This is gonna be a big one, because I see this going on of two ways: Either I'm gonna be well received on this article and people will tend to agree with me, or I'm about to start a big ass flame war. Either way, I think it should be fun. Just remember, Internet Asshole here. This isn't Burger King, Folks. This is me, some guy that lives in a city with a population less than 800 people gallivanting about with my junk in the wind, telling you what I think in the most entertaining way I can muster. Bear with me and agree, or hate me. That's the name of the game, folks.
So, Recently, the author of Rich Dad Poor Dad, Robert Kiyosaki made some pretty hefty claims about fiat as well as Bitcoin. Here's a taste of his claims based on his Twitter Account:
Damn, He's The Asian Financial Version of the "Time Cube" Guy
In order to make this slightly coherent, I'll restate his major points. First, he thinks "fiat" (specifically, the US dollar) is going down the shitter yesterday and that BITCOIN (Read: THE PEOPLE'S MONEY) - along with other commodities such as gold and silver - are going to SAVE People. That, and that the Coronavirus is gonna make Bitcoin go PARABOLIC. He also doesn't trust "human made money" (which is literally ALL money - including bitcoin and the value humans place on Gold and Silver).
I have seen several Publish0x articles on the subject matter, and it seems like there are a sizeable portion of people that take him seriously. I don't, and I'm going to explain to you why as clearly as I can.
Who in The HELL is Robert Kiyosaki?
Robert Kiyosaki is an American "Businessman" and purveyor of motivational books and seminars. He is orginally known for his best selling book Rich Dad, Poor Dad. He has started several different companies over the years (some of the bankrupt), but his brand has mostly relied upon expensive seminars and dodgy advice. I know saying this poisons the well a smidge, but I'm keeping it straight. I have actually read his flagship book, and the copy I had (after going through the anecdotes about the "difference in thinking" between his father, the Poor Dad and his Father's friend, the Rich Dad) went off the rails and started talking up the benefits of Multi Level Marketing (MLMs) and how it can lead you to be your own boss, give you passive income and generally make your life better. He was evangelizing the MLM business model as if it were the Goddamn Messiah.
Pictured: Basically Rich Dad Poor Dad
I shouldn't have to tell you, but I will. Ever gotten one of those Facebook messages from an old friend from high school who you haven't spoken to for at least two Presidents? Yeah, Jill. That's her name. Basically she became a Muffintop Soccer Mommy who has little to nothing else to do with her life besides watching her kids in-between sessions of scrolling though her FB feed and binging episodes of Desperate Houswives on Netflix. She finds you and friends you, and sends you a message about an AMAZING opportunity to become your own boss, make ass-loads of cash, making it rain straight out the door of your dreadful 9-5 job while giving the finger to your Boss and Janet from the Mailroom. All you gotta do is sign up under her to sell wraps or tampons or whatever and.. pay a 350 dollar fee to get EXCLUSIVE ACCESS to top of the line training that will teach you how to build your "down-line" and make a commission off everything they sell (but mostly a commission from your recruits' 350 dollar fee).
That is an MLM, every time. And I'm not pontificating here; I used to believe in the bullshit too. Until you look at the math behind it (like the potential exponential growth of a MLM overtaking the entire human population in just a handful of iterations) and the fact that any product your downline would sell would eat through the margins of the product price just a few levels down, it's clear to see that MLMs are not a legitimate business model. Don't believe me? Next time someone harangues you about joining their organization, ask them this:
Hey, I have an online store, can't I just buy the product at wholesale then mark it up a bit for profit? Why do I have to pay to join?
You're gonna get a shitload of excuses, such as "You can't just sell the product! You gotta use it and BELIEVE in it!" I have done this several times.
Stay away. stay VERY far away. Why? Because odds are, if you fall for their spiel, you're gonna lose your ass. These things weren't meant for people to profit from them unless they're in at the top. That's just the way it is.
But I digress. Kiyosaki used his book as a diving board to get people to join Amway. Yes, Amway, the same same people that have been accused of running a "legal Pyramid Scheme" and had to pay out a pretty hefty class action lawsuit settlement.
Not only that, but the seminars are sketchy as hell. Oh sure, the first day of the seminar is free, but the fees for additional training get higher and higher, with quasi-religious undertones. It's a fleecing scheme that would make Scientologists blush (in jealousy).
The flagship book has been panned by reviewers TIME and TIME and TIME and TIME again, being noted for everything from not having concrete financial advice to being "Self-Help Boilerplate". He isn't some business magnate. He isn't a Guru. He is a bullshit artist that sells shifty, unsubstantial advice to gullible masses. That's his legacy.
Now Ginger Man, Just because He's a "Little Eccentric" and His Other Stuff Is Questionable Doesn't Mean He's Wrong About Bitcoin!
This is a crossroads in this post where I need you to listen to me very carefully. Just because he might be "right" about bitcoin (in the loosest terms possible, the price action being affected by COVID-19 and potentially increasing in price) doesn't mean his methods of getting there are sound.
Is Bitcoin price action affected by COVID-19? Yes, but not in the way he thinks. Last month when the Coronavirus hysteria was ramping up, The crypto markets as well as the traditional markets took a big shit and went down to crazy lows that we haven't seen since shit.. late 2018. You were there, you saw it happen. While there is a new normal in the world and people are likely going to look to Crypto as a "Safe Haven" in the future (due to its benefits of not being contingent on central banks and largely divorced from traditional markets), it's not nearly there yet. There's lots to be done before we get there.
Is Bitcoin Gonna Go "Parabolic"? The easy answer here is... probably not. HOWEVER, next month is the Halving event for BTC, and this means that miner block rewards are gonna be cut in half. This means that the inflows and outflows of Bitcoin is going to fundamentally change, as miner rewards are fewer, and potentially - with increasing adoption - more bitcoin is going to be bought and either held or sold. The Stock to Flow Model of Bitcoin suggests that if the trends stay consistent - as they have more or less historically - we are going to see an unprecedented increase in the valuation of bitcoin. I've talked about this many times because it seems the most reasonable with basic economics - supply and demand determine price. The predicted halving is set to occur sometime around May 11th, but you're not gonna see a huge MOON spike on the 12th. It will take time, but the valuation is slated to be somewhere in the neighborhood of 100,000.00 USD/BTC. This is NOT FINANCIAL ADVICE, but just reading the writing on the wall and applying some basic economics to the BTC. At the end of the day, this is likely to happen, but not certain. Time will tell as we move forward.
Is "Fiat" (The US Dollar) Gonna Go to The Shitter? Maybe someday, but not anytime soon. The thing you gotta recognize with the United States Dollar is that it is the reserve currency for a big portion of the world - and likely will be for the time being. If the USD is hit by a huge devaluation by say, Hyperinflation or some other factor that makes people lose its trust in it - then the world as it is now would go to Hell in a way that makes the 1930s look like a cakewalk. Whether us Crypto fans like it or not, we are not yet in a position as an industry or movement where Bitcoin or any other Altcoin will dominate the world stage in the same way as the USD does. It can happen (I'm hoping it does) but patience is key here and we all gotta be able to push our way toward more adoption. We are still in the sub 1% to 1% range in terms of adoption, and if that were to increase to say, 5%, we will likely see Bitcoin and other cryptos as a total market break the Trillion Dollar Mark in terms of total market cap. Until then, USD where it's at.
The Bottom Line.
The first and foremost thing I would recommend to all my readers is do your own DUE DILIGENCE. Don't believe me, and REALLY don't listen to Kiyosaki. He's not someone you should look to for insight on the markets. He's just some guy with a personalized bottle of Snake Oil just for you... for a price. Never count on a celebrity endorsement, and never count on someone whose laurels rest on their partnerships. The proof is and always will be in the pudding. You won't be perfect at it, and neither am I. However, you can learn a lot from doing your own homework, and I'll always recommend you learn something new. Even if you can afford to lose it, your money is valuable.
Okay.. Let the controversy begin.
Thank you SO SO MUCH for reading, I REALLY appreciate it. As it wouldn't pair well with the message of this particular post, I'm not gonna shill anything. BUT if you like what you read, please consider giving me a follow. I'd really like that.
Until next time, keep your eye on the markets, and remember: one person's foolishness is another's opportunity.