Talk about shocked! I always say that it is important to watch what others are doing and saying when it comes to investing, and now there are some major happenings. From the San Francisco Chronicle:
But now, in the past couple of months, the man — whose engaging financial parables have coaxed millions of ordinary under-earning boobs (including yours truly) into the real estate market — has become a major bubble-blower.
On his Web site, richdad.com, which contains a forum for his casual and dedicated followers (including those who pay $100 a year to join his “insiders” club), he has begun posting articles that caution against what might be called “surreal estate exuberance.”
He cites the Economist at length, including the assertion that “the global housing boom is the biggest financial bubble in history.” He confesses that he’s currently dumping real estate that produces no cash flow (from rental income) and going “long on gold and oil.”
“I’m worried about people using their houses as ATM machines,” he says, referring to those homeowners who have refinanced their homes to buy cars, pay for remodels or to buy more real estate.
The article is quite interesting, and reveals a new side of the Rich Dad Guru. He talks about using hedges against the predicted housing crash, like oil, gold, silver, and other commodities. In addition, he goes on to say that he hopes for a nice crash so he can get in and buy more property (I agree with this simple wish).
Read the article, and learn a bit about why one of the Gurus of real estate is looking to clean house a bit. I just wonder if something like this could trigger a small panic. You never know with the rate information flies today.
One thing I do know is hold on to your shorts. Personally, I would get rid of riskier RE investments in exchange for safer, income producing bets (I’ve done this already!). Just remember how frothy things were before the stock market crash a few years back – it is a wise decision to at least prepare for a rocky ride.