Reed Review A Number of People Asked Me About Robert K

A number of people asked me about Robert T. Kiyosaki and his book Rich Dad, Poor Dad.
When I said I didnt think he was a

real-estate guru, they insisted he was. Several told me I would like him, that he preaches a message like mine. Eager to find such
a guru, I bought his book, Rich Dad, Poor Dad, in a bookstore.
Summary
Rich Dad, Poor Dad is one of the dumbest financial advice books I have ever read. It contains many factual errors and
numerous extremely unlikely accounts of events that supposedly occurred.
Kiyosaki is a salesman and a motivational speaker. He has no financial expertise and wont disclose his supposed real estate or
other investment success.
Rich Dad, Poor Dad contains much wrong advice, much bad advice, some dangerous advice, and virtually no good advice.
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Dangerous advice
"If you're gonna go broke, go broke big"

Convinces people that college is for suckers
I'm not the only critic
Law-breaking advice
Advocates committing a felony: have rich

friends for trading stock based on non-public
inside information, he says "That's what friends
are for."
Recommends tax fraud by deducting vacations
and health club dues
Brags about using a partner weasel clause in
which his cat is his partner
Wall Street Journal: "Rich Men, Poor Advice"

Smart Money Magazine: "Karma Chameleon"
Fiction posing as non-fiction
Oprah needs to confront Kiyosaki about calling a fiction book non-fiction just like she did
with James Frey
He asks why Rich Dad has to be any more truthful than Harry Potter
Admits fictionalizing on copyright page of Rich Kid, Poor Kid
Admits to 20/20 that he doesn't teach people how to get rich
Bad liar
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"Marine corps made him what he is today" - he was laterally transferred to the Marine Corp
from the Merchant Marine and Navy, he never went through the entry-level Marine
training
Can't keep track of his story

Shouts from the rooftops how rich he is, but
refuses to disclose real estate portfolio because
he "doesn't want people to know he has
money"
Lied about desertion while serving in Vietnam (admitted later he just missed the boat)
Became a helicopter pilot to "lead men" (platoon leaders and company commanders lead
men; pilots lead machinery)
Apparently lied about going bankrupt in 1985

Claimed his net worth is $50-$100 million
depending on the day; his Rich Dad Poor Dad
coauthor said in court that he only made $9
million
Rich Dad, Poor Dad triggers the following items on my Real Estate B.S. Artist Detection
Checklist: 1, 6, 7, 10, 11, 13, 20, 26, 27, 28, 29, 30, 31, 38, 39, 46, 49.
His "best teacher ever" changed repeatedly

1.
'92 - Ralph Kiyosaki (Poor Dad)
2.
'97 - Rich Dad
3.
'06 - Buckminster Fuller
The blueprint to becoming a "Financial Genius"
Kiyosaki sued by co-author Sharon Lechter

Sharon Lechter, Kiyosakis co-author of Rich Dad, Poor Dad, sued him in Clark County, NV (Civil Case #07-A-549886-C). It
was filed on 10/12/07. I would be interested in seeing the complaint. Apparently, little has happened in the case other than
motions to dismiss.
On 9/4/08, the Arizona Republic newspaper carried a story that said Kiyosaki had paid an undisclosed sum to Lechter to settle the
suit.
Creature of Amway
Over time, I have received numerous reports that Kiyosaki is primarily a creature of Amway (now Quixtar) and other multi-level
marketing organizations. Reportedly, his books were not selling until he allied himself with that crowd. Then the volume of sales
to those MLM guys made him a best-selling author, which caused normal non-MLM people to think the book must be good.
Click here for an email I received along those lines. There is an unauthorized Web site about Amway at www.amquix.info.
Some readers have said that if I am going to criticize Kiyosakis book, I must offer a version of how to better yourself that does
not have the flaws of Rich Dad Poor Dad. No problem. That would be my book Succeeding, which, somewhat to my surprise, is
my top seller of the 30+ different books I sell.
In the summer of 2007, the Ohio state government Division of Real Estate and Professional Licensing published an extraordinary
statement by a consumer of Robert Kiyosakis book Rich Dad Poor Dad and Cash Flow game. Be sure to read it at
www.johntreed.com/Ohioaction.html.
Selected emails from visitors to this page
Collection of age-old clichs about money

A reader suggested that Rich Dad Poor Dad is nothing but a collection of clichs about money. Old clichs. Clichs that have
been around since way before Kiyosaki claims rich dad originated them. The reader further said that Kiyosaki then appears to
have simply made up a bunch of accompanying phony stories to fill the clich collection out to the length of a book. She may be
right. For example, Kiyosakis fear-and-greed advice (see below) is an age-old Wall Street clich about securities prices.
Another reader put it this way,
But you have to admire a guy who can spin two or three paragraphs of very ordinary financial platitudes into such a range of books.
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Now admits 'fictionalizing'

On 8/15/01, a reader told me Kiyosaki now has the words Although based on a true story, certain events in this book have been
fictionalized for educational content and impact, in the fine print on the copyright page of Rich Kid Poor Kid. I had not
previously been aware that educational content and impact justified lying. Also, I am now confused as to why Kiyosakis books
are on the nonfiction best seller list if they are fictionalized. Probably because as A Million Little Pieces author James Frey
discovered, its a lot easier to be a best-selling author with a fictional book labeled non-fiction than with a novel.
John T. Reed's Youtube video on get-rich-quick gurus

Here are some clips where I mention get-rich-quick gurus from a speech I gave at the Bay Area Investor's Educational Services
on June 2, 2009 in San Francisco. The topic was my new book, Best Practices for the Intelligent Real Estate Investor.
See more YouTube videos of
John T. Reed
'Poor dad'
Back to top of page
The idea behind Kiyosakis title is that his real father was upper middle class. He graduated from Stanford, Chicago, and
Northwestern Universities, all on full scholarship, ultimately earning a Ph.D. He pursued a career in education and became the
head of the education department of the State of Hawaii. He owned the home in which the Kiyosaki family lived. Kiyosaki calls
him his poor dad.
'Rich dad'
One day, he asked his father how to make money. His father said he had not made much money and did not know how to make it.
He suggested that Robert ask the father of his next-door playmate, Mike. That boy's father was a successful local businessman.
He was also an eighth-grade dropout and ultimately a multimillionaire with a bunch of small businesses like construction,
restaurants, and convenience stores. Kiyosaki developed a father-son relationship with the neighbor. That is who he is referring to
when he uses the phrase rich dad.
One visitor to this site asked me if I was sure Rich Dad really exists. No, Im not. In fact, I now lean to believing that there
never was a Rich Dad, that Kiyosaki made the whole thing up. If I had written such a book, I would have named him in the
book, if only out of gratitude. It is noteworthy that Kiyosaki refuses to identify Rich Dad and the Honolulu Star-Bulletin was
unable to figure out who it was, in spite of the rather obvious next-door neighbor Mike whose father owns convenience stores,
restaurants, and a construction company clues. The man was purportedly around 30 to 45 years old in 1955. So he would be 83
to 98 now. How many people on that one street in Honolulu could possibly fit that description?
As I recall, the first convenience store was 7-11 and I believe they became widespread around the 1960s. Its possible Kiyosaki is
using the phrase convenience store loosely and really means corner groceries, which did exist in the 1950s.
But I also find the mix of business unlikely. The guy owns convenience stores, restaurants, and a construction company. I guess
I can imagine a guy who owns convenience stores and a construction company. Its odd, but not impossible. However, I have less
ability to picture a restaurateur who also owns a construction company. I knew one. His restaurant went out of business. For one
thing, the restaurant business is extremely management-intensive. At good restaurants, the owner is usually there almost all of the
time. Same is true of construction. Plus restaurateurs that Ive known are very different kinds of people from construction guys.
Kiyosakis real father (Poor Dad) was named Ralph Kiyosaki. I encourage readers in Hawaii to try to research Ralphs home
ownership when Kiyosaki was nine years old (1955) and try to figure out which adjacent or nearby homeowner might have been
Rich Dad. If we can find a person who fits the description, and he is either a public person or dead, I will publish the identity.
A bunch of people have told me Rich Dad was a now-dead guy named Kim or Kimi. Fine. Get Kiyosaki to say that. Or get
Kims surviving relatives, like Kiyosakis friend Mike, to say it. A bunch of yahoos on the Internet saying it means nothing.
People on the Internet see Elvis at their 7-11.
1992 book versus 1997

In 1992, Kiyosaki wrote a book called If You Want to Be Rich and Happy, Dont Go To School? It is dedicated to Ralph H.
Kiyosaki, former Superintendent of Education, State of Hawaii, the best teacher I ever had. This would be Poor Dad. But Rich
Dad Poor Dad, which came out in 1997, says quite emphatically that Rich Dad was the best teacher he ever had.
So maybe Rich Dad was the second best teacher he ever had. No. Actually, the 1992 book also identifies the second best
teacher Kiyosaki ever had: F. Marshall Thurber.
OK. So maybe Rich Dad was third. No. Kiyosakis 1992 book has an unusually long acknowledgment section. It lists 111
people, none of whom appears to be Rich Dad. That is, none are singled out except for his Poor Dad parents, in-laws,
business partner, and editors.
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Mind you, according to the 1997 book Rich Dad Poor Dad, Rich Dad supposedly became central to Kiyosakis life starting in
1955 when he was nine. So where was Rich Dad in 1992 when Kiyosaki was so diligent at identifying the people who had been
important in his life?
In a 4/18/06 Yahoo! column, Kiyosaki now says the best teacher he ever had was Buckminster Fuller. It would be a bit of an
understatement to say that Fuller was not an eighth-grade dropout who owned convenience stores.
Getch yer programs right here! Ya cant keep track of Kiyosakis best teacher he ever had without a program!
EST then Money and You

A man who says he has known Kiyosaki since the military in Hawaii says Kiyosaki got his start in the tell other people how to
live their lives business as a result of taking then becoming a speaker in the Money and You organization.
Money and You was a seminar company started by Marshall Thurber, an est graduate. Est was a notorious seminar company in
northern California run by Werner Erhard. Werner Erhard is apparently one of many aliases used by John Paul (Jack) Rosenberg,
a Philadelphian who started in life as a car salesman and who then moved through a series of aliases, sales careers, and wives
before coming up with the name Erhard and the est seminars. They were famous for not letting participants go to the bathroom
and for maddeningly vague advice. For a while, they were going to cure world hunger by getting a lot of people just to think
about it.
Money and You was reportedly a useful seminar. Shortly after Kiyosaki went to mainland U.S. from Hawaii to run away with
Thurbers circus, Thurber decided to shut it down. Thurber let Kiyosaki and some other speakers take over the business. They
promptly emphasized the Australian and New Zealand markets which have, at times in their history, overvalued products and
services from the U.S.
Their run in Australia ended when the Australian equivalent of 60 Minutes did an expos about Money and You.
Basically, it appears that Kiyosaki is a good salesman, although we sort of have to take his word for it pending confirmation from
Xerox. Good salesman is the universal description of all the expensive so-called real estate investment gurus. They are sales
guys, not real estate guys. Apparently Kiyosaki is yet another example.
This caller also said that Kiyosakis wife Kim appears to be the one who invested in Phoenix real estate. Bob appears to be the
Ralph Kramden (main character of the Honeymooners TV series) of the family, perennially hatching one-hare-brained get-richquick scheme after another (like Kiyosakis Money and you, velcro surfer wallets, and Rock T-shirt businesses) while his wife
invests in basic stuff. I am not ready to anoint her a financial genius. One would have to inquire as to whether their real estate
investments in Phoenix appreciated more than those owned by the average person. Most likely, they made the same return on
their properties as Joe and Jean Average Phoenix homeowner. If so, they would be as qualified as Joe and Jean homeowner to
write a book about it. As I have said in many articles in my newsletter Real Estate Investors Monthly, extraordinary performance
in real estate is measured by the degree to which your returns exceed those of ordinary homeowners who claim no expertise. In
fact, in most periods since World War II, ordinary homeowners have done great return-wise just because they were in the right
place at the right time. On Wall Street, they say that in a bull market, everyone thinks he a genius. And some, like Kiyosaki, who
are merely married to people who invested in real estate during a bull market, claim that they (the non-investing spouse) are
geniuses as a result.
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Reportedly, Kim got the idea to invest in Phoenix real estate from a female fellow employee of Money and You who said the
Phoenix market was going to be good. That female Money and You employee is the one who should have written us a book on
real estate investment. She may be the brains of the outfit if Kim did not add any value to her advice. (Actually, the employee
probably was just guessing and her having guessed right is meaningless. In fact, predicting marketwide appreciation in real estate
values is impossible to do. Decisions can only be evaluated based on what the decisionmaker knew at the time, not on results.
You can get good results from bad decisions, e.g., a winning lottery ticket; and vice versa, e.g., attempting a 25-yard field goal
that goes wide right when you are down by two points with three seconds left in the game.)
If Kiyosaki claims to be a competent real estate investor, he needs to show addresses of properties he bought that reveal greater
returns on those properties than were earned on similar properties at the same time by persons who claim no extraordinary
expertise. I suspect an examination of properties he or his wife owned will show that he earned that same returns as local
homeowners and that the only thing extraordinary about his purchases is that he had a large amount of book royalties to use to
buy them.
The guy who called me has the impression that Kiyosakis tortured psyche and insecurities stem from growing up as an obese kid
in Hilo in the 1950s. Since he did not know Kiyosaki until the military, that information must have come from Kiyosaki.
No more Bob
Kiyosaki went by Bob for most of his life. Since he became the famous author, he insists that everyone call him Robert. Sure,
Bob.
20/20 investigation of Kiyosaki

ABC 20/20 did a program about Kiyosaki who has now written 18 books. You can read their story about it at
http://abcnews.go.com/2020/story?id=1982669&page=1. The date on the Internet story is May 19, 2006 so the story must
have been aired on 20/20 around then. Basically, they gave three people $1,000 each and told them to try to start a business that
would show a profit within 20 days. One lost all he money. Another made zero. The third made $243.
Kiyosaki was brought in to coach them and to advise them during the 20 days. Based on the article, it sounds like about all he did
was whine about the three would-be entrepreneurs, the short time frame, and so forth. He also pronounced their failures a success
typical Kiyosaki logicbecause they learned from them. The ABC 20/20 story ends with,
Which begs the question: Does anyone really need 18 books to learn to fail?
Obviously, Kiyosaki has sold 26 million books on the promise that they would help you succeed. Then, when people who have
been personally coached by him fail, he blames them and, like the Queen in Alice in Wonderland, declares their failures to be
successes.
I guess it would be too much to ask for him to admit, Gee, I guess my advice was of no value to these three.
If I had been asked to participate in such a challenge, I would have said I have no expertise in telling anyone how to make a profit
with $1,000 in 20 days. I do not know how I would have done that if I had been given the money. Probably write a short book
and use the $1,000 to print it and create a series of Web pages about it. See my book How to Write, Publish, and Sell Your Own
How-To Book for the details on how to do that.
It would be interesting for 20/20 or a similar program to give $1,000 to Kiyosaki himself and let he himself show how to turn it
into a profit using some method open to his readers. You would have to have a microscope on him every second and prohibit any
undisclosed actions or conversations to prevent him from using methods not available to his readers.
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What business has Kiyosaki ever made a profit in? With regard to his 26 million books, he is not a businessman. He is only an
author. The businessmen generating those sales and profits are his publishers.
'Couldn't put my finger on it...'

I have received numerous emails about this analysis by me that you are currently reading of Rich Dad Poor Dad. There have
been several recurring themes in those emails. One is people saying that they liked Kiyosakis book, but that it caused them some
discomfort or second thoughts or unease. They often say they could not put their finger on what was bothering themor words to
that effectuntil they read this analysis.
'Made me think about my finances'

The most common favorable comment I get about Kiyosaki from those who generally agree with my analysis is that At least he
got me to think about my finances. Thats pretty lame.
The IRS makes you think about your finances every April 15th. You have to think about your finances whenever you fill out a
loan or credit-card application. I also think about my finances frequently when I pay bills or receive income. People who are
unhappy with their financial liveswhich is the typical Kiyosaki fanprobably think about their finances every time they get
into their shabby car or return to their unsatisfactory home (e.g., living with parents, bad neighborhood, too small, etc.).
There are lots of books that do a better job of getting you to think about your finances. I suggest my Succeeding and How to Get
Started in Real Estate Investment as well as The Little Book of Common Sense Investing by John C. Bogle and Jane Bryant
Quinns Smart and Simple Financial Strategies for Busy People. These are books that actually have what Kiyosaki falsely claims
to provide.
I think these made me think about finances comments are inarticulate at best and dishonest at worst. What is really going on is
a lot of people are schlepping along doing a half-ass job of managing the financial aspects of their lives. Rich Dad Poor Dad
slaps them up side the head and tells them to clean up their acts. Thats good, but the book goes on to deliver a pack of lies that
make getting rich seem much easier than it really is and make education sound much less valuable than it really is. Basically,
people want to get rich quick without effort or risk. Kiyosaki is just the latest in a long line of con men who pander to that
fantasy.
Can the ordinary person get rich? Yes
Is it as easy as Kiyosaki makes it sound? Not even close.
Can it be done as fast as Kiyosaki says? Nope.
Is education as worthless as Kiyosaki says? Every pertinent study has shown that the more education you have, the higher your
net worth and income. Also, educated people live longer, have fewer divorces, better health, and so forth.
Here are U.S. Bureau of Labor Statistics figures on education that were released on 8/17/07:
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Weekly earnings by amount of education

amount of education median weekly earnings
doctoral degree
$1,441
professional degree
$1,474
masters degree
$1,140
bachelors degree
$962
associate degree
$721
college dropout
$674
high school grad
$595
high school dropout
$419
Unemployment rate by amount of education

amount of education unemployment rate
doctoral degree
1.4%
professional degree 1.1%

masters degree
1.7%
bachelors degree
2.3%
associate degree
3.0%
college dropout
3.9%
high school grad
4.3%
high school dropout
6.8%
On the other hand, the public-school system is an easy target for criticism. It is generally run by union bureaucrats who graduated
at the bottom of their college classes. Colleges are also subject to criticism for letting students spend five or more years getting
low-income educations in subjects like philosophy and social work. Wisely-chosen educationdefined broadly as reading books,
talking to successful people in the field you are interested in, attending courses, and subscribing to trade publicationsgenerally
provides the highest return you can earn on your money and time.
Kiyosaki is just telling lazy and/or stupid students a line of bull that lets them avoid responsibility for their poor academic
performance and gives them a convenient scapegoat to blame for their lousy financial situations. There is also more value to
education than just its financial rewards. If you like philosophy and are willing to take a vow of poverty, you ought to study
philosophy. Not everyone suffers from Kiyosakis need to impress people with how much money he has made (or claims to have
made from sources other than selling books to Amway distributors).
most people want to believe rather than to know, to take for granted rather than to find out
James Thurber
Motivation
Another compliment readers often pay Kiyosaki is along the lines of, Well, at least he motivated me.
Yeah, by lying to you. Thats like me telling you I buried $100,000 in your backyard which is yours for the taking. Would that
motivate you? No question. You would probably spend the next two weeks digging up your backyard. After you found out it was
a lie, would you think I was a great guy for having thus motivated you to get all that healthy exercise? I doubt it.
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Missing the point

Since I posted this analysis, a number of Kiyosaki cult members have contacted me to denounce me for missing the point of
Kiyosakis book. OK, Please tell me the point. The odd thing is that each person has a different version of what the point of
Kiyosakis book isand it is never something I recall reading in the book. In fact, if a book has a point, multiple readers ought to
come up with the same answer when asked what that point is. If they come up with different answers, it is either because the
author was incompetent at communicating his point, or because the book has no point, or because the author deliberately
obfuscated the point.
From now on, if you think I missed the point, dont paraphrase Kiyosakis point to me. Give me an exact quote and the page
number in Rich Dad, Poor Dad where it appears. I suspect everyone who is tempted to send me the point of Rich Dad will be
unable to find in the book any of the wonderful advice they imagined was in there. It has been several years since I first said this
and I have yet to get my first quote of the point.
On 7/18/06, I finally got a quote from someone who says I missed the point. Here it is.
Please open your copy of Rich Dad Poor Dad and turn to page 77. Look half way down the page. You will see this:
"Rule one:You must the know the difference between an asset and a liability, and buy assets. If you want to be rich, this is all you need to know. Its rule No. 1. It is the
only rule. This may sound absurdly simple, but most people have no idea how profound this this rule is. Most people struggle financially because they do not know the
difference between an asset and a liability."
I did not miss that at all. In fact, I discussed the matter of his definitions of assets and liabilities squarely and repeatedly in this
review. Furthermore, the vast majority of the book has nothing to do with that point and some of the book contradicts that point,
like Kiyosaki bragging about his Rolex. I also note that in eight years, this is the only person who thought that was the point of
the book.
The only time different people look at the same thing and come up with different answers as to what it is they are looking at is
when the thing they are looking at is amorphous, like a cloud or a Rorschach inkblotor a politician. Politicians try to be all
things to all people. That requires them to say nothing (amorphousness), but to sound like they are saying something (the
point). They toss in a little spin to try to get all those people with those different views to see in the politician things that they
like. Kiyosaki slogans like Dont work for money. Make money work for you, are amorphous in their actual meaning, but have
the effect of spinning the reader into thinking he has just gotten good advice.
Heres a pertinent passage from Temple University professor John Allen Pouloss book A Mathematician Reads the Newspaper.
A similar argument helps clarify why inane I Ching sayings or ambiguous horoscopes seem to many to be so apt. Their aptness is
self-provided. In effect, their cryptic obscurity provides a random set of answers that the devotee fabricates into something
seemingly appropriate and useful.psychologists count on the amorphousness of Rorschach ink blots to elicit evidence of a
persons core concerns.
My own supporters occasionally commit the mistake of reading things into my writings. I once got an email complimenting me
on my writings. The writers favorite quote by me was, When everyone is digging for gold, sell shovels. I thanked him for his
compliments, but said, I never said that. He then wrote back that he searched all over my Web site, but could not find it.
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Cult
What Kiyosaki is really doing is operating a cult of personality. Anna Quindlen had an excellent article about such cults in the
8/14/00 Newsweek. She was talking about politicians and said they seek to elicit the words, I dont know why. I just like the
guy. Politicians want to be judged by their personalities, not their character or policies. To members of Kiyosakis cult, it matters
not how many false or probably-false statements I find in Kiyosakis writings. They just like the guy. Personality is an
appropriate criterion for selecting someone to hang around with. But it is a highly inappropriate criterion for evaluating
Kiyosakis advice, because hes not going to let you hang around with him and your familys finances are serious business.
I am not a politician. When I write something, I want to make sure everyone gets the pointthe same point. Here is the point of
this analysis:
Rich Dad, Poor Dad contains much wrong advice, much bad advice, some dangerous advice, and virtually no good advice.
The 48 Laws of Power

Heres an interesting letter I got from a reader:
I'm glad I found your Web site on Kiyosaki, and all the other snake oil salesmen. I was deluding myself into believing him, even though I had that little voice in the
back of my mind sending me warning signals (not to mention my wife)... Anyway, thanks for the info. Every once in a while, I do a search on Google and come up
with a gem like your Web site. This is living proof that the Internet can be used for good purposes by people who are TRULY generous. Once again thanks for your
work.
A few years ago I read a book by Robert Greene and Joost Elffers called "The 48 Laws of Power" (Viking, 1998). It is a
"Machiavellian approach to the systematic study of power." Basically, it is written as a how-to book. It gives the cynical lowdown
on increasing and maintaining one's power over others. It is truly an interesting and thought-provoking study in human nature. I
thought you might be interested in the following quote, which I feel is particularly apt in describing the power strategy that gurus
like Kiyosaki like to follow:
"Law 27 - PLAY ON PEOPLE'S NEED TO BELIEVE TO CREATE A CULTLIKE FOLLOWING. Judgment - People have an
overwhelming desire to believe in something. Become the focal point of such desire by offering them a cause, a new faith to
follow. Keep your words vague but full of promise; emphasize enthusiasm over rationality and clear thinking.
Give your new disciples rituals to perform, ask them to make sacrifices on your behalf. In the absence of organized religion and
grand causes, your new belief system will bring you untold power." (p. 215)
Keep up the good work,
Another reader said Law of Power 32 is pertinent too.

Law 32Play to Peoples Fantasies
The truth is often avoided because it is ugly and unpleasant. Never appeal to truth and reality unless you are prepared for the anger that comes from disenchantment.
Life is so harsh and distressing that people who can manufacture romance or conjure up fantasy are like oases in the desert: Everyone flocks to them. There is great
power in tapping into the fantasies of the masses.
You can see all the laws at http://www2.tech.purdue.edu/cgt/courses/cgt411/covey/48_laws_of_power.htm.
Short on specifics
About every third email I get about this analysis me that they agree with me that Kiyosaki is short on specifics about how to get
rich. In the first week of February, 2008, yet another woman told me she agreed with my saying he is short on specifics, I said
Kiyosaki had made her blind to the statement I made in huge letters (below after this sentence) and she switched subjects to my
ungentlemanly behavior in making such a comment. Although she did not deny that I had pointed out in huge letters that I never
said any such thing.
I never said Kiyosaki was short on

specifics!
Not only does Kiyosakis hypnotic effect on many people result in their seeing things in his book that are not there, now they are
seeing things in my analysis that are not here. Amazing! No wonder the guy can sell 26 million copies of nothing.
I would say that Rich Dad covers an overly broad array of financial subjectsreal estate investment, stock market investment,
note investment, and going into business for yourself. No one could adequately cover all those areas in such a short book. On the
other hand, Rich Dad has a lot of specificsas you will see below in this analysis. The problem is not that he is short on
specifics, it is that the book is a bunch of bull, including when he gets specific. To say that the only fault of the book is that it
lacks specifics is ridiculous.
Since I posted this item with huge letters saying I did not say he was short on specifics, the quantity of emails I get agreeing
with me that he was short on specifics is unabated. Have these people all had lobotomies? Actually, yes. Rich Dad Poor Dad is a
lobotomy by book reading.
Money is all that matters

On page 14 he approvingly quotes rich dad as saying, Money is power. [Since I wrote this analysis, Kiyosaki has changed the
layout of the book making these page numbers wrong for subsequent editions. They are correct for my edition, which says
published by TechPress, Inc. and has 1997 and 1998 copyrights.] On page 92, he tells of his rich dad keeping him waiting for
long periodswhen he was nine years old!! He was ignoring me on purpose. He wanted me to recognize his power and desire
to have that power for myself one day. On page 172, he says, I have found the principles of finding value are the same
regardless if its real estate, stocks,...or a new spouse...
On page 154, Kiyosaki says the reason you want to have rich friends is to get inside stock market information that you can
make low-risk profits. He ends that discussion with the sentence, That is what friends are for. That is the narrowest, most
mercenary definition of friendship I have ever seen. I doubt Kiyosaki is the only person who feels this way about his friends, but
he may be the only one dumb enough to say it in a book.
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My Succeeding book tries to get you to always keep in mind the paramount importance of living a balanced life with emphasis on
friends and family and doing the things that you find rewarding for reasons other than mere monetary income.
Although his family was not rich, he attended a predominantly wealthy elementary school because of an anomaly in the schooldistrict boundaries. The wealthy kids had newer toys and refused to invite Kiyosaki and his friend to parties, telling Kiyosaki it
was because they were poor kids. Sounds like he was scarred deeply by that humiliation and has lived his whole life since
trying to prove to some rude nine-year olds from the 1950s that he now has the money to be worthy of their party invitations. He
told Meet the Street that he has never been back to Hawaii. I suspect such a visit would rid him of these demons from his
childhood.
How much money does Kiyosaki have?

A number of people have accused me of being jealous of KiyosakiI guess because they think he has more money than I have.
Others have said they are going to follow him because he is fabulously wealthy and thats what they want to be.
How do we know this?

I know approximately what my net worth is. But I have no idea of what Robert Kiyosakis net worth is. Neither does anyone else.
He implies he has money. He has had four books about how to get rich on the business best-seller list. He brags about owning a
Porsche, Mercedes, Rolex watch, $400 golf club. The Honolulu Star Bulletinthe newspaper where Kiyosaki grew upwrote a
puff piece about him. You can see it at http://starbulletin.com/2000/07/10/features/story1.html. In it, Kiyosaki says a number of
things that imply he is rich. For example,
Im free to do exactly what I want, when I want, where I want. I can stop working if I want to. Money buys me freedom.
I once investigated best-selling real-estate author Robert Allen who wrote Nothing Down. At first, he claimed to own his home.
But when I checked the address which appeared on IRS liens filed against him, it was nonexistentno house at that address.
When I again asked where he owned his home, he admitted, I rent. I have the conversation on tape.
One of my MBA classmates, Paul Bilzerian, became a very successful corporate raider for a time. He stood silent while others
claimed he was a wiz who had made $150 million in Florida real estate before age 30. I called him up to ask if that were true. He
said I should read the article in the Wall Street Journal carefully. Indeed, it said he was reported to have made that much and
all Paul would say in the article was, Thats a good guess. In other words, Paul was pointing out to me that it was not he who
said he had made all that money. Paul subsequently was the subject of a Forbes story. They said they investigated his purported
Florida real-estate profits and could not find a trace of him in Florida real estate. He later got into trouble with the law and was
the subject of a 60 Minutes segment about his mansion in Florida that creditors could not get at after he declared bankruptcy.
According to the Honolulu Star-Bulletin, Kiyosaki wont say how much he is worth or in what hes invested. Kiyosaki claims,
I own companies. Im a major shareholder in oil and mining companies, plus real estate companies. I have intellectual property
companies. But he wont identify any of them. Why? As you will read below, one of my readers checked Kiyosakis claim that
he was a major shareholder out in a securities industry data base and found not a trace of him in spite of the fact that major
shareholders are required by law to be identified. If he is a major shareholder, it is in minor corporations so small that their
shares are not traded publicly.
A book editor unrelated to Kiyosaki used industry statistics to tell me he figures Kiyosaki has netted at least $11 million from his
book royalties since 2000.
With regard to Kiyosakis Money buys me freedom statement, my Succeeding book has a chapter on Wealth that discusses both
the advantages and disadvantages of being rich. Yes, there are disadvantages, like making your family members kidnap targets or
making yourself a lawsuit target. Last I heard, Kiyosaki was being sued by the co-author of Rich Dad Poor Dad, Sharon Lechter.
Mr. Privacy
Kiyosaki says, I keep my holdings private. You know why that is? Lawsuits. If you have money, you get sued.
Let me get this straight. Kiyosaki says he is rich, that he makes millions of dollars, and is about as high profile about his wealth
as you can get about itbest-selling how-to-get-rich books, appearances on TV shows like Oprah, interviews to daily papers and
national magazines. Yet he won't disclose any details because he doesn't want people to know he has money.
Not only is the guy a B.S. artist, he insults our intelligence.
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Somebody needs to give Kiyosaki a book on how to be low profile. Im sure it has a chapter that says going on Oprah to discuss
your best-selling book on getting rich is not a good way to prevent would-be litigants from knowing you have money. Kiyosaki
is, in fact, shouting from the rooftops that he has money. He just refuses to prove it. Or to let anyone investigate how he got it if
he does have it.
I have always felt that implying you have money was worse than revealing your net worth. When I was in grad school, I took a
labor relations course where actual union leaders were in every other seat with us MBAs. One said that one of the things they
love about employers is when they keep earnings secret. That allows the union to tell the employees that the company is getting
rich on their backs. That, in turn, causes the employees to vote for the union. Kiyosakis implying he is wealthy, but refusing to
disclose how wealthy, will almost certainly cause would-be litigants and others to overestimate his net worth, thereby increasing
the chances of his being sued over what they would be if he were more forthcoming.
Many small businesspeople adopt grandiose company names, like Pritchco Interplanetary, that make them sound much larger
than they really are. I tell my readers not to do that because such names encourage lawsuits. I encourage small real-estate
investors to use their own name, because people are more inclined to sue big-sounding corporations than an individual. I
recommend that you read an article I wrote on how to take title with regard to privacy and other aspects of money.
I suspect the real reason Kiyosaki refuses to disclose any evidence of his purported wealth is either
It was much smaller before he got rich from his book than his followers imagine
He did not get it the way he impliesfor example, his wealth may come almost entirely from telling people how to get wealthy and he may not have
been wealthy himself until he told people how to get wealthy
He achieved wealth in an unethical or illegal way
All of the above
For the record, I created another page to address the jealousy issue. Click here to see it.
Meet the Street interview

On 1/14/02, a reader told me Kiyosaki was more forthcoming about his wealth at
http://www.thestreet.com/funds/meetthestreet/10006507.html. Indeed, in an interview at that Web site, he says his net worth is
between $50,000,000 and $100,000,000 depending on the day. (I dont believe that. He also says he was bankrupt and
homeless in 1985. More about that later.) So which is itKiyosaki will not talk about his wealth because he doesnt want to be
sued or he will give figures, locations of his properties, and the nature of his corporations as he does in the Meet the Street
interview? What happened to the lawsuit threat?
There were a number of points in that Meet the Street interview that deserve a response
Kiyosaki said
Reed comment
avoid mutual funds and Mutual funds vary in their risk. Some are very low risk. 401(k)s have tax benefits that are hard to ignore.
401(k)s because they are Also, you can invest them in almost anything you want in many cases. If they are invested in broad-
too risky
based, low-cost index funds, like Vanguard 500 Index, they have no risk other than the risk that the entire
market will collapse.
Bogus gurus like to give extremely simple rules. Ignorant readers love them. Thats fine when the subject
permits. But this is an extremely simple rule that is not valid because of the complexity of the subject.
says his net worth is
I dont believe that. He was bankrupt and homeless in 1985 by his own admission. Although a lawyer
$50 million to $100
who searched the federal case management system on line says he could find no bankruptcy filing for
million depending on the Kiyosaki. He claims to have sold 26 million books. The highly successful book What Color is Your
day
Parachute? has only sold seven million copies since it first came out in 1970. But even if you accept the
26 million figure, Kiyosakis co-author royalty would appear to be about 72not enough to get you
anywhere near $50 million even if you had no living expenses. He claims to make money in other
businesses, but will not disclose enough detail that anyone can check that.
Also, whats this depending on the day nonsense? I presume thats a shameless effort to impress people
who are really ignorant about the world of finance. What he is saying is that his net worth doubles or
halves within 24 hours. He implies that causes him not the least bit concern. Gimme a break! If my net
worth dropped in half in one day, I would be pretty upset about it.
What must he be invested in to enable his net worth to double or halve in 24 hours? Pork belly futures?
No one in his right mind would invest his entire net worth in an investment vehicle that could double or
halve in 24 hours.
In the 2/03 Smart Money magazine article, he said his net worth was $35 million. Must have been a really
bad day in pork belly futures. Actually, his book-selling success notwithstanding, I would guess his net
worth is more like $3 million, virtually all of it from book and related sales.
the investments of the
Laymen think that. I dont. The main thing in managing an investment is stock picking. That is
wealthy are managed impossible to do well on purpose except for a few alpha money managers who are excruciatingly hard to
well
identify before the fact. Otherwise, its a crap shoot. If anybody ever figured it out, he would not need to
workfor the wealthy or anyone else. There have been numerous studies proving this, most notably the
classic book, a Random Walk Down Wall Street by Burton G. Malkiel. The wealthy do get good advice on
legal implications of their portfolios, but not on how to earn a high return. The notion that anyone gets
good advice on how to earn a high return in securities is a laymens myth. The truth is there are extremely
few money managers who can beat the market consistently over the long run and who they are changes
from time to time. Essentially, only a few institutions have been lucky enough to find them. Not, as
Kiyosaki says, all the rich.
says he was able to retire
So why didnt he? Hes still hustling his butt off to sell stuff.
at 47
there are three different This is primarily an income-tax-rate distinction as Kiyosaki explains it. He says these types of income are
types of income: earned,
taxed at 50%, 20%, and 0% respectively.
portfolio, and passive
The phrases passive income and portfolio income do appear in the Internal Revenue Code. I have
used earned income to describe money you make from your salary or business.
In fact, Kiyosaki is spouting nonsense. The federal income tax rates on earned income, passive income,
and portfolio income are the samenot 50%but your overall rate can get to that level when you add
state income taxes. The distinction between the different types of income involves whether the losses
from one category can be deducted from income of another category.
The 20% tax rate of which Kiyosaki speaks only applies to long-term capital gains. Those come from
selling assets at a profit after holding them for a specified number of months. You can have such 20%tax-rate gains in both the passive and portfolio categories.
The only income that is taxed at a 0% rate are special things like municipal bonds and gains of less than
$250,000 per spouse from the sale of certain personal residences.
It is possible to do transactions where there is no tax due at present, like IRC 1031 exchanges, but the
tax-free nature of such transactions stems from the fact that you received no income. Rather you put the
proceeds from the sale of one rental property into the purchase of another rental property. If and when
you eventually take out your profit by selling your rental property, you will be taxed on the gain that you
had when you exchanged. See my books Aggressive Tax Avoidance for Real Estate Investors and How to
Do a Delayed Exchange.
I own 10 rental buildings
Most investors use more specific terminology like apartment complex or office building or
in Miami, Austin, and shopping center. Investors usually use the phrase rental building to hide the fact that their properties
Phoenix.
are mere rental houses.
You should not own rental property in three states unless you have a specific reason for doing so. Why
not own all ten rental properties in Phoenix, where he lives? With Kiyosaki, I suspect he thinks having
property in three states makes him sound like more of a tycoon. To experienced investors, it makes him
sound like more of a dilettante. You want the property in the same regionpreferably where you live
so you can use the same people to work on all the properties and save on air fares, hotels, and so forth.
Actually, I believe I have the only books on absentee management: How To Manage Residential Property
For Maximum Cash Flow and Resale Value and absentee purchasing: Checklists for Buying Rental
Houses and Apartment Buildings.
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One reader said investing in three different regions gives you diversification benefits. Only against
regional economic downturns and possibly rent control if the buildings are bigger than one family. But
rent-control risk is better dealt with by staying out of multifamily and states that do not have a rentcontrol preemption in state law. The risk of regional economic downturns is not great enough to
overcome the disadvantages of spreading yourself that thin in terms of travel, personnel, need to learn
different laws and markets, etc.
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If the advice of Rich Dad back in 1955 was so great, how come Kiyosaki says he was homeless and bankrupt 30 years later? (A
lawyer checked the federal court records and said no one named Kiyosaki ever went bankrupt. So he apparently is bragging
about a non-existent bankruptcy. Im not ready to declare him nuts, but that would be evidence if I were.)
What kind of financial genius does it take to be homeless and bankrupt when you are a college graduate who had no student loans
and were trained as a helicopter pilot by the military. With all those advantages, and Rich Dads brilliant financial advice, the
guy still ends up homeless at age 38? And if Rich Dads advice wasnt good enough to keep Kiyosaki from becoming homeless
in 1985, how did it suddenly become something the rest of us should be following in 1997?
I suspect Kiyosaki has done well from his books with the help of Oprah and Amway et al. A reader who refused to let me use his
name said he attended an Amway meeting where Kiyosaki spoke and that Kiyosaki said his book was unknown until an Amway
Diamond Distributor started buying it in quantity. He further said that Kiyosaki urged the audience to focus on their Amway
distribution business, not on buying duplexes and such.
I further suspect that his secrecy has nothing to do with avoiding attracting lawsuits and everything to do with preventing the
public from finding out how much he really made and how he made it.
Clever life plan?

Kiyosaki would have us believe that he followed a coherent life plan laid out with the help of rich dad.
He says he went to the U.S. Merchant Marine Academy because he wanted to learn international business. People who want to
learn international business while in college should go overseas to school, like to the London School of Economics or to a U.S.
college with a strong international business or international relations department. The U.S. Merchant Marine Academy is a
grueling ordeal that prepares its students to operate oceangoing ships. Going there to study international business is like studying
construction and building maintenance to become a school teacher because teachers work in buildings.
U.S. Naval Academy

I did not put my suspicion that Kiyosaki was rejected by a major service academy in this analysis originally because I had no
evidence of it. Now I do. A reporter for People magazine interviewed me about Kiyosaki. In the course of the interview, he
mentioned that Kiyosaki admitted to him that he had applied to the U.S. Naval Academy at Annapolis, but was rejected for
academic reasons. So if he went to the Merchant Marine Academy to learn international business, why did he apply to the Naval
Academy? Let me guess. To study oceanography? And I guess if we are to believe that he went to the Merchant Marine Academy
to study international business, he must have deliberately flunked admission to the Naval Academy because going there would
have interfered with his plan to learn international business. What international-business purpose was served by applying to the
Naval Academy is a part of Kiyosakis tangled web that I have no clue about.
In his 1993 book Dont Go To School?, he said, In 1964, I received two nominations: one to the U.S. Merchant Marine
Academy in Kings Point, NY, another to the U.S. Naval Academy in Annapolis, MD. I accepted the Kings Point nomination.
The Naval, Military, and Air Force Academies are part of the Department of Defense. Their students are salaried, active-duty
U.S. military personnel. I believe the Merchant Marine Academy comes under the Department of Transportation. They seem to
have mandatory Naval ROTC at the Merchant Marine Academy which comes with some sort of military reserve commission and
status. The USMMA students seem to have a sort of scholarship as opposed to the salaried, active-duty status of the Department
of Defense academies.
Nomination
I am a West Point graduate, so I am familiar with the terminology and procedure associated with admission to service academies.
Kiyosaki says he received two nominations. Admission to the U.S. Naval Academy, like admission to my alma mater, the U.S.
Military Academy at West Point, is a multi-step process.
His statement, I accepted the Kings Point nomination, is extremely misleading.
The first step is to obtain a nomination from a Congressman or Senator. A nomination is not an admission. Rather it just lets you
begin the rest of the application process. Furthermore, there are two kinds of nomination: principal and alternate. I got a
principal nomination from Congressman William T. Cahill. That meant that I would be admitted if I passed the three categories
of criteria. Those who receive alternate nominations, which are ranked first, second, third, fourth, and so forth, only get admitted
if the principal and alternates above them fail to gain admission. The detailed facts about Kiyosakis nominations, if any, were
almost certainly listed in his hometown newspaper in late 1964 or 1965.
During the post-nomination application process, you undergo an extensive physical exam more demanding than to enlist in the
militaryand a physical aptitude test of your athletic ability. I had to go to Fort Dix, NJ for those two tests. Simultaneously, you
send your high school transcript and test scores to the service academy and they decide whether you meet their standards
academically. If you pass all three tests, and you were the principal nominee, you get an appointment from the President of the
United States. That means you are admitted. It is only then that you can claim to have turned down the opportunity to attend that
academy.
Kiyosaki seems to imply that he was admitted to the Naval Academy, but turned it down. However, the use of the word
nomination and the admission to People seem to indicate that he was, in fact, never accepted by the Naval Academy and
therefore could not have chosen the Merchant Marine Academy over the Naval Academy.
A midshipman at Kiyosakis alma mater said that in Kiyosakis 5th book, he does not mention the Merchant Marine Academy by
name. Rather he says only that he went to the military academy in New York. You gotta be kidding me! To 99% of the people,
the military academy in New York is West Point. If his book Rich Dad Poor Dad is any indication, Kiyosaki would have lasted
about two weeks at West Point before they threw him out for violating the cadet honor code. For chrissake, hes even lying about
having lived by the West Point honor code for four years.
Pilot
Taking an indirect and barely relevant route to an educational goal is a recurring theme in Kiyosaki's book. He seems to have a
fascination with extremely roundabout, reverse psychology methods of teaching or learning. Kiyosaki states that he became a
U.S. Marine Corps helicopter pilot so he could learn how to lead men. Pilots fly helicopters. A pilot may lead his copilot and
door gunner, but no one else when they are airborne. Furthermore, the actions of a copilot and door gunner are largely standard
operating procedure. They do not need to be led much. And if they did, the pilot would be in a poor position to lead them because
flying a helicopter is a task that consumes 100% of your attention. Only if he stayed in the service for many years would a pilot
be put in charge of a group of helicopters and then be a leadership position. Kiyosaki did not stay in the military. If you want to
lead men in the military, you become a platoon leader and company commander.
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Also, in the 1993 book, he says, Ibecame a fighter pilot and went to Vietnamand probably enjoyed combat more than
most pilots ever do. A Marine fighter is a fixed-wing jet aircraft that generally operates off an aircraft carrier. Helicopters
sometimes operate off carriers, too, but no military person would call a helicopter a fighter.
Never returned to my ship

The 1993 book contains a very strange discussion. He says that he found a little boy in my helicopter one day and had the right,
if not the duty, to shoot and kill him on the spot. This was the code of war we were taught as military officers.
I am aware of no such right, duty, or Code of War. The Third and Fourth Geneva Convention, to which the U.S. is a signatory,
prohibits shooting a surrendering enemy soldier, as does the U.S. Uniform Code of Military Justice. Furthermore, a child would
generally not be considered a soldier at all. To be sure, in Vietnam, children sometimes attacked U.S. soldiers with deadly
weapons like mines, grenades, or guns. They brazenly stole from our moving vehiclesengineer stakes and gas canswhen we
were in convoy, because they knew we would not harm them. I suspect a Vietnamese child in a helicopter would be trying to steal
somethingalthough he could be just fascinated by the aircraft like any kid.
Kiyosaki then melodramatically describes that after aiming and starting to pull the trigger, that he put my gun away that day
forever. I committed myself to finding new ways of doing things, instead of simply responding to what Id been told to do by a
person who supposedly had more authority than I.
Murder
In the absence of an immediate threat from the boyand he mentions no such threatshooting the boy would be murder, not
obedience to any U.S. military authority. Indeed, it would be gross disobedience.
The supposedly had more authority line is rather weird for a U.S. Marine officer. A member of the U.S. military is required to
carry out all lawful orders of his superiors and there is no ambiguity about authority in the military.
He then says that three weeks later, when his aircraft carrier was in Hong Kong harbor, they were ordered to return to Vietnam.
We were about to engage in a large military operation near the DMZ It would be unlikely that the details of an operation would
be revealed to military personnel who were ashore in Hong Konga British colony surrounded by Communist China at the time.
For secrecy, such details are usually only revealed once the ship leaves the shore. Plus, by the time Kiyosaki got to Vietnam,
virtually all U.S. combat troops had been withdrawn from the country.
I never returned to my ship. To this day, that was one of the hardest decisions I had to make. I trembled for hours as I walked the
streets with my mind screaming. I was called a coward and a traitor by some of the other pilots. I realized it was not the most
honorable way to handle my refusal to fight any more. But I also knew I could not fight and kill simply because I had been
ordered to do so. What the other pilots never understood was that for me to fly and kill again would have been the cowards way
out.
Well! Now thats a heck of a passage! Not returning to your ship when ordered to do so is desertion. One of my readers said
Kiyosaki appeared to be trying to claim that he was a conscientious deserter.
I hesitate to say that he is confessing to that. It is one of the most serious crimes in the military. The punishment can be death. But
it is hard to find any other explanation in this passage. The fact that his peers called him a coward and a traitor suggests that
explanation or possibly turning into a conscientious objector while on the streets of Hong Kong. I requested his military records
from the National Archives.
Once a Marine
Kiyosaki makes much of his Marine backgroundat least when hes not claiming to be an anti-war protestor. The Marine Corps,
to their discredit, bragged about him on their official Web site, apparently without checking out what he told them.
How do you get to be a Marine? On cable TV, I learned that you have to go through Marine Corps boot camp culminating in a
multi-day test called The Crucible. If you successfully complete it, you are awarded the right to wear the coveted eagle, globe,
and anchor badge of the Marine Corps.
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Did Kiyosaki go through Marine boot camp? Nope.

He did go through the U.S, Merchant Marine Academy plebe year which is arguably harder and longer. But that makes you a
Merchant Marine Academy cadet, not a Marine.
Marine officers generally do not go through boot camp. Thats for enlisted men. Officers typically graduate from the U.S. Naval
Academythe one that rejected Kiyosaki for not being smart enough. Or they graduate from a college ROTC program. The
Merchant Marine Academy probably had that. But even then, I believe you have to go through something called Marine Platoon
Leader Class after college. I would expect that they may not wear the eagle, globe, and anchor badge until they successfully
complete that Marine training.
Did Kiyosaki go through Marine Platoon Leader School? Nope.
So how did he get to be a Marine?
He was a Navy officer in helicopter school. The Vietnam war was winding down, so the Navy decided they had too many pilots
and decided to stop training Kiyosaki and his fight-school classmates to save money. The Marines, on the other hand, still wanted
more helicopter pilots. By letting Kiyosaki and his helicopter classmates make a lateral transfer to the Marine Corps, the
Marines could save the amount of money the Navy had already spent training them. In other words, to the Marine Corps,
Kiyosaki was a pilot trainee who was on sale for half price or overstock.
In World War II, officers who graduated from Officer Candidate School were called 90-day wonders. By that standard,
Kiyosaki is a zero-day wonder in terms of Marine trainingan instant Marine. He passed no crucible or its predecessor
tests. He just filled out some paperwork and made a wardrobe change.
Did he serve in the Marine Corps? Yes.
I have no problem with his claiming he served in the Marine Corps. But in his interview on the Marine Corps Web site and
elsewhere, he has laid on the Marine Corps made me what I am today stuff pretty thick for a guy who came through the Marine
Corps back door, skipping the notoriously difficult training that virtually all other Marines had to complete successfully before
they could claim the title of United States Marines. (a line from the U.S. Corps Marine Corps Hymn)
If any military training made Kiyosaki what he is today, it is the Merchant Marine Academy, not the Marine Corps. The U.S.
Marine Corps has a magnificent reputation. Unlike a relatively unknown institution like the Merchant Marine Academy, they do
not need the likes of Kiyosaki to add to their name recognition. The Marine Corps should be eager to make sure that the
Merchant Marine Academy gets all the credit for making Kiyosaki what he is today.
In the spring of 2010, I saw a Marine Corps recruiting poster. It had the slogan:
Always earned, never given.
That is false. Kiyosaki is evidence of that.
Are the Marines that proud of a conscientious deserter?

So let me get this straight. The U.S. Marine Corpss official Web site is bragging about Robert Kiyosaki and touting him as an
exemplary Marine in spite of the facts that:
he libels the Navy and Marines by accusing them of teaching him a code of war that required him to shoot an unarmed child in Vietnam
he says he committed, during his services as a Marine Officer in Vietnam to finding new ways of doing things, instead of simply responding to what Id
been told to do by a person who supposedly had more authority than I. In other words, he was going to refuse to follow the officers of his Marine
superiors to kill enemy soldiers in combat. (I also knew I could not fight and kill simply because I had been ordered to do so.)
he says his fellow Marine pilots called him a coward and a traitor because of his refusal to fight anymore
he says he refused to return to his ship which sailed without him to Vietnam
The fact that these seem to be a pack of lies designed to make himself a hero to the anti-war crowd ameliorates them somewhat,
but why would the U.S. Marine Corps brag about a former Marine officer who told such lies for such a purpose?
Kiyosaki military records

Robert Toru Kiyosaki was a US Naval Reserve officer from 6/4/69 to 10/3/70 reaching the rank of lieutenant j.g. Then he
switched to the Marine Corps from 10/4/70 to 6/30/74 and was honorably discharged as a first lieutenant.
He was awarded an air medal for courage and devotion to duty in the face of hazardous flying conditions during combat
support missions in Vietnam from 6/16/72 to 10/19/72, as well as several other medals which appear to be merely for being in the
military or being in Vietnam. I have several such medals myself. For example, you get the Vietnam Service Medal for setting foot
in the country. Kiyosaki has that with 2 Bronze Battle Stars. Bronze battle stars are for being in country during certain campaign
time periods. See my article on whether military people deserve all the medals they get and whether those medals mean what
civilians think they mean.
Also, civilians should know that all military medals have criteria and citations that make them sound very heroic. In fact, the vast
majority of medals with subjective criteria are probably awarded to guys who did little more than serve at a particular place and
time. For example, in 1965, when I was a West Point cadet, I and everyone else in the military at the time was suddenly awarded
the National Defense Service medal. We called it the I was alive in 65 medal. We also had a joke about its colors: The red is
for the blood we never shed. The blue is for the oceans we never crossed and the yellow is the reason why.
A Vietnam-era Marine fighter pilot told me an air medal means twenty missions (flights) in a combat area (like the entire country
of Vietnam and environs) Really!? Then I think the Army owes me an air medal or two. My jobs in Vietnam required me to travel
around to widely scattered baseswhich I did in Hueys, Loches, Chinooks, Piper Cub-type planes, and C-130s. It never
occurred to me that I should get a medal for it and I will not be trying to get any now.
The air medal citation says The Numeral 1 to represent One Strike/Flight Award is authorized. The meaning of this varied
from unit to unit and time to time. In some units, it could be merely for a guy taking a ride in an aircraft with minimal duties,
especially in 1972. Almost all U.S. military personnel were removed from Vietnam on 3/28/73. The last major combat units left
in the summer of 1972. Kiyosakis Air Medal was for the period June to October, 1972. The Air Medal Citation was signed by
Louis H. Wilson, Lieutenant General, U.S. Marine Corps, Commanding General, Fleet Marine Force, Pacific. Perhaps he or a
member of his staff at that time could clarify what this medal really involved.
His military records show that in 1972, his unit HMM-164 was on board the USS Okinawa, a helicopter carrier.
I am a little surprised that I have not heard from anyone in his unit.
Now that we know the name of the ship, we can obtain its log through the Freedom of Information Act, but I am not that
interested because Kiyosaki came back off his conscientious deserter story in the Smart Money Magazine article. He now admits
he was just one of hundreds of sailors and Marines who missed the boat when it unexpectedly left early.
His military records also contain the following Combat HistoryExpeditions.
From
To
Details
5/24/72 5/25/72
OP SONG THANH 6-72
6/29/72 7/1/72 OP LOMSON 72 Phase-1 RVN This was a major operation by the South Vietnamese military with some U.S. air
power support.
7/11/72 7/12/72 OP LOMSON 72 Phase-2 RVN This was a major operation by the South Vietnamese military with some U.S. air
power support.
7/11/72 7/12/72
OP SONG THAN 9A-72 RVN
7/24/72 8/29/72
Participated in special search and rescue operations with 31st MAU in the contiguous waters of RVN
9/29/72 10/21/72
Participated in special search and rescue operations with 31st MAU in the contiguous waters of RVN
OP = Operation?
RVN = Republic of Vietnam
contiguous waters of RVN = ocean off the coast
SONG THANH and LOMSON = probably Vietnamese villages or provinces
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The Marines often listed combat expeditions on a servicemans military record even though he had nothing to do directly with the
operation in question. It may only mean that some other members of his unit were involved. These combat expeditions could
appear on your record even if you were on R&R in Hawaii during the whole operation.
I would not have looked into his military records at all were it not for the strange story about not shooting a boy and refusing to
return to his ship. Now I am trying to figure out whether his accounts in his books jibe with his military records. My preliminary
conclusion is that the whole melodramatic story of not going back to the ship seems not to be supported by his military records.
He also appears to have had a Vietnam tour, but without either distinction or misconduct. His decorations, including the air
medal, are all analogous to the gold stars kids get in school for attendance. That is, they are for being somewhere or for being
somewhere for a certain period of time.
Heres is an email I got from a former Marine:
I couldnt help but notice that he was attached to H&MS-24 (Headquarters and Maintenance Squadron-24) Marine Air Group 24, 1st Marine Brigade. MAG-24 was
the entire air group with H&MS-24 as maintenance support efforts. They include support such as airframes, avionics, ordinance, which was my military occupational
specialty (#6541). [Kiyosaki] also said that he was 1st Marine Brigade. Brigade was ground side. Grunts, infantry, artillery. There is no way for him to have been both
airwing and ground at the same time without changing M.O.S.
[Reed note: I do not know Marine procedures during Vietnam, but Kiyosaki seems to have been trained as a forward observer to
direct artillery and/or air support at ground targets. Forward observers are typically attached to infantry or artillery units.]
A Marine major said this M.O.S. is for an enlisted man and that he did not believe the mans comments would apply to officers.
The making of a financial genius

There are probably many ways to became a financial genius, but Kiyosaki has certainly chosen an unlikely route:
flunked sophomore year of high school and had to repeat

U.S. Merchant Marine Academy
3rd mate oil tanker (or was it Love Boat type cruise ship as he said in one of his books?)
Marine helicopter pilot (or was it fighters?)
refused to return to ship when it was ordered to return to combat (or just missed the boat)
Xerox salesman
failed businessman (nylon surfer wallets)
failed businessman (rock and roll memorabilia)
failed author (1993 book If You Want to Be Rich & Happy, Dont Go To School?)
failed MBA applicant
homeless person
bankruptcy (or maybe not)
Kiyosaki tries to make a virtue from all his failures and false startssaying thats how you learn and you have to get back up and
all that. Fine. But couldnt we see a little more actual success after all these great lessons were learned? And how did all this
screwed-up stuff happen to a guy who had the benefit of Rich Dads brilliant wisdom back at age nine?
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What is his background really? I am impressed by Xerox salesmen as a general rule, but that aspect of his background sure
stands out from the rest. Did he really do that? He claims he was a top-five guy at Xeroxone of the nations most wellmanaged companies at the time. Really? And this after being something like a bottom-five guy everywhere else! (A man who
called me said he understood Kiyosaki was a top salesman at Xerox, but since he is a friend of Kiyosaki rather than a Xerox guy,
his knowledge may come entirely from Kiyosaki.)
College grad?
I was so skeptical that a college graduate could have written this book that I took the unusual step of calling his college to
confirm that he really attended and graduated. He did. If I were a Merchant Marine Academy graduate, I would request that they
do a recount of Kiyosakis college grades. This book is an embarrassment to the U.S. Merchant Marine Academy.
I have heard from two USMMA guys who generally agreed with my analysis. One noted that USMMA grads have an obligation
to stay in the merchant marine for a certain amount of time, because taxpayers pay for their education, but that serving in the
military either reduces or eliminates the remainder of that obligation. Maybe getting rid of that obligation, not learning how to
lead men, was Kiyosakis real motive for joining the Navy then Marines.
Archie Bunker on Wealth

Archie Bunker on Wealth would be a more accurate title for Rich Dad Poor Dad. The overall high-school-dropout tone of the
book is likely the influence of rich dad. To be sure, rich dad as depicted by Kiyosaki is street smart and has entrepreneurs
genes and energy. But like most high-school dropouts, rich dad has not done his homework on many of the opinions he passed
on to Kiyosaki. For example, Kiyosaki says, Prices go up because of greed and fear caused by ignorance. In fact, prices are
determined by supply and demand, as anyone who is reasonably well read knows. The fear and greed line is a common old
saying about the prices of publicly-traded stocks, bonds, and commodities.
Real estate expert?

On pages 106 and 107, he brags of taking back $190,000 worth of 30-year notes at 10%. Competent note investors would never
agree to such long terms. One expert I consulted called it a nutty note. I asked Bill Mencarow, owner of Paper Source if he
knows of any note investors who routinely take back 30-year notes. He said, To paraphrase Eisenhower speaking about Nixons
vice-presidential accomplishments, give me a week and I might think of one. Mencarow further states that 30-year selfamortizing notes, at best, would sell at about a 50% discount for cash. He actually asked around for me and found three guys
who would pay only $90,000 to $120,000 for Kiyosaki's $190,000 face-value notes.
If the notes are interest-only with a balloon of $190,000 at the end of the 30 years, they would sell for even less. Trading
$190,000 worth of real estate for paper that is only worth $90,000 to $120,000 does not get you a financial genius secret decoder
ring.
Kiyosaki says much of [the $19,000 a year interest income is] sheltered through our private corporation. In fact, corporations
do not shelter income. The corporations income is taxed when received at corporate tax rates. When that income is subsequently
distributed to Kiyosaki, it will be taxed again at individual rates. Real estate investors generally do not incorporate. Accountant
Bob Baldassari of McLean, VA says he and his colleagues almost never advise a small real-estate investor to incorporate because
the disadvantages far outweigh the advantages.
Smart note investors generally buy notes through their pension fund, which is not a corporation. Apparently Kiyosaki is not a
smart note investor.
He says he hopes they never pay off the $190,000 because he would have to pay taxes on the principal and because $19,000 paid
over 30 years is $500,000. In fact, taxes must be paid whenever any principal payment is made, partial or complete payoff. Taxes
must also be paid whenever any interest is paid. There is no way to avoid paying the taxes. And the only way to defer paying the
taxes is to defer receiving the income, which is cutting off your income to spite the IRS.
If he did these deals, which involve buying and selling six houses, in a short enough period of time, he would almost certainly be
considered a dealer for tax purposes. Dealers are not allowed to use installment-sale treatment. That means he has to pay all the
tax on the gain with the next quarterly income tax return after the closing, even though he has not received a penny of principal
from the deal.
If the borrowers literally never paid the $190,000 off, Kiyosaki would be out $190,000. Wanting to lose $190,000 is insane.
Measuring your return on a 30-year note by multiplying the annual interest by the term of the loan is extremely misleading. The
only way to measure payments received over a period of years is in terms of interest rate or present value. Bragging about
cumulative interest paid on a 30-year note indicates that either Kiyosaki does not understand the first thing about finance, or he
thinks you don't.
A reader and I got into a dialogue about these notes and I came to the conclusion that the typical Kiyosaki follower literally does not know the first thing about
finance. The people that guys like Kiyosaki and Sheets target are sort of the Thomsons gazelles of real estatepeople who are the weakest and most vulnerable
because of their ignorance of real-estate-investment principles. Click here for a quick overview of some basic principles.
On page 108, Kiyosaki brags that $190,000 was created in the asset column and no taxes were paid. Not paying taxes in this
case is hardly an accomplishment. The reason he has not yet paid any taxes is he has not received any money. He will start
paying taxes the moment he receives any interest or principal payments on the $190,000.
On page 24, Kiyosaki speaks of building a track [sic] of houses. This does not demonstrate the command of real-estate
terminology one would expect of a real-estate expert. (He means tract.)
Kiyosaki recommends various financial books, but only two real estate books: Donald Trumps Art of the Deal and Robert
Allens Creating Wealth. I think its safe to say that no other experienced real-estate investor in history ever gave a list of
recommended books that included only those two. Trump is a publicity-hungry, New York City high-rise developer whose book
is only somewhat useful to the typical real-estate investor. It would rank very low on most lists aimed at individual investors. For
a discussion of Allen, see the guru rating page of my Web site.
There is a lot of incorrect conventional wisdom in this book.
Kiyosaki book
The whole truth about the subject in question
The rich get richer.

Sometimes, they get poorer.
Its not how much money you make, its how much money you The more you make, the more you keep. Only a tax rate greater
keep.
than 100% would change that. There is no such rate.
By working harder, you simply increase the amount of taxes Working harder increases both your before-tax income and your
taken by the government.
after-tax income, as well your tax liability. What Kiyosaki says
would only be true if the tax rate were 100%, which it never is.
An intelligent person hires people who are more intelligent than As a general rule, people who are smarter than you will not apply
they are.
to work for you until you have reached a rather high level of
success.
On 8/21/00, the comic strip Dilbert made fun of this old
platitude by having it uttered by the pointy-haired boss. His
subordinates then gleefully pointed out that each boss in the
company must therefore be dumber than his subordinates and
that the CEO must be the dumbest person in the corporation.
Here is an email I got from a reader of this page: Ihaveafriend
thatisfollowingtheKiyosakimentality.Hewantsto
hire/partnerwithmecauseIhavemoreskillsandtalentsthanhe
does.Hewantsmetocomeupwiththebusinessidea,comeup
withthebusinessplan,thecapital,theinvestors,theoperations,
andetc...Iaskedhim,sowhatisyourcontributiontothe
businessthen.Hetellsmethatheisgoingfindpeoplesmarter
thanhimtomakethisbusinesswork.Thislogicisso
nonsensical.IfI'msmarterthantheentrepreneurthanwhyshould
heevenbeanentrepreneur?Icouldkeepalltheprofitsto
myself.
Itoldmyfriendthatittakesmanyhoursofsweatandlatenight
candleburningtorunabusiness.IknowbecauseI'vestartedone
before.Unfortunately,herefusestounderstandmymessage,
insteadhecontinuesonwiththisKiyosakitalkaboutstartinga
corporation!?Withoutabusinessidea,businessplan,he
requestedmetoincorporatefirst.Thisisexactlythecrapthat
Kiyosakiispreachinginhisbooks.
Thenwehadahugeargumentaboutwhoshouldwriteupthe
businessplanoncehecomesupwithanidea.Hecomesupwith
someideas,thenhewantsmetowritethebusinessplan.Iask
himafewdetailsaboutthetargetcustomers,SWOT,and
financialforecast.He'sresponsewasclassic,Youfigureitout.
GottalovetheKiyosakimentality.
Cheng
Most people work all their lives paying for a home they will
never own.
With each payment, their equity increasesas long as the

property value does not fall. Many people pay off their mortgage
in full before they die. Almost all thoroughly enjoy their home
both during and after the mortgage.
Most people, working for a paycheck, are making the owner, or Irrelevant. You should choose what you do only according to how
the shareholders richer.
it relates to your goals. You should not resent others benefiting
from your efforts. Indeed, you will prosper most when you help
others achieve their goals.
You work for the bank. After taxes your next largest expense is Irrelevant. You should use mortgage and credit card financing
usually your mortgage and credit-card debt.
whenever they will help you achieve your goals. Resenting bank
profits is childish.
The rich do not play by the same set of rules.
Yes, they do. This is sour grapes less successful people use to
rationalize their inability to succeed. They lack the character to
simply admit that they got beat fair and square in the economic
aspects of the game of life.
It is the knowledge of the power of the legal structure of the None of my rich friends make any use of corporations. I became
corporation that really gives the rich a vast advantage over the a millionaire in 1983 and never used a corporation. Corporations
poor and middle class.
have both advantages and disadvantages. Most real estate
investors do not use corporations. Note investors use IRAs and
such. Kiyosaki claims to be mainly a real-estate investor. See my
discussion below on corporation advantages and disadvantages.
The reason I minimize my income is because I dont want to pay Minimizing ones income is idiotic. You are always better off
it to the government.
with more income. His advice would only make sense if the tax
rate were 100%.
You should have a corporation and a board of directors.
One of my graduate-business-school professors called this,

Managing the company from the fiftieth floor when you only
have a one-story building. Having an outside board of directors
when you are an individual real-estate investor, with or without a
corporation, is a silly affectation.
Corporations are costly, time-consuming, and complicated and
have many disadvantages like preventing you from employing
your minor children and deducting the wages without having to
pay social security, withholding and so forth. Corporations
cannot escape those taxes or paperwork on minor employees. In
some states, the owner of an incorporated company cannot
represent himself in small claims court and must hire an attorney
for every little legal matter.
I love it when my real estate broker or stockbroker makes a lot of It means no such thing. Brokers profit strictly from transactions,
money. Because it usually means I made a lot of money.
regardless of whether they are also ultimately profitable for the
clients. Where are the clients yachts? is an old question that
points up the fact that the stock brokers make money while their
clients lose money.
I only play with money I can afford to lose.
A loss is a loss. All losses make you worse off. There is no line
which separates losses that matter from those that do not. You
should not invest in something unless you have a reasonable
degree of confidence that you will not lose. There are several
books, like Innumeracy and Why Smart People Make Big Money
Mistakes, that condemn this kind of thinking, which is a form of
erroneous financial thinking known as mental accounting.
Action always beats inaction.
Sometimes inaction is the best course, like when you are thinking
about selling real estate or a stock that subsequently goes up.
Contempt for traditional education and the educated

The book is almost entirely contemptuous of formal education and those who have graduated from universities. He wrote another
book called If you want to be rich and happy, don't go to school? On page 64, he delights in the fact that educated people now
came at [rich dads] beck and call, and cringed when he did not approve of them.
This is a bit sick. To borrow a phrase that is now a common sitcom punch line, I think Kiyosaki has some issues regarding
educated people and his relationship with his highly educated poor dad. He seems to have some psychological need to
dominate and demean people like his father. At my guru-rating page, I said Dave Del Dotto was the dumbest of the real-estate
gurus. Kiyosaki takes the prize for the real-estate guru with the most tangled psyche.
He says, ...the main reason people struggle financially is because they have spent years in school but have learned nothing about
money. I disagree. The main reason people struggle financially is bad decisions about getting an education, bad luck, too much
spending, too little savings and investing, too much reliance on organizations for their livelihood, and not enough reliance on
themselves.
Kiyosaki says that our schools focus on preparing todays youth to get good jobs by developing scholastic skills. He thinks
thats a bad thing. Its probably the right thing. Only a small percentage of people are suited to entrepreneurship. Even future
entrepreneurs usually need to begin as employees to get their starting capital and to learn while they work.
I would be among the first to agree that traditional formal education is lacking in many ways. I attended Catholic and public
schools, graduated from college and got an M.B.A. But I also attended the School of Hard Knocks for thirty-five years, and thats
not such a hot educational experience either. As someone said, in the School of Hard Knocks they give the test first, then the
lesson. That is a slow, costly, painful way to learn. Unfortunately, its the only school that teaches many things you need to
know. Obviously, the best way to prepare for life is a combination of formal traditional education, reading, seminars, experience,
and asking more experienced people for advice.
Want to know what the rich REALLY teach their children?
Rich Dad, Poor Dads subtitle is What the rich teach their kids about moneythat the poor and middle class do not!
Unfortunately, you will not learn that in Kiyosakis book. Fortunately, the real version of what the rich teach their kids, or
ought to, was the subject of a cover story (Rich, but not spoiledHow to raise your kids in an age of wealth) in the 6/12/00
issue of Forbes. Forbes knows rich. (
http://www.forbes.com/premium/archives/purchase.jhtml?storyURL=/forbes/2000/0612/6514266a.html&_requestid=27740)They
publish the annual Forbes 400, which is a list of the richest people in the world. If you have money and kids, that article and its
bibliography are worth a trip to a library. The article bears no resemblance to Kiyosakis advice, never mentions his best-selling
book in spite of its obviously related subtitle, nor is his book listed in their list of five recommended books on the subject of
Advice for the affluent parent.
The main issue for wealthy parents is finding a way to motivate their kids to not coast because of their parents affluence. Also,
the vast majority of parents, wealthy or otherwise, will tell you that kids are not big on listening to their parents. Kiyosakis
naivet about raising kids is to be expected considering that he has never had or adopted any kids. Why he feels qualified to tell
those of us who do have kids how to raise them is a mystery.
More to life than money

Also, there is more to life than making money. Traditional, formal education has opened up tens of millions of new, non-wealthbuilding horizons for students. But Kiyosaki seems to judge all educational experiences by the single criterion: does this tell me
how to get rich?
Kiyosaki talks like a politician

Kiyosaki uses phrases like the rich and the poor a lot. If you ran a Nexis computer search to see how and where those phrases
have been used in the news media, I predict you would find they are almost exclusively used by leftist politicians and quasipoliticians.
A number of Democrats have complained that the Republicans are no angels either. I know. I agree. But with regard to Kiyosaki,
the politicians who are most comparable are on the left because both Kiyosaki and the left pander to the poor. While use of
Republican demagoguery might work in some cons, it certainly would not fit the get-rich-quick-in-real-estate con. Even among
get-rich-quick gurus who try to rip off the poor, Kiyosaki is unique in using political tricks as heavily as he does. I come closest
to being a Libertarian so I could not care less about either the Democrats or the Republicans.
The way politicians talk is intellectually dishonest. They stereotype (e.g., the rich). They engage in name calling. (e.g.,
Kiyosaki dismisses cost-conscious accountants as bean counters and critics as Chicken Littles.) They change the subject.
They scapegoat. They try to arouse envy. There should be no politicking in a how-to real-estate book like Rich Dad, Poor Dad.
See my article on intellectually-dishonest debate tactics.
Meaningless slogans
Politicians also use meaningless slogans. Kiyosakis book has many of those. He even adopts Jesse-Jackson-like one-of-these,
one-of-those, pep-rally cadences. For example, Jackson says, Up with hope. Down with dope. Kiyosaki says, Dont work for
money; make money work for you.
Dont work for money; make money work for you, sounds smart, but what does it really mean? Quit your job and live off your
investments? Most of his readers are not yet in a position to do that. And when they are, they do not need his book. Obviously,
the correct advice is work hard at a job or your own business, save, and invest. Kiyosakis version is muddled and risks giving
people a dangerous wrong impression, but, like a politician, he seems more interested in sweeping the audience along to his
selfish ends than in teaching them what they need to learn. A Thomas Sowell column that appeared in the 9/25/00 edition of my
local paper contained several phrases that reminded me of Kiyosakis book:
political demagogues who exploit the voters ignorance to gain power

people whose chief talent has been the emotional manipulation of the public for political purposes
Sound bites are usually very unsound.
[people who] cant see beyond a media image or some catchy phrases and emotional attitudes
There are people out there whose job it is to manipulate your emotions for political purposesand they get paid big bucks.
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Here are some other meaningless slogans in Kiyosakis book: Learn to use your emotions to think, not think with your
emotions (page 42), Its not the numbers, but what the numbers are telling you (page 53), Id rather welcome change than
cling to the past. (page 110), Winners are not afraid of losing, but losers are. (page 114) The 6/28/01 Dilbert comic strip had
an employee saying, work smarter while broadening our focus. The pointy-haired boss responds, That doesnt mean
anything. The spouting of catchy, meaningless slogans is widespread. The habit of stopping and thinking about whether they
really mean anything is not.
Here is a pertinent email I got on 3/17/06:
John --
For several days I've skimmed Kiyosaki's book "Rich Dad's Guide to Investing" at my local Barnes & Noble, and found the
experience mesmerizing. My wife and I own a professionally managed portfolio of stocks, thanks to a modest inheritance, but
apart from keeping a worried eye on the financial pages we really take little action to grow our nest egg. I'm increasingly
interested in my alternatives, and I am potentially a prime candidate for Kiyosaki's mantra of "Don't work for money; make
money work for you." (I'm just that lazy.)
I would have bought the book but for its poor writing. As a newspaper reporter and former copy editor, I can spot padded prose
and logical fallacies a mile off. Inexperienced writers, or those who do not understand their subject, usually go on at great length
to say almost nothing. I seldom see even inexperienced writers try to bog the reader down, or avoid a clear "so what," as I saw in
Kiyosaki. And it didn't help that his writing style is lifeless, his characterization unconvincing.
In any event, I thought I'd Google around for expert reactions to Kiyosaki's books, as they are generally compelling in the way
that infomercials and seances are compelling. I read two things: his Web site, in which he promotes board games and a $2,500per-head weekend seminar targeted at people who, on average, likely can ill-afford the expense, and your analysis. I have to say I
found your site refreshingly thorough and public-minded, and I'm glad I ran across it. Another thing I know as a reporter is when
someone has done his homework. You have clearly done yours, and I'll be sure not to put any stock in Kiyosaki.
Incidentally for your readers who have seen the movie Mystery Men (1999), a tongue-in-cheek spoof of comic book super
heroes, this exchange may feel apt in considering Rich Dad, Poor Dad:
Mr. Furious: Okay. Am I the only one who finds these sayings just a bit formulaic? "If you wanna put something down, you
gotta pick it up". "If you wanna go left, you gotta go right". It's...
Sphinx: Your temper is very quick, my friend. But until you learn to master your rage
Mr. Furious: Your rage will become your master? That's what you were gonna say, right? Right?
Sphinx: Not necessarily.
With gratitude,
John Snyder
Western Massachusetts
Robert Blake
In this, Kiyosaki also reminds me of Robert Blake, the movie and TV actor best known for starring in the late-70s TV series
Baretta. Blakes TV-talk-show appearances were invariably interrupted by audience applause. Why? Like Kiyosaki, he was given
to spouting platitudes so grandly and self-confidently that the audience assumed he must have had said something great. He
didnt.
[Oddly, long after I posted this comment about Kiyosaki reminding me of Blake, Blake emerged from obscurity when his wife
was shot to death as he returned to a restaurant to get the gun that he forgot there. My comparing Kiyosaki to Blake had nothing
to do with guns and murdered wives. Also, a Los Angeles Times article about Blakes murdered wife, Bonny Lee Bakely, said she
told friends that she wanted to marry a celebrity like Blake to show up kids who made fun of her in school. That is reminiscent
of my analysis of Kiyosakis lifelong pursuit of money and status as an overreaction to insults he received in elementary school.]
Redefining words
Politicians also give new, bogus meanings to established words and phrases in order to mislead people. For example,
Democrats refer to almost all spending of taxpayers money on government programs as investments. They call abortion
choice and Republicans call opposition to abortion being pro-life. Kiyosaki does this, too. For example, he says, his book
will challenge the belief that your house is an asset and Define once and for all an asset and a liability. His quibble with the
notion that your house is an asset is the mortgage and other carrying costs and lack of rent income.
Trust me, your house is an asset. The mortgage on your house is a liability. As they accrue, carrying costs of your house like taxes
and insurance are also liabilities. Once again, Kiyosaki may hurt some people with this sort of rhetoric if he discourages people
from owning a home. Maybe what he is trying to say in his muddled way is that it is wise to live beneath your means, that is, buy
a smaller home than you can afford, so that you have a smaller carrying costs and therefore have more money to invest. I agree.
But you can learn that lesson in a non-muddled way from the book, The Millionaire Next Door.
Some have ordered me to be fair and balanced by attacking Republicans every time I attack Democrats. I am not trying to be
Fox News. They, like politicians, are trying to please masses of people for ratings. I am stating my views honestly, not twisting
them to make them fit into some equal-time formula.
I wrote an article listing the various intellectually-dishonest debate tactics at www.johntreed.com/debate.html.
Taking both sides

Another thing politicians do is take both sides of an issue. Kiyosaki is on both sides of many issues.
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Issue
Kiyosaki takes one side...
...then the other
Fear
On page 31 ...it's fear that keeps most

people working at a job.
Page 37 ...many rich people are rich not

because of desire but because of fear.
On page 40, rich people with lots of money
often have more fear the richer they get.
Timing markets
on page 109, Kiyosaki brags about timing

real estate markets
Wise investors buy an investment when
it's not popular. (page 154)
Also on page 154. Smart investors don't

time markets.
Federal income tax law
On page 95, he tells you to write off car On page 109 he says, I recommend playing
expenses, vacations to Hawaii, health club within the rules. The advice on page 95 is
memberships
tax fraud.
Main reason people do not get rich
the main reason people struggle

...the main reason most people are not rich is
financially is because they have spent
because they are terrified of losing (page
years in school, but have learned nothing
114)
about money (back cover)
The wisdom of joining a union
Good credit
Page 126. Personally, I take no sides

because I can see the need for and benefits
of both sides. (Rich dad was extremely
antiunion.)
Same page. Highly specialized people

should join a union. (Poor dad was a
union organizer.)
When I occasionally come up short. I still My wife and I have excellent credit. Same
pay myself first. I let the creditors and
page
even the government scream. Page 159
Use of inside information in securities

trading
The reason you want to have rich friends

who are close to the inside is because that
is where the money is made. Its made on
information. ...the sooner you know, the
better your chances are for profits with
minimal risk. That is what friends are for.
(page 154)
Im not saying do it illegally. Same page

[see below]
Treatment of real-estate brokers
Pay your brokers well (page 160)
Has an agent show him six properties then

says he wants to make half-price offers on
all six, which the agent refused to do. (page
170)
Extravagance
Kiyosaki says his poor dad frequently said, I cant afford it, while his rich dad said, How can I afford it? Theres another
one of those Jesse Jacksonisms. I agree that a knee jerk I cant afford it is a bad habit. I also agree that asking, how can I
afford it? is a good habit. However, this little yin-and-yang platitude leaves off the question of whether the expenditure
represents good value for the money? Kiyosaki buys extravagant things like a Mercedes and a Porsche and a Rolex watch and
seems to regard the How can I afford it? question as the only appropriate response to any conspicuous-consumption impulse.
This puts him at odds with the behavior pattern depicted in the book The Millionaire Next Door. That book, which is based on a
study of many real millionaires, found that actual millionaires generally buy used American cars. How do you think a man like
me got to be a man like me? Think about it. One of the keys to success in business is holding your costs down and getting good
value for every dollar spent. How could the same person be in the habit of spending money on extravagant items for which a
large show-off premium must be paid? (Note: The Millionaire Next Door book, although written by college professors, has been
criticized by other college professors as illogical. For example, they found that real millionaires had taken more risks than the
average person and concluded that risk-taking leads to millionaire status. Thats an error called winner biasconcluding that
characteristics of winners caused them to be winners. Most likely a study of the bankrupt persons next door would find that they,
too, took more-than-average risk. If so, the proper conclusion would be that risk-taking leads to extraordinary results, which can
be positive or negative. I do not recommend the Millionaire Mind book written by one of the Millionaire Next Door authors,
although it makes a few good points.)
Conspicuous consumption is for pretend millionaires

The authors of The Millionaire Next Door found conspicuous consumption was typically a sign of a non-millionaire who was
trying to impersonate a millionaire. Ostentation is item number one in my real estate B.S. artist detection check list. The fact that
Kiyosaki goes out of his way to talk about his Porsche; his wifes Mercedes; travel to Peru, Norway, Malaysia, and the
Philippines; his expensive attorneys, accountants, real estate brokers and stockbrokers, and his $400 titanium driver, makes me
wonder whether he is really a financial success or a walking (driving?) Potemkin Village.
Kiyosaki likes Texans. They have a saying: All hat and no cattle. Kiyosaki has a big hat (showy displays of wealth) and he
talks about it a lot.
The millionaire real-estate investors I know generally try to do their own legal and accounting work. They often buy through
agents, but try to sell without agents. Kiyosaki is the first real-estate investor I ever heard of who was eager to employ expensive
accountants, attorneys, and to use brokers always.
One woman who responded to my OK, Whats the point? question said Kiyosakis point was that you should not waste money
on expensive toys. I wrote back, Huh?! The guy who brags about his Porsche, Rolex watch, and $400 titanium golf club taught
you not to buy expensive toys?!!! She admitted that I had a point.
I also have an article on how wealthy people real ought to spend their money.
Risk management
Kiyosakis advice on risk taking borders on thrill seeking. He approvingly quotes a Texas saying, If youre going to go broke,
go broke big. This is dangerous, adolescent-level advice and may be why he has a bankruptcy (or not depending upon whom
you believe) on his resume.
Taking calculated risks is a prerequisite for a successful life. Thrill seeking is taking risks for their own sake without
calculating. On page 13, he says, Learn to manage risk, but the book gives no indication of how to do that. Nor does it give any
indication that Kiyosaki knows how to manage risk or ever cared about the subject. Indeed, risk management is a rather
sophisticated skill that would not be the forte of an eighth-grade dropout like rich dad. I recommend the following books which
discuss risk management. Kiyosakis head would explode if he tried to understand them.
Against the Gods, Capital Ideas, and Capital Ideas Evolving by Peter Bernstein
The Little Book of Common Sense Investing by John Bogle
Winning the Losers Game by Charles D. Ellis
The Four Pillars of Investing by William J. Bernstein
Fooled by Randomness by Nicholas Taleb
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Kiyosaki says he buys stock in small-cap companies that are just about to go public in Rich Dad Poor Dad. Thats rather unlikely.
How do you buy stock in a company before it goes public? In theory, you could buy stock in closely-held corporations from the
founder or his family or associates, but just before they go public seems like an extremely unlikely time for the owners of
closely-held stock to be selling. He refuses to name any such stock that he bought.
Ethics
His recommendations on using inside information in securities trading and deducting vacations in Hawaii are not likely to get
him appointed professor of ethics.
Factual errors
This book has many important factual errors.
Error
Correct version
One of the main reasons net worth is not accurate is simply
About the only asset you would sell at a gain would be real
because the moment you begin selling your assets, you are taxed estate. All other assets like personal cars, golf clubs, furniture
for any gains. (page 80)
would sell at a loss for tax purposes. You dont have to pay tax on
up to $500,000 of gain (married couple filing jointly) on your
residence because of Section 121 of the Internal Revenue Code.
You would have to pay tax on the sale of a rental property, but
thats why most investors do Section 1031 tax-free exchanges. I
have three books about tax-free exchanges: Aggressive Tax
Avoidance for Real Estate Investors, How to Do a Delayed
Exchange, and Reverse Delayed Exchanges. Kiyosaki himself
mentions tax-free exchanges two pages later.
the income-tax rate of the corporation was less than the
Sole proprietors are only taxed once. Corporation owners are
individual income-tax rates
taxed twice on corporate profits: once at the corporate level and
An individual with the knowledge of the tax advantages and
again on dividends that leave the corporation to its stockholders.
protection provided by a corporation can get rich so much faster Even if the corporate tax rate were just 1% you would be worse
than someone who is an employee or a small-business sole
off because it is added to your individual rate, not instead of it
proprietor.
as Kiyosaki implies. Its true that you can receive a reasonable
salary from the corporation and that will only be taxed once, but
Kiyosaki disdains mere salaries as highly-taxed earned income.
The only tax benefits of a corporation are the following: A
corporation can deduct various forms of employee insurance.
Sole proprietors can also deduct their health insurance
premiums. Corporations can also create cafeteria plans to
deduct limited amounts of child care and some medical expenses
that are not normally covered by insurance. In a one-man or
mom-and-pop operation, these small savings would probably not
give you a net benefit after paying the extra setup and annual
costs of incorporation.
my [corporation] bought me my first Porsche
He implies that you can deduct a Porsche if you simply have your
corporation buy it instead of buying it as an individual. In fact,
only ordinary and necessary (IRC162) expenses are
deductible and whether a corporation is involved is irrelevant.
Furthermore, the tax law contains explicit limits that prevent full
deductions for new luxury cars. He says all his Porsches are used.
This one could have cost $100.
A corporation can do so many things that an individual cannot. Both corporations and sole proprietors pay expenses before they
Like pay for expenses before it pays taxes.
pay taxes. Sole proprietors pay taxes only on the net income of
their businesses, which means after expenses.
by owning your own corporationvacations are board meetings There is no difference between the ability of a corporation to
in Hawaii. Car payments, insurance, repairs are company
deduct these expenses compared to a sole proprietor's ability to
expenses. Health club membership is a company expense. Most deduct them. Furthermore, it would often be fraud to deduct these
restaurant meals are partial expenses.
items. For example, a trip to Hawaii is only deductible if the
principal purpose of the trip were business and it was ordinary
and necessary. IRS would look carefully at a business trip to a
popular vacation destination like Hawaii. Even if the trip were
predominantly for business, only the airfare and meals and hotels
during the business days of the trip would be deductible. Hotel
and meal expenses for the purely vacation days would not be
deductible.
Business-related car expenses are deductible for both
corporations and sole proprietors.
Health-club memberships are never deductible for either
corporations or sole proprietors.
I earn 16% from the state government.
There are forms of insider trading that are legal
In order for a meal to be deductible or partially deductible, you

must be away from home overnight on business or you must
entertain a client or customer at the meal and you must discuss
business or negotiate immediately before, during, or immediately
after the meal. Since entertaining forces you to buy somebody
else a meal, and you can only deduct half the cost, at best, you
are no better off than if you had eaten a totally nondeductible
meal alone in the restaurant.
No, he doesnt. He is referring to tax lien certificates which can
pay interest rates that high. They are secured by real estate, but
payments are not guaranteed by any government entity.
It is generally illegal to buy or sell stock when you are in
possession of material, non-public information about the
corporation in question. The only legal insider trading is nonshort-sale trading which is done by an insider who is registered
with the SEC, reports his trades within ten days after the end of
the month in which the trades occurred, and who did not have
material, non-public information at the time of the trades.
Says friend did a tax-free exchange from a sole-proprietorship That is explicitly prohibited by Internal Revenue Code Section
rental house to a mini-storage limited partnership. (Page 176) 1031(a)(2)(B,C,D). Errors like this cause me to marvel at the fact
that Kiyosaki's co-author is a CPA. In 2008, she was suing
Kiyosaki for some reason.
Kiyosaki, like many other successful politicians, has been able to get people to stay loyal to him even after they find out he has
lied to them. I find this fascinating and have created a page where various Kiyosaki dupes explain why they still love him even
though he has given them false information.
People do not believe lies because they have to, but because they want to. Malcolm Muggeridge
The Rolex watch

A reader tells me that Kiyosakis corporation course says that he bought a $4,000 Rolex watch through his own corporation. He
had them deduct it as a bonus to him for his sales that year.
1.
2.
Rolex watches are not a good value. They are an extravagance whose main purpose is to enable their owner to show off.
A bonus from your employer, whether in the form of cash or goods or services, is taxable income at the federal level, at the state level in most states, and
at the municipal level in some areas. If Kiyosaki received a $4,000 Rolex watch from his corporation, he would have to pay tax on that $4,000 of income
on his next quarterly income tax return. In other words, from an income-tax standpoint, purchasing the watch through the corporation is a completely
meaningless exercise. Whether Kiyosaki buys the watch from his own funds or receives it from his corporation, he is out $4,000 (either as owner of a
corporation that now has $4,000 less in its bank account or as an individual who now has $4,000 less in his bank account) and he gets no personal tax
deduction whatsoever from it. While it is a deduction for his corporation, so is just paying him $4,000 in cash, and it is also ordinary income to him
individually, so its a complete wash.
3.
I surmise that Kiyosaki is implying this is a clever way to get a Rolex watch for free or at a discount by making it deductible. It is neither. If Kiyosaki
does not know what I have just said about this transaction, he is too ignorant of this subject to be writing and lecturing about it. If he does know, then he
has a rather low opinion of the intelligence of his readers and an equally low regard for their best interests.
Not likely
Kiyosakis book also contains many stories which I cannot say for sure are not true, but I can say I am familiar with the subject
matter he is describing and his scenario is highly unlikely. Even if he actually did these things, it is inappropriate for him to
present them without a warning that they are quite atypical.
Kiyosaki scenario
Can buy $75,000 house for $20,000 or less at bankruptcy auction
or on courthouse steps with five hours work
More likely real-world version

Elias, Renauer, and Leonard, authors of How to File For
Bankruptcy, say a typical home sells for 10% to 30% below
market value, not the 73% or more less that Kiyosaki would
have you believe. My book How to Buy Real Estate for at Least
20% Below Market Value has over 166 actual case histories of
bargain purchases, including some involving bankruptcy and
courthouse steps. Few of them involve 73% discounts. Those
that do are almost all sheriffs sales, which Kiyosaki does not
mention.
The late, longtime California foreclosure millionaire Paul
Thompson said he saw one or two deals per year, out of about
1,200, with this sort of discount, but never one that could be had
for only five hours work.
Kiyosaki says he bought and sold six properties to create

$190,000 of notes with a total of 30 hours work.
Kiyosaki is claiming to have made $190,000/30 hours = $6,333

an hour. In the 7/90 issue of my newsletter, Real Estate
Investor's Monthly, I analyzed the amount of time it took Paul
Thompson to do his deals. In 20 months, Thompson spent about
25 hours per week and bought 13 properties. His average deal
made $42,361, but he still only made about $256 per hour over
the 20-month period.
Either Kiyosaki, who flunked a year of high school, is
$6,333/$256 = 25 times smarter than former Lawrence
Livermore National Laboratories computer scientist Thompson,
or he figures you and I are dumb enough to believe that he is.
I would appreciate it if someone would find the addresses of
those six properties and the date of this transaction so we can
check it out whether it happened at all, and if so, the details.
In real estate, I can go out and in a day come up with four or five Based on the 166 actual case histories in my How to Buy Real
great potential deals.
Estate for at Least 20% Below Market Value, and thousands of
other interviews over the years, I said that professional bargainpurchase investors literally consider between 50 to 1,000
properties for every one they buy. Using the ratio most favorable
to Kiyosakis claim, 50 to 1, his boast means he looks at 200 to
250 properties a day. Thats about ten properties per hour or one
property every six minutes if he does not sleep or eat. Kind of
reminds me of the 20,000 women Wilt Chamberlain claimed to
have had sex withuntil somebody ran the daily numbers.
Thompson says the most properties he ever found in one day was
two and that was the tip of an iceberg of months of efforts culling
out those two properties from hundreds that didnt pan out.
Simple math and common sense is [sic] all that is needed to do The world is full of non-wealthy people who can do simple math
well financially.
and have common sense. Many additional qualities are needed to
succeed in business.
I offered $275,000 for a $450,000 building. They agreed to
$300,000.
More likely you would be shown the door if you offered

$275,000 on a $450,000 building. Negotiations, if they occurred
at all in the case of such an extreme low-ball offer, usually split
the difference. The seller coming down $150,000 while Kiyosaki
only comes up $25,000 would only occur in a very rare situation.
Get him to give you the address of this building.
For the average individual, a passive income of more than
If you achieved a 10% return on investment, which would be
$100,000 a year is nice and not hard to achieve. Depending on extraordinary, you would need $100,000/10% = $1,000,000 of
the market and how smart you are, it could be done in five to ten principal in order to achieve a passive income of $100,000. Only
years.
about 2% of the population has a net worth that big. The average
individual neither has such a net worth, nor is such a net worth
not hard to achieve for average individuals, as evidenced by
the fact that so few have done so.
my starting pay was $42,000 a year including overtime after I
I have no firsthand knowledge of the actual starting salaries of
graduated from college in 1969, and I only worked seven months merchant-marine officers in 1969, but I note that the salary he
a year.
claims, annualized to a twelve month year is $42,000 /(7/12) =
$72,000 (in 1969 dollars or $321,000 in 1999 dollars). The basic
wage of able-bodied seamen including extra pay for weekends in
1970 was $7,824 (working 12 months a year). In 1975, the
median income of all college graduates, not just recent grads,
was $14,656 a year. The 1969 median income for all households
(all ages and education) was about $8,800.
A visitor to this page sent me an email with the following:
My father in-law graduated from the Merchant Marine Academy
five years before Kiyosaki and my wife says it is likely that
Kiyosaki was making that much money in 1969. Apparently, her
dad (a ships captain for 35 years) was extremely well
compensated in those days, before the industry started drying up
and going foreign flag. Her dad chose Kings Point for two
reasons. One, he had a scholarship and two, he knew that he
could make a ton of money immediately out of school. I havent
spoken with him about Kiyosaki in particular, but my wife says
that $42,000 for a Third Mate in 1969 sounds about right. The
part about only having to work seven months out of the year is
also correct.
Another visitor who is involved in the shipping industry said he

thought Kiyosakis figures sounded a bit high, but not completely
out of the question. I would add that this sort of legal rip-off is
what has virtually wiped the U.S. merchant marine off the face of
the earth.
I could have easily doubled my pay had I taken the run to

Vietnam with a subsidiary shipping company
Its not clear exactly which figure he is doubling, but the most
optimistic interpretation would be $144,000 in 1969 dollars or
$642,000 in 1999 dollars.
In 1977, I formed my first company.
Whenever I meet a guy who brags about starting multiple

companies I always wonder what was wrong with the first one.
Were Hewlett and Packard a couple of losers because they only
started one company?
Today my investment company invests in South America, Asia, Sounds like a real jet setter, but the sentence is worded in such a
Norway, and Russia.
way that it could mean he owns one share of stock in a stock
market in each of those regions.
In 1973, I was watching TV and this guy came on advertising a The nothing-down movement was started by seminar speaker
three-day seminar on how to buy real estate for nothing down. Robert Allen in 1978. His book Nothing Down came out in 1980.
Cable TV did not become widespread until the early 80's.
Advertising real-estate seminars on cable TV infomercials started
around 1984.
A good real estate broker should take the time to educate you I used to be an agent. Many is the time I heard fellow agents say,
Never educate the public. Agents want to work with the buyers
who will take the least amount of their time so they can
maximize their earnings per hour. Educating buyers takes time,
plus the smarter the buyer, the more time it takes him to find a
property. Agents want dumb buyers and they want to keep them
that way. Thats one of the reasons I stopped being an agent.
When I interview any paid professional, I first find out how
It would be appropriate to ask a professional you were
much property or stocks they personally own and what
considering hiring whether they own any rental property. But
percentage they pay in taxes. And that applies to my tax attorney how much property they own, whether they own stocks, and
as well as my accountant.
how much tax they pay is none of your business and virtually
all professionals will tell you that if you ask these questions.
The bank wanted $60,000, and I submitted a bid for $50,000, My wife is a banker. I cannot imagine a banker saying, Wow! A
which they took, simply because, along with my bid, was a
cashiers check! They see dozens of cashiers checks a day.
cashier's check for $50,000.
It is true that sellers of all kinds will sometimes drop their price
slightly for a fast, clean, all-cash deal. But a cashiers check
alone is not likely to get you very many 17% discounts from
banks.
Frequently, my broker will call me and tell me [to buy] a
company that he feels is just about to make a move that will add
value to the stock, like announce a new product.
It is against the law for a broker or anyone else to provide

material, non-public information about a publicly-traded
corporation to a person who buys or sells stock in that
corporation and it is against the law to buy or sell stock when you
are in possession of such information unless you first disclose it
to the public following SEC procedures to do so.
I always make offers with escape clauses. In real estate, I make

an offer with the words subject to the approval of business
partner. Most people do not know the partner is my cat.
Competent real-estate agents and sellers would strike such a

clause. They would either substitute an early deadline for
removing all such contingencies, or they would simply say
Come back when you are ready to make a firm offer. If an
investor truly ever pulled this stunt, and it was discovered that his
partner was his cat, he would be shunned by everyone in his local
market from then on. This is a childish, fraudulent clause. If an
investor ever invoked this clause in a lawsuit and admitted his
business partner was his cat, a sane judge would not only find
against the guy who used it, he would chew him out and might
impose sanctions.
Says a friend wanted some land but didnt have time to look. So
The chances that a friend would want the same parcel you
Kiyosaki went out an optioned a large parcel and sold part of it to optioned are extremely slim. If the friend did not want it, and you
the friend for the amount Kiyosaki had to pay for the whole could not find another buyer within the option period, you would
parcel.
lose all your option money. Guys who really do deals of this
nature, like packagers, work closely with the builders who buy
ready-to-build land from them, and have numerous political
connections to get needed zoning changes.
Trading on inside information

Kiyosaki says,
The reason you want to have rich friends who are close to the inside is because that is where the money is made. Its made on information. ...the sooner you know, the
better your chances are for profits with minimal risk. That is what friends are for. (page 154)
It is against the law to provide material, non-public information about a publicly-traded company to a person who trades in the
stock of that company based on that information without first disclosing to the public what that information is. It also against the
law to buy or sell stock based on such information without first disclosing that information to the public. To make the disclosure,
you have to fie a particular form with the SEC.
Securities Exchange Act of 1934 [The civil penalties (triple damages) are at 15 USC 78t-1 and 15 USC 78u-1.]
Insider Trading Sanctions Act of 1984 ( Pub. L. No. 98-376, 98 Stat. 1264)
Insider Trading and Securities Fraud Enforcement Act of 1988
Securities and Exchange Commission Rules 10(b)-5 and 14(e)-3
Cady Roberts Co., 40 SEC 907
Persons who provide inside information are called tippers. Person who receive such information are called tippees. Both are
breaking the law if the tippee profits from such information. Here is the Blacks Law Dictionary definition of a tippee.
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Legal definition of a tippee

Persons given information by insiders in breach of trust. The purpose of [SEC] Rule 10b-5 is to prevent corporate insiders and
their tippees from taking unfair advantage of the uninformed outsiders. Conspiracy between corporate insiders and person to
whom insiders have furnished information is not required for such person to be declared a tippee...
Registration and reporting requirements if you receive inside information
Persons who are not corporate executives of the company in question and who possess inside information about that corporation
are required to file a personal statement with the SEC. If they buy or sell the stock of the corporation, they must report those sales
within ten days of the end of the month in which they occur. They are generally barred from any short selling. If a person trading
based on material, non-public information makes a profit within six months of trading the stock, the corporation and
contemporaneous traders can legally recover that profit.
Bounty for reporting inside traders
If you report an apparent illegal inside trader to the SEC, you are eligible to collect a bounty of up to 10% of the amount of
improper profits he is forced to give back. 17 CFR 201.61 to 201.68
As stated above, Kiyosaki says in his book, Frequently, my broker will call me and tell me [to buy] a company that he feels is
just about to make a move that will add value to the stock, like announce a new product. Perhaps Mr. Kiyosaki would like to
prove this has really happened to him by providing the name of the broker, the date, and the stock in question for just one of these
frequent occurrences. As far as I know, he has not responded to this invitation.
Simply stated, it is generally illegal to buy or sell a stock based on material, non-public information. In 2002, long after I first
posted the above discussion, Martha Stewart was being investigated for precisely the behavior that Kiyosaki advocates in his
book and says he has engaged in: trading stocks based on inside information.
More research on this page than in his book

One visitor to this Web site commented that she thought I did more homework analyzing Kiyosakis book than he did writing it.
I suspect thats true, but then its not saying much.
Property manager is the key to real estate?

Kiyosaki says, A great property manager is key to success in real estate. Hes nuts. Experienced property owners do not hire
independent 5%-of-the-gross property-management companies. When syndication was big, those companies owned income
properties all over the U.S. They tried to use local companies for everything they needed, but they found they could not get good
service out of local property-management companies so they all started their own in-house property-management companies.
I heard the head of a major pension fund say at a speech that his company tried to hire local property managers for office
buildings and finally concluded they had to create their own in-house property-management company. All my millionaire friends
manage their properties themselves and would never use an outside property-management company. The property-management
industry has almost no happy private clients. They mainly work for owners who are not spending their own money like
government agencies, nonprofit entities, corporations, and bank trust departments.
The problem with property-management companies is that they neglect properties and use expensive suppliers and
subcontractors. I estimate that approximately 90% to 95% of property managers take kickbacks from those expensive suppliers.
When I was a property manager I reported a number of bribe attempts to my boss. Both my predecessor and my successor at the
job took kickbacks. (A subcontractor showed me a canceled check cashed by my predecessor and my successor was fired for
taking kickbacks.) My secretary had worked for a major property-management company before working for me. She said every
property manager in her old company took kickbacks.
If you ask the typical successful investor if he ever used a property manager, he will shudder at the memory, admit that he did
once, and somberly swear, Never again. See my book on How to Manage Residential Property for Maximum Cash Flow and
Resale Value to learn how to manage your property yourself, which is the only way to go.
Real-estate commissions equivalent to restaurant tips?

Kiyosaki says he finds it funny that so many poor and middle-class people insist on tipping restaurant help 15 to 20 percent
even for bad service and complain about paying a broker 3 to 7 percent.
I can help him understand that. Restaurant meals generally run about $10 to $40. The 15% tip, therefore, runs only about $1.50 to
$6. Furthermore, the wages of waiters are deliberately depressed below comparable non-restaurant wages because waiters receive
their income partly in the form of tips. In other words, they count on that money and it has the effect of raising their hourly
income to a normal wage level.
Real-estate prices, however range from about $50,000 up to millions of dollars. But the work required to sell a listing is about the
same regardless of the price of the property. I am a former agent and I figure it takes about twenty man hours to sell a home,
maybe thirty or forty man hours to sell a commercial property. The appropriate hourly compensation level is about $25 an hour
given the training and experience levels of the average agent. Therefore, commissions ought to be about $500 for a house and
about $800 for a commercial property. Add another $1,000 per deal for the broker's overhead.
Six percent of, say $100,000, is $6,000, which is a lot more than $1,500. Sensible people think its dumb to pay that much. If they
can sell it without an agent, they save thousands and only have to do 20 hours work. The problem with the real-estate-brokerage
business is that there are too many agents. You can confirm that by opening any Yellow Pages. The real-estate agent section is the
biggest of all, even though the average homeowner only needs a real-estate agent about every ten years or so. Real-estate agents
are the only profession that will give you free pumpkins or mow your lawn or whatever to get your business.
Hustling for listings

Individual agents do not make extraordinary amounts personally because they have to spend so much time hustling for listings,
even though that effort contributes absolutely nothing to helping sell your property. The root of all this evil is widespread refusal
to cut commissions and refusal to cooperate with agents who do. If and when commissions become truly competitive, houses will
be sold for a flat commission of about $1,500 to $2,000 and commercial property will sell for a flat commission of about $3,000
to $5,000. Institutional deals involving platoons of lawyers and such will cost a lot more, but the commission will still not be a
percentage of the sale price. If and when breaking the agents 6%-commission cartel happens, there will be far fewer agents, but
the ones who remain will make a nice living and they will no longer give you free pumpkins in the hopes of getting a listing.
Until that happens, anyone who does not try to avoid paying a 3% to 7% commission when he sells needs his head examined.
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Smart real-estate investors generally do not try to avoid commissions when they buy. Rather they judge the price alone. If it's a
good deal, they buy. If not, they don't. If there is an agent, they support his right to the commission to encourage that agent and
others to bring them deals in the future.
Taken companies public?

A visitor to this site sent me the following email:
...when I read that Kiyosaki had taken companies public, I searched the SEC files online for his name and found no hits. That means he does not own 5% or more of
any public company in the USA. If he did, hed have to be listed as a beneficial owner with the SEC and on quarterly statements.
My money
In his Meet The Street interview, Kiyosaki says, I was able to retire at age 47, after just nine years of putting my money to
work in business, real estate and options, all without owning a single share of a stock or a mutual fund.
Im getting confused by his inability to keep his story straight. He says he makes money off inside information on stocks, but
never owned a single share of stock. What did he do with the inside information? Stand on the corner near the stock exchange
saying, Pssst! Wanna hot tip?
And what money did he put into business, real estate and options starting nine years before he was 47? That would be 1985, the
year he was bankrupt (or was he?) and homeless.
Main speaker at Jon Richards note convention

Jon Richards invited me to speak at his 2000 convention. I declined on the grounds that I do not know the note-brokering
business. I later learned that one of the other speakers at that convention was Robert Kiyosaki. Jeez!! Jon needs to raise his
standards, both in terms of making sure the speakers have note expertise and in terms of not headlining B.S. artistsbest-selling
author or not.
[Heres an email I got from Richards after he read the above.]
Wow! You could not have been more correct. The guy was extremely arrogant, and gave us no information about Real Estate or notes or how he made his money. He
seems to have come up with one idea about investing in assets and is riding that pony to lots of best sellers. I have never been so appalled at a speakers ability to talk
for over an hour and share no substantial knowledge. How in the world could he have 3 best sellers? Its frightening. In fact, I think if you look at the Wall Street
Journals list of best selling business books you will find primarily a list of simple minded garbage. (e.g. Who Moved the Cheese?)
Best seller status

One Kiyosaki supporter (they call him RK), said Kiyosaki has several best-selling books, but hes never heard of me, therefore
Kiyosaki obviously knows what hes talking about and I dont. (Click here to read that email and others) The list of best-selling
books on real estate and related topics includes two excellent ones: William Nickersons How I Turned $1,000 in $5,000,000 in
Real Estate in My Spare Time and Al Lowrys How to Become Financially Independent by Investing in Real Estate. But it also
includes real-estate/financial authors who later went bankrupt or got locked up for their real estate-related activities like Robert
Allen, Wade Cook, Sonny Bloch, Charles Givens, and Bill Tycoon Greene. For the most part, the list of best-selling financial
authors is a rogues gallery. There have also been best-selling books that recommended quack cures, unhealthy diets, and nutty
conspiracy theories.
Click here to see a list of best-selling real estate authors and the various troubles almost all got into.
Conclusion
All I know about Robert Kiyosaki is what I read in his book (and from other sources noted above). Based on what I read and
what I know about the subject matter in question, I am extremely skeptical as to whether he has done or seen many of the
investment things he claims to have done or seen. He claims to be an experienced, millionaire, real-estate investor, yet the book is
full of statements that I would expect only from a rather ignorant, not very bright, novice, investor wannabe.
Rich Dad, Poor Dad is one of the dumbest financial advice books I have ever read. It contains many factual errors and
numerous extremely unlikely accounts of events that supposedly occurred.
Rich Dad, Poor Dad triggers the following items on my Real Estate B.S. Artist Detection Checklist:
1, 6, 7, 10, 11, 13, 20, 26, 27, 28, 29, 30, 31, 38, 39, 46, 49.
Oprah
I understand Kiyosaki appeared on Oprah and was recommended by her. That was after this Web page was posted. Either she
and her staff did virtually no checking to make sure Kiyosaki was giving good advice or they found this page and totally
disregarded the factual allegations it contains.
I have been on a number of TV shows like 60 Minutes, Good Morning America, and Larry King Live. I have also been in various
magazines and newspapers like Money and the Wall Street Journal. They vary considerably in their quality control. Kiplingers
Personal Finance magazine is the best. They fact check every word you write for them. The worst I experienced was Good
Morning America. They were clearly more interested in ratings than whether they were broadcasting accurate financial advice. 60
Minutes was excellent at getting it right. In the case of personal-finance information, Oprah would appear to be interested only in
the ratings a guest produces, not the value of his information. Best-selling authors will produce more ratings than non-best-selling
authors. If Oprah was interested in good information, she would have someone like Jane Bryant Quinn on.
I once watched an Oprah show about youth sports, a subject about which I also write. During the show, she said a man was trying
to get his kids Ivy League athletic scholarships for ice hockey. They also put up a screen graphic saying that, which means it was
not just a slip of the tongue. My son was an Ivy League football player. There are no athletic scholarships whatsoever in the Ivy
League. They are prohibited by league rules. If the Oprah staff had done even the most minimal homework, they would have
learned that.
So what does it mean that Kiyosaki was recommended by Oprah? About as much as it means when she talks about Ivy League
athletic scholarships. Oprah, like Kiyosaki, is running a cult of personality. Neither one of them knows what they are talking
aboutor cares.
The Jim Frey/A Million Little Pieces incident with Oprah

On January 12, 2006, another best-selling non-fiction author whom Oprah highly recommended admitted his book contained a
number of lies. That would be James Frey and the book is A Million Little Pieces.
Oprahs response? She said she will continue to recommend it in spite of the fact that, some of the facts have been
questioned. Some of the facts have been questioned!? The author admitted he lied, Oprah. It has gone way beyond
questioning of facts.
So you can see where Oprahs coming from when the truth of non-fiction books is discussed. And you can see how willing she
is to admit to a mistake. The one thing Kiyosaki, Frey, and Oprah share is high ratingsand apparently thats all that matters to
the three of them.
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Follow-up
My 1/27/06 San Francisco Chronicle says that Oprah reversed herself on Frey, that she had him and his publisher Nan Talese of
Doubleday on for an hour and ripped them a new one on live TV. She did this because she was criticized by Washington Post
columnist Richard Cohen and New York Times columnist Frank Rich and others who ripped Oprah for not caring about the truth.
She had those two guys on the same show.
Oprah apologized and said, To everyone who has challenged me on this issue of truth, you are absolutely right. Well, I would
be one of those. Youre welcome, Oprah.
Frey was exposed by the Web site www.thesmokinggun.com (http://www.thesmokinggun.com/archive/0104061jamesfrey1.html).

That led to the various columns and editorials condemning Oprah.
I am glad to see that Oprah has belatedly decided the truth is important with regard to James Frey. But what about Kiyosaki?
He sold about ten times as many books as Frey in large part because of Oprahs help. Is she really interested in integrity? Or is
she only interested in integrity when the Washington Post and New York Times shine their spotlight?
There is no spotlight on Kiyosakis lies other than this Web page and an old Smart Money article. Now we will find out whether
Oprah has integrity in general, or just when the spotlight is on. If she has integrity in general, she will have Kiyosaki on her
show again and rip him a new one for lying to her and her audience and to his readers. I will not be holding my breath.
Furthermore, I do not believe there is a snowballs chance in La Jolla that he or his publisher will show if she schedules such a
show.
Character has been defined by many as, What you do when no one is looking. Compared to the Washington Post and New York
Times, Im no one. Now lets see what Oprah does when no one is looking at her endorsement of Robert Kiyosaki.
I wrote an article about the Frey incident at www.johntreed.com/HTWPfrey.html.
Sociopath?
Recently, I have read a number of articles that discussed sociopaths. A famous one said Bill Clinton was a sociopath. Both
Clinton and Kiyosaki are politicians. The more I read about sociopaths, many, but not all, of the characteristics, sound like many
of my comments about the various bad gurus. Here is a link to an article about whether Clinton is a sociopath. I draw your
attention, however, to the portion of the article that gives the definition of antisocial personality disorder, which is the scientific
name for sociopath behavior, from the American Psychiatric Association: Diagnostic and Statistical Manual of Mental Disorders,
(DSM-IV) fourth edition, 1994. I would provide that definition here, but it is copyrighted.
Here is a link to another similar discussion. Both articles say that 3% of all males and 1% of all females are sociopaths. 2% of the
U.S. population is 5.6 million peoplemore than enough to get a sociopathic book onto the business best seller list. (In 2006, I
was told these links no longer work. Try www.Internetarchive.org or some other Web site that lets you see no longer available
Web pages.)
I hasten to add that this definition contains many behaviors that I have no reason to believe Kiyosaki or any other guru have
engaged inparticularly those relating to private, family, or childhood behavior. What is noteworthy is the number of public
behaviors that are on the list. It should also be noted that I never saw this definition until 4/4/01, long after I first posted this
analysis of Kiyosaki.
Why I spend so much time on this page

A number of people have commented that I spent too much time creating this page. Probably true, but you might be interested in
how that came to pass. Initially, I bought Rich Dad Poor Dad and read it. Whenever I read a book, I underline it thoroughly and
make marginal notes. So the vast majority of the work was done while I was reading the book. Once I did that work, it was
simple to just carry it forward to this Web page.
I bought and read it in order to write a review of Rich Dad Poor Dad in my Real Estate Investors Monthly newsletter. The
review was only 1/3 of a page long. Space is at a premium in my newsletter. However, on the Internet, space is roughly infinite
and free so I saw this page as away to get some use out of more of the work I did reading Rich Dad Poor Dad to begin with.
Initially, this analysis was not anywhere near as long as it is now. I added to it as I received comments from readers and as I came
across pertinent stuff in the normal course of my life. Much of it was provided by readers who sent helpful passages and links. In
that sense, it is somewhat Wikipedia-ish. I did not create it. My readers and I did.
Kiyosaki is hurting people

This man is doing damage. I got an email from a surgeon. Her 17-year-old son read Rich Dad Poor Dad and now does not want
to study or go to college. He just wants to get rich and believes Kiyosakis pitch that education is a waste of time. He now puts
down and criticizes his mom for not being richer. I never knew a surgeon who was fighting the pigeons for something to eat. And
this particular surgeon says she finds her profession extremely rewarding in non-monetary ways as well.
Another guy wrote from Israel. He got so pumped by Kiyosakis books that he told his boss off and quit his job. Now he is
unemployed and hurting and wrote to thank me for this page, but to lament that he did not read it until it was too late.
If I do not try to set the record straight, who will? Almost everyone but me is either unqualified or unwilling to say anything. See
Why I created and maintain this Web page for some comments on why I am unwilling to sin by silence when I should protest.
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Australia and New Zealand

At one point, I suddenly started getting emails and a phone call from Australia and New Zealand about my real-estate stuff. Why?
Apparently Robert Kiyosaki and a guy named John Burley went to Australia and made speeches about getting rich in real estate.
Some Australians type Kiyosakis name into an Internet search engine and find this page.
There is an old saying that an expert is someone who carries a briefcase and is at least 50 miles from home. By that standard,
Kiyosaki and Burley must be absolute geniuses in Australia. Australians who are considering following Messrs. Kiyosaki and
Burley might want to contact real-estate people in their home area of Phoenix and ask how highly regarded they are among the
people who actually would see them do real-estate and other business deals, if, in fact, they do any.
Here is an email I got from an Australian:
Dear John,
I am writing to you after reading your article on Robert Kiyosaki.

You may be interested to know that Mr. Kiyosaki has not always been so well regarded in Australia. He has been involved with
various money making enterprises especially in the motivational/self help industry. Of particular note is a seminar he was
conducting over five years ago called "Money and You". This seminar ran over a couple of days and subjected the participant to
an almost "brainwashing" type of personal and financial rhetoric from Kiyosaki. After numerous participants and their families
complained, a television current affairs programme called Four Corners (the most respected current affairs programme in this
country) investigated the seminar and detailed Kiyosaki's dubious credentials and advice. Probably the most tragic side of this
seminar was that people who attended left and made terrible decisions which they later regretted deeply. This was the main thrust
of the programme which sought to show how people could be manipulated and be given bad advice.
What is of interest with the seminar is the same point as you raise.......... that is the cult of personality and the amorphous
advice/statements. When questioned Kiyosaki was both vague and ambiguous in his responses.
This I believe points to a man who has such a low self image and sense of self that he believes he can only be realized and
accepted by obtaining wealth. I also believe that such a man only seeks to exploit others in order to do so.
Having listened to some tapes of RK given to me by friends. I find gross generalizations, mercenary attitudes and a high degree
of perhaps "self loathing".
Anyway thank you for your article and let us hope there are many more who see RK and his kind for what they truly represent. T.
Fraser
I do not know anything about Australian real estate. It is likely that Kiyosaki and I share that characteristic, although he no doubt
learned a little during his speaking visit. My only visit to Australia was when I was on R&R from Vietnam in 1970 and I wasnt
looking for real estate.
Unlike Kiyosaki, I have no territorial ambitions. But my wife does and after she retired on 1/1/07, we began shipping to foreign
addresses
The act of selling a real-estate book to Australia or Canada implies that it is valid there. I do not know what validity, if any, my
books have in foreign countries, so I refuse to even imply that they have any validity there. I also refuse to research what validity
they have there because the market is too small and it is almost certain that special editions would have to be developed and
continuously updated to prevent Australian and New Zealand readers from getting into trouble following U.S.-oriented advice.
I am not interested in speaking in person in Australia. Its unbelievably far away. My jet from San Francisco to Vietnam had to
stop for refueling in Hawaii and Guam. Then my jet from Vietnam to Sydney had to stop for refueling in Darwin. I understand
they now have non-stop flights, but I think flights that long violate the U.S. Constitutions prohibition against cruel and unusual
punishment.
If you are in Australia or New Zealand and really want one of my U.S. books, order them. My late mother used to say, when my
brothers and I were little kids and running around, If you break your leg, dont come running to me. Similarly, if you buy my
book and it doesnt apply to Australia, dont come running to me. I never said it did.
As a substitute for my books in Australia, I recommend Australian visitors to this Web site also visit my Real Estate B. S. Artist
Detection Checklist. It should apply universally.
An Australian reader says that all the multi-level marketing (MLM) salespeople like Amway distributors are pushing Kiyosakis
books because of his encouragement to go into business for yourself. The MLM distributors then say that they are a way to do
that. He further says that the Kiyosaki discussion groups on the Net are overrun with MLM people trying to get you to become
one of their distributors. I would not be surprised. The adoption of Kiyosakis book by MLM companies could be the primary
reason it is a best seller. MLM cults are sort of a human equivalent of a computer virus, replicating themselves all over the place.
Smart Money story

The 2/03 Smart Money magazine did a story about Kiyosaki. They turned up a few details I had not dug up.
Kiyosaki is chameleon-like, changing his speech radically to pander to each audience. I said he was a financial demagogue. That
would be what a demagogue would do. To a religious audience, hes a preacher. To entrepreneurs, hes a Marine drill sergeant and
combat veteran. To Amway distributors hes an MLM guy, and so forth. Its called telling people what they want to hear.
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Component depreciation
At the end of a seminar to a religious group, he says he recently did a real estate deal where he got a 17% cash-on-cash return and
that theres 24% component depreciation on the property. Really? Gee, and I thought component depreciation was explicitly
outlawed by the Economic Recovery Tax Act of 1981. Actually, Im sure of it. Its right there in Section 168(f)(2) of the Internal
Revenue Code.
Smart Money cannot find his deal

Kiyosaki claims to have done many highly profitable real estate deals. But Smart Money could not find them in the Maricopa
County (Phoenix) records. He claimed to have bought one property for $20,000 and sold it immediately for $60,000. Smart
Money could find no purchase for which he paid less than $40,000 (one had no price) and no property which he sold in less than
20 months. When asked about the discrepancy, Kiyosaki said, I dont pay attention to those things.
Huh?
This may explain why Kiyosaki does not seem fond of going to court. Give an answer like that in a court room and the judge will
say, Answer the question, Mr. Kiyosaki. The court is not interested in what you pay attention to. Nor are you going to get away
with evading answering a question by giving an unresponsive answer like that.
Kiyosaki tried to claim the deal in question was done in a partnership. Smart Money could find no evidence of such a partnership.
Kiyosaki refused to provide the information or documents that would prove his claim.
Took Yamana Resources public?

Kiyosaki claims he has taken a number of businesses public. When asked to name them, he could only cite Yamana Resources, a
Toronto Stock Exchange corporation. The CEO and founder of that corporation, Victor Bradley, told Smart Money that
Kiyosakis only connection with Yamana is that he owned some shares of Platero Resources, a privately held corporation that
Yamana acquired in 2001six years after Yamana went public.
Desertion?
The melodramatic incident Kiyosaki relates about refusing to return to ship as a Marine officer in Hong Kong changes in Smart
Money. Now he says he was one of 480 guys who got left behind when the ship left early. In his first book, described above, he
seems to nominate himself for the Nobel Peace Prize as an active-duty, Marine officer, anti-war protestor. Now, we learn that he
just missed the boat.
Wanteddead or alive?
As to the whereabouts of Rich Dadat one point, Kiyosaki tells Smart Money that he died in 1992. Poor man.
Later, he says Rich Dad is still alive, but a reclusive invalid. Uh huh.
Later, he tells Smart Money that Rich Dad was a composite of several persons.
Finally, he gets angry at Smart Money. Is Harry Potter real? Why dont you let Rich Dad be a myth, like Harry Potter?
That would be fine, Robert, just as soon as you remove Rich Dad from the non-fiction best seller list and go over and compete
with Harry Potter on the fiction best-seller list.
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So I guess the final word is that Rich Dad is as real as Harry Potter. I suppose that, in turn, means that the way to become
financially independent is to get a magic wandor to write book about fictional characters who did.
One reader of this page and of Rich Dad Poor Dad says Rich Dad is really Ayn Rand. He says he is quite familiar with Ayn
Rands books and that Kiyosaki appears to have copied much of Rich Dads advice from Rand. In particular, he cited Rich
Dads Robin Hood story as a Rand story. Interesting.
Kiyosaki was a seminar instructor

Almost all of the bad real estate gurus got their real start as pitchmen or instructors for other bad gurus. Kiyosaki was an
instructor for attorney and real estate investor Marshall Thurber for nine years. I know nothing about Thurber other than that
Kiyosaki loved him when he wrote his first book and failed to mention him at all when he wrote his second.
Kiyosaki on PBS
I have heard that Kiyosaki was doing pledge breaks on PBS TV in 2005 and 2006. PBS TV never tires of telling us how
intellectually and morally superior they are compared to the for-profit networks and cable channels. But there is a lot more to
intellectual and moral superiority than merely restricting the length of the commercials you air. When it comes to hustling a buck
by using a charlatan like Kiyosaki, PBS bears more resemblance to the late-night get-rich-quick infomercials than they do to
NBC, CBS, and ABC.
The fact that Kiyosaki was one of the more successful recent pledge break offerings also reveals that the PBS audience is
nowhere near as bright as PBS would have us believe. Most people know that when something sounds too good to be true, its
not true. Apparently, a significant percentage of PBS viewers are not smart enough to know that. And that situation sure as heck
is not improved by PBS recommending Kiyosaki for their financial education.
They used to recommend people like Wall Street Weeks Lewis Rukeyser and Newsweeks Jane Bryant Quinn for financial advice.
They did not switch to Kiyosaki because he gives better financial adviceor even because he gives decent financial advice.
They switched to Kiyosaki because he inspires PBS viewers to part with more pledge bucks than Rukeyser and Quinn did. Like
the bad get-rich-quick gurus, the people who decided to put Kiyosaki on PBS are more interested in helping themselves to your
money than helping you with your money.
But they have Sesame Street

Some readers have also told me, essentially, that PBS can do no wrong because it has Sesame Street and The Jim Lehrer News
Hour, etc.. As long as PBS put on only shows that met those standards, my wife and I supported them. Now that they have
decided to go sleazy, if only in part, we are done supporting them.
Now, every PBS employees paycheck includes an amount that PBS derived from foisting Kiyosaki off on its viewers. They
should be ashamed of themselves. Actions speak louder than words. PBS has sold its viewers out.
KQED response
A reader complained to KQED, the San Francisco PBS station.
The reader directed KQED to the above review of Rich Dad Poor Dad. In it I say that Kiyosaki is a liar and a charlatan and a
danger to his readers. Seems to me that KQED has a responsibility to check whether I am right. After all, the above discussion is
full of quotes, links to laws, and other facts that PBS could check on their own or by consulting experts.
So did they? No. They just sent the reader an empty-suit, spin letter that referred him to Kiyosakis rebuttal of the above
comments on Rich Dad Poor Dad which is out on the Web somewhere. He calls it response to Reed. You can probably find it
with a Google search. PBS does not know which of us is telling the truth, or so they imply. But it is quite clear that they also have
no interest in finding out. PBSs policy with regard to whether their pledge break stars are frauds is Dont ask. Dont tell.
Simple math: running Kiyosaki get-rich-quick infomercials makes money for PBS. Worrying about whether Kiyosaki is a fraud
does not. Thus does PBS reveal who they really have become and what they are now really about.
I read Kiyosakis rebuttal of this Web page and was amazed at how lame it was. One of Kiyosakis biggest fans was on his side
after he read both Rich Dad Poor Dad and my above review of it. Then he came across Kiyosakis response to Reed and
thought it was so inadequate that he concluded my review must be accurate after all.
Heres an idea. Some programs on PBS actually still claim to be interested in truth, like the Jim Lehrer News Hour. Hows
about writing to them and ask them to look into Kiyosaki?
One email I got said PBS is more than just Sesame Street and Lehrer. Its also
Frontline
NOVA
History Detectives
Ken Burns documentaries
Charlie Rose
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Fine. Ask them to look into Kiyosaki, too. But dont hold your breath waiting for the empty suits at PBS to approve their having
anything critical to say about Kiyosaki.
Where have you gone Education TV?

I live in the San Francisco area. I appeared on KQED radio a number of times back in the 1980s. I once debated Nothing Down
author Robert Allen there. Back in that era, when KQED still had integrity, they also produced a series of personal-finance
programs hosted by Newsweek Personal Finance Columnist Jane Bryant Quinn.
PBS likes literary. Here is a literary quote they might want to consider before they promote the likes of Kiyosaki: A single lie
destroys a whole reputation for integrity. Baltasar Gracian, Spanish philosopher and writer 1601-1658
It is painfully ironic that PBS, which used to be called the Education Television Network, is now touting Robert Kiyosaki
whose first book was titled If You Want to Be Rich and Happy, Dont Go To School. It is a betrayal of its charter and principles
that the Education Television Network is now promoting a man whose book Rich Dad Poor Dad makes a hero of an antieducation, 8th-grade dropoutRich Dad. It is astonishing that PBS, which is the favorite TV network of teachers and
professors, is promoting a book that trashes Ralph Kiyosaki (Poor Dad), Robert Kiyosakis biological father, for wasting his
time getting degrees from Stanford, Chicago, and Northwestern Universities, all on full scholarship, ultimately earning a Ph.D
and rising to head the State of Hawaiis Department of Education.
The former Education network has turned into the whatever it takes to make a buck network. I thought NOT being that
was their whole reason for existence.
PBS ombudsman comments on Kiyosaki

PBS has an ombudsman and he felt compelled to comment on complaints he received about Kiyosaki pledge breaks. You can
read what he and the complainers said at http://www.pbs.org/ombudsman/2006/03/pledging_allegiance_or_march_madness.html.
He strikes me as a pretty wimpy ombudsman. For example, like a politician or other person whose main goal is to not offend
anyone, he characterizes some of Kiyosakis advice as controversial. Controversial?! How about dead wrong? Like Kiyosaki
advising readers to befriend executives of publicly-traded corporations so they can get advance information about stuff that will
change the price of the stock, then use that information to profit on trading the stock. Thats not controversial. Its illegal. For
details, see my discussion of that elsewhere on this page.
A reader told me he was not surprised that PBS airs Kiyosaki because they had already been airing medical quacks and New
Age idiots for several years before Kiyosaki. I once wrote that book stores ought to have a button under the counter. When a
person tries to check out with a New Age book, the clerk pushes the button and men in white coats come and take the customer
away.
Kiyosaki gets Yahoo! financial column

Yahoo! made Kiyosaki one of its financial columnists. In view of the fact that he is a liar and a charlatan, that tells us much about
Yahoo! Finance and nothing about Kiyosaki. Here is one readers email about Kiyosakis Yahoo! Finance column babblings.
Mr. Reed,
Thank you for thoroughly shredding this deluded huckster.

I probably never would have known who Robert Kiyosaki was if Yahoo Finance wasn't my start page. Several months ago I
started noticing his far fetched ramblings on how "cash is trash" and how we are now on the cusp of the biggest oil crisis in
history.
Due to my mistake of assuming that all content on Yahoo Finance was fairly credible, I actually read some of Kiyosaki's articles.
I came away with the impression that this guy was either the most forward thinking finance expert on the planet or a crack
smoker who simply placed his hands on the keyboard, attached electric stimuli to his genitalia, flipped the switch and started
typing.
It's downright scary that Yahoo allows his absurd pontification on their finance gateway. Many people consider the site to contain
legit financial information, which is why I felt the need to google and (thankfully) find your pants-down ass whipping. Guess I'll
be changing my start page.
Here's some advice for Kiyosaki's advocates that I offer free of charge: Instead of downloading the 48th ring tone on your Razr or
fellating the great Dr. Phil while he dispenses the "common sense" that you already have, take the time to form an original
thought just for once.
Don Jones
College Station, Texas
Kiyosaki teams up with Russ Whitney

Kiyosaki and Russ Whitney are reportedly involved in a joint venture that sells information on financial matters. See my Web
pages on Whitney.
Kiyosaki teams up with Donald Trump to write book reviewed by Wall Street Journal
There is a review of a book that contains portions written by Kiyosaki and portions written by Trump. Its called Why We Want
You to Be Rich. The Wall Street Journal reviewed it at http://online.wsj.com/article/SB116052181216688592.html?
mod=money_page_left_hs. They did not care for it.
Kiplingers Personal Finance also reviewed it at

http://articles.moneycentral.msn.com/SavingandDebt/Advice/TheyWantYouToBeRich.aspx?GT1=8690&wa=wsignin1.0. They
did not like it either.
Click here to read a review of the book by one of my readers.
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G.K. Chesterton review

A visitor to this Web site pointed out to me that G.K.Chesterton reviewed Kiyosakis book, in effect, in 1909. Pretty amazing.
You can read that review at http://www.cse.dmu.ac.uk/~mward/gkc/books/success.html.
Email exchange about Kiyosakis Yahoo.com financial column

Here is an email I received about Kiyosakis financial advice column on finance.yahoo.com and my response to the email writer.
Dear Mr. Reed,
Like some other people mentioned on your debunking site, I began reading Robert Kiyosaki's columns on Yahoo Finance because
I thought he must be at least a semi-credible financial advisor. But I found so many egregious distortions and logical non
sequiturs in his writing that RK has gradually become a source of humorous entertainment for me rather than a source of
knowledge or advice.
In his most recent Yahoo column, as of January 24, 2007, RK claims that you would have needed $100,000 in 2006 to have the
same purchasing power as $50,000 in 1996. That implies an annual inflation rate of 7%, but of course the US inflation rate was
more like 2-3% over the decade in question. How could anyone take him seriously after one or two mistakes like this?
In an earlier column, RK claimed that the US dollar had declined in value against other currencies because it was de-linked from
gold in the 1970s. But all other developed-country currencies are also floating freely and have no link to gold, so the lack of a
gold link explains nothing about why ones value has declined relative to others.
In yet another column, RK contradicts extensive research about human happiness, which says wealth beyond a certain point
contributes very little to happiness, and says with a wink and a nudge that we (he and his readers, I guess) know better. Yet
surveys show that Filipinos and Nigerians are among the happiest people in the world, while the Japanese and Hong Kong
Chinese are among the unhappiest. I think RK is failing to distinguish between a lack of financial worries and happiness, which
are two very different things. The fact that hes too obtuse to recognize the difference makes me wonder what happened to distort
his vision.
Your Web site on RK is a wonderful public service. Keep up the good work.
Greg Brockelbank
Kanagawa-ken, Japan
[Reed answer]
There is a CPI calculator at http://minneapolisfed.org/Research/data/us/calc/. I plugged in 1996 and $50,000. It has $64,276.61 in
2006 purchasing power, not $100,000.
Kiyosaki is childlike in his lying, that is, he lies about things that are easily disproved. A Time magazine cover story of a few
years ago was called The Science of Happiness and confirms what you say and disproves what Kiyosaki says.
May I quote your excellent email?
John T. Reed
Email from a private investigator
Mr. Reed:
I am a Private Investigator here in NY. Yesterday, my firm was hired to become involved in a civil matter SDNY in which Robert
Kiyosaki will appear as a witness. I read many of your posts with regard to Mr. Kiyosaki. It sounds like you may have done some
research on him and I was wondering if you found out anything factual that supports Kiyosaki is a fraud and if so would be
willing to share it with me. Thanks for your time. My contact information is listed below if you have the time to talk. Thank you.
These are some of the things about Kiyosaki's background that strike me as questionable:
1) that he was a marine pilot in Vietnam
2) he claims to have been shot down 3 times while in Vietnam
3) he claims to have "flown behind enemy lines in 1873 in order to go buy gold" and that he made a "fortune" doing this
4) claims to have owned hundreds of apartments in Phoenix and to have made millions in real estate
5) claims his father was the head of education for the state of Hawaii
6) claims to have started a "velcro" wallet business in his 20's which made him a millionaire and which got him featured in
Playboy and GC
7) claims to have done business with Duran Duran, Iron Maiden, Van Halen and other major bands in the wallet business
8) claims he is "not affiliated" with a company named Reef Securities which he promotes
Best,
Joe
Joseph P. Dwyer
Chief Investigator & Director of Operations
Investigative Resource Group, INC
PO BOX 873 Shoreham, NY
Telefax/ 631-821-7105
Cell 917-495-1872
Email privatei@optonline.net
From: John Reed [mailto:johnreed@johntreed.com]
Sent: Tuesday, June 28, 2011 8:03 PM
To: Joseph P.Dwyer
Subject: Re: Robert Kiyosaki
I already did. It's at my Web site. I continue to get more stuff regularly but it just buttresses what I said.
5 is true
Fom: Joseph P. Dwyer

Thanks for your response. I'm talking about factual evidence either from documents or persons you may have spoken to.
Respectfully, your opinion about Kiyosaki's books or misrepresentations he may have made about himself are not something I
can use. If you have any documents or interviewed any persons that I can contact who factually can dispute some of Kiyosaki's
claims that I previously listed, please let me know. Thanks again for your time.
Joe
Joseph P. Dwyer
Chief Investigator & Director of Operations
Investigative Resource Group, INC
PO BOX 873 Shoreham, NY
Telefax/ 631-821-7105
Cell 917-495-1872
Email privatei@optonline.net
from: John Reed <johnreed@johntreed.com>
Date: Tue, 28 Jun 2011 17:31:44 -0700
To: Joseph P. Dwyer<privatei@optonline.net>
Subject: Re: Robert Kiyosaki
Respectfully, read my article again, more carefully. I am an investigative journalist. I have been sued, unsuccessfully, for libel by
a guy like Kiyosaki, indeed, his erstwhile partner. I cited chapter and verse of the documents in my article.
Your question about his father would not suggest you ever set foot in an investigative role of any kind.
From Joseph Dwyer:
We got this case yesterday. You are a fool to question my experience and I don't appreciate your sarcasm. I'm retired from a
special narcotics enforcement unit with NYPD and have run a PI firm that specializes in RICO death eligible cases. Since 1995 I
have been the lead investigator in over 2 thousand federal cases in both the EDNY and SDNY. Look for me on Dateline this
August. My response to you was indeed respectful. Your response to me shows your an egotistical, sensitive, jerk!!! Bye now.
Sent via BlackBerry from T-Mobile
From John T. Reed
And I was on 60 Minutes 25 years ago. Fact is you did not read my article before alleging it was all opinion. I doubt there is any
opinion in it. Look for this email exchange on my web site.
[Reed supplement to the email exchange]
Im guessing this guy will now not use my article. That would mean he has to reinvent about a thousand wheels. Do PIs charge
by the hour?
Kiyosaki and Whitney's old company sued

Robert Crewe sued Rich Dad Education LLC, Rich Global LLC, Rich Dad Operating Co. LLC, Cashflow Technologies Inc.
Tigrent Inc; Tigrent Learning Inc., Tigrent Brands Inc., and Robert Kiyosaki. Tigrent is the new name of Whitney Information
Network (WIN). Real estate investment guru Russ Whitney sued me from 2002 to 2005 when the suit was settled on confidential
terms. Whitney was subsequently forced out of the company he founded which also changed its name to Tigrent and changed its
stock symbol from RUSS.
Crewe seeks costs and damages for breach of contract, breach of implied covenant of good faith and fair dealing, violation of the
Florida Deceptive and Unfair Trading Practices Act, unjust enrichment, negligent misrepresentation, and fraud.
Crewe's complaint alleges almost exactly what my web site comments on Kiyosaki and Whitney allege. Rich Dad Poor Dad
author allied with Whitney around the time Whitney settled the suit against me. I always suspected they got together because they
each had me as their main critic. National Association of Real Estate Investment Gurus Criticized by John T. Reed?
The suit is in U.S. District Court in Manhattan. Too bad it's not in Florida. Whitney sued me in U.S. District Courts in Fort
Myers, Fort Lauderdale, and Miami. His lawyer was Scott Rothstein, the "Bernie Madoff of Fort Lauderdale "we later learned
and is now serving a 50-year federal prison sentence. Unless there has been a lot of personnel turnover in the Florida federal
Courts, they remember Whitney/Rothstein.
The allegations are that Kiyosaki et al.:
use their "free classes" and $199 seminars about financial success as a come-on in a high-pressure "sales scam" to sell worthless
courses for tens of thousands of dollars
Defendants did not provide any training or education at the workshop
not provide attendees with any financial education that leads to financial success or independence
defendants' training instructors who hold themselves out as experts in their investment field but have no discernible investing
expertise or successful track record.
I wonder if there is some legal theory the defendants could escape liability on the grounds that each and every one of the
allegations in question was described in great detail on my web site since the early 2000s. In other words, had Mr. Crewe made
any effort, like a Google search that led him to my web site, he would have had thorough notice in the form of about 50 pages on
Kiyosaki and 500 pages, literally, on WIN/Tigrent.

Reed Review A Number of People Asked Me About Robert K

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A number of people asked me about Robert T. Kiyosaki and his book Rich Dad, Poor Dad.

When I said I didnt think he was a

"If you're gonna go broke, go broke big"

I'm not the only critic

Advocates committing a felony: have rich

Wall Street Journal: "Rich Men, Poor Advice"

Fiction posing as non-fiction

Admits fictionalizing on copyright page of Rich Kid, Poor Kid

Admits to 20/20 that he doesn't teach people how to get rich

Can't keep track of his story

Apparently lied about going bankrupt in 1985

His "best teacher ever" changed repeatedly

'92 - Ralph Kiyosaki (Poor Dad)

'97 - Rich Dad

'06 - Buckminster Fuller

The blueprint to becoming a "Financial Genius"

Kiyosaki sued by co-author Sharon Lechter

Collection of age-old clichs about money

Now admits 'fictionalizing'

John T. Reed's Youtube video on get-rich-quick gurus

Back to top of page

1992 book versus 1997

EST then Money and You

Enter your name and

20/20 investigation of Kiyosaki

'Couldn't put my finger on it...'

'Made me think about my finances'

Weekly earnings by amount of education

high school grad

high school dropout

Unemployment rate by amount of education

professional degree 1.1%

high school grad

high school dropout

Missing the point

The 48 Laws of Power

Another reader said Law of Power 32 is pertinent too.

You can see all the laws at http://www2.tech.purdue.edu/cgt/courses/cgt411/covey/48_laws_of_power.htm.

I never said Kiyosaki was short on

Money is all that matters

How much money does Kiyosaki have?

How do we know this?

He achieved wealth in an unethical or illegal way

All of the above

Meet the Street interview

Clever life plan?

U.S. Naval Academy

Never returned to my ship

Did Kiyosaki go through Marine boot camp? Nope.

Are the Marines that proud of a conscientious deserter?

Kiyosaki military records

The making of a financial genius

flunked sophomore year of high school and had to repeat

Marine helicopter pilot (or was it fighters?)

failed businessman (nylon surfer wallets)

failed businessman (rock and roll memorabilia)

failed MBA applicant

bankruptcy (or maybe not)

Enter your name and

Archie Bunker on Wealth

Real estate expert?

The whole truth about the subject in question

The rich get richer.