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John T. Reed' analysis of Robert T. Kiyosaki' book Rich Dad, Poor Dad 1 Copyright 1999, 2000, 2001, 2002, 2003 by John T. Reed A number of people have asked me about Robert T. Kiyosaki and his book Rich Dad, Poor Dad. When I said I didn"t think he was a real-estate guru, a number of people 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. I was unpleasantly surprised. I do not like his book at all. Over time, I have received numerous reports that Kiyosaki is primarily a creature of Amway 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 https://www.amquix.info/. ' Last updated 1/25/05 Selected emails from visitors to this page 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 Kiyosaki' books are on the nonfiction best seller list if they are fictionalized. "Poor dad" The idea behind Kiyosaki' 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, I"m 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 75 to 90 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. It' possible Kiyosaki is using the phrase "convenience store" loosely and really means corner groceries, which did exist in the 1950'. 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. It' odd, but not impossible. However, I cannot imagine a restaurateur who also owns a construction company. 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 I"ve known are very different kinds of people from construction guys. A reader sent me an email saying, "One thing I did notice in a first cursory look this morning was this information from the Rich Dad trademark application: > Other Data: The mark "Rich Dad" does not identify a living individual. So as of the filing date (March 23, 1999) Kiyosaki's "Rich Dad" was deceased." Actually, the phrase "does not identify a living individual" could either mean that the individual is deceased or that he never existed to begin with. Or maybe not. Here' an email I got on 2/12/05: Just noticed on your site the following: "One thing I did notice in a first cursory look this morning was this information from the Rich Dad trademark application: Other Data: The mark "Rich Dad" does not identify a living individual. So as of the filing date (March 23, 1999) Kiyosaki's "Rich Dad" was deceased." Actually, the phrase "does not identify a living individual" could either mean that the individual is deceased or that he never existed to begin with." I'm a lawyer. The phrase "does not identify a living individual" in a trademark application simply means that the trademark "Rich Dad" does not refer to someone named "Rich Dad" (i.e., first name "Rich", surname "Dad"). So that bit of reasoning doesn't quite work. But love your site anyway. Kiyosaki' real father ("Poor Dad") was named Ralph Kiyosaki. I encourage readers in Hawaii to try to research Ralph' 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. 1992 book versus 1997 In 1992, Kiyosaki wrote a book called If You Want to Be Rich and Happy, Don"t Go To School? It is "dedicated to Ralph H. Kiyosaki, former Superintendant 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 pretty clearly 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. Kiyosaki' 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. Mind you, according to the 1997 book Rich Dad Poor Dad, "Rich Dad" supposedly became central to Kiyosaki' 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? "Couldn"t put my finger on it"¦" I have received numerous emails about this analysis. There have been several recurring themes in those emails. One is people saying that they liked Kiyosaki' 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 them"”or words to that effect"”until 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 "He got me to think about my finances." That' 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 lives"”which is probably the typical Kiyosaki fan"”probably 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.). 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. That' 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. Kiyosaki is just the latest in a long line of con men who pander to that naive longing. 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. 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 education"”defined broadly as reading books, talking to successful people in the field you are interested in, attending courses, and subscribing to trade publications is generally 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 Kiyosaki' need to impress people with how much money he has made (or claims to have made). "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 Kiyosaki' book. "OK," I responded, "Please tell me the point."' The odd thing is that each person has a different version of what the point of Kiyosaki' book is"”and 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, don"t paraphrase Kiyosaki' 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. 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 inkblot"”or 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 "Don"t 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. Here' a pertinent passage from Temple University professor John Allen Poulos' 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 person' 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 writer' 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. 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 says they seek to elicit the words, "I don"t know why. I just like the guy." Politicians want to be judged by their personalities, not their character or policies. To members of Kiyosaki' cult, it matters not how many false or probably-false statements I find in Kiyosaki' 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 Kiyosaki' advice, because he' not going to let you hang around with him and your family' finances are serious business. I am not a politician. When I write something, I want to make sure everyone gets the point"”the 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 Here' an interesting letter I got from a reader: "I'm glad I found your website 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 website. 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," 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. I never said Kiyosaki was short on specifics! Not only does Kiyosaki' 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 11 million copies of nothing. I would say that Rich Dad covers an overly broad array of financial subjects"”real 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 specifics"”as 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. The book commits far more sins than that. 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 periods"”when 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 it' 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. Although his family was not rich, he attended a predominantly wealthy elementary school because of an anomaly in the school-district 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 help him get rid of the demons from his childhood.

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