Why the Game of Money Is Rigged
In a few months, my new book, FAKE: Fake Money, Fake Teachers, Fake Assets, is set to be released. To be honest, I’m still writing it. My publisher isn’t happy with me right now, but it’s something we’ve gone through with every book I’ve written. In the end, I meet the deadline and she can finally get some sleep.
When I wrote Rich Dad Poor Dad in 1997, it was to sell the board game that Kim and I created called CASHFLOW®. I never in all my life would have guessed that it would become the #1 personal finance book of all time. It has been said that it’s changed the way people think about money.
With the new book, I want to change more than the way you might think about money. I want you to understand the lies that have been told to us for decades.
A Brief History
It all starts with this diagram below: 120 years of the DOW.
If you look closely, you’ll see the GIANT crash of 1929. This crash put us into a depression that lasted 25 years. It nearly wiped out the U.S. And it was just this little blip—compared to what would hit the U.S. later.
As you follow through the years, you’ll see in 2000 the dot.com bubble, and then the financial crisis in 2007. You can see how significant these bubbles were. Yet, it seems we haven’t learned from what this chart is trying to tell us.
To predict the future, you have to understand the past.
Gross. Universal. Cash. Heist.
In 1983, my teacher was Dr. R. Buckminster Fuller, and he was famous for the geodesic dome, which was the U.S. Pavilion for the World’s Fair in Montreal in 1967. I studied with him for three summers.
Sadly, Fuller passed away on July 1st, 1983. After he died, his book, Grunch of Giants, was published posthumously. Fuller is more known as a scientist and a mathematician and an architect. When he wrote this book, it was a different kind of book. It was a departure from what he normally wrote about.
Grunch stands for Gross. Universal. Cash. Heist. It’s about who really runs the world economy. So, I read this book, and that’s when I really began to study. For the first time in my life, I became a student. I was a screw off before that. It made me question, “What is Grunch, who are these guys? Who are these guys that are controlling the world?” That was my question.
So, as Fuller said “Get the student out of school and get him back to his studies.”
I realized Fuller was saying the same thing my rich dad was saying. The game is rigged, the game of money is rigged against you and me. The problem was rich dad couldn’t really prove it.
In my book, FAKE, it’s going to prove to you that the game of money is rigged against you.
In FAKE, I talk about the three types of “fakes” that are in this world. Number one is fake money. When I studied Fuller, that’s when I realized this. Number two is fake teachers, and number three is fake assets.
Most teachers in school, while they’re good people, most of them really don’t understand money. So, they really can’t teach you about money, so I call them fake teachers. Because, they tell you to go to school, get a job, save money. And work hard and get out of debt. The problem is they don’t know what they’re talking about.
You’ve got to know who the real teachers are.
In 1971 when Nixon took the dollar off the gold standard, the U.S. dollar became fake. Later, in 1987, after Black Monday happened, they said, “Oh my God, how do we prevent it from crashing again?” So, they started creating fake assets.
In 1999 when President Clinton repealed the Glass-Steagall Act, our money turned into a casino…one big casino. They could take your savings and they could put it into a casino. If they lost your money, tough. The taxpayer covered the bill.
That’s why the Glass-Steagall act in 1999 was so crucial. They took your savings, put it in the casino.
Today, we have fake assets.
We had this crash in 2000, and they created more fake assets. The stock market went up in 2008, they say it was a real estate crash. It wasn’t a real estate crash, it was a fake asset crash. Fake assets called CDLs, collateralized debt obligations, MBSs, mortgage backed securities, and CDSs, credit default swaps.
And when it crashed, they did it again. They printed even more fake assets, because what happens when the markets crash, the rich get richer, and everybody else gets poorer.
We foot the bill, you and I the taxpayer, foot the bill. Is that fair?
Las Vegas Can’t Exist Without Losers and Neither Can the Government
Again, it’s a casino, and a casino depends upon losers coming in, so those at the top can win. In 1974, it was a thing called a 401K. They needed more losers to enter the market. So what did the financial planners tell you? “Save money and invest for the long term of the stock market.” They needed people to come in and push it up.
Again, it’s a casino, like Las Vegas, a lot of losers walk in, and only winners walk out with the money. That’s the game.
Why would anyone invest for the long term in the stock market when it’s a casino? My concern is, the old guys like me, are sitting there with their retirement plans which are broke.
The California retirement system is broke, Hawaii retirement system is broke. Chicago’s retirement system is broke. And if and when this baby comes down, my generation is toast.
So, the reason I wrote the book Fake, is so you can understand what has happened in the past so you can prepare for the future. Hopefully, you can protect yourself when the next crash comes. And it’s coming.
People say, “How do you know it’s coming?”
Well, markets always crash. Everything goes up, everything comes down. That’s real life.
Editor, Rich Dad Poor Dad Daily
This story originally appeared in the Daily Reckoning . The Daily Reckoning, offers a uniquely refreshing, perspective on the global economy, investing, gold, stocks and today’s markets. Its been called “the most entertaining read of the day.