It doesn't surprise me that truth can sound like an IBO.
Even the most venemous opponents of Quixtar must admit that there are successes... and that a good portion of what they say is true.

the most believable falsehood is the one that departs the least from the truth.....

Guys, get a clue. Go find something related to Quixtar to comment upon.

Yes, of course there are some successes. Quixtar itself makes a lot of money. And, for the last time I heard, 1 in 1,810 IBOs made as much as $65,000 per year; the average IBO made a paltry $88 per month or less.

I guess if you want to call that a "successful" business, go for it. But a lot more than 1 in 1,810 of my friends made that much or more doing other kinds of work.

Me, I'd sooner take up babysitting, dog walking, or flipping burgers. Much more lucrative.

QUOTE:
Home ownership: This is so basic even I know it! Kiyosaki claims his book will "challenge the belief that your house is an asset" and that "most people work all their lives paying for a home they will never own." Reed responds: "With each payment, their equity increases. Many people pay off their mortgage in full before they die. Almost all thoroughly enjoy their home both during and after the mortgage."

MY COMMENT:
Kiyosaki explained cleary in his book that even after you paying your mortgage, you must pay property tax to the government. If you dont pay your tax, let see what happen with your house after that. Who own the house, you or the government?

Is it clear now?

Ari writes,

If you dont pay your tax, let see what happen with your house after that. Who own the house, you or the government?

Your logic is severly flawed. You tried to demonstrate that a house is a liability because you pay property tax on it. That is irrelevant. You also have to pay a tax on your car (license fee). Does that make your car a liability? You pay taxes on your income. Does that mean that earned income is a liability?

A house is an asset, period. Having too much house can be detrimental when you cannot afford the mortgage, the necessary repairs, the gas bill, the electric bill, the garbage bill, and, of course, the property taxes.

Kiyosaki ain't worth crap. His books are lame and he makes a living duping the public, with his financial nonsense. He preys on the financialy weak and the weak minded! He lies about his rich dad. Rich dad was made up! There is no rich dad!

It's a damm shame the way he talks about his poor dad! If I were him, I would have dropped his lil dumb azz off at rich dad's door to beg to be rich and to beg for food!

I liked "rich dad poor dad" and it has some good points that the average Joe wouldnt even think of.

The book promotes thinking outside the square, in relation to money. Thats it true value.

"I liked "rich dad poor dad" and it has some good points that the average Joe wouldnt even think of.

The book promotes thinking outside the square, in relation to money. Thats it true value."

You're an utter idiot if that is honestly what you believe. Kiyosaki is a moron and a con-man. He's obviously fools people like you because he knows people like you are too gullible and will justify reading a useless book with comments like that. He doesn't know the first thing about money making or finance, and yet, stupid people like yourself seem to bow down to him like he is God. If that's the case, frankly I say you deserve what you get - you becoming "poor" while he becomes "rich" off your money.

Jeff writes;

>>>You tried to demonstrate that a house is a liability because you pay property tax on it. That is irrelevant. You also have to pay a tax on your car (license fee). Does that make your car a liability? You pay taxes on your income. Does that mean that earned income is a liability?

Actually, RDPD clearly defines an asset as something that puts money in your pocket and a liability as something that takes money out of your pocket. So, if you live in your house, you pay a mortgage, taxes, etc., it is effectively a liability because the money comes out of your salary to pay this stuff. In other words, the house is costing YOU money.

Whereas if you rent out a house to someone who pays rent, as long as the rental income covers ALL expenses (inc. taxes) plus a little, the house becomes an ASSET, ie. it is making money for you.

In truth, this is a simplification of the situation, as in a balance sheet, a house with a mortgage would be recorded twice, as an Asset and a Liability. Anyway, he makes an interesting point that our passion for buying houses to live in really isn't such a great way to make wealth (except through capital gains) as it produces no regular benefit.

But I do think he makes an interesting point: somethings that we attribute as having asset value aren't really assets at all. A Car is a quickly depreciating asset, and if you are paying car loans, some of the time, the net difference between the value of your car and your outstanding loan may turn it into a clear liability on your personal balance sheet, esp. in the first six months where you haven't paid anything off, and the car has suffered the sharpest decline in its value.

>>>A house is an asset, period.

Another point that RDPD makes is that yes, the house is an asset, but the question is whose? If you buy a house and its price decreases, your mortgage (assuming you have one) shifts into negative equity position, ie. if you sold, you would still have to repay the amount of the loan beyond the sale price of the house. Could it be said to be an asset then?

And if you don't believe, do you honestly think that housing prices will keep heading up as they have been doing so... Mmm...

Does this clarify things a little?

What I admire is RDPD's ability to string simple observations out to a whole book! That's quite an achievement. I did enjoy playing the game, though it is pricy.

Kenneth

I recently purchased the entire RDPD system. What should I expect to receive as additional information that is useful? i don't want to be taken as a fool giving my money away to a con-man.

Kenneth wrote,

Actually, RDPD clearly defines an asset as something that puts money in your pocket and a liability as something that takes money out of your pocket. So, if you live in your house, you pay a mortgage, taxes, etc., it is effectively a liability because the money comes out of your salary to pay this stuff. In other words, the house is costing YOU money.

You are confusing a balance sheet with a statement of cash flows. When I said that a house is an asset, that is in reference to a balance sheet where you list "assets" on the left hand side and "liabilities" on the right hand side. The fair market value of your house is an "asset". The remaining mortgage balance on that house is a "liability".

Now let's move on the the cash flow statement. Indeed the mortgage payment, the property taxes, et al are cash outflows. My salary is a cash inflow. As I said in my first post, having too much house is detrimental. It shows up on your statement of cash flows that your are paying too much on a monthly or yearly basis for mortgage, taxes and upkeep.

Anyway, he makes an interesting point that our passion for buying houses to live in really isn't such a great way to make wealth (except through capital gains) as it produces no regular benefit.

I get a great benefit from living in my house. I don't have neighbors right next door to me. I can invite 20 or 30 friends over for a barbecue every summer. I don't have a landlord to tell me what I can and can't do to the place.

Anyway, doesn't Kiyosaki live in a 2 million dollar home with just his wife and no children? If he practiced what he preached, wouldn't he live in one half of a duplex and rent the other half? I'm sure that he gets a benefit from living in his house too and isn't worried about it being an investment or not.

I have read Rich Dad, Poor Dad. I have also read The Millionaire Next Door. After reading TMND, I increased my net worth by $3.99 when I sold RDPD on Half.com.

Silly boy. That $88 doesn't fall from the sky. It's just a partial rebate back to you from the inflated priced you yourself paid for the products.

And yes, you work. You show the plan, over and over and over again. And attend meetings you wouldn't go to just for entertainment value. And listen to tapes.

Hey Joe, what system are u in Australia? BWW? WWG? Alliance.Net?

BWW is quite world wide, specially in India. China said no to amway (actually US style amway), amway products are sold in shops there. By law. So BWW is kinda creeping in there too.

Dexter Yager is a Britt Diamond in India. TOD / TEAM is basically just contained in US.

Any advice will be appreciated.

Tim, you're just playing on human nature and our reactions to failure. You fail at something and accept it, because society says it's acceptable. Don't blame the teacher, blame the student.

Excuse me: What on earth are you talking about? I have no idea what you're responding to. I corrected two factual errors you made, and you... launch into some long soliliquoy about blaming people?

Huh? Are you smoking something?

You hear that kind of negativity from those who didn't get the opportunity.

Oh! I see! You like to repeat "negativity". So you want some kind of discussion about Quixtar! Sorry! Wrong thread, dude. Move it elsewhere.

And try to actually respond to points being raised, okay? Hint: If nobody is talking about "blame", then don't launch into some weird, long, undecipherable rant about blaming people and "negativity", mmmmkay?

Thanks!

I love how cocky and arrogant most of the writers in here are trying to sound. It's easy to sound bold and witty when you're sitting alone in your pathetic little world in front of your computer, safe from any real confrontation. I feel like a panzy just writing this post, I can only imagine what people like Tim must feel like.

You wanna talk to me one on one Eric? You looks like Quixtar defender. What you want to talk about? I'm ready to "confront" you any day any time.

Where do you live?

English is my second language and I'm not a yellow teeth Britt. I couldn't care less how bad my grammar is ;)

First you were threatening. I was anticipating a wrestling match. Now you are back to your am-weasel mode. Surprise surprise!

I just got done reading "Prophecy" after never reading a RDPD series book. I also don't mean to offend anyone... Keep that in mind.

This issue over whether your personal residence is an asset or a liability is being taken too literally from what I can tell. The benefits discussed (barbeques and hot showers) regarding ones residence do not appear on an asset vs liability breakdown on paper, and that is his only point. By spotlighting this simple fact, he's attempting to challenge the idea of ones personal residence as an investment asset.

The sad truth in America is that many people use the equity (asset) in their home as a major portion of their retirement income. The only problem is that when you retire, you still need a place to live. If you refinance, the payment appears as an expense and the loan amount as the new liability. If you sell and take the cash, you still have to pay for a place to live. Hopefully, it's not a second rate care facility.

If you own real property or a business, you are supposed to generate passive income. If you work for yourself or at a job (professional or otherwise) you are earning your income. If you are earning your income and paying your mortgage, you can't fight the fact that you are paying for the investment - the investment is not paying you.

He's not saying you shouldn't own your personal residence and enjoy it beyond the bottom line. Personally, I enjoy our first home more knowing that it is a liability and not an investment. The fact that I like to have my friends over and cook steaks on the grill makes it more of a liability! If not for my home, where would I ask them to come? Where would I store the grill? Where would I take my shower and have my morning coffee?

Aside from this personal residence business, what other big issues do people have with this guy? He explained in this book that his "Rich Dad" was his best friend's dad - is that not true?

Aside from this personal residence business, what other big issues do people have with this guy? He explained in this book that his "Rich Dad" was his best friend's dad - is that not true?

"Rich Dad" is a fictional person. Kiyosaki admitted it in an interview with SmartMoney magazine in February of 2003. You cannot find the actual story online, but here are a couple of pages that make reference to it:

http://www.fool.com/news/commentary/2003/commentary030714me.htm

http://www.johntreed.com/Kiyosaki.html

If you have more than a few minutes and would like to know the whole story about Robert Kiyosaki, I highly recommend the second link. John Reed should thoroughly answer your question, "what other big issues do people have with this guy?"

Aside from this personal residence business, what other big issues do people have with this guy? He explained in this book that his "Rich Dad" was his best friend's dad - is that not true?
That guy is one of those who made us fool. In fact he added more credibility, as he had 'nothing to gain'. Yeah right!

- Guy was not famous till he found sheep like audience in MLM.
- Guy lauds MLM yet he never did it.
- Guy does many things against his own advice.
- Guy makes a lot of money fooling IBOs.

There, how many times I have to say it?

Or....do some home work and find something worth while.

Dear all,

I have finally had the chance to read RDPD, and the second book the Cash Flow Quadrant.

I find that a small issue (as some might thing), of thinking of your house as an asset or a liability is still very important. If we look at what is going on right now in the US or the UK (where I live), of so many people borrowing against their home equity and running excessive credit card debt in this ear of cheap money (interest rates are so low by historical standards and the Feds still think they have no inflation and not concerned about inflation in the property market and thus not raising interst rate enough). W

e now have a property inflation and so many people think these prices are lasting and that their retirment is secured by their huuge increase in house prices, but house prices will not go up for ever, and a sudden drop leaves a person with debt which is certain against house prices which are not certain by all means.

The simple concepts that Kiyosaki argues would make people think twice before seeing their house as a last resort.

But the problem soo many people have with Kiyosaki is that they are much too stuck with classic accounting jargon (I have a degree in economics and a graduate degree in Finance), is that an "asset is what you own" anda liability is what you "owe", when I first read RDPD and read what Kiyosaki had to say about that, I was crying, FOUL, an asset is what you own and a liability is what you owe. But that is misleading, this is the accounting that we have always learned at school, but it doesn't tell us the difference between an asset and an income generating asset.

I could by a new car, and that would be an asset, I can still sell it for some money later, but its value declines in time, and I spend maintainance on it, I of course benefit from it, because I can use it to drive anywhere and it saves me time and hassle. However, I can still buy the same car, and make it a cab for hire (in some countries where I lived like Saudi Arabia, you can do that in one day), and then make more money from it.

So, Kiyosaki is not really against the accounting jargon, he is just saying, there is an asset and an income generating asset.

Same thing appliese to a house. I have a place in london, a very small Studio apartment that has cost me GBP90,000 for just a studio apartment, and even in US prices that would be too much for just a Studio. I needed my own place. While the alternative, is that I could have deposited this money in another emerging market, with an exchange rate pigged to the US dollar, making an interst up to 12% on that money, and at the same time opt to pay the rent from this interst and even pocket a difference that would help me spend when I am short on cash.

Again, the flat is an asset, but I could by using another method, pay the rent (not buy the asset, and use the interst made on the money as extra cash), now I bought the flat but I don't have the extra cash, and that is a personal choice that I make because I just wanted to have something on my own, and at the same time be free as some of you have said to do whatever I want in my own place with out the landlord nagging me.

I hope you take Kiyosaki seriously, because even for a guy like me with two relevant degrees from top universities, and work in an international financial institution, I still saw some insight to his book.

Dont' also discount him on the basis that some of his thought are anti market economy or something, he is not. He just says that the modern market economy only cares for one thing, economic growth, so, no one says that the market economy is a fair system, it is just the system that is suppose to give us the best results when it comes to growth or jobs. But if you can position yourself at the better end of the system, there is nothing wrong with that.

Mekhalis,

You are giving Kiyosaki way more credit than he deserves.

Dont' also discount him on the basis that some of his thought are anti market economy or something, he is not. He just says that the modern market economy only cares for one thing, economic growth, so, no one says that the market economy is a fair system, it is just the system that is suppose to give us the best results when it comes to growth or jobs.

Please tell me specifically on which page of which book you got that from. I doubt you will be able to. Kiyosaki's greatest talent is to spout generalized platitudes to which individual readers can apply their own interpretation.

One book tells you to invest as much money as you can in assets. Another book tells you that you should be a business owner in Multi-Level Marketing. A different book tells you that education is not necessary to be successful and doesn't teach you anything about real life. That doesn't seem like a consistent or coherent message to me.

I'll close by pointing out, once again, the quickest way to call B.S. on any of Kiyosaki's teachings. He tells you that your house is not an asset, because it still takes money out of your pocket. Meanwhile, he lives in a giant $3 million dollar house with just his wife. Why then does he have so much of his money tied up in that house? His annual property tax bill, utilities, and association fees could pay for an entirely different house that would be just fine for two people to live in. He could sell the McMansion and put the proceeds into income generating investments. So long as he doesn't take his own advice, neither should anybody else.

"Anyway, doesn't Kiyosaki live in a 2 million dollar home with just his wife and no children? If he practiced what he preached, wouldn't he live in one half of a duplex and rent the other half?"

Not if his incoming cash flow can cover his expenses, as he states multiple times.

No offense, but you come off as extremely jealous of him. In fact, most of the criticism on this site is nothing by ad hominem attacks.

Color me seven shades of surprised.

No offense, but you come off as extremely jealous of him.

I wouldn't trade places with him if you paid me.

In fact, most of the criticism on this site is nothing by ad hominem attacks.

Huh? Again, you've lost me. Please re-read each bold subject heading above, highlighting mistakes on various topics: "Corporations", "Insider Trading", "Real Estate", "Envy". These are not personal attacks -- each simply points out his economic argument is wrong.

Dave,

"Anyway, doesn't Kiyosaki live in a 2 million dollar home with just his wife and no children? If he practiced what he preached, wouldn't he live in one half of a duplex and rent the other half?"

Not if his incoming cash flow can cover his expenses, as he states multiple times.

You are missing my point. I'm sure his income does cover his expenses. However, his expenses would be much less if he lived in a modest house and then put all that money saved on property taxes, utilities, association fees, insurance, etc into more rental properties. He "wastes" (his philiosphy, not mine) all that money on a big house and at the same time tells his followers that a house is a liability and not an asset. Doesn't that seem incongruent to you? Like, maybe he full of bull or something? Or maybe he didn't make all his money by actually following his own advice?

It's interesting how the QMO's work. You get advice from a bigger pin. You take that advice because the one with the bigger business must know something.

Kiyosaki never participated in an MLM. What credentials does he have to promote MLM as a viable way to create wealth.

IMO, Kiyosaki is just a hypester like Don Lapre. They may have made some money with said concepts in the past but now they make their moniey selling books about their outdated concepts. Hmm, it's like some of the unqualified diamonds I guess.

It's like the quixtar diamonds. Do as I say, not as I do.

It's like the advice they give doesn't apply to themselves.

It then becomes a lack of credibility.

ok..let us read kiyosaki's response to Mr Reed...

Didn't Kiyosaki himself admit being homeless and broke in 1985? That means he didn't learn or didn't apply anything he learned from "rich dad" up to that point in his life.

Aside from his sudden "fame" from the MLMer's buying his books, I wonder where his fortune came from?

Seems to me he's just a fairly successful fictional author.

Tim: Go find something related to Quixtar to comment upon.

Sorry, the previous link was satire.

Kiyosaki is also an endorser of network marketing (such as Amway, Tahitian Noni, Mary Kay, Quixtar, Juice Plus, etc.) which some consider to be little more than pyramid schemes. He reasons in his book, The Business School For People Who Like Helping People, that the companies teach the skills necessary to be a successful business owner, like leadership, the ability to sell and teach, and emotional intelligence. Critics say he endorses the industry in order to sell more of his books and material to their members.

Interesting, Kiyosaki says don't fear risky investments:

http://www.yahoo.com/s/479106

I'm really surprised how many of you slag off Robert Kiyosaki and his Rich Dad, Poor Dad books. I saw him on TV (Oprah Winfrey) and what he said about the definition of assets and liabilities was a focus point for me. It's amazing how few people really get what he's saying here. 90+ percent of people should get an F for their financial illiteracy. What I am now learning about investing in stock and real estate is really eye opening for me. What we need to do is be open minded and debunk all of those cherished prejudices and fears that hold us back and keep us poor by our own choice. Listen to those who've made and still making a mint rather than being stuck to somebody else's grindstone making that someone else rich. Cashflow is everything. Don't turn your cash into trash!

Question is did Mr. Kiyosaki make his fortune off his own principles or by selling his books to quixtar distributors?

Mr. Kiyosaki did make most of his money as it is now becoming apparent from selling books and teaching rather than from his own so called finnancial intelegence, but just because prior to hitting it big with the books, he wasn't successful with cash doesn't discredit the value of his message or philosophy on money.

Imran Aziz
China said no to amway (actually US style amway), amway products are sold in shops there

For the record, while in China I was approached by an Amway salesman on the street. This was before I knew what Amway was, btw. I don't know how widespread this is, but I wouldn't overestimate the rule of law in China.

Danni said "Mr. Kiyosaki did make most of his money as it is now becoming apparent from selling books and teaching rather than from his own so called finnancial intelegence, but just because prior to hitting it big with the books, he wasn't successful with cash doesn't discredit the value of his message or philosophy on money."

Joe says: While thta could be true, it puts a question mark on Mr. Kiyosaki's credibility and I wonder if he lied about some of the things in his book?

Right on Scott, you're just like the quixbots who think the "system" works. So if just one person succeeds with Mr. Kiyosaki's advice and everyone else fails, it's worth it? No wonder the quixtar people like his work.

Scott - If Roberts program helps even one person get out of the rat race and live a better life, then it is worth it.

... If his book is better than other similar books on the same subject then it's worth it. In Kiyosaki's case, his book is much worse than comparable texts. Information can be helpful as well as harmful and the time it takes to read a book should be considered, unless you think your time has no value. Personally, I had the misfortune of buying Kiyosaki's book and wasting my time reading it. It was worse than useless. If you think I'm saying this because of some 'lack of success' consider I made $20,000 selling my first apartment (just a few years out of college) not to mention the money I got back from payments made to principle on the loan. That's principle I would have lost if I'd been renting.

I've done well contradicting Kiyosaki's advice. I'm certainly not paying any more of my money for his worthless, overhyped books.

Would you really say "if one person wins gambling, it doesn't matter if 100 people lose?" That's some pretty poor risk analysis that you're doing. You need to look at the whole picture.

All I see from those who knock Robert K. is the ability to blame and debunk someone else because of their own personal lack of success.

Typical ad homen attack: "If you disagree with what my guru says, it must be because you're a poor, stupid loser!" Saves us having to debate and think about all those pesky details, eh?

Great answer, Ryan.

I'd like to know how many people achieved "success" by following RK's system. I would guess that success rate is similar to the success rate of IBOs trying to go diamond.

Funny how those that are afraid to think differently sure talk tough through their keyboards.

You don't like it don't read it. It takes a lot of energy complain and attack.

So...what are you really afraid of?

What talking tough and attacking? RK sells a book that he says you can get wealthy by following. It's a good idea to find out about the credibility of the author and to learn if people succeed using his methods. Who's afraid?

It's called due diligence.

People who just follow blindly usually end up at a loss.

Funny how those that are afraid to think differently sure talk tough through their keyboards.

"Afraid to think differently?" Who are you talking about? The millions people who blindly follow a popular financial guru or the few who point out a few holes in what he's selling?

Can't you tell when you're part of the herd, friend?

So...what are you really afraid of?

I might ask you that. Above, a number of problems have been pointed out. Rather than actually attempt to engage those arguments (much less refute them), you instead attack people, insisting that anyone who disagrees with you must be defective. (That's less scary than examining the counter-evidence, I suppose.)

That's a emotionally-based response, friend, not a rational one. So, seriously, why are you afraid of actually considering and responding to counter-arguments?

As I get older, one of the things I'm learning is how easily people can be controlled. Paradoxically, it's their pride at being smart individuals which makes them so easy to manipulate. Since they're smart, they can't possible be part of the herd, following an exploitative shepherd. Keeping that thought in mind helps drown out the mooing, and keeps them loyal to the guy or group they're following.

Nick -

Funny how those that are afraid to think differently sure talk tough through their keyboards.

I don't understand why you're so committed to defending a book that simply doesn't help people and tends to waste their time.

You don't like it don't read it. It takes a lot of energy complain and attack.

It takes a lot of energy to read and evaluate a book. But once you've done that, it takes almost no energy to write a critique telling other people if it will be worth their time. Four minutes for a review, maybe? That's why people so often give online reviews as a courtesy to others. Do you hate Amazon.com's critique feature? This is utterly common behavior done out of concern for others. And personally, I'm not "attacking" anything. I'm critiquing. If the book were good, I'd say so. Likewise, if you could convince me that the book was somehow helpful, I'd change my mind. But you really haven't given me any reason to believe that my opinions are misguided. Does that make sense?

So...what are you really afraid of?

I feel that the book is a waste of time. I don't want other people to waste their time. Seriously, why else would I say I didn't like a book? I'm curious to hear what nefarious plot you think I'm involved in, here.

Tim, I don't know you and I'm not your friend, sorry. And I don't have to refute the stuff above. I simply asked why you all put so much effort into something you don't agree with. It's gone back and forth 200 times and you can sit at your PC all night coming up with more replies. Why not spend that time focusing on something you DO care about?

The amusing part is that you're trying to come across as all-knowing and using your "paradoxically" big words to make someone (you?) feel important. Maybe its you that needs the pride of being a smart individual to compensate for something? Maybe because you're getting older and supposedly wiser.

No one said I was "following", "mooing" or anything other -ing. All I said was those of you that take the time to bash what then guy is writing probably have never really done anything any other way but the way you're 'supposed' to.

If I'm wrong I stand corrected and you're better man than me.

As for Ryan, and anyone else that thinks the same...I'm sure you've heard of Howard Stern? Don't like it, DON'T listen. It's very simple. He's a half-billionaire because more than HALF of the people that listen to him hate him.

Might be why Kiyosaki gets so much attention eh?

Maybe if you just applied your wisdom to something that you agreed with as opposed to something you don't he just might not be so popular.

Nick - Is "paradoxically" really such a difficult word? Tim's language seems about as straightforward and accessible as you could ask for.

As for Howard Stern, there's a difference between entertainment and providing information. I'm fine with Stern doing whatever he wants as an entertainer. But when Stern supports something that doesn't seem to be true, like when he supported Levitt's "abortion cuts crime" stance then yeah, I'm going to argue against his views. I don't care if doing this makes Stern rich or poor. I don't care if discussing Kiyosaki makes Kiyosaki rich or poor. Why should I care? I don't hate Kiyosaki. I don't hate Stern. I don't want either to fail in life. But people should know the truth about Kiyosaki and what he writes.

All I said was those of you that take the time to bash what then guy is writing probably have never really done anything any other way but the way you're 'supposed' to.

Nobody who knows me has ever called me a conformist. I'm happy doing things "incorrectly" if unconventional methods work. But to repeat myself, I'm having a lot of trouble understanding why you're defending Kiyosaki so vigerously. What persuaded you to do this? What has he done to deserve your undying loyalty? I really am curious here.

Well Nick, I hear some diamonds say this before. Evil reigns where good men sit and do nothing.

When various MLM businesses and whatnots claim you can get wealthy following a system and the system rarely bears fruits, a dissenting voice is important for those researching the opportunity.

How many people do you know who are living on easy street following advice in RK's book?

Wow.
Marc Miyake.
What a guy.

Loser.

Inherent nature of all demagogues is hypocrisy. R Kiyosaki fits the definiton. R Kiyosaki is a demagogue, Period!!!!

No wonder Quixtar Sheeple love him!!!!!

I read somewhere that R. Kiyosaki registered with quixtar, but I wonder what "fruit" he bears that gives him credbility to teach IBOs?

One question I have is if Mr Kiyosaki truly learned these success principles, why was he broke and homeless at one time prior to the success of his book RDPD?

And why does he have a book with Donald Trump? Is such a miliarder a fraud or mayber homeless?! You are liars boys, you, you ,you!!!

Yako said: And why does he have a book with Donald Trump? Is such a miliarder a fraud or mayber homeless?! You are liars boys, you, you ,you!!!

Joe says: It's not that he has a book, it's what he wrote in the book that leaves us with questions about whether he actually experienced and accomplished what he is writing about.

One segment of his book talk about insider trading of stocks - which is illegal for example.

If everyone were "investors" and speculators, as the Rich Dad mindset seems to be, we'd all be hustling each other with giant Ponzi schemes and doing our best to screw over the other guy before he notices that NOBODY is producing anything of value.

Oh, wait, welcome to the freaking U.S. economy. Investors and Wall Street will be the death of us all. The ONLY way to build wealth is to not spend money. That means work hard, and live within your means. It's not rocket science. "Making your money work for you" and other such euphemisms are marketspeak for "make somebody else work and suck your living from their sweat". That's what investors are; financial vampires. That only works for as long as the cattle are happy and nobody bothers to look behind the curtain.

"Savers are losers" seems to be a key of the Rich Dad mantra, or at least the advertisements. Yup, they are losers, but only because the &*$% investors are sucking them dry. Welcome to the new serfdom.

Tesh: While I agree with your remarks about RDPD, I've got to take issue with a few others...

Oh, wait, welcome to the freaking U.S. economy. Investors and Wall Street will be the death of us all...

Actually, no: Investors are the people who make new businesses (meaning new products, services, technologies and innovations) possible. They contribute the resources needed for businesses to start and grow.

If my brother-in-law wants to open a hardware store in a remote area which doesn't have one, and I loan him money to do it, that's not a "Ponzi" scheme at all. He uses my money for some part of his business, and exchanges that for a stake in the resulting profits. And the people in the town, if they shop there and make him successful, will be glad they don't have to drive as far to buy hardware. Everybody wins.

The ONLY way to build wealth is to not spend money.

Don't tell Warren Buffet that! He made lots of money by spending it first. Nothing wrong with saving it, but it's also true that sometimes you have to spend some to make more.

For example, you have to build the store building before you can start to make your money back by selling things.

"Savers are losers" seems to be a key of the Rich Dad mantra, or at least the advertisements. Yup, they are losers, but only because the &*$% investors are sucking them dry. Welcome to the new serfdom.

Nobody's being "sucked dry" by investors. Where are you getting such ideas? People who are "savers" MUST also become investors if they want to get wealthier. Otherwise, if you simply bury $10 in the yard, it's only going to be worth $10 (or less) when you dig it up again.

Yet if you INVEST it in something -- that's what a savings account is, whether you know it or not (and also what a municipal bond is, as well as a stock) -- you'll help create new wealth and make everyone a bit richer and better off.

Which is not life's whole goal, but it's certainly a lot better than policies and practices (socialism, social security, pyramid schemes, gambling) which destroy wealth make everyone a bit poorer.

Tim,

So you help your brother gamble. So Buffet is an extremely canny gambler. At least have the intellectual honesty to call it what it is.

Even so, that's not the real problem, at least not when we're talking about taking reasonable risk in hope of a reasonable reward. Life by its nature has risk, and that's what makes us grow.

No, the problem is usury, usually called "interest". Loans demand that people pay the lender for risk. In other words, you're paying people to gamble. At that point, it's not about providing goods or services to better society. It's about lining the pockets of someone who was already rich, as they demand not only the original amount loaned, but usury on top.

It's even deeper than that, though. Banks today treat usury as money. Credit that has been extended to people is treated as actual money, as we've seen with the CDO weirdness. There's no real value there, just a vapor promise and lots of debt. It's utterly and completely mad, and building an economy on usury and debt is purely idiotic. It is unsustainable.

It's the pipe dream of people to get rich and never have to work. Usury/interest and "investing" do this, but only by letting people hit a critical mass of money that "earns more money" or that "works for you" by leveraging interest. That's the leech part. The investor who lets his portfolio generate his income isn't actually working for anything, he's living off of the work of others. It's the other people, the ones who are actually working, who contribute to society. The investor might seek to salve his conscience by saying his "working money" is helping society, all the while slowly bleeding the actual producers with usury. The investor is not producing anything of value.

Does that always bankrupt the sheep? Nope, but it is effectively an upper class welfare system. People who "live off the government" (working class taxpayers) in the welfare system are denigrated in our society, but somehow, people who "invest smartly" and who live off of the working class are somehow praised. Both welfare systems are corrupt and morally bankrupt.

As for burying money, the only reason it loses value is because of inflation. Inflation happens when the money supply is increased thanks to the Fed, or when banks create vapor money with things like CDOs. Legal tender loses value as the system debases it, not because the work done to earn that money is somehow less valuable.

Working class people work more now than ever, and two incomes are often required to maintain a household in big cities. Their work (the people producing things) isn't less valuable, it's the legal tender that is less valuable. The blame for that lies squarely with the Fed, banks, and investors that demand their slice of the pie without actually doing anything to contribute besides having money in the first place.

You want to praise the small business loan ideal as the hotbed of societal innovation and production? OK, make loans interest free. They still have to be paid back, but without the bloodletting. That can only help the innovation and productivity of the real working class, as they get to spend more money on their production, and less on supporting their benefactors.

A quick clarification comment on the buried money and interest. The "magic" of the system is that money invested brings home friends with it, or that's the plan. (Bear Stearns Hedge fund much?)

Thing is, those extra dollars of interest are either "money" created by banks (debt) or printed by the Fed (inflation), or someone worked for existing tender. So, an investor's profit from interest either kills the value of other people's money in small increments through inflation, or it directly takes that money from the people who are actually doing the work. It's that simple.

Their work (the people producing things) isn't less valuable, it's the legal tender that is less valuable.

Hi Tesh,

I don't have time to address all your comments, but a few quick things; First, inflation can reduce the value of savings (a dollar in the bank) but not wages. Wages are determined by the market in the present. Inflation doesn't do much to wages that couldn't just as easily happen without inflation.

If borrowing from the bank is such a bad idea, why do people do it?

There are some very wealthy people who are happy to take out large loans to start a business so that they can make more money (be more productive.) This creates wealth, and people who decide who is or isn't a good risk help this happen. Gambling, conversely, does not create wealth. It moves it around.

Loans may slightly increase the money supply since cash can be in two places at once, but if the government stopped printing money, inflation wouldn't be much of a problem at all.

Tesh,

I agree with Ryan's economic comments, so I'll focus on addressing more of the moral implications you raise.

So you help your brother gamble. So Buffet is an extremely canny gambler. At least have the intellectual honesty to call it what it is.

If you want to call the "gambling", then yes, it is. In that relatively mild sense, all of life is a gamble. I gamble every day when I get in the car and go to work: there's a certain likelihood I will be killed, and a certain likelihood I will arrive and earn a day's wage. The same goes with choice of career, employer, or buying insurance.

But most people wouldn't morally equate that (opening a store in this example) with "gambling" in the sense of a form of entertainment which generates no economic value and generally impoverishes most the participants -- as you seem to be doing.

You're welcomed to your views, of course, but I'd just like you to also be intellectually honest about their implications. If starting a business is "gambling" in the way you're using it -- and thus presumably immoral -- then so are activities like skiing, driving, getting married, getting pregnant, etc. And if not, then why are you being so condescending or indignant on this particular point?

Sorry, I just don't buy your implication that risk is inherently immoral. And I doubt any reader here will either. But if I've somehow misunderstood you, you're more than welcomed to clarify.

No, the problem is usury, usually called "interest". Loans demand that people pay the lender for risk.

If "usury" is your core objection, then why you were railing against "investing" before? They're similar in some sense (you hope to make money), but also quite different. If you were really against usury, I would have answered completely differently, as I have mixed feelings about it.

In usury, you lend someone money and they owe you more no matter whether they gained or lost it. In investing, you share in their outcome, and own part of their venture.

By the way, Jesus praised people for investing in the parable of the talents. And he also condemned those who refused to invest. You should let him know about the apparently immoral stance he was advocating -- and warn others about his bad advice, also.

It's even deeper than that, though. Banks today treat usury as money. Credit that has been extended to people is treated as actual money, as we've seen with the CDO weirdness...

There are a number of things about the current system that I'd also disagree with. But I must again note that this a completely different subject than you'd raised.

I don't think, however, that it's insane or wrong to trade IOU notes, which you seem to be objecting to. It's very hard to carry gold or sheep around when shopping, for example. (And the clerks are never sure how many boxes of Kleenex should be exchanged for a particular sheep.) So we all carry paper notes representing a debt instead, which a sensible, not insane, innovation.

The problem most people raise is that those notes aren't backed by anything any more.

It's the pipe dream of people to get rich and never have to work...

Yes, and I spend innumerable pages and paragraphs fighting that same belief.

But I commented because you were railing against INVESTMENT (of all kinds -- not just dodgy ones), which, in general, is nothing like that. When you invest, one person works hard (the one starting the business) and the other, who ALREADY earned money, helps it generate even more wealth.

Generally, there's not many "getting rich and never having to work". Warren Buffet, for example, works every day of his life. He's just very effective at generating value for his customers, and then takes a percentage of that.

The investor might seek to salve his conscience by saying his "working money" is helping society...

Or he might just be one of those stupid saps who follows Jesus, and gets his values from Him.

Why on earth would an investor need to "salve his conscience"? It's a completely moral activity. I'm glad when I invest: I think I'm doing something good. I'd encourage you to do likewise.

[Note to the reader: This is another example of a person arguing as if their opponents secretly agreed with them.]

The investor who lets his portfolio generate his income isn't actually working for anything...

It's true he's not "working" -- in the sense of physical labor (by that token, I don't "work" either), but he is giving something up.

Look, let's say I have ten cars, and I decide to lend them out for a fee. (Or do you object to car and bicycle rental companies also?)

Maybe people rent them to use with their business, or maybe they rent them for pleasure. What I am giving up? I'm giving the use of my cars (or my money, which bought them), and the certainty they will stay in good condition. What might I gain? I might gain a bit more money for my very real sacrifice.

Now try substituting the word "cars" with "thousand dollars". The story don't change, just the object being given up.

So my point is that the person who is investing is indeed giving something up: They're not sure they will get their money back, and they can't enjoy it. They chose not to go on vacation, or buy a better house on the belief that more will be returned eventually.

The investor is not producing anything of value...

Please read the comments rules. My #1 pet peeve is people who refuse to read what I've taken the time to write back to them and think about it. You don't have to agree -- you can counter-argue, object, or drop the topic. But don't go on repeating yourself as though I'd never answered your objection, please.

So, that's a warning.

Again: my brother couldn't have started the hardware store. By helping him with extra money I have sitting around, he gets a store, his family can eat better or send their kids to college, the people in the town get to save time 'cause they now have a local store, and I also get to own a bit of a successful business. Everyone wins, and everyone is wealthier.

Does that always bankrupt the sheep? Nope, but it is effectively an upper class welfare system.

Why is it "welfare"? Welfare is money taken by force from taxpayers and given to rich or poor people. Nobody's money is taken in this scenario. You're simply pretending there's no difference between money redistributed by coercion -- where no wealth was created -- and money gained through completely free uncoerced exchanges which, on average make everyone richer.

People who "live off the government" (working class taxpayers) in the welfare system are denigrated in our society, but somehow, people who "invest smartly" and who live off of the working class are somehow praised.

That's right: because they're completely different. (See previous paragraph.)

I'm trying to help you understand economics, so you can learn about that particular subject before you start condemning others in an area in which you haven't done your basic research.

Also: People who "invest smartly" don't "live off the working class", as you state. In that transaction, both end up wealthier as new wealth is generated. And frequently, these investors are also "working class" people.

As for burying money, the only reason it loses value is because of inflation.

I agree. As I said, I'm not a fan of fiat money either, except in times of crisis, such as war.

But why are you so eager to justify "burying money"? As mentioned, Jesus condemned a man for failing to invest, and burying his money instead, and he wasn't saying that because of "the Fed"! ;-) There must have been some other reason, right?

Working class people work more now than ever...

I'm sorry, but this statement is factually false, here in the West. Have you been living in a closet? People used to work 10 or 12 hours a day, six or seven days a week just to eat. Children used to work as well. For food -- not a new Wii. We are able to work less than ever before, if we'd choose to.

Reading such statements is like taking a person into a lavish banquet, and listening to them rant about how they're more starved than ever before, and how there's nothing to eat.

Have you no gratitude for the wonderful and amazing gifts your creator has given you? You clearly have no idea how fabulously wealthy you are compared to most people in the world today, and most who have ever lived. There are people who would hack off a body part to trade places with you, and the rest of us.

I say this, quite bluntly, to shame you.

... two incomes are often required to maintain a household in big cities.

Two incomes are "required" in many cases because people aren't comfortable living with less, and because we've bought into the idea both people should work. Other have divorced, so both former partners have to work to keep up two residences.

Once, one person stayed at home. You mention inflation: what happens when that person then goes into the work force? What happens to the value of labor when suddenly almost twice as many workers are available?

But things are pretty good, still.

The blame for that lies squarely with the Fed, banks, and investors...

Nope. It mostly comes from people who have bought into the idea they need the next new gadget, and a lot of expensive services.

I agree that the Fed creates inflation. And that's about 3% devaluation each year. That's bad, but not nearly as bad as the ridiculous (and much larger) taxes taken more directly out of your check -- and squandered. If you're mad at the Fed for sucking up 3% of your wealth, shouldn't you be 10 times as made for seeing another 30% of it destroyed pointlessly? (But I see no objections at all to the larger problem in your writings.)

And, as explained, investors create wealth. If you want to understand why the West is wealthy and the rest of the world is poor, THAT -- the wonderful ability to invest -- is huge part of that story.

So please put the blame where it belongs.

A quick clarification comment on the buried money and interest. The "magic" of the system is that money invested brings home friends with it, or that's the plan.

Please clarify. What are "friends" here?

(Bear Stearns Hedge fund much?)

Not sure what this means, in this context, or why hedge funds are allegedly evil in your eyes. A hedge fund is just a way of balancing risks. If you invest in stocks, for example, you might want to buy some bonds, because one goes up with the other goes down. If you invest in a home building company, you might also invest in a place which owns rental units (which makes money during a slowdown in building).

Large companies do this too; that's what "hedge funds" are.

So, an investor's profit from interest either kills the value of other people's money in small increments through inflation, or it directly takes that money from the people who are actually doing the work. It's that simple.

I'm sorry, but this statement isn't even wrong: it's incoherent. Investors don't make money from interest. Lenders make money from interest. Investors make money by receiving dividends (which are portions of profits) or by selling their part ownership of a company to someone else for a profit.

And, as I've explained already, investments don't "kill the value of other people's money" -- they actually generate wealth for all involved by creating real value, not just new paper bills (as the Fed does). You're confusing inflation with wealth production, which are exactly opposite concepts.

In the old days, a dollar bill represented one dollar in silver. Inflation happens when a government prints new bills and dilutes that value. If it prints twice as many, then each bill I hold will only represent half as much silver. Inflation devalues the notes which represent wealth -- it doesn't devalue the wealth itself.

In contrast, when my brother starts his hardware store, he starts by building a new building on what used to be a vacant lot. When he's done, the total value of that building is usually more than the value of the land plus lumber, steel, cement, wiring, and labor.

In that scenario, new value was created. No-one got poorer. Everyone got richer.

An economy works this way: I grow corn, you have trees. We trade, and Bob fashions the trees into tables and chairs (giving up his labor and time) and Camile fashions the corn into bread. We both trade with them too, paying for their labor. Now we all have cornbread, chairs and tables where before, I just had raw corn, you just had a vacant lot full of trees (and were hungry), and Bob and Camile had too much time on their hands and untapped skills, but no food or furniture.

Many people don't understand that in an economy, new wealth is created all the time. It isn't being stolen, it's being created out of the raw materials God gives us all -- our time, labor, intelligence, and the raw materials around us.

And, as a final aside: Where do you get your values? How did you decide, for example, that it was immoral to invest? Who taught you that?

Among my several sources for values, in no particular order, are my philosophical assumptions, the bible, and my observations about what works. When I read the bible, I see that God is very happy with investing (not usury, but investing) and very happy with people who create businesses and create wealth to share -- provided they have their other values straight also.

You seem to echo some of those values, but oppose the bible's teachings on others. (Some comes across as semi-Marxism.) So you have an odd mix, there, and I find it curious and wonder where you're getting this stuff from, what your influences are.

Robert Kiyosaki is in Hawaii to do a seminar, apparently. I was a bit distressed to hear a radio announcement in which the ad says (not verbatim) to come listen to RK, because "savers are losers". I take this to mean that if you are banking your money, you are losing.

I do find it ironic though, that when I believe I saw someone giving some kind of positive testimonial on an RK infomercial, there was a disclaimer stating that it was a "unique experience".

Contact RK himself:

I didn't see the article as jealousy. The issue was whether Mr. Kiyosaki actually made money using his own techniques or did he finally get wealthy selling books and speaking engagments to duped amway and quixtar audiences?

If he had learned so much, why was Mr. Kiyosaki at one time homeless and broke? When did the wisdom actually kick in?