The legendary author of 'Rich Dad, Poor Dad' says he's avoiding stocks as he braces for the next market crash - and warns mom and pop investors are being set up for disaster

• Robert Kiyosaki, author of the best-seller "Rich Dad, Poor Dad," says investing in stocks, ETFs, or mutual funds at this time is "not safe."
• He calls the Federal Reserve, Treasury, and Wall Street "complicit," and centers his criticism and market forecasts around their practices.
• "The average mom and pop with a 401(k) can never retire on their 401(k)," Kiyosaki said.
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Robert Kiyosaki, author of the #1 personal finance book of all time "Rich Dad, Poor Dad," thinks public-market investors are being duped.

"Well, if you don't believe it, look at what happened in 2008 when the subprime market came down," he said on "Money Life with Chuck Jaffe," an investing podcast. "Trillions of dollars were lost and Wall Street bankers were paid billions in bonuses."

Meanwhile, the Federal Reserve's interest-rate cuts "ripped off every saver on planet earth and destroyed any returns a pensioner or retiree - or somebody who dreamed to retire - wanted to have," he said.

"So the Federal Reserve bank, the US Treasury, and Wall Street are complicit."

Today, Kiyosaki is seeing more of the same.

"The average person is so naive they actually think that these guys are on your side," he said.

Kiyosaki says that the Fed and US Treasury - through the practice of quantitative easing - have engaged in "counterfeiting money." Simultaneously, corporations are taking full advantage of these Fed-induced ultra-low interest rates and buying back swaths of their stocks.

Because of this phenomenon, he believes that savers are being punished for their prudence (earning peanuts in interest), while corporations are being unjustly rewarded for taking on excess debt and manipulating their stock prices higher.

"There's a disconnect between share price and fundamentals of the company," he said. "And that's because the CEOs are looting the companies - loading them with debt to buy their stocks back."

Kiyosaki thinks the confluence of cheap capital, increased corporate debt levels, and growing disparities between stock prices and fundamentals will result in a market crash with severe, widespread consequences.

"I'm saying the next setup is coming - the 2008 market crash - and the next one is coming," he said. "But it's not going to be in subprime mortgages, it's going to be in subprime pensions."

For clarity, Kiyosaki uses the term "pensions" to describe defined contribution plans such as: 401(k)s, RIAs, and superannuations.

As a result, Kiyosaki says that conventional investments vehicles - stocks, mutual funds, and exchange-traded funds - are "not safe."

"They're being set up," he said. "I am a professional investor; I'm not mom and pop. I wouldn't touch mutual funds, ETFs, and stocks right now."

"I'm the guy that's been criticizing Wall Street for years because they're stealing," he concluded. "The average mom and pop with a 401(k) can never retire on their 401(k)."