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Yes, accounting is like the "language of business," as Warren Buffett says. If you don’t understand this language, it’s hard to know whether a business is trustworthy. That’s why The Rich Dad Company created CASHFLOW games—to help adults and children learn about money, financial intelligence, and how businesses work. This knowledge is especially important in a world where greed and dishonesty are common.
Robert also talks about how governments need to manage their money wisely. He explains that governments must earn money, protect it, budget carefully, use it effectively, and get good financial advice. When governments handle money with honesty and responsibility, both the country and its people do well. But when money is mismanaged, people suffer through higher taxes, rising debt, and a struggling economy.
He points out a big mistake in U.S. financial history. In 1971, the U.S. stopped using the gold standard and made the dollar the global reserve currency. This decision turned the U.S. from the richest country in the world into the one with the most debt. While a few people became very rich, millions of others struggled, widening the gap between the rich and the poor.
The issue lies in poor budgeting. The U.S. spends more money than it earns, importing more than it exports. Instead of solving these problems, the country has built up huge debt. Rather than using money wisely, it depends on borrowing, which makes the economy weaker.
Robert warns that if other countries stop trusting the U.S. dollar, there could be serious consequences. The government might default on loans, cut important benefits like Social Security and healthcare, raise taxes, or allow inflation to rise, which would harm workers. These issues show a lack of financial responsibility.
Right now, the U.S. government tries to "make more money" by printing more, raising taxes, borrowing, or even starting wars. But these are short-term fixes that create bigger problems later. Robert’s point is that with better planning and decisions, these financial problems could have been avoided.
What Is the Age of Integrity?
Robert explains how history has shown that when governments misuse money, it leads to inflation and economic trouble. For example, inflation weakened powerful kingdoms in the past and played a role in Hitler’s rise to power in Germany when the country’s currency lost its value.
In the U.S., many schools fail to teach the difference between money and currency, leaving people financially unprepared. Robert believes the world is heading toward a major crisis—financial, political, environmental, and spiritual. This "perfect storm" will affect ordinary people the most, especially the poor, while the super-rich will remain mostly unaffected.
Despite these challenges, Robert sees an opportunity to grow stronger and smarter if we face these problems with courage. Some countries are starting to teach financial education in schools. Robert predicts that the country with the best financial education will lead the world to a brighter future in this Information Age.
What Does It Mean to Increase Your Intrinsic Value?
Increasing your intrinsic value means improving your skills and financial knowledge to prepare for tough times. Robert calls this developing "financial intelligence." He compares it to a sailor preparing a boat for a storm—focusing on fixing the weakest areas first instead of trying to improve everything all at once.
The goal is to become financially stronger and increase your personal worth. Robert encourages taking small steps and reminds us that progress takes time, just like how athletes take years to master their craft. He also says it’s okay to ask for help when needed—everyone needs support at times.
It’s about learning to invest in things that have lasting, real value, which Robert calls intrinsic value. He suggests studying how Warren Buffett evaluates businesses to see their true worth. Even if you don’t plan to invest, this practice can help improve your financial decision-making.
Why Is Real Estate a Good Investment?
Real estate is a popular investment because it’s something you can see, touch, and control. You can directly influence its value. However, not all real estate is a good investment, so it’s important to analyze a property’s real worth (its intrinsic value).
Real estate also allows for creativity. You can find unique ways to finance a property, make improvements, or increase its value. This flexibility makes real estate better than stocks or mutual funds, where you have less control.
The key message is that combining creativity with honesty and integrity in real estate can lead to great financial success.
Preparing for Tough Times
Robert emphasizes the importance of being proactive and preparing for tough financial and economic times. He uses the metaphor of "battening down the hatches" on a ship during a storm. This means protecting your finances and being ready for uncertainty.
He shares his own experience of surviving typhoons at sea. The ship survived because it was wellprepared, strongly built, and operated by a trained crew. Similarly, in life, we must prepare for challenges like rising oil prices, a declining dollar, growing debt, and global instability as the world transitions from the Industrial Age to the Information Age.
Robert believes greed, corruption, and misinformation have weakened financial systems worldwide. However, he also sees this as an opportunity for growth. By staying brave, improving your financial intelligence, and taking smart actions, you can not only survive these challenges but also thrive, becoming wealthier and wiser.
Are you ready to unleash your financial genius?
