Mr Kiyosaki was featured on the Live From the Vault YouTube series by Kinesis Money where he commented on the doom and gloom outlook of the global economy. He noted that a market collapse is due, as more countries continue to print money to stay afloat amidst the pandemic, adding that soon the Zimbabwean Dollar and the America Dollar may have the same consumer value.
Mr Kiyosaki holds a personal net worth of roughly $100million (around £ CONVERSION), and 32 million readers sought to read his allegorical story of financial insight, Rich Dad, Poor Dad.
He has been looked at with reverence similar to Warren Buffett, but Mr Kiyosaki is often far more open about the unfortunate circumstances of the current economic climate.
He noted that the biggest problem the world is currently facing is the printing of money in order to maintain economies during the pandemic.
He said: “In one year, they print 16 percent of the GDP of the world. Only question is: how much longer can they keep that up?”
Continuously printing large amounts of money in any economy is unsustainable, but as new Covid variants are discovered and restrictions brought in and taken out almost daily, governments around the world have had few other options.
Mr Kiyosaki added that derivatives, or “fake assets” currently outnumber actual debt globally: “Debt is measured in trillions, and the derivatives market is measured in quadrillions.
“Everything is fake now. So, it’s like I give you an ‘I owe you’, and you give somebody else an ‘I owe you’, and we just pass these ‘I owe you’s’ around, and this market has grown so big, it’s now in the quadrillions.”
He revealed that this is the exact reason why he prefers gold and silver over currencies, sharing: “I say it’s not how much or what’s going to happen in the future. All I care about today is how many ounces you have. Because in a few years, you’re going to wish you had bought more.”
While paper money is a relatively common concept, Mr Kiyosaki pointed out the small uptake when it comes to physical pieces of tangible wealth like gold and silver.
Essentially, in the current market, £16 in fiat currency and one ounce of silver hold the exact same worth but what Mr Kiyosaki suggests is that in times of turbulent economies and a potential market downfall, silver will still retain its value.
“This mountain of debt is so high, if they stop printing money, it crashes. And when it crashes because they find out the dollar – which is the reserve currency in the world – is worthless, you’re going to wish you had more ounces of gold and silver.”
He added that the current shortage of gold is likely to increase as more people move onto this trend and that those who are quick to move may never be able to buy gold again.
“When it collapses, which is coming – we don’t know when, but it’s coming – you won’t be able to buy the physical stuff because all the people that sold the derivatives like the ETFs will be buying.
“And the guys you bought the ETF from are your biggest competitors. If you understand that’s how screwed up the whole market is, you stay away from paper and you go buy as much hard physical gold and silver today.”
For the everyman, saving money in the form of fiat currencies is normal, but in the event that the entire “paper system” collapses, these types of savings will be entirely worthless regardless of the number of digits the bank account holds.
Mr Kiyosaki cautioned: “I think the secret to the next 50 years is you don’t want any money that is this [holding up a Zimbabwean note]. You want nothing attached in the US to the Treasury or the FED.”
Zimbabwe is the ideal example for this type of print market collapse paired with skyrocketing inflation, as £1 will buy Z$482 (Zimbabwean Dollars).
While that may not seem too extreme, within the country itself TheWorld.org estimated Z$100trillion would barely cover the cost of a single Hershey’s kiss.
This is the issue Mr Kiyosaki has when it comes to fiat currencies, noting that gold and silver will not do this: “If you understand that, that’s why I call it God’s money.
“And I call blockchain people’s money. Because it’s outside the FED and outside The Treasury, it’s outside the Bank of England, it’s outside the German Bundesbank. And in a few years, you’re going to find out these banks are in serious trouble because of debt.”
He concluded: “It’s called the shadow banking system. The shadow banking system is so huge that if I can’t pay you so you can’t pay somebody else. When that whole shadow banking system collapses, that’s exactly what Rickards says, you won’t be able to buy it at any price. They won’t have it. And people won’t take paper then.”