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'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

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Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#61
post #34

Earlier quoted context omitted.

Doesn't mean it's wrong. Besides, it only sounds bad if you care about economic output and give it a moral value.

It's woefully short sighted, as it misses the long-term prospect of economic output, as most classes of people you mentioned provide some economic benefit in one way or another. Cynicism should be precise, in my opinion.

You can swing to the opposite end of the spectrum and argue that everybody is economically useful indirectly to the point that any meaningful definition of economic utility is gone.

I think emotional opposition to what I wrote comes mainly from the fact that people tend to give moral valuation to economic usefulness. If you are not useful, you are bad. And since they don't want to think about large amount of people as bad, cognitive dissonance arises and forces them to extend the definition of economic utility till they feel comfortable again. Till they narrowed down the amount of bad people to fit their comfortable world view.

I think much healthier way is to say that economic utility and morality are orthogonal and it's perfectly fine that retirees or learners don't have economical utility without any additional justifications. This approach allows making moral judgements more freely and accurately. In this framework, being economically useful can't be used to cover immoral behavior and lack of usefulness can't be used to stigmatize perfectly harmless people or even those useful in other ways.

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#62
post #30

Earlier quoted context omitted.

> Society is built from people producing economic output. That's a very idealistic image. People producing economic output are a not that large fraction of society. There are a lot of people in the society who are useless or harmful from the point of view of economic output. Military, advertising, retirees, children and full-time learners, significant fraction of bureaucrats and political class, successful rent seeke…

'Economic output' might be too specific a term for an outsider like me to wield accurately. Elder care, child care, education, health, etc. are all services that benefit society. I don't mean to complain about people who need those services. The military and politicians have their roles too (though I bristle at 'policital class').

I didn't mention care. Care is beneficial. But saying that the reason for care is economically beneficial gets very close to broken window fallacy.

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#63

Earlier quoted context omitted.

If you owe the hospital $1,000 that's your problem. If you owe the hospital $100,000 that's their problem. Medical debt is the #1 USA reason to personally declare bankruptcy... USA! USA!! USA!!! [EDIT]: Despite this comment's unpopularity, this was how I first heard a similar quote, over a decade ago (in Medical School)... so it remains posted =P

This is a typical saying in many languages. You owe , it's your problem. You owe , it's their problem. Coz if you get hit by a bus good luck collecting on the debt.. Now, regarding the medical debt.. I remember the day that I found out that in EU i was getting €60k gross, for a job that would pay $130k gross in the US.. so yeah.. eat well, work out, and if in the US you can save an extra $30-50k per year depending on…

I have a childhood medical condition that has caused me a lifetime of marginal disability. I eat right and work out (as much as possible with the disability and it causes me much pain). I also save lots of money because I assume I'm going to need all of it for medical purposes at some point, and I'll still end up poor. Such is life I suppose, but it is possible to imagine a better system at least.

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#64

I think the guy is one of the biggest intellectual scammers out there. He wrote his famous book when working a normal 8 hour job and was nowhere near being wealthy. He wasn't a rich dad. Just a normal guy.

That famous book doesn't claim anything about his wealth, though. It's about his somewhat editorialized childhood/adolescence experience with two adults - his own father and a mentor - and the difference in their behavior and outcomes.

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#65
post #9

If you owe the bank $100k that's your problem. If you owe the bank $100M that's their problem.

If you owe the hospital $1,000 that's your problem. If you owe the hospital $100,000 that's their problem. Medical debt is the #1 USA reason to personally declare bankruptcy... USA! USA!! USA!!! [EDIT]: Despite this comment's unpopularity, this was how I first heard a similar quote, over a decade ago (in Medical School)... so it remains posted =P

> Medical debt is the #1 USA reason to personally declare bankruptcy... USA! USA!! USA!!!

Good for them. Health insurance / medical care debt in EU (yes, that definitely exists) can't be handled by declaring bankruptcy, they're going to take practically all your money directly from your bank account until you die homeless.

I personally had this problem, fortunately I work in IT so I got out of it. Ever since then I am helping people in this situation - it's really not unheard of.

EU!!! EU!!! EU!!!

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#66
post #7

Earlier quoted context omitted.

> While he recommends leveraging debt to buy assets, he disapproves of taking out a loan to buy materialistic items that won’t increase in value or pay dividends. > “A lot of people use debt to buy liabilities,” he said. “I drive a Ferrari. Guess what? It’s paid off 100% because it’s a liability. I drive a Rolls-Royce. It’s paid off 100% because it’s a liability.” There's your answer. And this is actually sound advic…

Note that he didn't say depreciating asset, he said liability. I've always considered cars a liability and I'm glad to see I'm not alone.

Exactly. I just used the depreciables term in case someone put out an argument stating cars can still be resold for some "asset" value.

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#67

Earlier quoted context omitted.

Good sarcasm :) I don't know who you are and how much you make. The first thing I do when I get paid is "pay my future self". Believe it or not, food comes second. The order of business is 1) Invest, 2) Save, 3) Spend. Never the other way around. I follow a mix of "7 accounts.." ( https://www.youtube.com/watch?v=auzLhKvsxnQ ), Intelligent Investor (for investments - mostly VOO or VOOG with some SOXX). I perhaps save…

You say every 3 years like that's a long time. Is this more sarcasm?

At their income level, probably changing phones every year would be a common practice.

But their communicational goal here is just to say they consume less than their income would allow in the short term.

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#68
post #20

Earlier quoted context omitted.

His debt doesn't fund consumption, it funds real estate, which he rents or sells for a profit. He's not advocating to go into debt for a lush Bahamas vacation. The value of long-term debt to fund real assets is that inflation corrodes the debt value, while boosting the asset value. Even if the asset doesn't appreciate above the inflation (meaning you do nothing all day), you can still make money if interest is lower…

> Even if the asset doesn't appreciate above the inflation (meaning you do nothing all day), you can still make money if interest is lower than the inflation rate. It's a shame that lending institutions also understand this and attempt to set their lending rates accordingly.

They don't care. In the US, reserve requirements are very low. For every dollar of capital, they can lend 10x, 20x more. They literally create money out of thin air.

When a lender pays interest, even if it's below inflation rate, banks still make profit, because they didn't have to put any real assets, so the opportunity cost is zero.

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#69
post #36
post #20

Earlier quoted context omitted.

His debt doesn't fund consumption, it funds real estate, which he rents or sells for a profit. He's not advocating to go into debt for a lush Bahamas vacation. The value of long-term debt to fund real assets is that inflation corrodes the debt value, while boosting the asset value. Even if the asset doesn't appreciate above the inflation (meaning you do nothing all day), you can still make money if interest is lower…

Stupid me. I was using money to buy food the whole time.

If you mean you were using debt to buy food and thought it's sustainable, it's an arguably stupid behavior, indeed.

Re: 'Rich Dad, Poor Dad' author Robert Kiyosaki reveals he's $1B in debt

#70
post #9

If you owe the bank $100k that's your problem. If you owe the bank $100M that's their problem.

If you owe the hospital $1,000 that's your problem. If you owe the hospital $100,000 that's their problem. Medical debt is the #1 USA reason to personally declare bankruptcy... USA! USA!! USA!!! [EDIT]: Despite this comment's unpopularity, this was how I first heard a similar quote, over a decade ago (in Medical School)... so it remains posted =P

In the US, roughly 80% of medical costs are from chronic illness, and roughly 80% of chronic illness is caused by obesity.

So it stands to reason that ~64% of those medical debt bankruptcies are nobody's fault but their own because they refused to put down the twinkies.

I love how everyone loves to denigrate the health coverage situation in the US but fails to account for how fucking fat and lazy we are. There is no political solution for our unique problems, short of public hangings of food industry executives and mandatory rationing, both of which are anathema to the American Zeitgeist. Single-payer healthcare would only make the problem worse, as it would increase the moral hazard to stuffing our faces.

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