printing it like crazy, and money was making people poor and those booms, booms and busts and bubbles and all this.
So Prophecy was about the biggest stock market crash in history coming in 2016.
So I was 16 years out. The subtitle is Why the Biggest Stock Market Crash in History Is Still Coming, How You Can Prepare and Profit From It.
The crash I was talking about here was the dot-com crash.
And as you know, then came the subprime crash, and then came March 2020 when the Dow crashed the biggest crash in history.
So this was just prophetic at that point.
And that's we were talking about at the break, it's one of the most important things for an investor is to study history, so you can see what's coming.
The 1970’s Stagflation Experience
George Gammon: You had the opportunity to be right in the thick of things in the 1970s and see this stagflation that most of us just kind of read about or it's just something, especially for Millennials or younger investors nowadays, they just think as though it's inflation is something that can never happen to us.
It can never happen to the United States because we've never seen it.
Yeah, might happened in the '70s, but my goodness that was back with black-and-white TV and it could never happen today with MMT and with what we know about the modern monetary system, of course, we can never see that.
But how was it to live through the 1970s when prices were going up at 6%, 10%, 12% per year?
And then, the next part of that question would be, have you seen similar price increases in what you buy on a day-to-day basis from 2008 to 2020?
Robert Kiyosaki: Well the big change, again, let's go back to the '70s because that affects how I see it.
That was '72 and then Nixon opened the door to China in '74, I believe, and then in '75 gold became, this guy named Blanchard made gold legal again in America.
So the door to China was opened. So the reason we don't have much inflation, although these are printing money was Chinese goods.
Walmart shoppers loved China.
So the Chinese low labor cost and all that kept inflation down for let's say the average person.
But for the professional investor, you know it, I know it, there were bubbles all over the place, right?
There was the bubble, the subprime bubble. That was massive.
And then just recently we had the subprime crash in 2019. And the average person doesn't see it.
They see this bubble into the stock market.
But I saw the bubble in the repo market, on the shadow market. And then the stock market kept going up, and all the idiots were rushing in.
And as you know, as you get older, the higher the market, the more stupid the investor because they come in in droves.
They come in in droves, only to get slaughtered.
So the reason I was thinking you're my hero is, a lot of the things … I'm not kidding you.
Nobody can take the shadow banking system and make it so simple to understand.
I've been trying to figure out what you've been displaying on the board for 20, 30 years, and you go, “This line goes here.”
I have only one question which I haven't understood yet.
George Gammon: Yeah.
Robert Kiyosaki: What's a milf?
George Gammon: I don't know if I can answer that question right here Robert.
Trying to keep it family-friendly.
What is it, money market funding, yeah, we'll go at the Fed's version of milf, right?
Robert Kiyosaki: Yeah. But what you were talking about since I was … My degree is in oil.
Standard Oil that's where I worked. I drove tankers. I was third-officer.
And the way you describe it perfectly is the monetary system is nothing more than a series of pipes.
It's like a massive oil refinery, all these pipes running all over the place.
So every time I'm watching your programs, and I recommend your programs to everybody to understand the macro or the invisible macro underneath the stock market.
So what you're drawing is a diagram of a refinery, oil refinery, with just massive pipes.
So every time you're drawing those lines, my brain is computing.
The reason I want to thank you is because [inaudible 00:16:31] your confirmation bias by, I think it was about May of last year, everybody's running into the stock market and then I think you were talking about the repo market, and I said, “I'd better get out.”
And I don't flip property. I have a lot of real estate.
But because of your program and a few other guys too, I said, “I better start exiting now because I think the party's over.”
And what we did was we had 8,000 rental units. We sold off a thousand.
We sold, I hate to say this, the junk. We sold our non-performing, do you know what I mean?
We trimmed the hedge back, the stuff that wasn't performing. We just didn't foresee certain things.
But because of your work and people like you on YouTube, I said, “Okay, I better start moving.”
So we sold in the summer of 2019.
And then because of you, you started talking about the shadow banking and the repo market and milfs and all this other stuff.
Then I could see, we could see this crash. And as I said here, Prophecy, Why the Biggest Stock Market Crash in History is Still Coming, it came in March 2020.
It went down in three massive steps. And people who didn't see it got wiped out.
They're being wiped out right now.
George Gammon: Yeah. And I want to make sure that everyone understands that the rebuttal is, “Oh well, you couldn't have seen the virus coming.
It was just this total Black Swan event.”
But the people who say that are really missing the point.
And I think that the point, and the point you most likely made in your book, is that the system itself is structurally flawed.
And just because we have a virus or we have a mortgage-backed security crisis or a housing crisis or dot-com bust, that's just what you see on the surface.
When you look underneath, it's like a wave, right?
You just see the tippy-top on the surface and you think that's the wave, but you look underneath and you're like, “Oh whoa, no, this is a lot more screwed up than I actually thought it was.”
Just by looking at a dot-com bust, an inflated housing bubble, or this virus that we have. People have to look beneath the surface.
And to your point, look at the plumbing of the system and figure out why the plumbing isn't working and why the Fed has to come in and take their balance sheet to seven trillion dollars.
Why do they have to do that?
Why do interest rates in the United States have to be at 0%?
Why couldn't Jerome Powell raise interest rates above let's call it to 2%, 2.25% without the whole thing crashing down?
It's because the point you made in your book is that the system is flawed.
It's too fragile. It's not based on the economy anymore.
We financialized everything to where now the tail is wagging the dog.
Yeah, in the stock market, real estate market, bond market.
I could see it all over it. But Mr. and Mrs. Walmart shopper was happy taking low-priced goods from China.
And then China was buying our bonds, you know what I mean?
But Mr. and Mrs. Average or the Middle Class could not see it.
Was the inflation back in the 1970s much more noticeable for the people shopping at Walmart and Target or K-Mart or whatever was back then?
Robert Kiyosaki: It was a lot more noticeable because China hadn't come on yet.
George Gammon: Right.
Robert Kiyosaki: When you talk about, well, how fast was it changing, I was living on Honolulu in the [inaudible 00:20:20].
Go to a restaurant and they have like little stickers because the price of food was changing every single day.
George Gammon: Oh yeah.
Robert Kiyosaki: You go in and I said, “Can I have a hamburger?”
“Well today it's $1.00” and I go the next day's $1.20, $1.30.
They kept changing the price. That's how we understood inflation.
And what you're saying is the average person, the Millennials and Gen X and all this, they haven't seen that. And I agree with you 100%.
It's coming so big that we might go back to the Weimar Republic of hyperinflation or Venezuela or Zimbabwe.
And I don't think we're ready for it because like I said I was a surfer.
So '71 when Nixon took the dollar off the gold standard, that was like the first wave had started.
Then China joins. China comes unglued. Gold comes off the gold's standard.
Everything starts to change, and every … There's small wave surfers.
A small wave surfer rides shore break, and that's wind-driven waves. But I had fantasies.
And that's all they were, fantasies of being a big wave surfer. And those are the ocean swells that come out of Alaska.
So they hit wide. They're massive.
And every surfer has got to be cognizant of the feeling inside the wave patterns.
Yeah, you paddle out. So you see the first wave and you'd better catch that second wave.
But if you don't catch that second wave, the third wave is going to take you out.
And if you wait for the third wave, you'd better be quick, drop-in.
Robert Kiyosaki: So what happened when I saw when Corona appeared, I go, “Oh, there's a black swan or a red swan,” or whatever you want to call it.
And that was the third wave. The third swell cleaned everybody out.
And I was on Wolf Blitzer in January of 2008. You can check it out at The Rich Dad site.
I was saying the biggest stock market crash is coming.
This is January 2008. And I said [inaudible 00:22:25], “Lehman's going down,” Lehman Brothers.
And Lehman went down September 2008.
Larry King: “You're really that worried about Goldman Sachs and Lehman Brothers?”
Robert Kiyosaki: The people, if they had listened, they'd be out.
But people said, “You don't know what you're talking about.”
But I just, and I'm trying to [inaudible 00:22:53], but what you're showing the world at Rebel Capitalist, is the internal mechanism of what's generating the waves.
You're the wave generator. So when I saw a repo start going down in September 2019, it was another confirmation.
We had sold off about a thousand units, stuck all that, went back to cash.
We don't like to flip. We'd rather hold. So we're doing fine.
And other businesses are doing fine.
But you said it exactly correct on Marin Katusa about the swaps and all that. The average guy is not paying attention to it.
George Gammon: Yeah.
Robert Kiyosaki: My friend just sold his business for 1.8 billion.
He has no idea what the repo market is. How did you get so far?
But they don't know.
They know school district like you said, they know interest rates, but that's about it. And they couldn't see this crash coming.
What happens in the next three years, five years when the political narrative in the United States changes completely?
And now all of a sudden we don't want our stuff made in China.
We don't want to give them the leverage over us to create and produce our medical masks, as an example, or our pharmaceuticals.
And then let's say the virus has the effect of breaking down global supply chains while at the same time you have this narrative to bring supply chains back to the United States.
Now all of a sudden, we're right back to the 1970s, in the sense we don't have the global supply chains to give us cheap goods.
So we've got to make everything here.
A lot of people would say that's a good thing.
It can be good and bad, but it takes us back to the 1970s where prices that you see at Walmart and Target start going up dramatically.
And you combine that with helicopter money.
If the Fed or the government spends more money bringing down into the real economy creating excess demand while you're reducing the amount of supply.
Robert Kiyosaki: Yeah. Again, you said it with Marin Katusa.
The average guys is not even, they're not even … There's microeconomics and macro.
Most people are mini. They're not even paying attention to anything.
So there's no inflation.
Well, what about the cost of a college education? What about home prices? What about the stock market? What about the bond market?
Everything was in a bubble, but people were shopping at Walmart and they were happy because the price of a hamburger at McDonald's was stable.
And the only reason that happened is because the Fed was printing trillions of dollars to cover … or hundreds of millions, to cover up for the lack of production in America.
So now that the wave has crashed, people are saying, well we should bring our factories onshore, which is good, but that's four or five years out.
I mean even rich dad, we're already in process.
We're going to bring manufacturing onshore, just because it wasn't much advantage of doing business in China.
So anyway. Things are changing so fast, if that's what you're asking, people are not paying attention.
And I think this debt, we're the biggest debtor nation in the world, possibly in history, possibly in our life.
If it's measured in dollars, we have 1.4 trillion in derivative …
I mean quadrillion in derivatives. 265 trillion in debt.
Every emerging market is beholding to us. So the dollar stays strong.
So Americans are saying, “Well, there's going to be a little V-recovery.”
I don't think so. I think what's going to happen is we're going to go into hyper.
Not this year or next year, but it's coming.
And that's going to set up a whole another storm. At the same time we have pensions that are bankrupt.
And old guys like me, 401k guys, we're toast.
So it's more than MMT or socialized money. It's we have to go to Zimbabwe.
Who Stole My Pension?
George Gammon: On this note Robert, I'd love for you to expand on your most recent book, which was Who Stole My Pension.
I think it really plays into what we're talking about. Oh, there it is right there.
Robert Kiyosaki: Yeah. Yeah. It's my old gig because when I came back from Vietnam, I came back in January of '73 and my poor dad, he was unemployed.
He had no job, no paycheck, no pension.
And again, it's that little Vietnamese woman who wouldn't sell me gold because I was an idiot.
How can a man with a Ph.D., honest, is a very, very good, hard-working man, be unemployed, no job, no pension?
And again, I said, “Maybe I'm seeing the future.”
So my poor dad being an academic type he says, “Well, are you going to stay in the Marine Corps for a career?” I said, “No.”
“Are you going to fly for United?” I said, “No.”
“Are you going to go back to sail for Standard Oil?” All high-paying jobs.
I said, “No.” Something told me I had to become an entrepreneur, because the future today is extremely bright for an entrepreneur.
Every time I hold up my little cell phone, back in '73 we didn't have anything like that.
I had quarters in my pocket. Yet that cell phone is the most powerful tool of any entrepreneur in history.
And these yo-yos can't make a buck.
If I had that little cell phone, it could magnify my brain power, I could sell throughout the world and all this, that's what you're doing, I'm doing right now.
That cell phone gave all of us so much power. But our schools are still telling us to get a job and save money and get out of debt and invest in the stock market.
That's why the kids are getting wiped out. There's no financial education in schools.
The Pension Funds
George Gammon: Yeah. And talk also about the pensions, the baby-boomers.
We have this glut of population that is retiring. They're dependent, a lot of them, unfortunately, on Social Security, on their state pension fund.
But these pension funds are just drastically underfunded.
And let's say they're only 50% funded like in California, or Illinois, New Jersey, and they need to get a 7% return just to meet their liabilities.
So they've got to go further and further and further out the risk curve where before, when the Fed just, when we had what's called normal interest rates before the Fed dropped it to 0, they could just buy treasuries, something safer, get that type returned.
But now they've got to buy corporate debt, they've got to buy junk debt.
They've got to buy private equity. They have to buy Uber, Tesla.
They have to invest in WeWork and all of these crazy companies. And it's a result of the Fed. Can you expand on that a little?
Robert Kiyosaki: Well, thanks for reminding me.
A lot of things happened in '71.
It was Nixon, the dollar off the gold standard, and then came China opening.
But the same was … end of the defined benefit pension plan.
Until then, if I had stayed with Standard Oil, I would have got a pension for life.
A defined benefit is a paycheck for life.
Well, they cut that in '74 or '75 and they started ERISA, Employee Retirement Income Security Act.
With that came the 401k, IRA, SEP, and all this.
Basically they said the moment you leave your job, you're on your own.
So that's why the story who stole my pension here is, I kind of woke up with my poor dad, the government cut his pension.
PhD, good man. He never cheated on my mother, drank a little bit, but that was about it.
And he couldn't find a job. So I'm standing there going like this. We have those, the Buddhists call it some kind of moment, Satori moment.
You go, “Oh,” and you see the future. And I said, “This is going to happen to my generation.”
Robert Kiyosaki: So most of my friends got jobs with Eastern Air Lines which is gone, but the bulk of them got … they're really happy they got hired by Pan Am and United.
Pan Am's gone. United's pension was taken over in 2009, I think.
So all my friends who were pilots with these high-paying and they're making about 300,000 a year, which is a lot of money for them, they don't have pensions, they don't have anything.
So the guys of the 401k are toast too, because if this market keeps crashing, they're gone.
And then Kentucky, Mitch McConnell senator, just whispered the word bankruptcy and the Democrats took off of that because Kentucky's teachers, firefighters, and police officers pensions went 16% funded to 9% funded in March of 2020.
They went single digit. So that's why …
I don't know what McConnell meant, but if he said bankruptcy, that might be a way of saying to every teacher, firefighter, and police officer adios.
Hope it doesn't happen, but that's where we are as you and I speak right now, pensions are going broke all over the world, all over the world.
George Gammon: And while at the same time I think people are also relying on Social Security.
Basically what happens is Social Security is tied to the rate of inflation, but they're now changing the way they measure inflation once again.
And they're pegging the Social Security not just to the CPI but a different unit of measurement, that of course, like you'd expect, measures inflation lower than the CPI.
I think that they're just going to have, they're going to peg the CPI to where it's much lower than in the real economy.
So the purchasing power that you're getting with that Social Security check is just going to continue to go down while at the same time your pension's disappearing.
Robert Kiyosaki: Correct. It's a pay-go scheme.
You've got to pay as you go, but it's really a Ponzi scheme.
All this depends on a younger worker contributing for the old guys today.
So Social Security is gone. Medicare is going to go bust because of the … Healthcare's through the roof right now, all the pharmaceuticals.
So that's why when I was watching you with all your programs, with Marin Kotusa talking about swaps I'm going, “Holy shit.”
And it's exactly as you said. People should go see that shit. As you said it exactly, most people are not paying attention.
They don't know what you and I are talking about right now.
But if you watch those trends and all that you can see. So this is my pick.
What you were saying, what Marin was saying, is gold is going to be the best today.
There is no … Probably bitcoin too and silver.
But with hyperinflation coming and the swap lines getting cut down to the different countries like Papua New Guinea, gold's going to become scarcer too.
George Gammon: Yeah, physical.
Robert Kiyosaki: Physical. So we're heading, so if gold keeps going up and all the governments have to print more money, and less gold is entering the marketplace, oil is dropping.
Bankruptcy is going through the roof, the question is are they going to print or not print?
And I think not only was March 2020 the biggest crash.
I don't think we've started printing yet.
George Gammon: Yeah. Yeah.
Robert Kiyosaki: It might be why I'm a republican.
George Gammon: I don't think Americans realize that they are in the same position as Barrick Gold in the United States, in the sense that the government is going to look around and say, “Who has the resources here?
Oh, it's the people who own houses. Oh, it's the producers. It's the guys or gals that have cash flowing businesses. The people that really create the jobs. Let's go after them because they have the money.”
I mean do you see it playing out like that in the United States from a tax standpoint?
And if so, I know you've done a lot to structure your own portfolio to minimize taxes.
I guess if you could expand on that, it'd be awesome.
Robert Kiyosaki: Right, yeah. You cover [inaudible 00:35:43] show also, is that there's rent control coming in.
George Gammon: Yeah.
Robert Kiyosaki: And they're going to raise real estate taxes.
So that's going to freeze guys like you and I, which only means we have to get smart.
All it means to me is we got to get smarter. When I hold up a cell phone to young people I say, “This is to leverage your brain.
This little iPhone leverages your thoughts. You have more power today to be the best. You have a global entrepreneur.”
When you look at this, when you look at the macro in the next 10 years, 2020 to 2030, 2 billion people will turn 65.
Two billion, out of the 7.5 billion. And that's going to cause the ripple effect when things happen.
It was just like in '71 when Nixon took off, took the dollar off the gold standard.
It's set up today, 2020. Now that's going to go down.
People are saying, “Well, it's going to be a V.” I think it's an L.
But the good news is with what we're doing right now and with that little iPhone, you don't have to be a victim of what's coming.
There's more opportunity today, but it's between your left ear and your right ear.
Intellectual Property Assets
George Gammon: Yeah, exactly. I want to expand on that because let's go back to Rich Dad Poor Dad.
You had a brilliant way of describing that on one of your recent videos I watched where you didn't describe it just as most people see it.
“Oh, I just wrote a book and I just put it out there and I happened to go on Oprah and it took off and the rest is history.”
You see a book as an asset that produces cash flow.
I think that if people could see the internet, and to your point, their cell phones, as a vehicle that they themselves could produce assets that produce cash flow.
The same way you did with Rich Dad Poor Dad, it would change their mindset.
And then also, if you could talk about, if you could … If you were a young person today, or anyone for that matter, and you were writing Rich Dad Poor Dad or you were creating an asset.
A content form of asset cash flow, wouldn't it be far easier to get that book out there now with the internet, and with YouTube, and with podcasting and with blogging than it was back in the '90s when you first got into the game?
Robert Kiyosaki: It's so effing easy, I can't stand it.
I'm a complete technosaurus wreck. I don't know. I don't know how to use my cell phone.
Excuse my allergies. But I make about 25,000 a month on YouTube.
It's just because like you and me, I just want to teach.
So in one of my tweets I said, “The best teachers are now on YouTube,” like us.
And we attract from all over the world. It's just how you look at stuff.
You could be watching The Kardashians, or you could be watching George Gammon or Robert Kiyosaki, it's up to you.
But today it's more sensible. It's never been easier. That's my opinion. But if you look at my balance sheet, Rich Dad Poor Dad is a book on accounting.
That's all it is. Income statement, balance sheet, statement of cash out, cash flow, because my top assets are intellectual property.
George Gammon: Right, IP.
Robert Kiyosaki: IP, right? So I publish a book, I sell a license to 50 publishers throughout the world.
Day one, I'm positive. It may take me three years to write a book let's say.
It cost me $50,000, but I sell 50 licenses for $10,000 each.
I'm in the money. And I have my cash flow game. And our cash flow game are blowing out. That's a 25-year-old game.
And they're just blowing out the door and all this, and I'm up here in my mountain cabin and thinking about the next entrepreneurial adventure.
But with that cash flow from my IP, I lever up with debt to buy RP, real estate.
So let's say I make a million in IP, and I have to find a property that's worth five million.
That means I've got to borrow four. So I've now stepped up my depreciable basis to five million dollars.
So I'm depreciating five million instead of one million and I'm paying no taxes on the one million and I'm getting cash flow and with the extra income I'm buying gold and silver.
George Gammon: One of my final questions Robert is what keeps you going?
Because you always talk about it, and I totally agree with how it's all about what is between this ear and this ear.
It's all about what's in your mind.
So from someone who has trained themselves, through experience, life experience, through wars, through having success and failures as an entrepreneur, and you still wake up every single day motivated to do your podcast.
To invest in real estate, now you're excited about another crash where you can go borrow another $300 million and take it to the next level.
Why do you do it? What motivates you?
Robert Kiyosaki: Well, it's like, it's a game. It's like you love golf. And the while we were in the break, my wife is an avid golfer.
She just loves the long ball. She can hit, you know?
George Gammon: Yeah.
Robert Kiyosaki: It's her game. And for me, my game was rugby.
But if you don't love the game, don't play. It doesn't mean you always win.
I mean, there's you have good days and you have bad days. But I just found my game.
And I think what you and I are doing is we're only teaching what we wanted to learn ourselves.
George Gammon: Exactly right. 100%.
Robert Kiyosaki: It's all it is.
So when my … the story I wrote, Rich Dad Poor Dad when I was nine years old, I asked my school teacher, “When am I going to learn about money?”
“We don't teach money at school.” I said, “So why am I in school?” And that kind of set up my curiosity.
They say curiosity kills the cat.
So I'm watching your stuff because the system, the study of money, is such a pervasive massive global subject.
And any place says they know it all, you know they don't know it. So really that's it.
But for people I just, and I only invest in what I love too.
Look, I don't have stocks, bonds, mutual funds, or ETFs. I don't love them.
But I love my property. I love the stuff I have. I have little oil wells. It's just fun for me.
It is just this game. And my [inaudible 00:42:52] said to me, there's a million ways to financial heaven, there's a billion ways to financial hell too.
You know any better, figure out which way you want to go. And as you and I know, a lot of people are in hell today. I feel for them.
George Gammon: Yeah, yeah.
Robert Kiyosaki: But we've been there.
George Gammon: But to your point there's more opportunity today, to get them on the right path and to get to where they want to be financially.
There's far … Even going back to 2004, 2005.
I remember one of the businesses I set up that did well. This was back in the early days.
I had $100,000 to my name, and I had to borrow 400 because I had to have 500 to set up this business, which I built it up and it became successful.
I had over 100 employees.
But if I look at the amount of cash flow the business actually threw off, compared to what you could do today by just starting a website, or starting a YouTube channel or a podcast like yours…
I mean look at your startup costs. You've got 500 grand to this brick-and-mortar location to just buying a microphone, a computer, and throwing out content that you're really passionate about and that you're still producing today.
It just gets you out of bed, it gets you excited, it gets you fired up. And it might not be financial education.
It might not be macroeconomics. But regardless, everyone's got something that really gets their juices flowing.
In today's day and age you can leverage that to turn it into digital assets that pay you to own them that you can parley into real estate, precious metals, into God's money, whatever you choose.
Robert Kiyosaki: And you can do it all over the world, so they can feel what I felt. What leverage. What leverage. I just can't believe not everybody's doing it. So I'm just …
The other thing too is you don't have to be the lone ranger like you mentioned your team.
I have a great team, but we're all on the same team.
We want the same things for our customers. We study together. We call ourselves like a holistic learning unit.
We have accountants, attorneys. We're always learning together.
And if you don't love learning, then you better find out what you do love learning, you know what I mean?
Like I said, I flunked out of high school twice because I can't write.
Well, once I found out what I wanted to learn, there was no stopping. I get up to learn. I don't get up to go to work. I get up to learn.
I was looking forward to talking to you, tell you, anybody who doesn't see what George Gammon is doing, they better wake up.
Because like I said, old Marin Katusa went, “Holy moly.” I've studied this subject so much. It is just the most exciting game.
Kim and I have been homeless. We know what it feels like. We appreciate that.
Exactly as Nassim Taleb says, that either fragile, robust, or anti-fragile.
A fragile person's like a champagne flute. You hit it, they shatter, you're screwed.
A robust person's like a granite rock. You can pound on them all day, you'll still be there, nothing's going to change.
But an anti-fragile person no matter how much pressure you put on, they get smarter and better. And that's the entrepreneur.
George Gammon: And that's why I wanted to bring up your stories about when you're in the war.
And it just reminded me of my father when he was in World War II. And he had that same type of attitude.
I see it exactly playing out in you, and I saw it in him. It's just this anti-fragile mentality that no matter what happens, you just can't keep them down.
They get right back up and they keep going. They're like the Energizer Bunny.
They just keep going and going and going. You can't stop them.
And sooner or later they will become successful. It's not a matter of if. It's just a matter of when.
Robert Kiyosaki: Yep, yep, yep. And my wife Kim and I, we say a lot of metaphysical things too, like spiritual things.
So you have your mind, you have your body, you have your emotions which are very powerful. Most people are terrified so they don't learn them very much.
But it's also your spirit. And that's what the Marine Corps taught me, was the spirit of your team, your man. I didn't hate my enemy.
They had spiritual worlds like mission, duty, honor, code, respect.
Things like that are spiritual words. And that seems have been lost in our society today.
George Gammon: Yeah.
Robert Kiyosaki: Don't gossip behind people's back. Say it to them face to face. Be respectful. It's missing. And people are more fragile, “Oh, it hurt my feelings.”
But that's for guys like us, for anybody who's anti-fragile it's the best time.
Because the fragile people are just breaking up right now.
Oh, when they come trigger events, I got to go to a safe room to have a good time.
But there's so much more. When you told me you're in Medellin, I'm going, “God, I love that place.”
I mean Colombia has the most beautiful woman on earth. I know why you're there. Laughing.
George Gammon: Well, yeah. Yeah. I'm here for the macroeconomics Robert. Let's set it straight.
I'm here because the currency is cheap, cheap real estate, all that other … We'll talk about that when we stop recording buddy.
Robert Kiyosaki: It's just this adventure. And I was watching 60 Minutes last time.
This woman, “So I just graduated from school and tomorrow I don't have a job.”
I feel for her. We've all been there. But does she go forward or does she get fragile? That's her choice.
Kiyosaki's Teaching Resources
George Gammon: All right Robert. I want to be cognizant of your time.
So for anyone who wants to find out more about the teaching you do, where can they go?
So every time you're drawing your little diagrams on your board, those are cash flow pipes.
George Gammon: Okay.
Robert Kiyosaki: You know what I mean?
George Gammon: Yeah.
Robert Kiyosaki: And if you don't control your cash flow, you're screwed.
Because cash is either flowing in or is flowing out, or is going to the government or is going to your mortgages and all this.
There's all those pipes. So we created this cash flow board game because my rich dad taught me how to be rich playing Monopoly.
And you and I and everybody in the world knows the same formula for Monopoly, four greenhouses, 10 31 red hotel.
That's the game. So I own thousands of red little greenhouses.
Jerry Colangelo and I are partners in the Biltmore in the Wigwam.
We just play Monopoly. So that's it. It's just this game. But people …
And I know it's serious. Money it's a serious game.
But if you don't want to learn it, then I don't know what else to say to people. It's just this fun game, is Monopoly.
George Gammon: But you have all those resources.
Robert Kiyosaki: That's it.
George Gammon: You have all those resources on your website, correct, which is richdad.com, and then your podcast.
I'd strongly suggest people listen to your podcast because not only do you have entrepreneurs on there, but you have mindset people and you also have macro guys.
I think you have Rickards on there. You probably had Schiff.
I know you've got a lot of … And by the way, you might even have me on there sometimes too. And I think in the next couple days here, to throw in a plug for that.
Robert Kiyosaki: I know. I know. Learning is the most … YouTube is the best because you get people who like learning.
That's what I love about it. I learn from everybody.
George Gammon: Yeah, absolutely.
Robert Kiyosaki: So I'm looking forward to talking to you about it because I'm not blowing smoke.
Every time I watch your show, I'm going, “Holy mackerel.”
I understand more about the plumbing or cash flow. And that's the game.
And the average person who's hurting right now is because the cash stopped flowing in.
It's flowing out. You know what I mean? That's the difference.
George Gammon: Yeah, an entrepreneur is a person or the investor, on that side of the quadrant, as the person who has just more control over that cash flow than the employee.
The employee has no control over their cash flow.
They're at the mercy of another entity, another person, or a government.
Robert Kiyosaki: Right. And with gold, the word is counterparty risk.
So if you're working for an employer, you're only as good as your employer.
A lot of people found out their employer it's not worth it.
They weren't really good. Whereas my employees are happy because our business is still sailing.
We're making more money than ever before, they're going to make more money.
So these are all lessons in life that this time, this coronavirus we call this invasive virus, pandemic, is a time to look at yourself, look in the mirror.
Say, what am I learning right now? Because that's … I've done that so many times and I've had no money.
When Kim and I were homeless, I had to look in the mirror. It's not a pretty picture.
George Gammon: Yeah. Absolutely.
Robert Kiyosaki: I've either got to shape up or get out.
George Gammon: You don't know this, but in 2009 I lost pretty much everything I had.
And it wasn't because of the economy.
It was because I got into a big battle with a couple of politicians, and I learned the hard way, that no matter how much money you have, no matter how good of a lawyer you have, you're always going to lose that battle.
And I lost big time. Fortunately, the business was still profitable so I took on partners for capital and brought it back up. But there's nothing like …
I've been extremely poor. I grew up poor. And it's a different feeling when you go from making a little bit of money to going back to poor and looking at yourself in the mirror.
That's when you've really got to put on your anti-fragile face and go out there and start kicking ass.
Because it's a lot harder to go from rich to poor back to rich than it is to go from poor to rich from an emotional standpoint.
And I'm so glad I was able to go through that and come out the other side because just like the war that my father fought or the war that you fought, it just makes you so much better of a person moving forward.
Robert Kiyosaki: Right. Anyway, it's an honor to be in your program, and thank you very much and I look forward to interviewing you in my program.
But this is the most fantastic time to be alive as far as I'm concerned, and we both been there with nothing.
George Gammon: Yeah.
Robert Kiyosaki: And sometimes nothing is a good starting point.
When I met Kim, I was 850,000 in debt, in the consumer.
I owed my investors 850,000, and she still married me. She still married me.
We'll work a way out of this. And that's why we're rich today because we found that … We turned our mistakes into lessons.
And that's all life is, is a lesson after lesson, mistake, lesson, mistake, lesson.
George Gammon: Yeah. Okay, so here's my last question, I promise.
Who is more anti-fragile, you or Kim?
Robert Kiyosaki: Kim.
George Gammon: Kim's the rock, huh?
Robert Kiyosaki: She's the reason I'm here. I wouldn't be here without her. She was a blessing and all this. Because she's stable. I'm unstable.
I mean, I'm an entrepreneur. I can't … I have ADD.
If you look it up in the dictionary ADD, it's my picture in there.
But she keeps it on track and integrates the stuff. She runs all of our … My business partners call her.
They don't call me. Because George, most of the time I'm watching guys like you on YouTube. I'm not kidding. I go like, “What did he say?” It's so fascinating.
I never was a student, but now I'm a student, so that's …
If I can leave somebody with a thought, is find that student in you, where you just want to learn and learn and share what you learned. You have to want to share too.
George Gammon: All right Robert. Well, I could go on forever. We'll leave it there.
I just sincerely appreciate your time. It was an honor to talk to you and I cannot wait to do it again.
Robert Kiyosaki: Yeah. Thank you very much and thank you for all the guidance you've given me, so I appreciate it. Thank you.