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They don’t come bigger in personal finance circles worldwide than Robert Kiyosaki, author of the all-time best-selling money book, Rich Dad Poor Dad. I grabbed half an hour with him last week for CNBC Africa to talk about his 19th and latest book, Second Chance. It’s very different to the best-seller that has given him such a massive profile. In it Kiyosaki, now approaching 70, shows his reflective side, explaining why such admiration for his hero “Bucky” Fuller, the genius philosopher who believed all of life is a grand experiment by the Great Spirit. Here’s Part One (Part 2 available here) of a fascinating discussion that takes us through his own journey, why he admires Fuller so deeply – and banks so little. And tells us why he is so worried about stock markets. – Alec Hogg
I’m with Robert Kiyosaki. The man who, many years ago, introduced many people around the world to a book called ‘Rich Dad, Poor Dad’. I’ve had the privilege of engaging with Robert a few times on radio but this is the first time on television.
Thank you for that.
Robert, thank you for being with us here, in South Africa. You’re a regular visitor to the country.
I love South Africa. I love Africa but I love South Africa even more. It’s great.
‘Rich Dad, Poor Dad’ – just an update, how many copies have now been sold?
Whether it is legally printed and bootlegged, so probably about 50 million.
Incredible, I like the book but this new book, ‘Second Chance’. You say it all started in 1967, when you went to the man who you dedicated the book to: Dr R Buckminster Fuller, your hero.
Right, Dr Fuller is considered one of the world’s greatest geniuses. He went to Harvard twice. He was thrown out twice. AIA, American Institute of Architects, he was considered one of the greatest architects. He designed the geodesic dome, so in 1967, I hitchhiked from New York to Montreal, Canada to see the geodesic dome, and the man who could see the future.
I not just saw the dome but I was fascinated by Fuller and then in 1981, I came – then I saw him on several times. I was a little guy in the audience. Then in 1981, in Kirkwood, California, which is just south to the Lake Tahoe, I had the chance to spend a week with him and that week with him changed my life.
Well, up until 1981, I was what you would call a greedy capitalist, hard-core, just make money, screw everybody and all this, and then after Fuller I realised it was a higher calling to just making money. That really put me in a tailspin because my fundamental beliefs about money, and why I was an entrepreneur changed. I realised I had better start working for everybody and not just myself. That was a change.
In the book you write about Fuller’s belief that there is an experiment God is making on Earth with mankind.
Well Fuller wasn’t really religious, but when he spoke of God, he liked what the American-Indian called the Great Spirit that binds all of us, if we can feel it or not feel it. He basically believed that God wanted to find out if human beings were going to choose heaven on earth or kill ourselves. That was the choice and that’s what he was best known for.
He had these things called generalised principles. General principles are principles that are true in all cases, so I set out to study the generalised principles he talked about, but I only got to five and out of those five principles, I made millions of Dollars, without having to screw people. It was a whole other mind shift – a higher mind shift, a more spiritual mind shift, then just making money for myself.
And that kicked you into writing ‘Rich Dad, Poor Dad’.
Yes, Fuller was a futurist and he made predictions. Like he died in 1983, July 1st, but he predicted, before the end of the decade, before 1990, there would be a new technology that would change the world. As we know, in 1989/1990, ARPANET became the Internet and the Internet has now changed the world, so he has made about 250 predictions and most have come true. Some are still yet to come true, so that is what he was known for.
Your book that sold 50 million copies was a result of what you learnt from Bucky Fuller?
Well it was a combination of Bucky Fuller and my Rich dad, because they were basically saying the same things. My rich dad was an uneducated man but a hard-core capitalist, and Bucky was highly educated but a hard-core socialist, but they had big hearts. They weren’t mean people. Reading Bucky Fuller and studying with him and studying with my rich dad, I realised that both were saying the same thing, and that was that we’re being ripped-off financially that the world is setup to make us poorer, not richer.
You offer some fairly controversial opinions referencing Fuller’s book Grunch of Giants////
Well he died on July 1st, 1983, and then a few months later, post humorously, Grunch of Giants was published and Grunch stands for gross universal cash heist. In other words, we’re being ripped off by the very thing we work for – is money.
Cash heist? Sounds like people driving into a bank and stealing our money….
Yes, that’s exactly what he was saying and it was exactly what my rich dad was saying, so when I read Grunch of Giants. It was his first book it was Fuller’s first book on the economy. All of his books were on maths, and science and design, and architecture and very, heavy stuff.
When I read ‘Grunch of Giants’ both rich dad and poor dad, I mean both my rich dad and Bucky Fuller made sense, and that’s why, if you had read ‘Rich Dad, Poor Dad’, my rich dad said ‘never work for money’ and Bucky was saying ‘that’s how our wealth is stolen, is through our monetary system’. Which setup my campaign in ‘Rich Dad, Poor Dad’, to, basically dumb down, to make what Fuller, who was hard to read, as you know?
And rich dad made it simple enough for average people like me to understand, so Rich Dad, Poor Dad is a compilation of both Fuller and my rich dad. Made simple enough, so the average person could understand what our schools don’t teach us about money.
Steve Jobs always said if you – things are very complex but if you can tone it down to make it simple that people can understand, and clearly with Rich Dad Poor Dad, you…
Made it simple.
What was the overriding thrust of the message in the book, looking back at it now?
Well it goes simply about money as a vocabulary. You know as we learn to speak Xhosa or English, or Japanese. Well money has its own language, so if you understand the vocabulary of money, you know, words can make you richer. Words become flesh, as they say in the Bible, so by teaching people the proper definition of each word. Like income, expense, asset, liability, and cash flow, which are the six basic words of money. If you understand income, expense, asset, liability, and cash flow, you can control your life financially.
If you don’t understand money, as you say, people who are uneducated, financially, do not ask tough questions.
We see that all over the world.
Right, well people call their house an asset but if you can read a financial statement, you’ll see most peoples’ houses are liabilities.
Because they drain your cash?
Because it is taking it all, simple. Assets put money in your pocket and liabilities take money from your pocket, so you have your nice BMW. You might call it an asset but your banker calls it a liability, but they’re happy because you’re making monthly payments on it.
Just before we go into your views of where we’re going, into the future. You also look at how the banking system has affected or changed the structure, enslaved in many ways is the way, in fact, that’s the way you put it.
Yes, and I’m against the banking system. Nor am I against the stock market. I love the JSE. I thought about listing here at one time but Toronto Stock Exchange offered me a better deal. What I’m against is the lack of financial education. We’re all are interested in money, so why don’t we teach money at school? That has been my complaint forever.
Why don’t we? I know you have some pretty strong views in the book. Tell us why you don’t think that financial education is passed on in schools.
Well my research found that back in 1903, a man named Jonty Rockefeller and Carnegie, and those guys took over the academic systems of the world, and that’s why they created, in 1903, a thing called the General Education Board and they determined what you learn at school. That’s why there’s no financial education in school. I remember raising my hand and going ‘hey’. I was nine years old. I said, “When I’m going to learn about money?” The teacher said, “We don’t teach you about money in school.” I said, “Then why am I in school?”
It’s an extraordinary, and many people will think that, come on that’s a conspiracy theory that Rockefeller and Carnegie, etcetera, but it is extraordinary that there is no financial education at school.
No, the purpose of education, the current education throughout the world actually comes from Prussia, the German System, and the purpose of the Prussian System of Education was to create employees and soldiers. People who would do what they were told, but not think.
All right, so looking at this book. It is thought provoking, if nothing else. In fact, it’s lots of things.
However, it also is pretty out there because Clay Christensen, who’s the greatest business thinker in the world, is very open with his faith. This is only the second time that I’ve seen somebody of the same kind of position, talking about their faith in the way that he does, and you do here.
So what is it that drives you? You talk about there are certain rules that God gave man, so that man could pass this great experiment that Bucky Fuller talks about.
Right, and again, I’m not really religious but I’m very spiritual. I spent two years in Vietnam and I saw what I called ‘dead men kept fighting’, so I know there had to be something, you know. I believe we are all here for a purpose, and when we find our purpose, you become self-actualised, like Maslow’s Hierarchy of needs, and I didn’t really realise that my purpose was to teach because I hated school. Then one day I studied Fuller and I went ‘oh my God I have to start teaching’ and that was probably on the totem pole of lists – teacher, last position, and now I’m an entrepreneur in education but it was like ‘oh my God that’s what I was supposed to do’. I didn’t’ know that. I was just making money for me. Rather than telling people what I know, so that’s when I started to write.
Your life changed when you were 50 years old. On your 50th birthday – you took a chance. You wrote your own book. You published it yourself. No one was interested, initially but my goodness, the public were.
Yes, I remember people telling me ‘you should stick to your old job’ and I never expected Rich Dad Poor Dad to take off. First, I created the Cash Flow game, which is how I learnt about money. I played Monopoly with my rich dad for years, so Cash Flow is the only game that’s a step above Monopoly, and then I couldn’t sell the game, so then being a marketing guy – I wrote Rich Dad Poor Dad, out of desperation. Then that book didn’t sell either and then it took off with Oprah called me two or three years later. I went on the Oprah show, and suddenly I went from ‘nobody knew me’ to ‘infamous’. A legend in my own mind but that’s the power of faith. That’s the power of Spirit.
Yes, you do have people, pundits saying it’s simplistic. You don’t know what you’re talking about. How can you call a house not an asset, and I’m sure Second Chance will have the similar kind of criticism.
Absolutely, if you’re not saying something, you’re never criticised and my friend, Donald Trump right now, is in a lot of hot water. He’s saying things that he shouldn’t say. I don’t agree with but that’s the chance you take, when you come on programs such as yours, etcetera. You will always be criticised.
We’re talking with Robert Kiyosaki. The author of ‘Rich Dad, Poor Dad’, one of the greatest selling financial books of all time. He’s also just written Second Chance, which is a lot deeper. If you thought that ‘Rich Dad, Poor Dad’ was deep well wait until you get onto this one. The second part of the interview is available here – Kiyosaki waxes lyrical about two books that are shaking economic thinking in Southern Africa. He describes RW Johnson’s treatise as a must read – suggesting at the current rate of its Government’s debt accumulation, SA has just two years of “freedom” left.