Robert Kiyosaki & Raoul Pal: They Replaced Horses, Didn't They?

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1:31Welcome to Real Vision's Festival of Learning. I'm with two guests today who truly need no introduction. Raoul Pal, our co-founder and CEO at Real Vision, and one of the most popular personal finance authors in the world, Robert Kiyosaki, the author of Rich Dad, Poor Dad, of course, and dozens of other books with tens of millions of copies sold. Guys, welcome. Great to be here, Ash. Great to see you. Good to see you, Robert. Before we got on air, I was thanking Raoul because he saved my life. You know, I'm really – a lot of young guys because of the book that changed their life. But years ago, I was watching this thing called Bitcoin.

2:12It went from zero to 20 ,000. And I took technical trading 101. one. So I saw it go up. I saw it retrace back down to five cents. I said, oh, Bitcoin's finished. And then it traced back up and traced, you know, it kept tracing. And I didn't have any guts to do anything about it. So I was talking to a round of one of these shows. He says, buy Bitcoin. He didn't say idiot, but basically that's what he said. He says, don't miss this one. So I bought Bitcoin years ago at$6 ,000. I nearly cried. That was a lot of money. So I bought 60 at$6 ,000, 60 Bitcoin at$6 ,000. And every time I see the price of Bitcoin, I take laps around the beads to Ralph.

3:02So thank you for saving my life, Ralph. Anytime, my friend. You've saved millions of people's lives financially, so we can all thank you as well. Guys, it's a perfect segue way from Bitcoin to AI, something that we've been talking about a great deal at Real Vision. Let me tell you why I'm so excited to host this panel. You know, we talk to programmers, engineers, executives, but today we get to talk about the influence of AI on the lives of real people through the lens of employment, personal finance, and of course, investing. Let's begin at the beginning. What do you guys think is going on with the AI revolution right now?

3:36What's hype? What's game changer? What's going on? Well, just yesterday, I was at my dentist's office And I'm so old, you know, I was, I remember when they were coming across America and covered wagons.

3:52But I'm in my dental office, dentist office, just yesterday with a guy as old as me. And he's showing me my teeth via AI. Now, well, I had no idea what he was talking about. But he's an old guy, an old dentist. Good one. He was blown away. He says, these are just your teeth. What we're doing with AI today. So that's all I knew. An old guy, an old dentist, just going, I can't believe what they're doing. And so he and I were conjecturing like we're doing now what happens tomorrow. And what he said is that AI is going to take over machines. So whatever that means, Ralph, take it away from here. Yeah, I mean, look, we've all seen this machine learning and AI coming.

4:45And then suddenly that chat GPT happened. And suddenly, human knowledge has become scalable. That is something yes, books did that before, but not in the same way as this. It means we've got infinite knowledge accessible anywhere all the time, in a way that we can't understand. So I think it's one of the most powerful technologies the world has ever seen. And when you hear people like Sam Altman talking about it, they don't even know how these things learn. There's an amazing documentary about DeepMind, the Google version, when it beat the best Go player in the world. And there was this moment where it started playing Go like no human.

5:28And they're like, well, it's clearly gone crazy. It's mad. It doesn't work. And then it won every single game ever since that date. And it had learned itself how to play the game of Go in a way no human had ever done before, played moves that no human had done, and had strategies that they didn't know. And that's the same thing with AI now and these large language models. We don't even know what they know. All we know is what we can ask them. And that's kind of weird. It's like meeting somebody in a foreign language, and you've only got some of the words in Spanish to ask them a few questions.

6:03That's not the extent of their knowledge. It's the extent of our ability to question them. So there's that happening. And then, as you said, Robert, the applications at real world level outside of this chat GPT are growing everywhere. There was a friend of mine here who is the chairman of the local hospital. And he is also the radiologist. And I showed him this one night over dinner. And he just got this new, well, he knows he's out of a job eventually. but they're using AI to read some of the x-rays and stuff. But he said, I've just taken a possession of a new MRI brain MRI machine. He says, I've never used it before.

6:38It's new technology. And he said, I spent six hours today teaching myself how to use it, Googling and everything else. He said, I had to pull research papers, all of this. I said, why don't you ask ChatGPT4 the same question? We were over dinner, over a glass of wine and within 30 seconds, his face went ashen. And he's like, oh my God, it knows everything. And he said, that's just saved me six hours. Now he's a senior radiologist. So his per hour time is expensive. So six hours of his time and deliver it to him in 30 seconds. And I'm like, this is how deflationary and powerful and how much productivity you can gain from this one single thing.

7:21So it's such a big thing. Well, the answer is, it's going to do a lot of good, but it's going to destroy a lot of the old. It's the same as Bitcoin is doing. So the question is, another person I was listening to says, women will be the biggest losers. And he says, the reason for that is that men have traditionally combined both physical and mental activities. So like an auto mechanic still has to work the wrenches and things like this. But if you're an office worker, what they call a knowledge worker, so a lot of 60 % of women, it says they're going to get wiped out. I went, wow. I'm not saying it's true or not, but people are conjecturing like we're doing today.

8:08What does this mean into the future? Right? I mean, so that's what it means. Yeah. I mean, I had the same, you know, when I was asked about this five years ago, three years ago, two years ago, when friends with kids would come to me and say, what should my son or daughter do? And I'd say, well, listen, most of these jobs are going to get replaced eventually by AI and robots. So either do data sciences or do creative arts. Then the first application of AI that came out was creating photographic art, music art. And it's like, it actually replaced the artist first. And data scientists, you actually don't need to, So there's an element that you can just ask it, natural word prompts to build you a website.

8:56So you don't even need the computer programmers. You don't need the data scientists because it can do all of it. And that's pretty shocking. We're seeing music now being built by AI that sounds exactly like a famous music artist, and you can't tell the difference already. We're not the only people working on this what's coming tomorrow thing. It's like we're talking about Jeff Booth. You know, he speaks about Bitcoin. And again, I worship you, Ralph, for telling me to buy it at six. Because with the way Jeff Booth talks about Bitcoin, I'm going, it's religious. He's taken Bitcoin to the savior of planet Earth, you know, with a monitor systems collapsing, as we all know.

9:39And so what's AI going to add? You look at what happened with COVID hit and all of these, the perfect storm hits. And now AI hits. And so just to let people know what I'm doing, I said, behind me is my cashflow game. And I said, your greatest assets is between this and this, this here and this here. And you'd better start programming it. Does that make sense to you? I mean, they probably programmed chat GBT. But if you don't start reprogramming this thing, and to me, the biggest mistake that we made years and years ago in education go to school, get a job, work hard, save money, and just give your money to Wall Street and they'll take care of you.

10:25Well, they've taken care of you. You know what I mean? They've wiped them out. Look at my generation, the boomer generation. Every time they raise interest rates on bonds, the stock market crashed on them. And so you have my generation, I think 60 % of all US tax dollars goes to old guys. and Social Security, Medicare, and all this. And so America has become a welfare state. The trouble is America is bankrupt, as you know. And so that's why Jeff Booth of The Price of Tomorrow just speaks with reverence to Bitcoin. And I think we need to do the same thing. We need to get ahead of the game. Use the gap between this and this to reprogram your life for the next 20 years, if you have 20 years.

11:17Hey, everyone. We're going to take a quick pause and hear a word from our partners. We'll be right back.

11:26Yeah, I think a lot of people fear it, and there's a right to fear it. We don't know where it ends up, right? This could be a super intelligence. We don't know what genie we've unleashed. But what I know between now and then, you better damn well leverage it. Yes. Or it will leverage you. Yes. I mean, this is so disruptive for jobs. And then the robots come and replace all the Amazon workers. And then the robots have the AI and the robots get smarter. You know, this is real. And it's happening at a speed that humans can't deal with. And the only thing to do is get smart in it as fast as you can and use it.

12:03And it feels daunting, but we've all got to. We've got to. You know, we're talking about Amazon. Look at what's happening with shopping centers. Gone. Office buildings, gone. And you're going to sit there and say, oh, the government's going to take care of me? Holy mackerel. So, you know, and so I'll just give Raul another plug for all these years. I'm kind of the, I'm kind of the Rodney Dangerfield. I get no respect in finance, you know, because what I thought Rich Dad put in, Your house is not an asset. Savers are losers. And I don't trust a 401k. I was speaking sacrilege at that time. But I think we all have to start thinking that way now.

12:50So this coming Tuesday, I'm redesigning another business that works in concert with AI. So I'm taking the Rich Dad business, then redesigning with other technologies so that AI and humans can work together. That's what I'm working on. Yeah, and we're working on similar at Real Vision as well, of how do we integrate knowledge and put it all in one place and let the AI work for you and you not for the AI. Don't fight it. And that's one of the other things that I just think of is, like, we're faced with this massive technological revolution. And some people are really uncomfortable with investing in technology.

13:37They just don't like it. They want to invest like Warren Buffett and buy cash flow generating businesses. Fine. But this is like a nuclear bomb that's just arrived. And I just think you kind of need to invest in it. I always think invest in your own demise. Don't bet against it. It's better to hedge yourself by getting better to die rich at the hands of the slave, the big boss AI than to die port at the hands of the AI. And that's going to require so much brain power. I mean, this is your greatest asset, your greatest liability. You know, I talk about being old, but I remember buying this. This is a gold coin.

14:19It used to be 50 bucks. You know, today it's 2 ,000. So I come out with Rich Dad and pour that. I say, this stuff here is trash. Cash is trash. Because you study history. This stuff is, you know, throughout history, this has always gone to zero. Always. 100 % of the time has gone to zero. And people still work and save for it. Now AI is going to bump this thing to the moon. The changes are going to be so profound that nobody can save you except you. You know, you guys have framed this out as a time of extraordinary opportunity and extraordinary risk simultaneously. simultaneously. When you think about those sort of countervailing factors, what are some of the strategies, techniques, you guys spend a lot of time, both of you thinking about how to prepare, what are some of the strategies, techniques, ideas that people who are listening to this show, watching us can implement in their own lives to get ahead of this curve that you guys see coming?

15:20Robert raises the most important point is, you know, the best asset you've got in a knowledge based economy is to become more knowledgeable, you know, using what's in your head. So educate yourself. It may, as I said, it may seem daunting, but my mother-in-law, who's an artist, she's making a book about the history of the world in logarithmic form. So the first page is like the first 100 billion years, and the next page is the next 100 million, etc. And she's an artist. So she's graphically representing all of this and then factually representing it as well it's a really cool project she's been working on for many years she was staying with us in the cayman islands and i could see her bookmarking everything in google she'd have all these textbooks with her i said what are you doing i said just use chat gpt completely changed her life and she's in her mid-70s and she's like oh this is amazing and she's on it all day we're all going to have to do that.

16:19We're all just going to have to embrace the technology. And even when you're building a business, most business models are going to die really fast. I mean, the media industry, when you can just copy, you know, Robert, you can create a business now where you have the AI create versions of you that can be personalized. So I can come with my own personal finance issues and ask AI, Robert, and it'll know me and stuff like that. That's all coming. And it's a matter of two or three years away. I mean, it's ridiculous. Also, besides this, you know, the gray matter between your left ear and your right ear, it's who do you spend time with?

16:55Who are your friends? So right now, not that I have many friends anyway, except you, Ralph. I've got to look for lunatics. Do you know what I mean? I've got to find people who are willing to think outside reality. So I went to this group in Nashville God, it was an amazing group, all entrepreneurs. And this one guy said, what do you do? He says, well, he's Musk's rocket guy. And he says, my job is to take a 40-story building, push it into space, and return it. I'm going, how do you do that? I mean, these guys are so outside the box of their jobs. and so I'm talking to him and all this but he was the guy that came up with a solution for me at least my business because we're all different businesses he says you've got to he said the idea of a teacher is obsolete which as you may know my background my hate of school I never got along with a teacher and he says the problem is if a student doesn't like a teacher or vice versa students screwed Do you know what I mean?

18:12You got into a fight with your teacher day one, you're finished. And so he stood up in front of the room. He says, the idea of a teacher standing in front of a room is an obsolete idea. And again, so that's what I'm saying, well, you've got to hang out with lunatics. You know, when I said, you know, I said, savers are losers. I don't work for dollars. I don't have a 401k. I don't do any of that stuff. I got attacked. But today, it's kind of proving true. So the guy says, a teacher standing in front of the room is an obsolete idea. So, well, that's where I started. I said, if they're toast, what comes next?

18:55If a teacher is toast. And I'm going to argue something else, potentially. And Japan has led us the way. The young Japanese generation don't have kids anymore, right? they were well before our own that generation in ours because the Japanese population is older. In Japan, they started having digital friends.

19:22So when you said earlier, you know, seeing people in person, I'm not sure. I know that we all want to spend more time around people because we're all now working on Zoom calls. We're doing less traveling, less around. So it's nice when we all get together, right, in person. But I'm not entirely sure that the younger kids won't just have digital friends that aren't humans at all. That's a good point. Because we're already seeing people launching versions of ChatGPT that are personality-based, that learn about you and therefore is your friend. And Japan pioneered this a long time ago. I mean, again, that's thinking crazy.

20:00But who knows whether our friends will be mainly human or AI. And that's mind-blowing to think about, but it's happening. It's so cliche, but think outside the box. But I started searching, I mean actively searching for whack jobs. So when that guy stood in front of the room, one guy stood and says, I take Musk's rockets, 40-story buildings, take them into space and bring them back. I'm going, how do you do that? I can't even pay the rent. This guy's taking this thing up and bringing it back. Another guy stands up and says, the idea of a teacher is obsolete. need. Standing in front of a room, you don't need them.

20:41I'm going, wow, what does that mean? So the next question is, what do we need? Does that make sense to you? Yeah. I mean, even when you say, just to get people across the line to understand what you're saying here, don't need a teacher. We don't need a university. We don't need the school system. We don't need any of it. The education complex is vast and we rely on it. It's part of our social structure you were laughing that you couldn't get through school because you couldn't spell and you know i got into one university the only place that would take take me because my grades were so shitty because i discovered girls and cars and pubs at an early age and um but that whole hierarchical system of where you went and how you got educated i went to harvard i went to oxford i for kids being born today it's irrelevant and today those people listen to you and me right right now?

21:35You guys are heretics. How dare you say that? I mean, like speaking out against education, it's like speaking against the Catholic Church or the Mormon religion and all this. We're coming up against religions, you know, ancient religions. What is education? And so when that guy stood up there and he says, the idea of a teacher standing in front of a room is an obsolete idea. My mind goes to say, what do we need then? Hey, everyone, we're going to take another quick break and hear a word from our partners. We'll be right back to the Real Vision Crypto Daily Briefing.

22:15So, OK, let's go there. What do we need then? What did you start to think? I don't expect you to have all the answers, but where did your mind go? Well, you and I have been on the same wavelength forever. We're entrepreneurs. We're entrepreneurs and investors. Rather than saying, give me a job and put my money in a 401k or an IRA. That's obsolete. I stopped that in 1998, I think. I'm not doing it. So when I started to say it, I was getting into trouble. So I recommend being an entrepreneur. And I get taken off of shows now, Raoul, because I said, I don't want Wall Street.

22:59Do you know what I mean? That's like speaking against the Holy Mother. Oh yeah, that's another big relationship. I know. You don't step on Superman's cape, you don't step on Wall Street's cape and all this. But just to prove all my life, this is my... I took the biggest gold mine in America public this summer, last summer. Congrats. Because I don't like Wall Street. Do you know what I mean? I'm not saying you should like it. But that's another big thing, right? Wall Street is clearly going to get disrupted in this. I mean, it's like the whole Bitcoin thing. It's replacing middlemen, paying experts for knowledge when all the expertise in the world is in this magic black box that we can all get on our mobile phone for 20 bucks a month.

23:47Why the fuck do we need any of it? We don't need any of the system of that way. Remember that guy who wrote the book Flash Boys or something? Yeah, Michael Lewis. Holy mackerel. How in the world can you beat the machine? Do you know what I mean? Here I'm taking day trading 101, and this guy's got this machine going against me. I'm going, man, talk about step on Superman's cape. Yeah. And that raises a lot of questions because then it becomes who owns the machine and who owns the data. And who controls the machine? And there's going to be this world of open source versus Microsoft, who now currently own everything and Google in that machine world.

24:38But what it does for finance, as you say, it becomes completely game changing. It's going to tear it down. it is yeah and then you throw in web3 and that's that was that was what i was going to say ash is like once you throw in web3 there's a new system of value and ai and put this all together that's the end of the financial system lock stock all of it the banking system we don't need banks to lend money this can all be done by computer code we don't need a credit clerk checking whether robert has paid his last credit card bill and can I lend him money? It'll all be done instantaneously and offered to you in advance because it knows that you might want some extra cash flow.

25:20All of this changes, everything. So the question is, what an entrepreneur does, this is what Rich Dad bought at 1997. It came out. Again, it got turned down by everybody. But being an entrepreneur, I create my own assets. So that's what the definition of Rich Dad bought at is. What is an asset? You know, there's another thing, Robert, remind me of that, talking about houses and assets. The first time I picked up one of those Oculus Rift VR glasses, the early stage, right? It put me in this room of this beautiful kind of contemporary house with this amazing view with the sun coming up. And I'm like, this is nicer than where I live.

26:04And in a few years' time, this is going to be so picture perfect. Yes. that I can live in a garage and not care because what I see and what I feel is this amazing world. And then your house, then houses are worth very little as well. It's just, again, people, you know, AI, it's all part of the same technological revolution. And I think Apple announces on June 5th, so I think by the time people watch this, Apple will have made their announcement about what they're doing. And I think it's going to make the world spin again on its axis. and everyone's going to recalibrate again what this all means.

26:40And this is what we're doing today. We're asking people to think that way. Do you know what I mean? To question everything. You've talked a lot about these themes, about the disruptions, about the opportunities. When you guys think about investing in this new age, how do you think about it? What are some of your guiding strategies? Well, it goes back again, Raoul, to Rich Dad Poor Dad is based upon two words, asset versus liability. What's an asset? What's the liability? It's called financial literacy. How do you define an asset and how do you define a liability? So when Wall Street defines an asset as a mutual fund, we go a little nuts.

27:20The question is, whose asset is it? Who's a counterparty there? So this piece of gold has no counterparty. That's why I call gold, silver. I call it God's money. It was placed here by God. They're on the periodic tables. Bitcoin is people's money because Wall Street, well, so far they can't mess with it that much. And so he goes into financial literacy definitions. What is an asset? What's a liability? So that's why I know he's hated by a lot of people, but Trump and I are really good friends. And we talk about how we create our own assets. What an entrepreneur does is I don't need Wall Street and I don't need the Fed, I don't need anybody to create my assets.