Photo from Unsplash
Originally Posted On: https://investingin.gold/robert-kiyosaki/
The second largest property developer in China, Evergrande, has been rocky recently and the whole market has noticed it. The default of the developer is looming over the market.
Robert Kiyosaki is the author of “Rich Dad Poor Dad” and a big name in the financial world and he predicts that the default of Evergrande is going to lead to a major economic crash. In a tweet he said:
“HOUSE of CARDs coming down. Real estate crashing with stock market, China’s Evergrande Group cannot pay. Valuation of properties fake. Will real estate crash spread to US? Yes.”
In an interview with Kitco News he also said, “this is going to be the biggest crash in world history.”
Not wanting to be the complete pessimist, Kiyoaski has provided some guidance on how you can protect yourself from the downturn of the economy. This comes in the form of recommending that you diversify your assets with three investments.
Robert Kiyosaki’s recommendations:
When the market starts to go down, one of the first investments that starts to pay off is gold. It is also Kiyosaki’s first suggestion, an easy safe haven that you can seek out. Gold cannot be printed and is not controlled by world governments, so it is a currency that holds its value.
Getting ahead of the pack is important as many investors will move to gold when the market starts to turn downwards. The beginning months of COVID-19 saw the price of gold drive up over $250 an ounce. An easy investment in gold includes bullion and bars but those are expensive as it involves investing in a chunk of gold all at one time.
What is easier for investors without the money at hand is investing in gold mining companies. As the need/demand for gold goes up, these mines will profit more and then your shares perform better. At the same time, investing in these means you are not investing directly in the metal, you are investing in a company that deals with the metal and there is a risk there.
Silver is another one of those logical suggestions that Kiyosaki gives. It is another precious metal and trends just like gold. Silver stores value in the metal and also cannot be printed.
We are now seeing prices that are 30% higher over the last two years. Silver doesn’t show any sign of diminishing, especially with its currency use and use in certain industries.
Ways to invest in gold and silver include; bullion, bars, or mining companies. Something that is worth noting though is that silver has a lot of uses in the industrial world and as such some of the value comes from the demand there. If the industries that use silver start to have a downturn, the value of silver can be affected too.
For many people it might be a surprise that Kiyosaki now recommends Bitcoin as a way to hedge against the market crash. Let’s take a moment to look at why. Bitcoin has now entered the mainstream and a lot of people have started to invest. Its price is also holding at high values. In addition to that, it isn’t controlled by any government.
You can invest in Bitcoin directly through a number of companies. This allows you to have an asset that you can control on your own. At the same time, that comes with the volatility/risk that comes with the Bitcoin market. You can also invest in companies that work with Bitcoin such as Bitcoin farms.
Tesla has invested in Bitcoin according to CEO Elon Musk, in an attempt to protect themselves from any potential crash. Other companies and investors start to notice when a name as big as Tesla invest in something.
PayPal allows you to invest in cryptocurrencies through there system. You can buy, sell, and hold a number of cryptos directly through the same account you use to make online purchases. This simplifies the process of owning and selling crypto by a lot. It also reduces the number of accounts that you have to have.
A specific stock that you can invest in if you are interested in crypto related stocks as opposed to actual crypto is Nvidia. Nvidia makes graphics cards which are relied upon heavily in the mining of crypto coins, similar to what you would invest in for gold or silver mining. That being said, stocks are quite expensive. Nvidia starts around $205 for example.
With Bitcoin (and other crypto currencies) you can invest in a faction of a coin so you can invest the exact amount that you want or can afford to. For those that are looking to invest in the best option when it comes to crypto currencies, Bitcoin is the recommended option. The others can offer protection but they aren’t as well-known and reliable.
An Even Better Option
No matter which of the above three investment options you consider, they have risk to them. Even if they aren’t directly tied to the stock market or financial sector, when a crash hits, they will be affected.
Kiyosaki has an even better option for investors. You can invest in a more protected, better option, U.S. Farmland.
No matter what happens, people need to eat, even if there is a crash. Having agricultural land in your portfolio allows you to have a profit even when all else is down.
You can invest directly in farmland by buying a farm and managing it. There are also platforms that allow you to buy a stake in a farm in the U.S. With these platforms you earn money from the business that the farm does, such as leasing fees and the sales of crops. You will also have that investment for the long term. It will perform whether there is a crash or not.
As an informational article, we are only trying to outline options that you can use to help secure your financial future. We are not providing any kind of warranty.