Feb 14, 2023
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2022 has been tough for most investors. Stocks have plunged, bonds have tumbled, and even broad benchmark ETFs are deep in the red.
But the worst could be yet to come according to Rich Dad Poor Dad author Robert Kiyosaki.
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“I believe economy is the biggest bubble in world history,” he says in a tweet. “God have mercy on us all.”
Since a lot of financial assets have gotten cheaper in this market downturn, it might seem tempting to buy the dip. But that’s not what Kiyosaki is doing.
“Many of you know I do not invest in equities, bonds, ETS or MFs. Please DO NOT listen to what I’m going to say next: ‘I would get out of paper assets’,” he says, adding that the world economy “is not a ‘market.’”
Instead, Kiyosaki likes these real assets for protection.
Cryptocurrency and precious metals
Bitcoin investors have learned the hard way just how volatile it can be. But Kiyosaki doesn’t seem bothered by the cryptocurrency’s downturn.
“BITCOIN? WORRIED? No,” he writes in a tweet earlier this month. “I am a Bitcoin investor as I am an investor in physical gold, silver, & real estate.”
In fact, he sees the crypto mayhem as an opportunity.
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“When BITCOIN hits new bottom, $10 to $12 k? I will get EXCITED, not worried.”
Kiyosaki believes in bitcoin for the same reason he loves precious metals: a distrust in our fiat money system and the government.
It’s easy to get in on the action — there are plenty of platforms that allow you to invest in crypto.
Robinhood Financial has already made trading stocks commission-free and easy, and now with Robinhood Crypto, you can also invest in cryptocurrency.
It’s a great option if you don’t have millions to work with — Robinhood Crypto lets you place an order to buy or sell crypto at fractional amounts instead of buying whole coins.
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“I bet against the Fed, Treasury, Biden, & bet on [gold], [silver], & Bitcoin,” he explains.
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Fine art
For anyone who doesn’t agree with Kiyosaki or doesn’t want to take the risk on crypto, consider investing in art.
You probably think of art as just some canvas that makes your living room look nicer, but it has quietly outperformed other asset classes for years.
Art is part of a $1.7 trillion asset class according to Deloitte, which is roughly half the size of venture and private equity. Contemporary art has outperformed the S&P 500 by 131% for the past 26 years, and it has a near zero correlation to stocks according to Citi. Having a low correlation to stocks makes art a useful hedge against market volatility.
This asset class has previously been limited to the ultra-wealthy. But now, instead of buying a single painting for millions of dollars, you can invest in shares of individual works.
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Masterworks does all the work for you, finding, purchasing and storing the artwork, while you get the rewards.
Wine
Fine wine is an inflation-resistant physical asset that you can invest in if you don't have the appetite for crypto.
As of right now, the S&P 500 is down 24% year to date and down 18% in the past year. Meanwhile, the Liv-ex Fine Wine 1000 has gone up 14.1% and 22%, respectively. It offers plenty of growth, too. Since 2005, Sotheby’s Fine Wine Index has gone up 316%. Wine outperformed the Global Equity Index by 1.88% annually over the last 15 years.
Wine is a more stable investment than stocks, but everyday investors have largely been locked out of the game by the constraints of specialized knowledge and logistical factors like proper storage.
Vinovest helps you skip the difficult parts of investing in wine so you can jump straight to the benefits.
When you create your account, they'll ask you a few questions about your investment goals and risk tolerance to determine which wines will best fill out your portfolio.
Next, fund your account with at least $1,000 and Vinovest's master sommeliers will use proprietary algorithms to set up your portfolio — their direct connections ensure the lowest prices with the highest returns.
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Jing is an investment reporter for MoneyWise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.
