On Tuesday (May 19), Robert Kiyosaki, the highly successful and world-renowned author of the "Rich Dad Poor Dad' series of personal finance books, made yet another passionate plea for people to protect their savings -- from the unlimited money printing that central banks seem prepared do -- by investing in silver, gold, and Bitcoin.
"Rich Dad Poor Dad", which is one of the top 10 personal finance books of all time, is a book that "advocates the importance of financial literacy (financial education), financial independence and building wealth through investing in assets, real estate investing, starting and owning businesses, as well as increasing one's financial intelligence (financial IQ) to improve one's business and financial aptitude."
Yesterday, Kiyosaki, who has been criticizing for the past several weeks the Federal Reserve's response to the economic damage caused by the COVID-19 pandemic, sent out a tweet that seemingly strongly urged his 1.3 million followers to protect themselves from what he feels is inevitable high inflation (and possibly hyperinflation) in the future by using their dollars to buy silver, gold, and Bitcoin:
NEW YORK CITY GOING BROKE. All cities count on INCOME TAX, SALES TAX & REAL ESTATE TAXES, especially COMMERCIAL RE. Add pension contributions for teachers firefighters & police. USA GOING BROZkE. FED PRINTING FAKE $ cannot SAVE YOU. Get gold silver Bitcoin and SAVE YOUR SELF.— therealkiyosaki (@theRealKiyosaki) May 19, 2020
Last Saturday (May 16), Kiyosaki sent out a tweet that laid out where he thinks the prices of silver, gold, and Bitcoin would go within the next few years:
ECONOMY dying. FED incompetent. Next BAILOUT trillions in pensions. HOPE fading. Bought more gold silver Bitcoin. GOLD @$1700. Predict $3000 in 1 year. Silver @ $17. Predict $40 in 5 years. Bitcoin @$9800. Predict $75000 in 3 years. PRAY for the BEST-PREPARE for the WORST.— therealkiyosaki (@theRealKiyosaki) May 16, 2020
In the past one-month period, according to data from GoldSilver, LLC, the price of silver has gone from $15.25 an ounce to $17577 an ounce (a gain of 15.21%).
As for gold, its price has gone from $1,691.11 per ounce to $1,754.20 (a gain of 3.73%), but in the year-to-date period, the gold price has gone up 15.61%.
In the case of Bitcoin, according to data from CryptoCompare, BTC-USD is currently trading at $9,772, pretty much unchanged in the past 24-hour period:
However, so far in 2020, the price of Bitcoin has gone up 36.04% (against USD).
Episode #263 of Anthony Pompliano's "Pomp Podcast", which was released on April 7, featured an interview with Kiyosaki.
During this interview, Pompliano (aka "Pomp") was asked about Kiyosaki's latest thinking on "traditional inflation hedge" type assets such as silver and gold.
Here is what Kiyosaki said:
"Gold and silver are God's money. Bitcoin is open source people's money."
Kiyosaki is not alone in being concerned about the huge amounts of quantitative easing (EQ) by the major central banks in their fight against the economic imact of the current COVID-19 pandemic.
With regards to gold, TD Securities, Bank of America, Goldman Sachs are just a few of the investment banks that in the past few weeks have raised their price targets for gold.
During an interview on May 12 with Alix Steel, a co-anchor of Bloomberg Television's flagship morning show "Bloomberg Daybreak: Americas", Jeff Curie, global head of Commodities Research in Global Investment Research (GIR) at Goldman Sachs outlined his reasons for being bullish on gold.
When Steel asked Curie if he had "a favorite commodity trade", this was his reply:
"At this point right now, we still really like gold.
"There are a lot of reasons to own gold. Foremost is that you are still seeing the debasement effects of all the stimulus going on..."
According to a report in MarketWatch that got published on March 24, Curie and his team wrote in a note to the investment bank's clients:
"We have long argued that gold is the currency of last resort, acting as a hedge against currency debasement when policy makers act to accommodate shocks such as the one being experienced now."
On April 21, Bloomberg reported that Bank of America had increased its 18-month price target for gold from $2,000 to $3,000 an ounce in a report titled “The Fed can’t print gold.”
BofA's research report was written by Metal Strategist Michael Widmer, who is head of research in metal markets, and Francisco Blanch, who is the global head of commodities research.
The two analysts/strategists expect the demand for gold to go up as governments around the world use monetary and fiscal tools to combat the economic damage caused by the COVID-19 pandemic:
"As economic output contracts sharply, fiscal outlays surge, and central bank balance sheets double, fiat currencies could come under pressure... Investors will aim for gold."
On April 7, Michael Novogratz, a former Goldman Sachs partner, as well as Founder, Chairman, and CEO of crypto-focused merchant bank Galaxy Digital, said that all of these massive economic stimulus packages that we are currently seeing should benefit hard assets such as gold and Bitcoin.
His comments were delivered during an interview with Rebecca Quick on CNBC's "pre-market" morning news and talk program "Squawk Box".
When Quick asked Novogratz if he was putting any money into the markets right now, this was the reply:
"I have a big Bitcoin position. I continue to add to it partly because I think this is an amazing environment for both being long gold and long Bitcoin.
"Nancy Pelosi came out today to talk about another trillion dollars of stimulus.
"Money is growing on trees right now. I learned as a little kid that money really doesn't grow on trees, and so we have a global money printing orgy going on.
"And maybe it's necessary, but at one point that comes home to roost, and so I think hard assets are going be a big buy. Gold [and] Bitcoin are my two favorites."
And in the crypto space, there is definitely no shortage of critics of the Fed's recent actions.
For example, yesterday, American entrepreneur Alex Mashinsky, the Founder and CEO of Celsius Network, was interviewed by Kitco News.
Here is what he had to say about the Fed's QE efforts:
“All that is not good for us long-term. What we’re really doing is is we’re borrowing from the future. We’re reaching out to the future, we’re borrowing from our children, spending it today to save our lifestyle and our level of income and we’re leaving the IOU to our children."
In the current environment, Mashinsky recommends allocating 25% of your assets to gold and 5% to Bitcoin.
Lastly, although silver, which some people saw as a high beta version of gold, is not as popular as gold as an inflation hedge, there are many people who feel that it is currently undervalued at the moment.
On May 15, prominent analyst/trader Chris Vermeulen said in a market commentary for Kitco News:
"Today, both Gold and Silver are making bigger upside price moves with Silver up over 3% while Gold is up 1.3%.
"We believe this nearly 250% faster Silver advance may be the start of what we have been predicting for many months – an incredible parabolic upside price advance in BOTH Gold and Silver.
"Earlier research by our team suggested that a set up would happen in Precious Metals where Silver began advancing much faster than Gold and that this move would likely prompt a downside move in the Gold to Silver Ratio targeting the 50 to 65 level.
"Our earlier research suggests when this move/setup begins, we could begin to experience a nearly 250% to 350% rally in gold, targeting $3750 or higher, and a 550% to 650% rally in Silver, targeting over $70, over a 12+ month span of time."