Robert Kiyosaki expects the stock market to crash and the US economy to suffer a historic downturn.
The “Rich Dad Poor Dad” author has been warning about stocks and growth for more than two years.
Stock buyers are betting big on an AI boom, and the Fed cutting rates and avoiding a recession.
Brace for stocks to nosedive and the US economy to crater, Robert Kiyosaki has warned.
In a Sunday tweet, the “Rich Dad Poor Dad” author said he doesn’t trade stocks and bonds as he prefers more control over how his investments turn out. “Yet too many signs point to a severe stock market crash,” he noted.
“If your future depends on stocks and bonds please be careful, possibly ask for professional advice,” he continued. “Afraid depression coming.”
Kiyosaki’s grim outlook strikes a major contrast to the rosy state of markets and the economy today. The benchmark S&P 500 index has rallied 17% this year, while the tech-heavy Nasdaq Composite has soared 35%, in part because investors are betting that artificial intelligence will cause corporate profits to balloon.
Meanwhile, annualized inflation has slowed from a 40-year high of 9.1% to only 3% over the last 12 months — not far off the Federal Reserve’s 2% target. The decline has fueled hopes that the US central bank, which has hiked interest rates from almost zero to north of 5% in a bid to crush inflation, may soon reverse course. If the Fed does reduce borrowing costs, that promises to slash the odds of a recession and provide a boost to stocks and other assets.
However, several commentators have compared the AI boom to the dot-com bubble, warning the technology may be overhyped, and speculation on Nvidia and other related stocks has sent their valuations to unsustainable highs. Other experts have cautioned the Fed might continue hiking rates if inflation proves stubborn or surges again, sparking an economic slowdown.
Kiyosaki’s latest tweet didn’t spell out why he expects stocks to plummet and a brutal, protracted economic downturn to set in. Yet he predicted back in May 2021 that the Fed would raise rates to tamp down inflation, and that would cause stocks, bonds, real estate, and gold to crash. He was correct on the rate hikes, but asset prices and economic growth have proven resilient to higher borrowing costs.
It’s worth noting that Kiyosaki is a vocal critic of the Biden administration, and has been warning of an epic market crash and promoting gold, silver, and bitcoin as haven assets for more than two years. The personal-finance guru has also freely admitted that he plans to capitalize if markets tumble and the economy crumbles, as “the best time to get rich is during a crash.
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