(upbeat music) - [Announcer] This is
the Rich Dad Radio Show: the good news and bad news about money. Here's Robert Kiyosaki. - Hello hello hello, it's Robert Kiyosaki. The Rich Dad Radio Show: the good news and bad news about money. And of course that song
comes from Goldfinger, the James Bond film when I was a kid, loved the James Bond movie,
but it was about Goldfinger, and that's a hint to
let you know that today is about the subject of gold
and silver or precious metals. And you know where this is the saying that is said from one of our guests today is, "Gold loves cheap money." And as you may know if
you've listened to Rich Dad or read Rich Dad, the thing though, the big part of why Rich
Dad was created was in 1971, President Nixon took the
dollar off the gold standard and money became cheap. And so today, it's one
of the biggest rip offs I've ever seen, is all these
people are working for money, saving money, investing their money, and people are just ripping
them off via their money. In other words, money
is making them poorer, so the harder they work for it, the more taxes they pay,
and the poorer they get. So anyway, that's why the
Rich Dad Radio was created and today's Rich Dad Radio Show is, we're gonna talk to two
of the people I trust the most in this subject of gold. And it's a very exciting
subject 'cause gold, you know it's going up
and down as anything does, 'cause it's manipulated. But it's around $1400 an ounce, and just 20 years ago it was
like $350 or $250 an ounce. And now it's up so many percentage points, but nobody's watching it, and then silver hit $15 an ounce, and silver actually is the
cheapest thing in the world today because a number of years ago, silver was $50 an ounce
and it's only $15 an ounce, everything's gone up but
silver hasn't gone up. Does that mean you should buy it? Of course not. But anyway, today please pay attention, very important show about gold and silver. Any comments, Kim? - Yeah well yes I do,
because, you know, Robert, you and I love to have our gold supply, and it doesn't-- - [Robert] And silver. - And silver, and it does surprise me how people think that that is so risky and what you're saying is the dollar's losing value more and
more, but nobody seems to, they think gold is risky. So here's what I see happen all the time, I see people who have bought gold, not a lot of gold, but some gold, and every day they go,
"Oh, the price is up, "the price is up, oh
that's great, that's great. "Oh the price is down, oh no no no." But nobody knows why. Nobody knows what causes it go up and what causes it to go down, so we've got two experts today, and silver as well, two experts who are gonna
give us some indicators of what to look for and what's
coming in their opinion, in their expertise, because
instead of just saying, "Oh it's up, oh it's down," I wanna know why. - Yup, so our guests
today are Brien Lundin, he's editor and publisher
of Gold Newsletter. He's the host of the
oldest, most respected gold investment event conference, it's called the New Orleans
Investment Conference. And I love that show,
I love that conference, 'cause I've learned so much. I mean Brien has some of the best speakers in the world, like me, there. And other people. And also our other guest
today is Dana Samuelson. He's the president of
American Gold Exchange. He operates out of Austin, Texas. And Dana was also the past
president of Numismatics, now if you don't know what
numismatics is, stay tuned, because it's a very important
segment of investing for gold. So if all of you right now, I think you may have seen me on TV for a competitor of some of these guys, but I'm saying I love silver
because of all the so-called acid classes in the world today, silver is still minus 70%. It's still undervalued, from where it was back in 1980, I believe, when I was, I first got onto silver. So anyway, again, our
guests are Brien Lundin, editor and publisher of Gold Newsletter, please subscribe to it, and Dana Samuelson, his website is https://www.amergold.com A-M-E-R-G-O-L-D.com. So Brien, welcome to the show. Dana, welcome to the show.
- Welcome, you guys. Thanks for being here. - [Brien] Great to be with you. - [Dana] Thanks for having us. - So Brien, since you're the
old guy in this whole thing, (laughs) not really but anyway. You have the most history,
'cause you were there, 'cause when I first started buying gold, by the way, I'm gonna plug my book, Fake, I started buying gold in 1972. I had to go to Hong
Kong to buy a crookery, and I paid like 50 bucks for it, but when I bought that crookery, and I was now a criminal, I had to smuggle it into the country. And it was illegal in 1972
for Americans to own gold, so Brien has been with that transition, he worked with the gentleman that got to have made gold
legal for Americans to own. So Brien, could you give a brief rundown, what happened in the transition from gold being illegal for Americans to legal? - [Brien] Yeah, absolutely. You know, both Dana and
I actually worked for Jim Blanchard, who was an absolute icon in the gold industry. People call him the original Gold God. And he started Gold Newsletter in 1971 on the exact day once when he heard that President Nixon closed the gold window. And what the gold window was that, even though it was illegal
for American citizens to own gold, foreign
countries could still exchange their dollars for gold, and de Gualle, of all those people in
France, was so crafty. He realized that with the United States spending so much money on Vietnam and bread and guns and
butter, the welfare state, that the dollar was getting cheapened, so he'd sent all the dollars they had, as many as the US would take, and was taking the gold out of Fort Knox. So Nixon put a kibosh on
that, closed the gold window, and took the dollar
completely off of any tie, severed any tie to gold. And what happened at that point was that, the central bankers, especially in the US, could then print and spend with abandon, they really had no restraint whatsoever. And they were like
teenagers given a bottle of Jack Daniels and the keys to the car. They immediately ran
the car into the ditch, which was the 1970s. And since then, they've been doing, you know they've been
a little more careful, but every time there's any
kind of a economic slowdown, they immediately lower interest rates, and the last crisis in 2008, they actually had to start printing money, so that's kind of why
the value of the dollar, especially since then, has been
on a fairly steady decline, and gold, although there's been a bunch of waves in the line, and jigs and jags, has steadily been increasing in value relative to the dollar. And so, you know, along the way Jim Blanchard started the
New Orleans Conference to teach people how to invest in gold. He did that in the early 70s, he started Gold Newsletter
in the early 70s, and we've been trying
to get the story out, and help people make money
as gold kind of gradually, and in fits and starts, but continues to appreciate against the dollar. - Right, and the New Orleans
Investment Conference is, that's a fantastic educational event. It's not for techies and those guys that are into the stock market, it's for guys who are into what
I call hard tangible assets. - [Brien] Right. - So it's like food, it's like gold, oil, and things like, and
even real estate there. So it's a very educational conference, and I learn a lot going there. So Dana, give us your story, how'd you get into this
insane subject called gold? - [Dana] (laughs) Well,
it's kinda curious, I graduated from college in
1980 with a German degree, of all things, when
interest rates were 18, 19%, inflation was 18, 19%
on the heels of the US becoming really the first fiat
money printer in the world when we went off the
gold standard in 1971, and I was completely unhirable. But I got a job in a vault
working for a company in Houston, Texas counting, shipping, and weighing because I could be trusted. And we were selling a lot of coins to Blanchard & Company in New
Orleans at that point in time, and I was offered a job over there to learn how to appraise old classic gold and silver coins minted 1933 and earlier, so I became a numismatist, which is a big word for a coin nerd. So I learned how to appraise old coins and went to work for Jim. Brien came to work about
the same time I did, and we both learned the history of gold and silver from Jim Blanchard, who was basically the
godfather of our business, and I worked my way up the ladder and I started my own company in 1998, when I felt I had enough
experience and knowledge, and it was right at the
bottom of the gold market, as you said at the top of the show, you know gold was at $250 an ounce when we balanced our budget for the first time in 20 years in 2000, and it's done nothing but go up since then as the whole world has
done, especially since 2008, what the US did in the 70s,
which is print a lot of money. - And they keep printing
and printing and printing. - [Dana] Right, and the debt
just keeps getting bigger and bigger and I saw
an interesting headline on Market Watch website
about six months ago, it said, "Debt doesn't
matter until it does." And we're getting closer
and closer to the point where debt is going to
matter for a host of reasons. - So Dana, when you say numismatic, you know people say, "Oh,
I'm gonna go buy gold," and they go into a precious metals dealer, and maybe the dealer is
not quite as ethical, or just wants to make a lot of money, and they start pitching numismatic versus just a one ounce gold coin, could you explain the difference? - [Dana] Yes, so there
are modern bouillon coins that are minted today,
that have been minted primarily since the late 60s and early 70s by the South Africans in the form of one ounce gold krugerrands. The Canadians started making one ounce gold maple leafs in 1978. The Chinese started making
gold pandas in 1982. These are all one ounce
modern bouillon coins that really don't have much value over their intrinsic gold content. They make more and more
of them every year. It's like Jay Leno used
to say about Doritos, eat all you want, we'll make more. Well that's what the mints
around the world have been doing. So these are just round
bars, for the most part. They have no value over their gold value, they are exactly that, an ounce of gold. Numismatics, on the other hand, are collector coins mostly
minted prior to 1933, when the US quit making gold coins, that have value above and
beyond their gold content for collectibility, scarcity, popularity. For the most part in the US these are old US $20 gold coins that
we call Saint-Gaudens, that were minted in 1907 to 1933, and then there's a liberty
design minted 1850 to 1907. So these are about one ounce gold coins, but they were actually
$20 bills back in the day before paper money became
as prevalent as it is today. - So let me ask this question. Why was 1933 such an important date, that's all I want to know. - [Dana] Well in 1929, the
Wall Street crash came, and then to stabilize that, FDR had to do something drastic when he
became president in early 1933, and that was to take the
gold out of the money, and that's what FDR did. He made gold illegal to
own in the United States, so all that gold and, not silver, but all that gold that was
money was literally confiscated and it was illegal to own gold in the United States between 1933 and 1974, when our old boss and
mentor, Jim Blanchard, helped to get gold re-legalized in the United States at that time. Now the rest of the world, it was fine. You could own gold in Europe or Asia, in Switzerland, or in
Japan, or China, India. There is gold culture and gold is money, it's been money forever, and there's a much higher gold culture than there is in the United States. But to stabilize the
economic situation then, Roosevelt had to do something drastic, 'cause people didn't
trust the paper money, they wanted the gold, so he had to take the
gold out of the currency. Just like de Gualle
didn't trust the dollar starting in the late 60s. I mean in the mid- to late
60s, if my memory's right, we had 11 or 12 thousand
tons of gold in Fort Knox, and by the time we got
down to about 8300 tons, I believe is the number,
Nixon said that's enough, we've gotta go off the
gold standard in 1971, and that led to the
re-legalization of gold in 1974. Spearheaded by Jim Blanchard. - So Brien, you were a part
of this whole transition. What was your recollection of, or what is your comment on numismatic and then buying regular gold coins? - [Brien] Yeah and well
first off, you know, Dana just mentioned that FDR took us off of the gold standard, but it was very much
more devious than that. He knew that he was
gonna devalue the dollar, so first he took away
the gold from everybody, and then he raised the price of gold from a little over $20 an
ounce to $35 an ounce. In effect, in one fell swoop, he devalued the dollar by 69%. So it was like he was steering the Titanic into an iceberg, saw the iceberg coming, and then went around and
took the life reservers from all of the passengers so they
couldn't protect themselves. So it was really, really one of the most devious things that a politician has ever done to the US citizens. - But isn't that one of the
reasons the gold bugs like we, the three of us are and Kim is, we're always afraid that
the government's gonna come and confiscate our gold, I mean that's still a rumor
sitting out there, isn't there? - [Brien] There really is and you know, I don't think it'll happen, but if something's already happened you can't deny the fact
that it could again. So that's one of the
reasons why some people invest in what's called semi-numismatics. Those are coins that have
a lot of gold content and just a bit of collectable value. Typically they circulate at a lower grade coins from pre-1933, and the reason why they buy some of that as part of their bouillon
holdings is because in 1933 when FDR and the government confiscated Americans' gold holdings, they
exempted collectible coins. So that's the idea there, is that if they ever do this again, they're probably going to have
to exempt collectible coins, so if you have some of
these older US coins, you have some degree of
protection from that. But generally, and I
think Dana will agree, if you're going to buy numismatics, do so as a hobby, enjoy the hobby, and that's the way
you'll make money at it, by really educating yourself
and learning about it. And collecting for the joy of collecting. And those will be cool. - And the reason we say
this is when, you know, I shop different coin dealers
in town, stuff like that, and I almost pretend not
to know what I'm doing, and not all of them but a large number of them will try and sell me a rare coin. Why is that, Dana? - [Dana] Well it's a
greater profit margin. It's as simple as that. If people are interested in buying gold, and they don't know much about it, they get steered sometimes
in the wrong way. And that's a self-serving mechanism that some unscrupulous
dealers do just to make a little extra money or
make a lot of extra money. And the thing about
the classic older coins is that they're limited
to what was made years and years go, so some
are legitimately worth a lot of money because they're
very scarce or popular, while others trade pretty close to their intrinsical value if
they're much more common. So dealers don't always do business at the client's best interest, but they sometimes do it
in their own best interest. - Really?
- Yeah. - Hey well anyway, we need to go to break, but the reason, I understand
this is for the first time, couple years ago I started
buying numismatics from Dana because at least he could
give me an education on what I was buying, what
the price was, and all this. Whereas if you know nothing, you know, you just walk in there, and
they can tell you the song and dance of how rare this coin is, and you have no idea what
they're talking about, so-- - [Dana] Well we always ask
people what their goal is, what are you trying to accomplish, and once we understand that, we try and help them with their goal, and if bouillon is more appropriate for what they're trying to accomplish, that's what we offer them. If they're interested in numismatics or want a little leverage
to the gold price, sometimes we'll offer
numismatics in that case. - Okay, so we'll come back. Once again, our two guests
today are Brien Lundin, editor and publisher of Gold Newsletter. His website is
http://www.goldnewsletter.com, and Dana Samuelson, he is the president of American Gold Exchange,
also past president of the Numismatic, how do
you pronounce that, Dana? - [Dana] The word is numismatics,
it's the study of coins. I was president of the
Professional Numismatists Guild, which is the leading organization of rare coin dealers in the country. - Okay, and Dana's website
is http://www.amergold.com. When we come back, we'll go
into why they're so bullish, they're so optimistic about gold, you know we have my friend Jim Rickards, he's calling for gold
to hit $10,000 an ounce, and then on the other side of the coin is Harry Dent, who's
calling for $400 an ounce. So this is gonna be an
interesting discussion because either you're for
gold or you're not for gold. - And there's also a lot of
interesting things happening with various countries
throughout the world in regards to gold and what's
going on behind the scenes, so we're gonna find
out about that as well. - Yeah, there's a lot-- - A lot of gold going, moving around. - Games going on right now. - Yeah, yeah. - So we'll be right back. Welcome back, Robert Kiyosaki. The Rich Dad Radio Show: the good news and bad news about money. You can listen to the Rich Dad Radio Show anytime, anywhere on iTunes or Android, and all of our programs are archived at http://www.richdadradio.com, because we don't make any recommendations, for example, not saying
buy gold or silver, or sell gold and silver. But we archive that so you can
listen to this program again, because repetition you'll learn even more the second
time you listen to it. But more importantly,
have friends, family, or business associates listen
to this program about gold. If I could shamelessly promote
my book that just came out, it's called Fake: Fake Money, Fake Teachers, and Fake Assets. There's a lot of misunderstanding about this subject called gold and silver, and a lot of people
are still saving money. I mean if you read Rich Dad Poor Dad, you have got to be an idiot to save money. Yet that's what everybody's doing. Or working for money, why would you work for
something they're printing? It doesn't make sense to me. So anyway, the book is
called Fake, please read it. But listen, have your friends, family, and business associates
listen to this program again about gold on http://www.richdadradio.com. Once again, our guests are Brien Lundin, L-U-N-D-I-N, editor and
publisher of Gold Newsletter, host of the infamous New
Orleans Investment Conference, for all you guys who go to the tech shows, you may wanna go back to
the old world and watch, and you can do to New Orleans
Investment Conference, 'cause that's really where the base of the economy emirates from. It has food, it has
land, water, gold, oil, just the fundamentals of the economy. And Brien Lundin's website is http://www.goldnewsletter.com Our other guest is Dana
Samuelson, D-A-N-A. And he's the president of
American Gold Exchange, he was the past president
of the Numismatics Society, and his website is
http://www.amergold.com. A-M-E-R-G-O-L-D.com. Very important, we're gonna find out now why they think, why
they're bullish on gold, you know why is Rickards saying $10,000 and Harry Dent saying $400? Any comments, Kim? - Yeah, well I wanna go to Dana, 'cause I've just read in this article, Dana, I want to read it to you
and get your comments on it. It said that the Federal Reserve, in its effort to boost the US dollar, has deliberately kept the price of gold at artificial bargain levels. China, Russia, and other countries are taking advantage of the
Federal Reserve's policy by buying gold on the cheap. And you say gold loves cheap money, so what's going on? Gold loves cheap money,
Russia, China, Turkey, they're all buying, stockpiling
gold, what's going on? - [Dana] Well, since the
financial crisis of 2008, we've seen a big trend
shift with central banks around the world accumulating gold as a hedge against counter party risk, which is on an institutional level, this is not Bear Stearns-Lehman
Brothers anymore, this is China, India, Russia, Japan. They're buying gold, the
central banks are buying gold, to protect themselves as a hedge against counter party risk with other currencies. - When you say "counter party risk," what do you mean by that? - [Dana] Well, debt is
an obligation to pay. - Yeah, let me give here an example. Let's lend your brother-in-law $100,000. That's highly counter party risk. It's only as good as your brother-in-law, that's really what it means, and all stocks, all money,
has counter party risk. Gold does not. That's why I say it in my book, Fake, gold and silver are God's money. God is a cosigner on gold and silver. So please continue on, Dana. - [Dana] Well, I love Fake, Robert, because it is such a good book to explain to people why gold is God's money, why teachers aren't teaching
the right things in school, and why most assets are
manipulated much more than the gold and silver price have been. But back to Kim's question, you know, the dollar is the
world's reserve currency, and gold is priced in dollars, so as the dollar gets strong or weak, gold tends to trade at an inverse pattern to the strength
and weakness of the dollar, because as the dollar goes up or down, the gold price goes up or
down in other currencies. When the dollar's weak, gold is cheaper in other currencies than
when the dollar is strong. So we've gone through a period where the dollar has been inordinately strong because the US economy has been the world's leading economy
since about 2013, 14, 15, helping to bring the other
economies of the world up, as the world's largest and most
vibrant transparent economy. Now China's become the number
two economy in the world. The European zone is about
1/3 of the global economy. But we've done is created so much debt in the world today that we're not gonna be able to pay it back. We'll talk a little bit
more about that, I assume, in a few minutes, but
what's happening now-- - Dana, can I add something to that? Gold is relative. For example, dollars
are pouring into the US because we are kind of a safe haven, so the dollar gets stronger, that means the price of
gold doesn't go that high. But if you're living
in Venezuela right now, your currency is so weak,
gold is much more expensive. So the price of gold varies to the currency of the country you live in. So that's why if I was
in Venezuela right now, I woulda wished I had
bought a lot of gold. And what Dana and what
Brien are saying is, before the United States
becomes Venezuela or Zimbabwe, buy gold now while the dollar is strong. Is that correct, Dana? - [Dana] Yes, yes. It's good for Americans to buy gold while the dollar is strong. If the dollar weakens, the gold price is gonna go higher and what we've seen over
the last two months, which has helped gold to
break over $1370 an ounce is bond yields plummeting
around the world. In the US, the 10 year
treasury's gone from 2.5% to under 1%, I'm sorry under
2%, it's right about 2% now. Australia, the UK, Japan, and Germany, all of these bond yields have plummeted, which means people have been buying bonds very heavily as in a flight to safety, and the old expression goes, "Smart money follows the bonds." And this is clearly a sign that we're facing a bit of a
global economic slowdown, whether it's a real contraction
or leading to a recession, we don't know yet, but
money is getting cheaper as measured by what the yields are, and that's why I say
gold loves cheaper money. Because it doesn't have to compete against for returns against a CD or an environment where stock markets are pretty toppy, you know gold doesn't have to compete as hard when money gets cheaper, like it's been getting cheaper. And that's the value of the
dollar versus other currencies, as well as what people can
invest in, like treasuries. - So Brien, I mean obviously
you've been a gold bug and a gold bull for all these years. What is your crystal ball saying and why are you bullish
on gold and/or silver? - [Brien] Well, it's debt, really, Robert. I mean if you look at
the debt loads in the US and every developed
economy around the world, it's inevitable, it's just
a matter of simple math. In a few years, we're going to be paying, if we aren't already, we're actually gonna be borrowing just to pay the interest on the national debt here in the US. And throughout human history,
you know this is nothing new, going back to the ancient Romans, going back to ancient Greeks. Civilizations throughout human
history over and over again have over-spent their means on wars or entitlements or whatever, and they've created debts that they can't handle any other way, so what they've done every time is they depreciated or devalued the currency that those debts are denominated in-- - That makes the debt cheaper. - [Brien] Exactly. Exactly. So that's the age-old, that's the only prescription over and over again. - So let me explain what, let me explain what Brien is saying. You know just before the crash of 2008, there were people who were
refinancing their house to pay off their credit cards. And that's what the US
government is doing right now. They're refinancing the
future to pay off the debt, the money they've already spent. So that's why Brien and Dana
and people like myself and Kim are optimistic that the US
government is so upside down when it comes to paying their bills. They're borrowing money
to pay their bills. What does that mean for gold or silver? Is that correct, Brien? - [Brien] That's exactly true,
and the only difference now than from previous times
throughout human history is that now it's an interconnected world and every country is in the same boat, so everybody's trying to, they're racing to the bottom of the hill in terms of their currencies. You know, everybody's trying to competitively devalue against
every other currency, so-- - And that's what Jim Rickards
wrote the book Currency Wars, if the dollar is so
strong, China and Mexico and Canada and then Europe
cannot buy our products. - So by Russia and China
and India buying gold, doesn't that help to
devalue the US dollar? - [Brien] Well, to some degree. What they're trying to do is
get strategically positioned where they're not at the
mercy of the US dollar. They're kind of looking ahead
and seeing the debt loads and problems in the US and seeing the US as the world's reserve
currency has a special burden to bear in these kinds of situations. So they're saying that
the dollar cannot be worth what it's worth now down the road, and they want to kind
of insulate themselves, and become independent
from the dollar's role-- - What they're basically saying is, US is borrowing money to
pay off its past debts. And the debts they're gonna borrow for, like the pensions and entitlements and student loan debts, are only gonna get bigger and bigger and bigger, 'cause it goes back to 1971 when Nixon took the dollar off the gold standard and the dollar basically
became creditor debt, as you call it, and they can
print as much as you like, which is why the Rich
Dad company was formed, why we say the rich don't work for money. Why would you work for money
when they're printing it? It doesn't make sense to me. So that's why Kim and
I own silver and gold. So Dana, anything to add to this borrowing money to pay off the bills? - [Dana] Well the debt has
just exploded, you know? In 2008, the amount of debt in the world was about $99 trillion globally, and it's about double that now, in the time when we've
had a relatively healthy world economy and low interest rates. And, you know, the political
will of the United States to fix something doesn't really happen until it becomes horribly broken. So we're gonna keep
adding to our debt load, which will keep causing our
interest payments to go higher, and we're gonna spend more
on interest very soon, if we're not already, than we're spending on
military in the United States, and that's never happened before. There's an economist by
the name of Lacy Hunt, here in Austin, who works for
Hoisington Capital Management. He studied nine economies in the world, or saw nine examples
over a 100 year period, where when a country
had 100% of debt to GDP, for five years or more, it was impossible for that country's
economy to grow GPD at 3% or more a year because
the debt service starts to eat into where the money would be spent on research and development
or infrastructure. And the US has been in that
position for five years now, which is where the tripping point comes. - Well what the, let me get a-- - [Dana] We're not gonna be able to-- - So Dana, let me give them
a comparison real quickly. What Rickards was saying,
is that 60% debt to GDP, that's the tipping point. And today we're at 114% debt to GDP. We went past the point of no return, and I think that's what we're saying here, that we have to keep borrowing
now to pay our bills. - [Dana] Exactly. Exactly, and this is a recipe for disaster or a much weaker dollar. And gold is the ultimate
currency of last resort. That's why people rushed to it following the financial crisis of 2008, and the gold price,
depending on where you start, you know, $700, $800, $900
an ounce, more than doubled. Now we've gone through
a major corrective phase and it's starting to rise again. - So wait, let's go on, 'cause
we're all gold bugs here. But let me ask this question. There's two questions. How is the price of gold manipulated? How do they keep it lower? And the second question is, why do so many people hate gold? So let me toss it to Brien. How is gold, the price
of gold, manipulated? - [Brien] Through the
paper gold market, Robert. Essentially, the futures
and options markets on gold. There's so much more gold traded through these paper contracts in the
futures and options markets than there actually is
physical gold traded in the US. And you know, these trades on COMEX, if you open up a paper gold contract, supposedly you can take physical gold, you know let your contract mature, and then you can go ahead and take delivery of physical gold. Well at any point in time, there's as many as 150 people who think they own that ounce of
gold in the COMEX vault. - But doesn't that also effect
the gold and silver ETFs? - [Brien] Yeah, well not,
it effects the marked price on the daily basis of gold. - Right, but a lot of times, the ETFs don't have the gold, do they? - Well they'll have--
- Fractions. - [Brien] In their
prospectuses that will show that there is a chain of
custody and everything else, but there's a lot of legalese. And the bottom line is, it's not the same as gold in your hand or gold in your vault
or gold buried somewhere that you know where it is. - And the futures and options, when that contract comes due, they just take it in money, right? They're not asking for gold, they're just getting cash? Or money? - [Brien] Exactly. And whether they're doing it at the urging or orders of the government or whether they're just
doing it to make a buck, the markets are set up
and leveraged so much that these hedgers and speculators can move the price kind of at will. And they can force it
down if they're short, and they can turn around and buy it and drive it back up. And these high-frequency
traders, you know, if a group has about $120 to $150 million to spend on a bet in gold, and some other markets as
well that are the right size, they can make about a
billion and a half dollars in the span of 10 minutes. If they pick their spots, they do their algorithms correctly and they drive the
price down, turn around, go long, and drive it back up. It's amazing how these markets can be manipulated these days, and-- - But that's any market, too. - [Brien] That's any market as well. But gold is the right-size
market, it's kind of a Goldilocks market.
- Small. - [Brien] For this kind of
a high-frequency trading. - And gold is shallow, I
mean there's not much of it. Not like stocks and bonds, which are deep. - [Brien] Right. - So anyway, just for those of you who watch price of gold going up and down, that has often times only
has to do with manipulation. But when you look at the fundamentals, which is what Dana is doing, if the fundamentals are so
bad that we have so much debt, Dana, why do people hate gold? - [Dana] Well, people are not trained to buy gold in the United States. It's a negative investment
for the big Wall Street houses that wanna sell stocks or bonds or-- - It competes. - [Dana] Anything that'll
make them money, right? Which is why you wrote Rich
Dad in the first place, Robert. People are just not
educated in this country. Other countries, they are,
but not in the United States. Which is why we call
gold the barbaric relic, which it really isn't, but
it's just an education, more than anything.
- Well you know what, I don't know if you've heard Jim Rickards, but what he said was, he was the last class
of his business school where they actually taught gold. He says right after that, the teachers, the academics, came out
and started singing like, birds in a choir, saying,
"Gold is a barbaric relic." so there was this whole,
according to Rickards, at least, there was this whole
academic case against gold. - [Brien] There was, and
you know what Jim says, is that he's looking at the
same numbers we're looking at, and he's saying that
this next debt crisis, the dollar's credibility is
essentially going to be trashed, and the only way out of it, the only way that the dollar can regain its role as the world's reserve currency, is to back it to some extent with gold. And that, even at a minimal backing of all the dollars out
there that exist right now, even a 20%, just a 20% backing, of all those dollars by
the US gold holdings, would equate to a $10,000
an ounce price of gold. More than five times, almost six, more than six times, level
that it's at right now. - And that's what keeps all the gold bugs chomping at their bits. (laughs) - [Brien] Exactly. - And then there's Harry Dent, who says it's gonna go to $400. And I hate to say this to Dana and to Brien as a pure speculator, or owner of gold, goes to $400, I'm happy 'cause I'm
gonna buy even more of it. But it wipes out a lot of people, right? - [Brien] It really does,
and if it does happen, it will be because
there's a liquidity event where people just have to sell their gold to meet margin calls. Like what happened in 2008.
- Right. - [Brien] And it won't last long, but the key difference today from 2008 is that not many of these hedge funds and big moneyed speculators even own gold, so they don't own it, they can't sell it. - So--
- I was listening to, Jim Rogers, and he says he's
waiting to go back to $800. What do you guys think? - [Dana] I think we've already got a pretty hard bottom in gold, the $1050 from December of 2015. You know with the gold
price moving higher now over $1370 into the low $1400s, anything under $1200 I think
is gonna look cheap to people, if we get back to that level. So there'll be a lot of buying at $1300, if we go under that, $1200,
if we go under that, $1100. It's a long way to $800 from there unless something incredible
or certainly unusual happened. - The whole economy would go
to pieces if that happened. - And so, Dana, for the novice, what are, just give us a couple,
what are the indicators we should be paying attention
to, coming up right now? What should we be looking at? - [Dana] Well the biggest
factors that impact the gold price in the short term are the relative strength or
weakness of the US economy. So if we turn in a
really strong GDP number, or the hiring is good, like we had a good number this past week on jobs. That tends to put
downward pressure on gold. And conversely, if we have
weak GDP or a weaker dollar, so look at how strong or
weak the US economy is doing relative to other economies
because we're the leader, we have been and we still are. Look at interest rates,
where they're going. Gold loves cheaper money, and right now the market is driving, I think, the Fed to react more than the Fed's reacting to
what's happening globally, which is an economic slowdown. It's clearly happening around the world. And I've been saying to
myself for a year or two, "Will we lift the rest of
the world's economies up, "or will they drag us down?" Well, based on the numbers
that we're seeing now, it feels like we're being pulled backwards by the rest of the world's economies. The wild card, of course,
is the short term tariffs on China, whether we lift those or not, come to a happy conclusion to that, or whether they drag on further. - Well, Dana, Dana, Dana,
I mean the whole point here is this, okay, this is the point. 'Cause we're an international company. The point here is this, if you
own dollars, gold is cheap. You have Zimbabwe dollars,
gold is expensive. And so it's all relative to your money. The thing I love, I was
just in South Africa, I was just cracking up. Zimbabwe is so desperate for any kind of collateral they're now accepting pigs and goats and sheep. - Oh my.
- And cattle as collateral, because their money is so worthless. Also what happened in Zimbabwe last month, or two months ago now, is
exactly as Rickards talks about in his book, The Road to Ruin. He talks about, they shut
the whole system down. They shut the stock market down, they shut the banks down, they shut the bond markets down. And everybody was without money. So, the thing is, and I hate to be a pessimist with all this, but all too often we look at
the $10 or $20 move of a price, but we miss the big picture. So depending, the price of gold depends upon which country you live in, and what is the value of
the money you trade in? So really that's the lesson and that's the big point
of the Rich Dad Radio Show. We're an international company. But to all you Americans,
right now in US dollars, gold is cheap. Any final words there,
Dana, and we're gonna close. Dana and Brien, final words. - [Brien] I agree with what
you said completely, Robert. But I think it's also
important, the direction. And I think that all currencies, all the major currencies out there are going to be cheapened because the debt loads are so high,
so gold is, you know... and we're not telling people to sell everything and buy gold.
- No. - [Brien] It's just an
important insurance policy that everyone should have a,
you know, some of it out there. And I hope that people will come to our conference this fall
and look at Gold Newsletter. And if they go to
http://www.goldnewsletter.com/richdad they can actually save
a whole lotta money, and even get Gold
Newsletter at half price. - All right. - [Brien] That's just for your listeners. - Oh, thank you for that. - And definitely, do
attend that conference, because years and years ago
we were laughing about it, I was one of those guys standing there selling my goldmine and silvermine. And it was... I wasn't at your conference,
but other conferences. But it's such an interesting opposite of stock market conferences
and tech conferences. - And I think the biggest thing about Brien and Dana is
that you're educators. You want people to be educated about gold, and so you've got
http://www.goldnewsletter.com, you've got http://www.amergold.com, a wealth of information
there, so check it out. - So final words there, Mr. Dana. - [Dana] Well, Robert, you taught me that being an educator is
what I really need to do. - Right. - [Dana] Both of the experience that Brien and I have in the marketplace, that's really where we're
really well-placed to help people now.
- We're the old guys, we remember when gold was illegal. - [Dana] True, true. I think people should think of gold as an insurance policy for
the rest of their money. If you have 5 to 10%
of your assets in gold, you have a nice counterbalance against traditional paper assets,
stocks, and bonds. And the stock market's clearly looking a little toppy right now,
could go higher, who knows? But things change, and I
think the risk-reward ratio is a little high in paper assets and the reward ratio
is a little low right, I'm sorry, is high for what
could happen in the future. So gold is really an insurance policy, and I'm guilty of what you,
most Americans are guilty of, which is being so US-centric and myopic. The fact that you have
a world view, Robert, and can help people understand
what's really happening in the rest of the world
paints a fuller picture of what's really going on in the world. - Well, I was just in Zimbabwe, and they had a hard time
putting a goat into their safe. (everyone laughs) So I love the extremes, you know? It's such an interesting time, gonna thank both of you
gentlemen for being stalwarts and seeing the price of gold go from $35 all the way up now to about $1400. But who's counting? Anyway, thanking the both of you. - Thank you, Dana, thank you, Brien. - [Brien] Thank you. - And that--
- Thank you, Robert, thank you, Kim. - Thank you, when we come back, we're doing the most
popular part of our program, which is Ask Robert. We'll be right back. Welcome back, Robert Kiyosaki at the Rich Dad Radio Show: good news and bad news about money. And once again, thank
you to Dana Samuelson, president of American Gold
Exchange in Austin, Texas. His website is http://www.amergold.com. And Brien Lundin, editor and
publisher of Gold Newsletter. He's the host of the New
Orleans Investment Conference, the world's oldest and most
respected gold investment event. His website is
http://www.goldnewsletter.com. And these guys are the old guys like me, we've been in gold since
before elephants walked, before the wooly mammoths
walked the Earth. But it's a fascinating subject, and we're called gold bugs or
barbaric relics of the past. And everybody's jumping
into BitCoin right now, and I cover all this in Fake. You know today there's God's money, which is gold and silver, 'cause God's money means gold and silver was here when the Earth was formed, or pretty long time ago. And then we have fiat
money, or government money, which is the dollar, yuan, yen, and peso. And then we have people's money, which is BitCoin and BlockChain. So you have a lot of choices today, and everybody's an expert
on each one of them. Any comments, Kim? - Well I just think now is the time to really get educated about
gold more than any time, because as Dana and Brien both said, really what gold is is an insurance policy against a collapse, - That's all it is. - Against a crisis, financial crisis, and
that's a real possibility, so now more than ever I think
you should learn about gold and go own some gold.
- Well let me say this, if you trust the government,
you know the US government, the English government,
the Japanese government, Australian government, then
just save your silly money. Save the Aussie dollar, save the yen, save the peso, save the
Canadian looney, save the Euro. If you trust your government. I don't trust them. So that's why Kim and I save gold. We don't... gold is not an investment. And by the way, Rich Dad
does not recommend anything, we're an education company. So if you want an investment, you should talk to Brien as well as Dana, but we don't recommend anything. And when people say, "How
much gold should I own?" Well, Kim and I own a lot of it because, if you read Fake, we don't need money, we've figured out and
call it infinite return, we can just print our own money,
but that takes some skill. Anyway, depends on who you are, but most people say 5 to 10%, I don't know how you measure that, but most financial
planners will say 5 to 10%. The reason they don't say 25% is because they don't get
commissions on gold. If you just understand it's always self-interest in everything in the world, and that's why the Rich Dad company makes, we take no commissions and we make no recommendations of what you should buy. So once again, we're now at Ask Robert, the most popular of our program. You can submit your question to askrobert@richdadradio.com. So Melissa, what's the first
question for Ask Robert? - Our first question today
comes from Calman in Australia, Favorite book Rich Dad Poor Dad. - Aussie, Aussie, Aussie, oy, oy, oy. - Says, "Hi Robert, thank you for "sharing your wisdom with the world. "In your radio program you say "that you buy and store
gold, the real stuff. "However, most governments
around the world "have the right to confiscate
and acquire your gold "when currency collapses,
can you comment on this?" - Well that's why we covered that already, and with Brien and Dana, 'cause remember we were around when gold was illegal for Americans to own, so that kinda is a hang-over, but also it's a way for
the stock and bond guys to tell you this doubt
of gold in real estates. You know, everybody's got self-interest. But I mean, do you think they
could take our gold away? You know they did this back in 1933, and Americans were like sheep. (bleats like a sheep) They did as they're told. Today we'd shoot the guys,
you know what I mean? Nobody's gonna say, "Oh yes, "I'm a good little citizen of the US. "I'm gonna let you take my gold." Or a good citizen of Australia. "Yes, I'm gonna take you my gold." You know nobody wants that job, to come and try and take your gold. You can take your kids, but they won't take their gold. So anyway, it's a possibility, but that idea is I think,
just a hold-over from 1933. But it's also a way for
people to get you to buy something else and go off the trail. Any comments, Kim? - Well I think you hit
it on the head is that, the stock market and Wall Street and all the financial
markets throughout the world, they don't make any money on gold, so-- - [Robert] Or real estate
a lot of the times. - Yeah, so they don't recommend it. They actually talk against it, so I think that could be just a ploy. I mean it's always a
possibility, anything's possible, but this also could be a ploy to keep you in the stock market,
keep you in the bond market. - [Robert] But another thing too, is-- - I'm gonna keep buying. - Another thing too, is there's a law on what they call these storage houses in different parts of the world. And the rich have these storage houses, I mean Kim and I have visited 'em in, Switzerland and Singapore and
different parts of the world. So the rich don't hold
our wealth in banks, I'll tell you that much,
they don't trust the banks. So those of you who trust
your banks, have a good time. We don't hold anything inside our banks. Only one reason Kim and I go
to banks is to borrow money, we don't wanna keep our cash there either, because one of the talks
I'm doing lately is, what happens if, as Jim
Rickards says in Road to Ruin, if they shut the banking system down? Which they have done. They've shut the banking system down more than they've confiscated gold. So what happens if they shut
the banking system down? You're SOL. You're out of luck. So the thing that we have is we have access to money outside the banks, and access to our gold, but also to things like firearms, you know, just so they
can't take it from us. So anyway, it's a very unstabling time, we've never been here before. That's why 1971 was
such an important year, 'cause for the first time in history, the whole world is on
uneven, shaky footing because it took dollar
off the gold standard. Any comments, Kim? Melissa. - [Kim] Melissa, what's the next question? - Our next question comes from
Brian in Waterford, Michigan. Favorite book: Cashflow Quadrant. "I'm a big fan of gold and
silver and enjoyed Fake. "My question is, why do you think "the gold to silver
ratio is so out of whack? "Is gold over valued compared to silver "or is silver just on sale?" - I tell you what, silver
is my favorite of all. Kim and I started off in silver. - Yeah we did, we started
buying silver coins, matter of fact, that's how we put a down payment on our first house. - [Robert] Yeah. And we were buying silver for
like a dollar fifty an ounce, and today's at $15. This is the point, sports fans. Gold is saved. Nobody burns that stuff. Silver is burned. It's being consumed all the time. Silver is the last, if you see me, on another program where I'm endorsing another gold and silver company. Lear Capital, by the way. On Fox. But I'm talking about silver. The reason is silver is the
last under-priced asset. You know, you should
always buy low, sell high. So I stopped buying gold at $1350. But I've always bought silver, because I remember, I'm so old, that silver at one time was $50 an ounce. Today it's $15 an ounce. Everybody in the world can afford silver. You know, you can buy a silver coin, a 1960 silver dime, for two bucks. So we go, "Oh I can't afford it." well you go, this coin, I
wanna buy a silver coin for $2. Everybody can afford it. But the trouble is, they've been educated into staying away from gold and silver, and they hold this trash called cash. So just remember this. Silver today is 75% below
where its all-time high was. It's dirt cheap and they're
burning it all the time. They use it in batteries, solar cells, medicine, water purification, and so the consumption
of silver's going up while gold is going into storage. So all you people out there
thinking, "Well, you know, "I'll just, I think I'd
just rather save the dollar, "I trust my money, or the yen,
or the Euro, or the peso." You're an idiot. You're really an idiot. Just look at the charts. So if silver is 75%
below its all-time high, and they're burning it up
because they use it in industry, well duh, maybe you should buy some. "Nah, nah, nah, my mommy and daddy told me "to save money and savers,
you know, are the way to go." Well don't save the
dollar, don't save the yen, don't save the Euro,
don't save the Aussie. Save silver. Any comments, Kim? - Well you know too that you say, that silver is used industrial, used in solar panels, used in
water treatment, all of that. Don't you think--
- [Robert] And batteries. - And batteries, but also if
there's a slowing economy, does that have any effect
on the price of silver because it's not, and I'm sure there's gonna be more technologies
that are gonna use silver, but maybe haven't been invented yet. But I just wonder if that has any impact with the slowing economy on the price of silver.
- Everything has an impact. Everything, just look at the price. It's 75% below. It's the cheapest asset you can buy today. "No, I think I wanna buy
Apple at all-time highs." Well you're an idiot. That's why you wanna buy it. You been sucked in. You're sucked in. "Oh I think I'll buy,
I'll wait to buy gold. "I don't have enough money." Well silver, you can buy silver for $20, you can buy a one ounce
silver for $20 right now. "No, I can't afford it." You sound like my poor dad. You know what I mean? Bunch of idiots. Look, the world has changed, please wake up, and thank
you for listening too. Thank you for your questions. Submit your questions to Ask Robert, and thank you for listening
to Rich Dad Radio.
