Page 24 - Rich Dad's Increase Your Financial IQ: Get Smarter with Your Money

Fifty years ago, the manufacturing companies provided health care and
retirement benefits. Today, millions of workers are earning less, while at the

same time needing more money to cover their own medical expenses and
save enough for retirement. Every day these financial problems are not
solved, they grow bigger. And they stem from a larger national problem that
is beyond the power of the individual to change or solve. They stem from

poor economic policies and cronyism.

The Rules of Money Have Changed

In 1971, President Nixon took us off the gold standard. This was a poor
economic policy that changed the rules of money. It is one of the biggest

financial changes in the history of the world, yet few people are aware of
this change and its effect on the world economy today. One of the reasons
so many people are struggling financially today is because of Nixon’s
actions.

In 1971, the U.S. dollar died because it was no longer money—it became
a currency. There is a big difference between money and currency.
The word “currency” comes from the word “current,” like an electrical
or an ocean current. The word means movement. In overly simple terms, a

currency needs to keep moving. If it stops moving, it rapidly loses value. If
the loss of value is too great, people stop accepting it. If people stop
accepting it, the value of the currency plummets to zero. After 1971, the
U.S. dollar began moving to zero.

Historically, all currencies eventually go to zero. Throughout history,
governments have printed currencies. During the Revolutionary War, the
U.S. government printed a currency known as the Continental. It was not
long before this currency went to zero.

After World War I, the German government printed a currency in hopes
of paying its bills. Inflation exploded and the German middle class had its
savings wiped out. In 1933, frustrated and broke, the German people
elected Adolf Hitler to power in the hopes he would solve their financial

problems.
Also in 1933, Franklin Roosevelt created Social Security to solve the
money problems of the American people. Although very popular, Social