Betting Against the Fed

Release date: October 27, 2021
Duration: 62min
Guest(s): Jay Martin
Jay Martin
 
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The Rich Dad Radio Show: Jay Martin on Gold, Silver, and Bitcoin

November 3, 2021

By: Crystal Davis

Jay Martin comes from Vancouver, British Columbia and is the president and CEO of Cambridge House International, producing the largest investment conferences in the country on both technology and natural resources. Jay is also a board member of The Entrepreneur Organization and hosts The Jay Martin Show, focusing on investing topics.

Today, he joins Robert and Kim Kiyosaki to talk about natural resources and Bitcoin as investments, specifically in today’s economy.

Jay says, when it comes to Bitcoin, he is personally still unsure. He prefers the solid investments of gold and silver.

Crypto Vs Gold?

Jay says while it’s a good question and one he asks frequently on his podcast (The Jay Martin Show) and youtube channel, he thinks we are asking the wrong question. Comparing the two like apples to apples isn’t going to work, he says. He owns gold, and he owns Bitcoin. It may be worth having a ‘horse in the race’, he says, but he doesn’t want to go all in. “Physical gold bars and coins; that’s what I prefer to own.”

“Bitcoin is 13 years old; it’s not enough of a track record to convince me that it (Bitcoin) knows what it is yet.” For Jay, it is like comparing Facebook stock to real estate. “They are two very different things.”

Robert remarks that silver is his personal favorite out of the two. “It’s an industrial metal,” he says. “Gold is a precious metal. Silver is precious AND industrial.”

Jay thinks the consensus that he gathers is that silver is one of the more bullish commodities right now. “If you look at the macro trend supporting what should be a really robust gold market, gold and silver haven’t really responded yet.” Jay says that while gold is not performing right now, and it appears the trade is dead, he went and doubled down on his own. For Jay, that is desirable. It takes patience, he says, but if you sit tight, he feels it will pay off.

“Why isn’t the price of gold higher?”

Because beneath the surface, Robert says, the dollar is toxic. “I wouldn’t touch that damn dollar. I’d rather not hold dollars right now.”

Jay asks, “Even short term, US dollars, you don’t want them?”

If there is an investment, Robert says, yes, but we ‘save gold, silver, Bitcoin, and we use debts as money, real estate debts.” Real Estate guys borrow money to invest; why would you use your own money?”

“When we need money, we borrow money to buy the investment, and the investment throws off cash flow. The extra cash goes into...gold, silver, Bitcoin.”--Robert Kiyosaki

Jay Martin says he invests similarly, but with real estate. With Bitcoin, he just doesn’t have clarity on why he is buying it. “I have three reasons, but they are (still) undecided to me. I don’t know when and why I would sell it.” Is that speculation, he asks? A trade? He thinks maybe it is, but if so, in Jay’s view, he should be taking profits off it.

Robert reiterates that by investing in Bitcoin, he is betting against the dollar and the stock market. He doesn’t trust stocks, Robert says. “It’s completely, 100% manipulated by credit markets. They print the repo market, the reverse repo market, and they’re selling T-Bills and all this stuff.”

For Jay, he doesn’t touch (or invest in) anything in the broad equities market. He likens it to a ‘barbell’ approach: hard assets, safe haven assets on one side, and early stage, speculative investments on the other side. On the spec market, he says, companies listed on the Venture Exchange do not have enough liquidity or the forces that Robert is talking about to really manipulate the market.

“I tell people if I’m buying something, why I’m buying it, but I never tell people what to do with their cash.”--Jay Martin

What Jay likes to coach his viewers to do is to invest in being an investor in the speculative market. As soon as you’re taking profits, push it over to hard assets or those safe haven asset classes, whether that is Bitcoin, real estate, gold, cash.

Investor, Jay Martin, says he is struggling with a big conflict in his mind, right now. He says he has never seen so much division with the quarter million investors that his platforms reach. And it’s the trajectory of this division that concerns him the most.

As an example, he says in his latest newsletter he was telling the story of a restaurant in a nearby, very small town of about 6,000 people. The restaurant has been open for about three decades, and is a big contributor to the local economy.

Like many small businesses, Jay says COVID destroyed them. They shut down for months, and when they finally reopened, they had to increase the amount of staff they employed to meet sanitation standards. Meanwhile, their table count was cut in half for these same requirements. So cost is up, revenue is down. In the province of British Columbia, the vaccine mandate came into effect, stating that anyone who patronizes a restaurant, casino, hotel and similar, must be vaccinated. The restaurant owners put their foot down, Jay says, stating that it is illegal and against their principals to require vaccine records for their patrons. In response, the government took their business license for six months. This is the final blow to a long standing, small business that already took a huge hit from COVID.

The commentary, Jay says, spoke volumes and shocked him. A vast number of commentators to the story supported the government's position and condemned the restaurant for not following the orders. Jay published the article to his platforms, and addressed the situation as a moderate. He says he effectively “didn’t condemn the government” for what he felt was a crazy outcome.

Now, he says he wonders if he isn’t called to use his platform for more than just his own portfolio and investments, but to speak out, and gain attention for things like this.

Roberts' take on the dilemma is that now, in this country, you find that you really can’t talk about it. Everything is too divided.

Robert says, “We’re going into one of the roughest periods of humanity right now. And the problem is the dollar.” We have so much debt right now, they are going to have to keep printing the dollar. But every time they do that, it creates more poverty. “The system is failing,” Robert says.

“We’re going to have more homelessness, more unemployment, and the government has to print more money.” Rich Dad’s position is one of a capitalist; a capitalist is someone who believes in teaching people how to fish. A socialist, he says, is someone who wants to give people fish.

“If we are really about freedom and choice, that means we have to allow other people to be free to choose what we disagree with, right?”--Jay Martin

Jay Martin says that he is recognizing the importance of giving the people the right to their opinions, and for those who are navigating this economy right now, to listen to both sides.

“We are so triggered, so easily triggered,” he says. “We hear something we don’t like and we turn our backs, go back to our own confirmation bias. And that is the problem, right?”

What is money? Gold, Silver, Bitcoin or the US Dollar?

Robert says that for him, it is NOT the US dollar. “Why would you save dollars, when they have printed 10 trillion already this year? To me, it’s utter stupidity.” So the question becomes, are they going to print more or less?

When the baby boomers go bust, Robert thinks they’ll print more. When the stock market comes down, they’ll print more. The problem, Robert says, isn’t the stock market. It’s the credit market, the treasuries.

Jay agrees, and says “Saving (has) the right intention. You’re producing more than you consume and storing the balance. But leaving it in cash is where the risk is, and that comes from a lack of understanding.”

And what about Bitcoin? Is that now ‘digital’ gold?

Bitcoin is an invention and as Robert sees it, “they are going after the same enemy; the Treasury, the Fed, and Wall Street.” He bought Bitcoin, but right now, isn’t still buying it because the entry point price is too high. But Bitcoin is a certain generation's digital gold and that is where they are storing their wealth. Regulations are also now coming down hard for Bitcoin ownership, it’s worth noting.

Jay Martin on Investing

“I always start my investment thesis by understanding, what's the macro trends, the tailwinds and the headwinds that's occurring? Because I want to invest at an early stage, but only if there's a tailwind. I don't want to invest into a headwind. So understanding the macro picture first, and then we dive down, we have a bunch more granular junior mining specific guests joining on stage to talk about exactly where they're putting their cash, in the early stage commodities market.”

Robert asks,

“Now, are they having a harder time finding more gold or is there still plenty of gold out there?”

Jay thinks it’s inevitable that they’ll keep coming up with gold. “It’s really a business model that hasn’t changed in 100 years.” Early stage exploration is a business model where a junior exploration company promises only to spend every dollar they’re given but not generate income. They need to raise cash to explore for the minerals that the world needs. While mining is probably going to change in some ways, the world still needs minerals to produce the technology we rely on.

Jay Martins Vancouver Resource Investment Conference will be held January 16th and 17th in Vancouver, Canada. You can listen to Jay Martin on the Jay Martin Show on Youtube and wherever you listen to podcasts. Visit Cambridgehouse.com for more information on the VRIC and Jay Martin.

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