AUTHOR of Rich Dad Poor Dad Robert Kiyosaki says he is hoarding bitcoin, gold and silver investments rather than stock as trust in the market has been broken and expects “biggest crash in world history.”
Mr Kiyosaki has advised investors to be patient and wait for bargains in light of a post-pandemic world, anticipating a drop in currency value due to Government stimulus during COVID-19. The personal finance mogul looks to stabilise his portfolio by sticking to cryptocurrencies and precious metals and plans to reap in on the benefits of an upcoming market crash.
Mr Kiyosaki, 74, started his business career as a serial entrepreneur, finding equal parts success and failure alongside his debut as an author with ‘If You Want to Be Rich and Happy, Don’t Go to School’ which asked parents to encourage their children to enter the real estate business rather than furthering their education.
In 1997, Mr Kiyosaki saw the publication of his book Rich Dad Poor Dad which advocates for the importance of financial education, independence and wealth building through investing and entrepreneurship.
Rich Dad Poor Dad quickly became a staple in every businesses’ bookshelf very quickly and has since sold over 32 million copies with a solid six year streak on the New York Times bestsellers list.
The book delves into the different mindsets of the poor, middle and upper classes, showcasing the differences between each that translate into the reason why they are in their current financial state.
Mr Kiyosaki focused on the teachings of his ‘two dads’. His ‘rich dad’ and the lessons he provides is based on the father of his childhood’s best friend whilst the teachings from ‘poor dad’ are from his biological father.
Now, My Kiyosaki has combined all of these teachings into what seems to be a fool-proof strategy as his investments continue to grow alongside his net worth of $100million (£72million).
He shared that, as part of a forecast for the investment sector, investors should be wary of the stock market and patience will prove fruitful when it crashes and a ‘bargain bonanza’ comes as a consequence.
He recently tweeted: “Bitcoin is booming. Gold is stagnant. Silver is 50 percent below all-time highs. Silver is the best, lowest-risk, high-potential investment. Bitcoin has the greatest upside. With dollar dropping, bitcoin and silver are the best investments.”
Mr Kiyosaki makes these claims in light of the stimulus the American Government has provided during the pandemic, which he believes will fuel a collapse in the dollar’s value and asset prices as the Federal Reserve hikes interest rates.
He added: “The primary reason I invest in bitcoin, gold, & silver is because I do not trust our leaders, the Fed, Treasury, nor the stock market.”
Mr Kiyosaki also predicts that the housing market will see a similar downfall if interest rates increase, adding that burgeoning investors wanting to break into the market should be patient, saying that: “Crashes are the best time to get rich.”
David Woodward, managing director of independent wealth advisory firm Woodward Financials, commented on Mr Kiyosaki’s warning to investors: “I’ve witnessed first-hand those that are happy to take risk and those that want to sit on the fence.
“The problem is how long do you sit there? Three months, six months, or one year more, watching their cash being eroded by inflation while their safe-haven investment returns and value slip away. Only to the realise after missing out on a few years of growth they sheepishly re-enter the market.”
He continued: “Most investment advisers recommend that you should always remain invested and that over time you’ll come out ahead rather than try and time or predict the market.”
There is an element of risk in every investment made, but the ability to time the market correctly is a very rare skill, one that people like Mr Kiyosaki has seemed to get the hang of, and for ordinary investors is a risk that often ends up going badly before it gets better.
Mr Woodward argued that this strategy can also be circumvented with active portfolio management, which could also serve investors well if what Mr Kiyosaki predicts does come to fruition.
“Why watch your portfolio go up and down for an average return over the years when you can actively manage your portfolio by selling high and buying low or adjusting the asset allocation and market exposure.”
He added that whilst Mr Kiyosaki has made some good predictions, which in the past have often proved true, it is still a huge risk for himself and investors following his lead.
“If he is wrong, he could see his investments plummet. With the decarbonising of the planet, we’re likely to see a huge shift in where investment returns come from and could be one of the many reasons why the impending crash Mr Kiyosaki is waiting for may never materialise.
“That is why we track the market daily looking for moves in both directions, you snooze you lose,” he concluded.