The U.S. stock market showed impressive gains in 2023, and the latest gross domestic product (GDP) figure exceeded expectations. But according to “Rich Dad Poor Dad” author Robert Kiyosaki, the picture might not be as rosy as it appears.
“Don’t they know the stock market is up because Biden raised debt ceiling. America’s debt is going up … so stock market going up,” he wrote in a recent tweet. “America is broke.”
The author’s concern about America’s escalating debt was echoed by Fitch Ratings. Shortly after that tweet, Fitch downgraded the United States’ long-term foreign-currency issuer default rating from its highest AAA rating to AA+. The credit rating agency pointed to “expected fiscal deterioration over the next three years,” a “high and growing general government debt burden” and an “erosion of governance” as reasons behind the decision.
While some experts expect a soft landing for the U.S. economy, Kiyosaki is less optimistic.
“First shoe to drop. Fitch rating services downgrades U.S. credit rating from AAA to AA+. Brace for crash landing,” he tweeted. “Sorry for the bad news yet I have been warning for over a year the Fed, Treasury, big corp CEOs have smoking fantasy weed.”
Given this stern warning, where should concerned investors turn?
“Still prefer gold, silver, Bitcoin,” Kiyosaki said.
Here’s a closer look at these assets.
Gold And Silver
For thousands of years, gold and silver have served as a reliable store of value.
Unlike fiat money, which can be produced in unlimited quantities, these precious metals have an inherent scarcity, making them a valuable hedge against inflation. While headline inflation has come down recently, the price levels of many necessities — like food and housing — remain elevated. If you believe inflationary pressures are still on the horizon, you might want to give these metals a second look.
At the same time, gold and silver have historically been recognized as safe-haven assets, providing investors with a hedge against economic uncertainty and geopolitical risks. In times of political unrest, wars and other crises, gold and silver have often been sought as a refuge, given their global recognition and value.
Investors can gain exposure to the segment through exchange-traded funds (ETFs) like the SPDR Gold Shares (NYSE:GLD) and the iShares Silver Trust (NYSE:SLV). However, in an interview earlier this year, Kiyosaki said that he’s “staying away from the SLVs or the GLDs” because he wants “no counterparty risk.” Instead, he prefers physical bullion.
Some say that Bitcoin is the new gold. While Kiyosaki has long been a fan of the good old yellow metal, he likes cryptocurrency as well.
Last month, he tweeted, “Bitcoin to $120K next year.”
Considering that Bitcoin currently trades at $29,360, Kiyosaki’s price target implies a potential upside of more than 300%.
One of the things that makes Bitcoin appealing is that its total supply is capped at 21 million coins. This stands in stark contrast with fiat currencies, which can be printed at will by central banks.
Another hallmark feature of Bitcoin is that it is decentralized, meaning it operates independently of central banks and traditional financial systems. It can also act as an alternative means of storing and transferring value in the event that one country’s economy or currency is faltering — it is possible to send and receive Bitcoins anywhere in the world.
It’s easy to buy and sell Bitcoin these days. But the cryptocurrency is volatile. While the price of Bitcoin has surged 76% year to date, it’s still down more than 50% from its peak in November 2021.
If you don’t like that roller coaster ride, you might want to look into reliable income plays outside the crypto world such as investing in rental properties with as little as $100 while staying completely hands-off.
Image courtesy of Wikimedia Commons
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This article ‘America Is Broke’: Robert Kiyosaki Warns That A Crash Landing Is Coming, Says The Fed Has Been ‘Smoking Fantasy Weed’ — Here Are The 3 Assets He Likes For Shock Proofing originally appeared on Benzinga.com
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