Rich Dad Author: If You Want To Be Rich, Hold Gold
(Kitco News) - Despitereaching all-time highs this week, one famed investor says that any long-termrallies in the market won’t hold.
Robert Kiyosaki,best-selling author of “Rich Dad Poor Dad” and his latest book “Why The RichAre Getting Richer,” said that a market crash is imminent within the next twoto three years.
The S&P 500Index has sustained its second-longest bull marketin history, climbing 19% in 2017. The S&P 500 last traded up 9 points to2,785.
"Somethinghas to happen,” Kiyosaki warned, “I don’t meanto be an alarmist, because I like crashes, that’s when everything goes on sale,so when everything goes on sale, I’m back in the market.”
Kiyosaki toldKitco News in an exclusive interview that the world has been in a debt bubble since2004, and that “the problem with debt bubbles is that when they come down, theycome down like an avalanche so I don't think it's too long [away.]”
According todata from the Federal Reserve Bank of St. Louis, the U.S. federal debt-to-GDPratio has climbed to 103%, up from 60% in 2004, and is currently at the highest level sinceWorld War 2.
While the lastfinancial crisis saw debt levels rise dramatically, U.S. equities lost morethan 35% over the course of the recession.
On his view offinancial assets, the self-proclaimed gold bug is one of few investors to bebullish on both bitcoin and gold, noting that the cryptocurrency will slowlyerode fiat currencies’ relevance, while gold will act as an important hedgeinstrument.
“When I talk topeople, I say, ‘what do you think will be here in 2040? Will gold still behere? Well, it’s been here since eternity. Will the dollar be here? I don’tthink so. Will blockchain be here, I think so,’” he said.
Gold hasrallied 6% since the Fed raised rates in December, while bitcoin hasdropped 50%from its all-time high last month. Some analysts attribute this decline to bitcoinoutflows back into gold, which some cryptocurrency traders view as a competingsafe haven asset.
Still, Kiyosakimaintains that bitcoin will outshine traditional fiat currencies in roughlytwenty years.
“The way I seethe world today is that there’s three kinds of money,” Kiyosaki said, “there’sGod’s money, which is gold and silver, there’s government money, called fiatmoney, or currencies, and the third type of money now is cyber money. That’sreally the way I look at the world and currencies, is what’s going to be herein 22 years.”
Kiyosaki hasbeen “collecting” gold ever since Richard Nixon removed the dollar from thegold standard in 1971,and is today, a self-proclaimed gold bug.
His love affairwith the yellow metal can be traced back to his days flying in Vietnam, when hemet a guru who convinced him that gold is “the tears of God.” “If you want[steady] income,” Kiyosaki said, “just use real gold and keep it near you.”
“I will neversell gold,” Kiyosaki added, “gold has made me very happy.”
By David LinFor Kitco News
Follow @davidlinMTL
dlin@kitco.comwww.kitco.com Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.