Is debt the new asset?

[Sterling Wyatt]

Was listening to podcast by George Gammon and Robert Kiyosaki recently. They made the comment that with high market valuations for most RE right now, and record low interest rates, that the debt is now the asset, and the property is now the liability. I think I get what they were trying to say, but can anyone expand in that comment?

[Erik W.]

I don't quite "get" what they're saying....will have to listen to the podcast.

I know Kyosaki is good at one thing: using high-level, pie-in-the-sky analysis and cherry picking data to sell books and courses. He's pop culture REI. In his world of trite clichés (don't work for money; let money work for you....buy low, sell high....work for yourself, not someone else; own assets, not liabilities, etc), there is always a story from a person who has a first name and a last initial whom you and I could never contact to verify that A) said story actually happened and B) how hard they had to work on their own to make it happen.

So, I would not trust him with anything unless I personally vetted the details IN DETAIL.  He even admit on several occasions that most of his writings in the "Rich Dad" series are fictionalized accounts designed to teach concepts.  In other words, he gives a theory.....that sometimes works out in practice with a whole lot of elbow grease on your part.

If someone won't show me their balance sheet, I take everything they say with a grain of salt.  Especially if they say real estate is not an asset.  I guarantee you, it is.  If you disagree, then please send Quit Claim deeds to all your non-assety real estate naming me as the Grantee.  Thanks in advance.