I read my first Robert Kiyosaki book Rich Dad, Poor Dad (1997) about five years ago. Since then I have been hooked on Kiyosaki's writings and I have read several of his books more than once.
It was only by reading Kiyosaki did I fully appreciate the importance of money and a financial education. During my PhD years I was much influenced by one of my professors who said: "Some people know how money works; some people know how ideas work." I aspired to be an ivory tower thinker with not much involvement with mundane things like money.
But Rich Dad, Poor Dad showed me that money itself is an idea and one who has financial intelligence can succeed in minting money. Indeed after 1971, when US President Richard Nixon took the world off the gold standard, money has become free-floating fiat currency which can be printed at will. Money is a fiction whose value rests on the "full faith and credit" of the governments.
Kiyosaki's Increase Your Financial IQ (2008) was written during the onset of the Great Recession. With the emerging housing crisis many people got the message that Kiyosaki had been putting forth in all his books: "Your house is not an asset, but a liability."
An asset is something that puts money in your pocket and can buy other assets. This includes good businesses, paper assets like stocks and bonds and real estate. A house that you reside in consumes money and, in these times, its capital appreciation cannot be taken for granted.
Kiyosaki says that, with all the "funny money" being printed, the middle class will suffer a lot. It does not matter which party is in power. "If it's Democrats, they will probably tax and spend. If it's Republicans, they will probably borrow and spend. The net result is the same: greater debt, bigger financial problems, and higher taxes. All funded by taking as much of your money as possible." (Italics in original.)
Kiyosaki says that the Old Economy rule of "Work hard, save money, get out of debt, invest for the long term in a well-diversified portfolio of mutual funds" is an obsolete rule. With money declining in purchasing power these rules will no longer work.
As far as I am concerned, I am still playing by Old Economy rules. My investments are in the form of mutual funds and residential house and my earnings are as an employee. At this juncture, I find it frightening difficult to change to another "quadrant" (to use Kiyosaki's term). But if I go broke, at least I must try to amass the financial knowledge that tells me precisely why I went broke and who is to blame.
The world is a dangerous place. Institutions like central banks and Wall Street firms are playing games with our money. How will this end? With a paper money collapse? It is time to learn!
It was only by reading Kiyosaki did I fully appreciate the importance of money and a financial education. During my PhD years I was much influenced by one of my professors who said: "Some people know how money works; some people know how ideas work." I aspired to be an ivory tower thinker with not much involvement with mundane things like money.
But Rich Dad, Poor Dad showed me that money itself is an idea and one who has financial intelligence can succeed in minting money. Indeed after 1971, when US President Richard Nixon took the world off the gold standard, money has become free-floating fiat currency which can be printed at will. Money is a fiction whose value rests on the "full faith and credit" of the governments.
Kiyosaki's Increase Your Financial IQ (2008) was written during the onset of the Great Recession. With the emerging housing crisis many people got the message that Kiyosaki had been putting forth in all his books: "Your house is not an asset, but a liability."
An asset is something that puts money in your pocket and can buy other assets. This includes good businesses, paper assets like stocks and bonds and real estate. A house that you reside in consumes money and, in these times, its capital appreciation cannot be taken for granted.
Kiyosaki says that, with all the "funny money" being printed, the middle class will suffer a lot. It does not matter which party is in power. "If it's Democrats, they will probably tax and spend. If it's Republicans, they will probably borrow and spend. The net result is the same: greater debt, bigger financial problems, and higher taxes. All funded by taking as much of your money as possible." (Italics in original.)
Kiyosaki says that the Old Economy rule of "Work hard, save money, get out of debt, invest for the long term in a well-diversified portfolio of mutual funds" is an obsolete rule. With money declining in purchasing power these rules will no longer work.
As far as I am concerned, I am still playing by Old Economy rules. My investments are in the form of mutual funds and residential house and my earnings are as an employee. At this juncture, I find it frightening difficult to change to another "quadrant" (to use Kiyosaki's term). But if I go broke, at least I must try to amass the financial knowledge that tells me precisely why I went broke and who is to blame.
The world is a dangerous place. Institutions like central banks and Wall Street firms are playing games with our money. How will this end? With a paper money collapse? It is time to learn!
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