Renowned financial experts, including Robert Kiyosaki, the author of “Rich Dad Poor Dad,” and legendary investor Stanley Druckenmiller, have voiced their concerns about the growing unfunded liabilities in the United States, which they believe are indicative of a looming economic crisis. They point to the staggering unfunded liabilities, which have exceeded $250 trillion, as a significant warning sign.
Kiyosaki, who has a substantial following of 2.4 million Twitter users, has recently declared that the United States is in a state of bankruptcy. He has been advising his followers to protect their wealth by investing in secure asset classes such as gold, silver, and bitcoin (BTC), in light of the rising costs that the U.S. government has yet to fund. He views the ongoing political debates about raising the U.S. debt limit, currently at $30 trillion, as futile, given the enormous value of financial market ‘derivative assets,’ which are quantified in thousands of trillions or quadrillions.
Kiyosaki has previously predicted an economic downturn due to the Federal Reserve’s decisions to raise interest rates since the previous March, a measure taken to curb inflation. He blames the Fed’s strict monetary policies for causing the downfall of regional banks and predicts further collapses. He consistently highlights the importance of gold, silver, and bitcoin as valuable hedges in potential recessions. In April, he even predicted a surge in bitcoin value, forecasting a future price point of $100,000 and beyond.
Stanley Druckenmiller, another influential investor, shares Kiyosaki’s concerns about America’s fiscal situation. He warns that the growing debt liabilities and costs could potentially force the government to make severe cuts to social service programs, including social security and Medicare. During a recent keynote speech, Druckenmiller stated that when considering the obligations the government has towards future senior citizens, the U.S. debt amounts to approximately $200 trillion, a figure much higher than the currently estimated $31.7 trillion national debt.
Druckenmiller advocates for immediate curtailment of social programs by the government to mitigate a potentially worse economic situation in the future. He firmly believes that reducing entitlements is not an option, but a necessary measure to prevent more drastic actions in the future.
As of April 2023, the civilian unemployment rate in the U.S. was 3.4%, with nonfarm employment standing at 155.7 million people. The median household income was $62,843 per year, and the per capita income was $34,103 per year per person. These figures highlight the current state of the U.S. economy, providing a backdrop against which the concerns raised by Kiyosaki and Druckenmiller can be understood.