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Robert Kiyosaki Predicts the 2022 Housing Crash

Robert Kiyosaki has been in the real estate investing business for years now. He’s been through the ups and downs of the real estate market cycles, so it’s safe to say that when Robert thinks something is bound to happen… you better believe him. Join Ken McElroy, Danille, and Rich Dad, Poor Dad author, Robert Kiyosaki, in a discussion about inflation, the failing Fed, and the impending economic collapse of America.

Ken McElroy:
Hey, everybody has all of, you know, my good friend, Robert Kiyosaki, he’s on with us today. The author of rich dad, poor dad changed many, many, many, many people’s lives. Uh, we just spent the weekend together in Dallas, uh, listening to Ron Paul and a whole bunch of really smart people on Liberty and freedom. And, uh, we study every single week with the advisors on a zoom call and, um, uh, Robert, it’s always a blast to have you on and I can’t wait to chat with you.

Robert Kiyosaki:
Yeah. I mean, w we, we chatted all the way to, uh, Dallas and the jet and all the way back on the jet and you never even told me I was doing the show with you.

Ken McElroy:
Oh, you got to save something for later.

Robert Kiyosaki:
Yeah. Anyway, that’s always fun. Always fun.

Ken McElroy:
Yeah. Yeah. Yeah. So, so, uh, for, for, for a lot of you guys that don’t know, uh, Robert and Kim and I, we’ve been friends for a long, long time. They’ve invested in a lot of property with us. We have a lot of history. I’ve been on a road with Robert and Kim and the advisors. And we’ve been all over the world and written all kinds of books and had all kinds of fun and educated. Uh, actually, Robert, you are the one who taught me that I am a teacher.

Robert Kiyosaki:
Sure. Yeah. That’s important. You have an important job because you know, most teachers have no idea what they’re talking about. That’s why they’re school teachers. It’s nice to have a teacher that knows what they’re talking about. Yeah, yeah.

Ken McElroy:
You know, you know, well, well obviously we, we, um, we all learn together. That’s the cool part. I mean, imagine, I mean, we were at dinner Saturday night and people were just going crazy. Cause it was obviously Robert, uh, they had, you know, rich dad, poor dad, but then they look over and they see George that they look over, they see me. They’re like, what the heck? Like what a three are you guys doing here? And they all like, uh, our waitress, the manager, the head of the bar, and this is at a Del Frisco’s in downtown Dallas. And they all recognize, and they were all watching us. It’s very cool. Everybody’s trying to, uh, figure stuff out. Right?

Robert Kiyosaki:
Yeah. The really neat thing about that dinner at Del Frisco’s is they’re not the guys that are at the seminar where I made the seminars. We attend are expensive. We’ve got to admit that. So all of the old hardcore, uh, people comfortable, but to know that our YouTube videos are reaching the masses, that’s really satisfying. It makes my heart happy. And I think even though this COVID thing shuts us down and all this stuff, it’s still worth it. And, um, as you know, we’ve been studying the federal reserve bank, the macro economic systems, the shadow banking systems. And we can just do that going onto our little I-phones, you know, we just dial into this little thing here and we bring up fantastic teachers like Lacy hunt, uh, Jim Rickards. And, um, what’s his name…

Ken McElroy:
Uh, Jeff Snyder.

Robert Kiyosaki:
Jeff Snyder. I mean, boys are resilient and in real life, if not for zoom or Twitter or Facebook, all this stuff we’d have no access to them. Yeah. And the best part about it…

Ken McElroy:
That is the best part. And by the way, guys, like those are the last three videos we studied. So we study a video a week and the first one was Lacy hunt. The second one was Jim records. The last one was Jeff Snyder. And then of course we got to spend the weekend with George Gammon. So I got to tell ya, I’m a complete basket case. I have no idea like whether we were going through inflation, deflation, stagflation, hyperinflation, everybody’s got, they’re so smart. And they have all these different viewpoints. So what do you think?

Robert Kiyosaki:
Well, I, what I thought was fantastic because Lacy hunt and then, uh, Jen records who has LTCM long-term capital management, one of the smartest guys I’ve I’ve ever met, you know, go write a book together. And then, uh, Jeff Snyder. And the thing that is shocking is that all of them say the same thing is the fed has no power. The Fed’s a joke. And that’s why Ron Paul, you know, Congress I’m wrong. Paul was with us in Texas and he says the same thing and the fed, but everybody thinks the federal reserve bank is omnipotent. You know, the most powerful bankers in the world and what these guys are saying, they have no power because the real banking system, it’s the shadow banking system. It’s the banking system we cannot see. And so everybody’s, so when the fed says, oh, we’re going to talk about expectation to say we’re printing money. So the fence is where we’re printing quantitative beings. And everybody goes, oh, that means there’s going to be inflation. Oh, this kind of big inflation, all of this going to be inflation, but what Lacy hot jumped records and jumps matter of saying no it’s deeply.

Robert Kiyosaki:
Right? I mean, that’s amazing.

Ken McElroy:
Yeah. In fact, what they said was that there, if you take a look at the trend line for inflation, we’re actually below the trend line,

Robert Kiyosaki:
Right? Lacy hunt started the whole thing. He was, I think he was part of the fed. He says what the fed the pot depends upon its GDP, gross domestic product product equals M two times B and M two is money supply. So every time the fed chairman, this guy us up there says, oh, we’re issuing, you know, we’re going to print money. They don’t print money. But everybody thinks when the fed says we’re printing money or quantitative. And they think it’s M two and with Jeff Snyder and everybody else is saying, George, everybody’s saying the fed doesn’t print money, the fed prints bank reserves and the differences, we cannot spend bank reserves. It’s not money. But everybody says, oh my God, this is going to be inflation because their Fred’s printing money, but they’re not printing money. They’re printing back reserves.

Ken McElroy:
Yeah. Yeah. In fact, um, one of the things that Snyder Snyder called him camel’s humps. Remember he said the stimulus payments. If you want to take a look at inflation, take a look at when they, when they dropped all that money on, uh, on the people you see, uh, uh, you know, inflationary hump, and then inflationary hump based on the amount of money that they stimulated in the economy.

Robert Kiyosaki:
I think the most important thing is that the fed is a joke. Exactly. And he was on stage with us in Texas. It’s a couple of days ago, he said the feds have joke and everybody says, oh, don’t fight the fed. What else did they say? Fed has sparked guidance. And the fed is the wizard of Oz. He’s got no power, you know, and it’s kind of hard for the average person to understand that, but that’s the beauty of YouTube, but all the stuff we listened to and going to those conferences and the, and so the conference was for a lot of rich people, but then to go to all Del Frisco’s and have the waitstaff all excited because we’re there. So that’s the power of YouTube. Yeah. Access to everybody.

Ken McElroy:
Yeah. Everybody’s trying to learn together.

Danille:
The, um, so since the fed only prints, um, prints for the bank reserves, is that why you’re having real estate, um, kind of skyrocket right now? Cause the banks lending more

Robert Kiyosaki:
Well, it’s what they call. They manage expectations. So when the fed gets up there and says, we’re going to do Q E they uneducated the unwashed, the filthy, but people don’t watch YouTube say, oh, that means there’s going to be inflation, QE, quantitative using this are printing money, but they’re not printing money. They’re printing bank reserves and you cannot spend a bank reserve. All it is is a ledger entry between like, you know, IOU Neal, $10. And you say, I owe you $10, but there’s no money there. So it’s a complete Chan. And that’s what the power of YouTube is. And guys like Jeff Snyder, Lacy hunt, and, uh, Jim records and the staff staff working on us. They can now get to some of the best teachers in the world for free.

Ken McElroy:
Yeah. And we’ll put those links up on the podcast here, you know, best. So people can see them. But there, those are the last three videos that we studied. And I think it’s important because, uh, I, I also fell into that camp. Robert, I, I thought all the fed prints money and that’s, you know, so I, but all four of those folks, Gammon Snyder records and hunt all say, that’s not how it works. No.

Robert Kiyosaki:
And this said, we’re in deflation, not inflation, but everybody’s buying houses, Danielle, because I think prices are going up because it’s called the fed manages X, X expectancy, not reality. So they, they said, you know what? I watch CNBC all those goofballs up there and say, oh, the fed issued or a guidance. It’s a sham. They want to trick. And that’s what guys like Lacy hunt, Jeff Snyder and gem records is saying, it’s. And then they said, well, don’t fight the fed. And that’s why it was so profound in Texas. And then studying what we study at rich. That is these three guys who most people would never even listened to the smartest guys I’ve ever met. So it’s the fed is a wizard of bombs. There’s nothing there.

Danille:
So if everyone thinks there’s inflation, but there’s actually deflation going on or they’re afraid of deflation happening, what does deflation look like for those that haven’t experienced it?

Robert Kiyosaki:
Well, let me explain it. Cause this is what Jeff’s not at made really clear. It goes to the monetary system of the banking system does a thing called a shadow bank. And the shadow banking system is like a hundred times bigger than the fed and what all three guys, Lacy, hon gem records. And Jeff’s better was saying the shadow banking system is crashing. So the fed is out there saying, oh, we’re issuing forward guidance saying, um, we got print QE or whatever they do. So I buy things. Price is going up. But the reality of the three of saying, we’re going into a depression, that’s crashing because the biggest money system is a shadow banking assessment. We cannot see it is crashing as we speak.

Ken McElroy:
Yeah. And there’s a lot of us dollars on basically, uh, we trade in us dollars. So, uh, in talking to George, George would say, you know, there’s a tremendous amount of us dollars outside of the U S

Robert Kiyosaki:
That’s a shadow bank.

Ken McElroy:
That’s the shadow bank. So people don’t know. I mean, you think about if we buy something from China and we are the world’s largest consumer that we pay them in us dollars, they’re taking us dollars. And that’s what these guys are talking about. You got to pay attention to the whole picture, right?

Robert Kiyosaki:
It’s the fed, the fed has no power. The fed has the wizard of alums. And if you think of it, well, I wrote an article for our friend at Jetset, and I wrote about the fed big, the wizard of Oz. I caught hell for that one too. But I was, I was just kinda guessing, you know, I was just kinda guessing, I think like Jetta yelled out, looks like uncle Festus, or, you know, th they’re all a bunch of cartoons. I mean, what was this name? Who was the fed chairman of green span? Oh, I’m going to tweak interest rates that half a percent. He raised by half by half a percent and all these idiots jump up and down like a bunch of clowns. And it got no power. The biggest monetary system is the shadow banking system. And it’s quite brown.

Ken McElroy:
Yeah. Yeah. And so what the, what the fed is doing is they’re tapering off buying the bonds and they’re talking about potentially increasing rates, right?

Robert Kiyosaki:
Yeah. They say we’re tapering stuff. I think, oh, that means the economist’s getting strong. Oh. And that means they’re going to increase rates, but the fed has no power. The fed is Western a boss.

Ken McElroy:
Yeah. I yelling came out today that says that. Cause right now inflation’s at 5.4 or 5.3 she’s uh, they, she got the sporting and said that, um, she thinks that it’s going to be pretty inflationary through mid 2020 to transitory. Transitory is now a year. You’re going to change the definition of transitory. Yeah.

Robert Kiyosaki:
Uh, but what it really means is if you notice the reason the shelves are empty is because the fed or Yellen has been paying people to stay at home. So the truck drivers, aren’t driving, not unloading the trucks, the shelves are empty. Oh my God, there’s a shortage. I think it’s all manufactured. Why would they pay people not to work? Why would they be 9 million boats, ships sitting off shore? Nobody’s all loading them. The shelves are empty and everybody thinks doesn’t function. The supply and demand.

Ken McElroy:
I know what gas is at all time. Highs, rents are at all time highs and home prices are our all time highs right now. And unemployment’s at an all time high. Is that crazy?

Robert Kiyosaki:
Yeah. And then by the, it cuts out the Keystone pipeline and then he wants to buy oil. So Russia and Saudi Arabia are in trouble now because when they abandon Afghanistan that broke the agreement with the petrodollar with Afghanistan. I mean, with Saudi Arabia in America, America promise Saudi Arabia. We protect them. But when they dumped Afghanistan, the Saudi said, oh my God, we can’t trust America. So this is all happening in the last few weeks. And so European, the shadow European shadow, the Eurodollar or the shadow banking system is collapsing. And so by that, I mean, a and so Paula gets up the fed Chimp gets up and he says, oh, we’re going to start to add taper. And that means we might start interest rates that trying to get people to spend money.

Ken McElroy:
Yup. Ah, interesting. Yeah. So that’s essentially what a Gammon and Snyder and records and hunt said is that they’re what they’re doing is they’re using these, uh, almost marketing tactics to get people, to keep consuming.

Robert Kiyosaki:
Yeah. If what they say is low, low interest rates are not good. It means the economy’s collapsing. And if this were a really high, that would be good for another reason. Everything is opposite of what we think it is. And that’s what the power of YouTube. But as we started Lacy hunt, um, Jeff records and Jeff Snyder.

Ken McElroy:
Yeah. Yeah. And, and, and we were, we were talking about this this morning, you know, this is, uh, uh, you know, right now what who’s getting crushed is, you know, fixed income, uh, you know, people like my mom on social security, she makes $1,450 a month. And that’s what she’s going to make in five years, by the way. And stuff’s going to go up that obviously you gotta take care of her, but, uh, you know, anybody on that, anybody, uh, you know, like those, some of those workers that we met, you know, I, I, funny, I was reading something today, Robert, the guy said, if I give you a 4% raise, are you going to be happy or angry? Right. And, you know, because, but it’s still not enough

Robert Kiyosaki:
Now, you know, inflation is a tax. That’s what it is. And I, and the trouble is there really isn’t inflation. It’s really deep. And the trouble is what’s the flattening as a shadow banking system. And the fed doesn’t have the power to stop it. So that’s why the odds are going into a depression, but also on when they dumped all the weapons in Afghanistan, it off the Saudi Arabians, Saudis, and Israel. They don’t trust Americans today. So that’s crushing the economy of Europe.

Danille:
So when they, uh, if the shadow banking system collapses, how will that affect our monetary system here?

Robert Kiyosaki:
That’s a, that’s a, that’s a multimillion dollar question. Good one though, because that’s why, that’s what we call Kenny. And I go into those things and we’ll learn more as, as much as anybody else, because you hear all this different people saying different points of view. That’s a good thing about YouTube too. You know, somebody says it’s going this way. Some people wasn’t that way. So the best thing to do is, like I say, your mind should be like a parachute. It works best when it’s open. So I sit there listening to people and go up all, I may not agree with you, but I’m going to listen to.

Ken McElroy:
Yeah, for sure. Um, so what do you think is going to happen with all these workers? You know, where it just seems to be getting worse. Like people are now just saying that they’re also making a little bit of money with crypto and, uh, you know, some, if they own any real estate, uh, I was talking to Jay, as we were talking to George on the way back from Dallas, he said, yeah, they’re buying these big, expensive cars. You know, they’re, they’re, they’re feeling rich, but they don’t, they don’t have any monthly income.

Robert Kiyosaki:
Well, there’s crypto billionaires. Right? All Bitcoin billionaires. I’ve never had a job. I mean, the driving McLaren’s and all of this stuff, you know, I wish I was there, but I kinda think I like all of our approach, you know, kind of the nail is a little hard work and experience goes a long way, but you got lucky. It’s like, it’s like a kid who was born lucky. They don’t, they don’t know how to recover. If they lose it all like many sports athletes, I broke five years after making millions. So those, that could be the crypto guys.

Ken McElroy:
Yeah. Yeah. Because if it’s not sustainable. Yep. That’s exactly right. I think there’s unfortunately a pretty good disincentive for people to go back to work.

Robert Kiyosaki:
I don’t know, man, because I liked my work. I mean, you and I don’t have to work. I love her. And I liked, I love studying. I love hanging out with all you guys. I have a blast in Texas, you know, it’s just fun. But to think, to get paid, to not work, but it doesn’t, it doesn’t go with me. I don’t like it. I’d rather not get paid.

Ken McElroy:
Yeah. I agree with that. I just, I know that there’s article after article, I read one this morning that said, you know, back in the day, you used to have to pay to lure a, an executive, let’s say to a company, now you have to do it to, to, for anybody. Yeah. You basically have to pay incentives.

Robert Kiyosaki:
I think Danielle, the most fun we had though was, you know, here’s this holler at 300 people, a lot of them doctors and all this stuff. And you know, doctors, this is the trouble with a doctorate. You understand tax law. If a doctor earns a million dollars, they net 400,000. That was, they pay 60% in taxes. So the screw job is, oh, my son is a doctor. My daughter is a doctor. She makes a million dollars a year, but his take-home is 60% less folks, but Kenna and I up there and I like to be the standup comedian. So like Kenny and I get up there and I said, Hey, Jedi, how much money did you borrow last week? And what did you

Ken McElroy:
Say? Like 300 million

Robert Kiyosaki:
And the robot solid, the new,

Ken McElroy:
Well, the best of the best was, uh, you know, uh, one of the tax havens right now is Puerto Rico. You can, you know, you can go there. And basically, uh, you’re doing business there it’s a 4% tax. So Robert, I are eating breakfast with this couple and they’re like, yeah, we’re flying tomorrow to Puerto Rico. I go, wow, how long do you have to be there? 183 days. They have to move to Puerto Rico to legally to be able to do that. And so, uh, and so we’re scratching our heads, God. Well, if you buy enough real estate, you have depreciation. You won’t need to move to Puerto Rico. And then Robert being the smart at, he says, yeah, well, I ended up, I just bought a jet and I got to write the whole thing off this year. It gets any capital gains that I had, which is true, you know? And so there are ways to mitigate tax legally if you find the tax code, but there w their limited view was moved to Puerto Rico.

Robert Kiyosaki:
Yeah. So what they’re doing is they’re moving to Puerto Rico about that for sale 183 days. And apparently the lockdown is draconian fascist, but I said, why don’t you just buy some real estate? But this is the key that now the reason that cannot buy enough real estate is they don’t have Kenny skills to buy $300 million in real estate. The easy part is the borrowing the money. The hard part is managing the property, right? Kenny. Yeah.

Ken McElroy:
Yeah. Without a doubt and buying correctly, as you know, Neil owns real estate. So yeah,

Robert Kiyosaki:
That’s the hardest part is the management. The borrowing is easy. The finding is ease. So I’ll just tell the story. When, um, Kim and I were doing our best to get up, to have enough real estate, you know, millions of dollars of real estate without the pay taxes, the biggest problem was managing. And then when I met Kenny, about 25 years ago, he said he was property manager, man, we’re all, Kevin are all over him, like a cheap suit. You’d be the property manager. And then, then Sarah knows this. And McKenna is a great guy. And then he looked at our property. He says, I can’t help you. I said, what do you mean you manage property? Yes. But your properties are too small.

Ken McElroy:
He had to Robert given up their game.

Robert Kiyosaki:
And so that’s, you know, so, you know, Kenny makes it sound easy. Yeah. That was probably a 300 million, but you cannot borrow 300 million if you can’t manage. And if you can manage a million, you pay no taxes. But so after we’re through talking this, I was laughing my off. It was a rumble. So with doctors who, like I said, they make a million dollars, they pay 600,000 in taxes. So when Kennedy got up there and says, I have borrowed 300 million, all these doctors swarmed him, you know, but they can’t do, they cannot borrow 300 million because they cannot do what Kennedy does, which is managed properties. That’s the key.

Ken McElroy:
Yeah. Their biggest issue. I, and so that’s why these tax and these tax policies, you know, they are going to be what they are. But I said to everybody, I said, the tax code has always been, and it will be a guide to teach you what you can do legally. Yes. That’s essentially what it is. Yes. People, people don’t look at it that way, but it’s really a book that says, okay, here’s what you can do. So if you work within the rules that they tell you, and that’s, that’s the piece they don’t, what they do is they take their tax returns to somebody and then just does their, their, their books. But there’s no tax planning. Right.

Robert Kiyosaki:
And I was sitting there, I called Tom wheel right this morning, you know, tax-free well, and I said, Tom, is it true? These doctors make a million dollars a year and pay 600,000 in taxes. He says, he sees it every day. They go to school and become doctors at massive student loan debt. They make millions of dollars and give it to the compliment.

Ken McElroy:
Yeah. And they don’t know what to ask. And they have all, oftentimes they have the wrong advisors on their team that, you know, they don’t, they don’t realize that there’s, if they buy like their own building, just that simple take that money, put together a group of doctors and buy their own building and have them rent back from themselves. They’ll get a massive depreciation deduction just from that one move.

Robert Kiyosaki:
It helps, you know, that’s what Dr. Tom burns does. Why doctors by doctors don’t get rich, you know? But again, if we’re going to ask them, let’s say it again. Cause it’s so important. The reason I’m standing on stage with Kenny, and I said, how much money did you borrow last week, Kenny, without skipping a beat 300 million, the nail, the room went silent, but they don’t realize the only reason Kenny, I can’t borrow that much, but Kenny can borrow it because of property management. Yeah. How many employees do you have?

Ken McElroy:

  1. Yeah. That’s

Robert Kiyosaki:
The difference.

Ken McElroy:
Yeah. As you know, and a track record and it’s paired up with collateral on a down payment and all those other things, which, which, uh, Robert didn’t ask that question, but the, um, you know, the, and so we, we, we showed them basically our model, which was buy something, increase the value, put new debt on it, pull the cash out and it blew their minds. So like, it’s like you and I talk about this all the time, but surprising that these very, very smart, very, very wealthy doctors from all over the country that never had heard that.

Robert Kiyosaki:
No, it’s the nail there. Kenny was swamped. That’ll talk to me. Cause I don’t know anyway.

Ken McElroy:
I’m sure I’ve seen that

Robert Kiyosaki:
Before. And all I do, I told, we told this room about 200 people. I make money. Let’s say I make a million dollars. I’m in trouble because if I don’t place that money with debt and then step it up to an asset. So I make a million dollars. I got a call, Kenny. I said, I need $4 million in debt. It’s completely opposite. But people think I want the debt. So Kenny is going to take the 4 million Marilyn Marriott to my 1 million and the asset becomes 5 million. And when you have a $5 million asset, then you can depreciate it, appreciate it and advertise it. Those are accounting terms. That’s why I pay no taxes, but we’re trying Ken and I are up on stage doing our best to explain to people, Kenny and I are partners. Not because I’m in real estate, but because Kenny can borrow money and he can manage the property. And if he can’t do that move to Puerto Rico,

Ken McElroy:
That was the part that was most interesting. I mean, these are really, really smart people. And some of them are creating a residency and Puerto Rico to, you know, to try to mitigate tax. I, you know, it is, as you, as everyone knows, it’s the largest expense of your life by a long shot tax. But people don’t see it that way because they don’t really re you know, they, they, it kind of happens, you know, silently, you know, behind the scenes. Right.

Robert Kiyosaki:
See if we can picture this. Okay. A doctor makes a million dollars. He’s an, a student, you know, that’s 400,000 Kevin as seed students. We make a million dollars, but we take home 1.1 tax rate

Ken McElroy:
Year over year, over

Robert Kiyosaki:
Year, we’re accelerating so fast over those doctors. That’s why his license plates does what, see, what’s your license plate?

Ken McElroy:
Oh, well I have one that says infinite and the other says ceased

Robert Kiyosaki:
The mindset C plus.

Ken McElroy:
Yeah. But that, you know, it’s interesting as everybody works their butts off, and then they start making all this cash. Even when you sell something like a company there, the whole issue is how do I pay? I mean, even this morning, that was, if I sell this, how do I mitigate tax taxes? And it’s, uh, it’s a, it’s something that you can learn. It’s something that you can do. And it’s actually not that complicated if you, if you just scratch the surface a little bit, right?

Robert Kiyosaki:
Yeah. That’s why Tom, as Tom, we have a right to buy this book. Tax-free wealth because America was founded in 1773 as a tax-free nation. It was the Boston tea party. And now the New York times wants us to believe it’s a 16, 19 project, whatever it is. But America is really a tax-free nation. That’s how it’s formed. And it’s just gone downhill since then. I just thought it was so, so interesting that when I said the fed does not print money, the fed prints bank reserves. Now, why is that so important? Because what that means is the banks need Kevin to come into the bank with a project, with an asset, like, you know, the project in, uh, Austin, Texas, and like all, thank you, Kenny. Thank you. Because what the average guy doesn’t realize is the bank needs one day fed gives ’em those bank reserves. They’ve got to lend it out. They cannot pull down to the bank and serve. So Kenny walks in, I got a $50 million project and they say, thank you, Jesus. He showed up, they got led Kennedy, this money, but it’s all there until Kenny comes in to borrow the money, does money exist? Right.

Ken McElroy:
That’s right. That’s that was very, that was a lot of clarity there. That makes sense. Yeah. So we got approved today on that loan, by the way, on the Austin loan.

Robert Kiyosaki:
Yeah. Kevin, Kim’s jumping for joy because she has got approved too. I don’t know what for, but this is the funny thing, you know, Dave Ramsey, who lived at tray, the rest of us would say, how much debt could I get?

Ken McElroy:
Yeah. Covered debt. Right. We want good dad. That’s that’s, that’s uh, covered the, you need the income to cover. You don’t just want to borrow. Right.

Robert Kiyosaki:
Well, they asked isn’t a property, the asset, the tenant, correct. Put the money into the property for a place to live. And then we can tax breaks. But the, this is the best part, but other NASA guys. So let’s say Kenny and I buy a property for a million dollars and in Texas, and that increases the rent and the property is now $5 million. And most people would sell the property to get the 4 million out. And what happens if we sell the property to get the portable, you know?

Ken McElroy:
Yeah. Well then we have tax

Robert Kiyosaki:
Capital gains.

Ken McElroy:
Yeah. We have a capital gain tax and we have a depreciation recapture tax. Yeah. Um, yeah, the, uh, and we have the problem of having the cash again in an inflationary economy to try to figure out what, what are we going to reinvest in again?

Robert Kiyosaki:
So the way, so Danielle, when Kenny was talking to Kevin and I, cause Kim was the one doing the property management, it’s a pain in the. It really is. You got a phone call. You say, Hey, somebody is walking out with every refrigerator, like, you know, call the cops and all that stuff. But anyway, so let’s say my property at a billion, Kenny improves a property. It’s now what, 5 million, how do you get the 4 million out? And

Ken McElroy:
Yeah. Well then you take obviously the, uh, the property back to the bank, maybe that bank, or even another bank and the bank looks at the collateral and they lend against it. So the bank lends against the collateral. That’s now worth 5 million. So maybe you get an, maybe you get 3 million at that point or, or 4 million, uh, at that point in debt, more debt.

Robert Kiyosaki:
Yeah. So let’s say Kenny borrows out the 3 million in collateral from the property, the 3 million is one

Ken McElroy:
Tax-free. Yep. Yeah. I mean, you don’t play, you don’t pay tax on debt. Right. As you know, so, and that’s the model and that’s why we get these questions. Robert, you know, people are like, well, my, my property is worth a lot more. I’m going to sell. Right. We had that one today. I’m like, don’t sell, put more debt on that you can manage, especially if you’re and then go out and do that again. And, but what they do is they sell, then they put that money in the bank or give it to a financial planner or, you know, uh, or, uh, or wealth manager and, or in the bank, uh, even worse. And it sits there until they can find something else.

Robert Kiyosaki:
Yeah. The reason that Kenny’s system works is every time we borrowed money, they don’t pay taxes.

Ken McElroy:
I know. Isn’t that interesting that the IRS in the system

Robert Kiyosaki:
It’s so funny. It’s funny. I can’t stand it sometimes, but I can’t explain it to a person. So when I get up on stage in Texas, a couple of days ago, I just asked him that one question, can I, how much did you borrow last week? He goes, oh, 300 million. It’s sucked air out of the room.

Ken McElroy:
I’m sure. Right. Well, I noticed rod Paul stayed for the whole thing. Yeah.

Robert Kiyosaki:
Came up to me. I didn’t know you were that smart. I said, yeah, I’d watch YouTube.

Ken McElroy:
Yeah. He’s one smart boy. I’ll tell you what he’s, he’s been through the ringer, uh, you know, uh, ran for president three times and, um, you know, and, and has always stood for Liberty and truth. And I really enjoyed his talk.

Robert Kiyosaki:
Yeah. That’s just really what he said. Cause he wasn’t at rich dad radio show. He said the constitution has no good if our leaders our lives. Yeah. This was before they, before they pledge to defend the constitution, they should put the hand on the Bible and stay and restate the 10 commandments because the constitution is only as better as our laters. And that’s the guy, Neil, how was saying with the fourth turning the fourth, turning is marked by bad leadership. And I don’t think any worse than it is today. I’ve never seen such bad leadership that they lie cheat and steal. And you know, the fed was, the fed guys were caught for insider trading.

Ken McElroy:
So this is the, this is the game we’re playing right now. So where do you think we’re heading with the real estate market and the debt market and all that?

Robert Kiyosaki:
Well, that’s what, that’s why I give my money to you. You know, that’s because I just want to say to people to borrow 300 million, you’ve got to be absolutely spot on with the management. And as you know, management is a key for real estate for businesses, for the government and if a person cannot manage or a script. So as long as we have our management skills, we’ll do well. Like I don’t, I don’t really care, you know, as I set up the room. So yeah, though I walk through the valley of the shadow of death. I shall fear no evil because I have a Learjet and my money is stashed off shore.

Ken McElroy:
All true, by the way.

Robert Kiyosaki:
That’s the second passport Getty. The second passports, Nick.

Ken McElroy:
Yeah, I know. I want to talking about that. You know, the, um, so what do you is going to happen with the currency? The dollar cupboard, you know, with all the shadow banking and all that, do you have any predictions?

Robert Kiyosaki:
Okay. That’s, that’s hanging out with gambling, you know, I mean, he, I wrote home with them after we dropped, after we left there. But that, that boy is that, that guy as one smart dude charges. Unbelievable. So he’s explaining to me why the dollar was say, if, when he told me about the, you know, I’m going to call him just like I call you.

Ken McElroy:
I know we used to have

Robert Kiyosaki:
To figure it out. Call, call, call George. And that’s such a good time to be alive, really, as bad as it is, the most exciting time I’ve ever seen.

Ken McElroy:
I agree. There’s so much opportunity right now. Well, their wellbeing. Yeah. I think there is right now.

Robert Kiyosaki:
I, I I’ve been investing a wild man and startups, so there’s some stuff coming down the pike. So there’s more opportunity as technology champions. It’s a lot of good stuff happening.

Ken McElroy:
Yeah. A lot of, I think a lot of the sacred cows are going to be taken down. I mean, you, you look at this for Sears and Kmart, then Walmart now, Amazon, even Bazell said, he goes that there will be a day that Amazon is not at the top. And uh, I just think that there’s always opportunities at every juncture.

Robert Kiyosaki:
I’m just, I just, I think we should relay it. This is what Lacy hunt was. One of the guys with the Dallas fed, I think, and he was talking to Jamie P equals M two times big gross domestic product equals money supply. I’m too tired. It’s philosophy of money. But what he was really accurate saying, cause this affects Kenya and I, when, when they measure Jean King, they don’t measure brawl can blast at what broken glass did. You know, Danielle, when you walk one of the shopping centers, a lot of places are empty. That’s broken glass. That means so they don’t measure the loss. They measure the gains in GDP, but they don’t measure the number of shops closed. So it’s not an accurate number. So ever since Lacy hunt said that I went to our friend’s place, I’ll mention his name. And he was trying to som it a whole top floor of this building. And I walked into that. I turned it down because it’s office space. I don’t understand. I understand apartment houses. I don’t understand office space. So I went into this office building I was exposed to by, it was 70% empty.

Robert Kiyosaki:
That’s broken glass. That means somebody is not receiving the monthly payment.

Ken McElroy:
Yeah. He said another way he’s he wants you to step into the falling knife.

Robert Kiyosaki:
So I almost have a shopping center, not too far in Scottsdale road. And it’s only a couple of shops now that’s broken glass.

Ken McElroy:
Is that right? And that doesn’t show up right now in GDP. No,

Robert Kiyosaki:
But it will. That’s why it’s really an exciting time, but what’s going to happen. It’s going to be a lot of creativity. I don’t know. I mean, who goes shopping when you go online?

Ken McElroy:
Yup. Yup. Yeah. And so that’s the broken glass that is going to show up suit, you know, cause those, those buildings have real mortgages and they have real people that put up real equity and they have real jobs associated with it and, and all those things are going to make their way through the system.

Robert Kiyosaki:
And a lot of those big office buildings, recent, we don’t hear about it is because REI teams, real estate investment trusts big, big, big, big Kenny’s, big public companies. The is mama and pop the baby boomers

Ken McElroy:
Invest in [inaudible]. Yeah, yeah. Or a lot of 401ks, pensions, 401k REITs or real estate investment trusts. They’re basically, uh, stocks.

Robert Kiyosaki:
So when, um, lastly Han says that’s broken glass headbands, a lot of the baby boomers are toast because they haven’t, they bought, they drank the Kool-Aid and invested in REI.

Ken McElroy:
So George went to, um, was it freedom Fest in new Orleans? The, or the

Robert Kiyosaki:
Gold?

Ken McElroy:
Yeah, the new Orleans investment conference. He said that, well, first of all, they just had that hurricane. So he said 70 to 80% of the buildings and houses in the area had blue tarps on the roofs and uh, EV and a big, big chunk of, uh, businesses were boarded up and they required of course, vaccines and masks and all that. And so he, he basically said, he’s not going back. And it’s, it’s a, it’s a city right now. That’s obviously, uh, imploded, it’s dying. Yeah. The city that’s just new Orleans. And so all that stuff has debt and equity and, and jobs and all that kind of stuff. It as tourism and all that stuff starts to not go there anymore. Or Chicago or New York or Seattle or Portland, you know, that’s, what’s starting to show up now

Robert Kiyosaki:
That’s, that’s the broken glass. I call it vacancy. And then, um, so you know what that’s, why is, again, Kenny can borrow 300 million because he managed the property.

Ken McElroy:
And so, so when Robert looked at that office building again, when I said don’t catch a falling knife, that that property is at the beginning of the knife is beginning to fall. And, uh, you don’t want to catch it while it’s falling. You want the property to be all the way vacant or almost all the way vacant back to the bank. Uh, you want it to that’s you want to buy the property from the bank after everything’s cleaned up.

Robert Kiyosaki:
And that’s what, uh, all, all three guys are saying Lacy on Jim records and, uh, uh, rich, rich Schneider, the collateral spend.

Ken McElroy:
That was, uh, that was one of the opinions from, from video to video radio was that all this money has to be backed by collateral something somebody has to pay it. Somebody has to be able to pay, right.

Robert Kiyosaki:
Uh, so about office building that’s right by my house. It’s empty. That’s collateral,

Ken McElroy:
Right? So somebody borrowed against that. And if they can’t pay it now it’s bank owned.

Robert Kiyosaki:
So that’s what, when we talk about the fed doesn’t lend money, it lends bank credits and the fed needs what the banks need. People like Kenny to come in there and borrow money and what they borrowed money, almost collateral. Here’s this office building. And the bank would say, oh, what a wonderful idea. We’ll lend you the money on it, but now the building’s empty.

Ken McElroy:
So then the other interesting part about that is you can’t get alone if a bit of a building I’ve, I’ve had to buy on the other end of that, where you go into a bank and they own the real estate or REO or real estate own, they call it in their REO department and the banks like they want to, they want to get rid of what’s called a toxic loan or a toxic asset, but they can’t put debt on it. He goes, there’s no debt it’s.

Robert Kiyosaki:
Yeah. The tenant, the tenant is yes. So that’s why Kenny has always said, you know, you want to invest in properties where those jobs, Hey, look at what happened in New York city. Plus Amazon was going to move into New York city, but they offer Amazon huge tax breaks and ALC Alexandria, Ocasio, Cortez. So that’s not fair. So they chased Amazon out of New York

Ken McElroy:
City would have been their headquarters.

Robert Kiyosaki:
Chased Amazon out of the yard, Amazon New York be okay today because Amazon

Ken McElroy:
Survived it’s certainly would have been a lot better off.

Robert Kiyosaki:
And what Amazon has done, a lot of small businesses thrive and all that stuff. So that’s why it has been one big disaster after disaster after disaster. And I don’t think we’ve seen the worst yet.

Ken McElroy:
Right? I would agree. Again, I, the knife is still falling in. Some areas is still fine, but in areas like Chicago, new Orleans, Portland, downtown Seattle, people are telling me and San Francisco don’t go there. Right. You hear that? Yeah. It’s dicey. Yeah. Yeah. So, so you got to wait for that to make its way to where it goes. But, uh, unfortunately that money is invested through people’s pensions through their, uh, insurance policies, through their 401ks on that. That’s where the money originates.

Robert Kiyosaki:
So let me give you the good news, no matter how bad the news is. Okay. Like I said, when we stood up in Texas and I said, how much money did you borrow last week? Ken, it’s a $300 million. That’s always there. The banks have to lend money. So when people say, well, you should save cash. Why would you say cash when you can borrow it? So, you know, it’s almost like the real real estate home. Remember those days and the 2008 and all that, all that property was available. But the bank owned that RALS are called real estate. You just go to the bank. And they said, look, you got this office building. Nobody wants it solid to me. The bank would actually loan you the money to buy the property. So what I was saying on stage with Kenny yesterday, or two days ago in Dallas, how much money did you borrow? The secret to life is how much money can you borrow and how well can you manage that yet? And so that’s why I don’t worry because I know Ken McElroy,

Ken McElroy:
But also when you go get that bank owned property, what are they ask? Who’s your team? How are you going to manage it? And how are you going to fix it? Because that’s how they make money. So they’ll, it’s like, it’s almost like handing, you know, a Baton in a race. Like they hand you the Baton and they hope, you know, that, that you could take it up the value and then they can get it off there, up there, back up their books. And that’s essentially how the real money is made is you got to wait though. You don’t want to catch that falling knife. You want it to actually be at the bank. You want to go to the bank, you want to negotiate with the bank. And that’s where you want. That’s where you get the heaviest discounts on real estate. And then you fix it

Robert Kiyosaki:
So that, so Danielle, you know, you’re really young, but I remember somebody of these disasters. And finally I realized disasters were the best time to get rich. So, you know, the answer is I don’t really care because I know Ken McElroy, he can borrow money and he can fix the property we can change. And that’s what next year, the problem is those doctors came up to talk to Kenny. After we got off stage, they don’t have the skillset to think about what he does, right?

Ken McElroy:
Yep. They want to invest, but they actually don’t know why.

Robert Kiyosaki:
No, but they don’t have the skillset to manage what that, if you’re going to borrow that much money, you’ve got to have a team that can manage that much money. So it’s, it’s a very exciting time. And that’s, that’s why I’m happy. You guys invited me on your show because this is the best time, but you better know who, you know, you know what I mean? I don’t care if a doctor is the best doctor in the world, like I said, he’s a guy who’s gonna make a million dollars next year. And he’s going to get 600,000 of it. Cause the government and we can borrow a million dollars and that’s all tax free.

Ken McElroy:
And that is the name of the game. So it is a great time to get educated, sit back and watch, pour yourself into YouTube, try to get as many answers as you can and be the right at the right time. And you don’t need the cash. You need the knowledge and the team and the, and be able to manage this.

Robert Kiyosaki:
And that’s why your three books are like Bibles. The ABC is property management and then advance advances are the finals. The property management is the key. Yep. And then the ABC is, are the base. So you invest in that. You’ll make a lot more money than going back to college.

Ken McElroy:
Yeah. So we’re, we’re all waiting for a crash. That’s what all my, all my guys that made money in the past. They’re like, where do you think the crash? The number one question. When’s the sale.

Robert Kiyosaki:
I think it’s already here could be. That’s why this dumping treasuries, you know, that’s my interest rates so low. They need cash. Don’t those that sell treasury T-bills is for cash. Penny. The dollars.

Ken McElroy:
Yeah. It’s uh, it’s going to be interesting. That’s for sure. But you should not be too concerned. You just got to be aware.

Robert Kiyosaki:
Yeah. And then they’ll, I mean, Kennedy is the boy. I am not, not blowing smoke. I know I can’t do what Kenny does. I can only ride right at his tail. Right. So it’s really the best time because, um, anyway, it’s really a great time.

Ken McElroy:
I think so. I think so too, even though the media will tell you everything’s so bad and it is in a lot of respects, but there’s, there’s a lot of really good things happening and there’s a lot of positions you can put yourself into right now and be on the positive side of this. Well, we’ll have to come back on this one predated or this goes,

Robert Kiyosaki:
It’s such an exciting time. It’s such an exciting time.

Ken McElroy:
It kinda is to honestly, to watch it, especially if you have passive income, like we do. I mean, it is scary. It’s horrible. People are getting hurt and all that, but there is a way out of this and, and, and there’s, uh, there are things that you can do today to make sure that that you’re going to be fine.

Robert Kiyosaki:
Yeah. And I would get Kennedy’s three bucks because the key to it is debt and texts. If you can manage debt and you know, you don’t pay taxes you’re way ahead, way down the road. So it, because as long as you can borrow money, the banks are happy to give them, but you’ve got to have the collateral. Right. Kenny.

Ken McElroy:
All right, Robert. Well, thanks again. Awesome. Hanging the weekend with you. And I can’t wait to watch the new video tomorrow and be ready for our Thursday talk again. Yeah.

Robert Kiyosaki:
Yeah. So thank you, Danille. You must, it was really a fun trip. It was a,

Ken McElroy:
It was fun. I wouldn’t have got, could have been there. Ken, when I got injured, if I was like, that’s for sure. She would have kept me out of trouble.

Robert Kiyosaki:
Just remember my saying, yay. Walked through the valley of the shadow of death. I shall fear no evil because I have my lyrics yet. That’s right. I can get out of here quickly.

Ken McElroy:
No, I know. Well, I’m glad you have that. Okay. Robert, actually chat with you and see you buddy. Talk to you soon.

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Ken McElroy has lived and breathed real estate for his entire adult life, learning from the ground up. He shares his insights and experiences on his podcast, “Real Estate Strategies with Ken McElroy,” and on his wildly popular YouTube channel. Ken is passionate about educating others so that they too can experience financial freedom through real estate investing.
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