Gary North on current economic affairs and investment marketsGary North -- Specific Answers
HomeContact MeTell a FriendText SizeSearchMember Area
Gain immediate access to all of our current articles, the question-and-answer forums, dozens of free books, and article archives. Click here for details on how to join.

About This Site
Academic Gaps
Capitalism and the Bible
Christian Economics
Clichés of Protectionism
College Finances
Debt Management
Ellen Brown: Critique
Federal Reserve Charts
Gary North's Free Books
Get Published Here!
Gold Price & My Report
Keynes Project
One Lesson
Price Index (U.S.A.)
Questions for Jim Wallis
Remnant Review
Social Security/Medicare
Sustained Revival
Tea Party Economist
U.S. Debt Clock
Yield Curve
Your YouTube Channel
Gary North's Miscellany
Budgeting for Wealth
Business Start-Up
Career Advancement
Digital Tools
Education That Works
Evernote: Free Notes
Federal Reserve Policy
Fireproof Your Job
Goal-Setting for Success
Great Default
Inheritance Strategies
International Investing
Investment Basics
Job and Calling
Keynesian Economics
Marketing Case Studies
Precious Metals
Real Estate
Safe Places
State of the Economy
Stocks and Bonds
Study Habits
Video Channel Profits
Members' Free Manuals
Our Products
Contact Me
Tell a Friend
Text Size
Your Account
My 100% Guarantee
Privacy Policy
Terms of Use

This site powered by MemberGate

How Dave Ramsey Made $55 Million by Being Good on Personal Debt, Naive on Business Debt, Lousy on Investing, and a Loudmouth Bully.

Gary North
Printer-Friendly Format

Sept. 3, 2011

I have kept my mouth closed on Dave Ramsey for years, but no longer. I have finally had enough.

In a January 23, 2008 phone call, he excoriated Peter Schiff's book, Crash Proof, after telling the caller that he had never heard of the book or Schiff.

This was unconscionable. The rule is simple: if you attack a book, read it first.

The caller, a young woman, said that her father was worried about a coming stock market crash. He was buying gold and foreign currencies. Ramsey said this advice was "absolutely ludicrous."

On that day, the Dow was at 12,270. Gold was at $880.25.

Yesterday, the Dow closed at 11,240. Gold closed $1,884.50.

You tell me: Ramsey or Schiff?

But it gets worse. Ramsey's off-microphone research man told Ramsey that Peter Schiff is Irwin Schiff's son. Ramsey then went into a tirade over the father's tax protest advice. He then said this: "This kid's dad is a nutburger, which probably means the kid is a nutburger."

No, it means that Dave Ramsey is a disgrace. He verbally tarred and feathered Peter Schiff for a position Schiff personally opposes: the tax revolt.

The "kid" is three years younger than Ramsey. He runs a business. And, just for the record, he has never declared bankruptcy. Ramsey did -- and has become a multimillionaire by parleying that act of contract breaking into an anti-debt career. He is like the reformed alcoholic who says no one should take a drink. For the record, I hope he has long since repaid all of his former creditors with interest. "The wicked borroweth and payeth not again." (Psalm 37:21a).

On Irwin Schiff, I have been clear: I was clear in the mid-1970s, when Schiff began his crusade against paying income taxes. I published R. J. Rushdoony's 1975 article, "Jesus and the Tax Revolt," in the Winter 1975/76 issue of The Journal of Christian Reconstruction, which I edited. The article was a refutation of the tax protesters. This was when Schiff had just begun his crusade. I knew who he was, and I joined with Rushdoony to oppose what he and others like him were doing.

In 1975, Dave Ramsey was 15 years old.

Watch the video. Then I will comment on Ramsey's pathetic track record as a financial adviser.

He bullied that young woman. He was contemptuous of her father's advice. He made it appear as though her father was a gullible victim of a charlatan.

Charlatan is as charlatan does.

The phone call came in January 2008. Remember what happened next -- an event that Schiff had called perfectly? There was the worst stock market meltdown in modern times. The entire financial structure was changed. The government nationalized Fannie Mae and Freddy Mac. The Federal Reserve gave secret loans of $1.2 trillion to big banks.

Was the advice that the woman's father received from Schiff accurate? Yes. Was the advice from Ramsey accurate? No. Yet he came on like a know-it-all expert. He showed her!

Then the stock market showed him: the worst crash since 1932. Unemployment remains above 9%.

In Texas, they would say that Dave Ramsey is all hat and no cattle. They would be wrong. He is all hat and diseased cattle.

He tells people to buy no-load stock mutual funds.

The longer your money stays invested, the more it can grow. Over the last 30 years, the S&P 500, a standard measurement of stock market performance, has averaged a 12% growth rate.


Put your retirement money in growth stock mutual funds with a track record of at least five years of consistent returns (12% average). Divide your portfolio equally among growth, growth and income, international and aggressive growth funds.

He posted this on March 22, 2010. On that day, the S&P 500 closed at 1166. Ten years earlier -- March 22, 2000 -- the index was at exactly 1500.

Let's see: that's a loss of 22%.

But wait! There's more!

Using the inflation calculator of the U.S. Bureau of Labor Statistics, we learn that the dollar lost over 21% of its purchasing power, 2000 to 2010:

So, combining these figures, the investor who bought a no-load index fund of the S&P 500 and held it for a decade lost almost 40% of this investment.

Ramsey never discusses the retirement-destroying rate of return that American stocks have produced since early 2000. It has been 11 years of false hopes.

Dave Ramsey is a purveyor of false hope. He never changes. He never learns.

For the record, I warned my Remnant Review subscribers in February 2000 and again in March that the price/earnings ratio was too high, and that a market decline was imminent. It began in mid-March. In terms of purchasing power, it has never recovered.


He offers his desperate listeners the dream of riches. But they must do it Dave's way. We read on his site:

A research study conducted by Dr. Thomas Stanley and Dr. William Danko revealed this fact in their book, The Millionaire Next Door. The findings by the two researchers support what Dave has said for years: your biggest wealth-building tool is your income. It almost sounds too simple, but it's absolutely true!

Right now you might be saying to yourself, I work hard and have a steady income. Why am I not a millionaire? The answer might be that you spend more than you make. If that's true, you're essentially giving your money to someone else so they can become rich while you live paycheck to paycheck. If you want to be a millionaire, you need to change your lifestyle to mimic most millionaires.

Did you take special notice that most millionaires invest their money? It's not enough to live below your means and save money; you must invest that money. Dave recommends you invest in mutual funds because they offer several advantages over individual stocks. Here's a quick breakdown of his suggested investments:

* 25% in a growth mutual fund
* 25% in a growth and income mutual fund
* 25% in an aggressive growth mutual fund
* 25% in an international mutual fund

What's wrong with this rosy picture? This: the book describes self-made rich men, and almost all of them made it by starting a business. What's more, most of them declared bankruptcy once. Some did it repeatedly. They lived in terms of debt. They stiffed their investors, their bankers, and their relatives. Starting a business is risky. They passed to others as much of this risk as they could.

In the book, we learn that 85% of them had started businesses. To start a business, you must adopt one or more of these options to fund it: (1) borrow money from friends and relatives; (2) borrow money from a bank; (3) borrow money from customers (e.g., cash up front for a subscription); (4) put up your own money for a cash-only business (exceedingly rare the first time you start one); sell shares in your firm (even more rare). Once the business is profitable, you borrow money more to grow it. This is "the millionaire mind." the authors' title for their other book.

These men invested wisely in a diversified portfolio only after they got rich by using debt.

In short, a bunch of them got rich exactly the way Dave Ramsey did. They borrowed money, declared bankruptcy, started over, and got rich. Most of them are not worth $55 million. According to this site, he is. (If he wants to prove me wrong, he can post his CPA's signed statement of another figure.)

The words "cognitive dissonance" come to mind. Dave Ramsey lives in terms of these two words. He has gotten rich with them.

He keeps telling listeners to do what has produced major losses for anyone who has done it for the last 11 years. Furthermore, they have lost time. They have less time to get back to what they had before they listened to him, after taxes and inflation take their toll.

He promotes this nonsense in the name of a safe and secure retirement.

He will have a safe and secure retirement. They won't.

He helps people get out of debt. This is admirable. Then he gives them wrong-headed but conventional advice that loses money. He is like a man who sobers up people by getting them to start smoking two packs of cigarettes a day.


He hates gold. No other word better describes his attitude.

This is from his website, written by some staffer, but clearly endorsed by Ramsey.

From 1833 to 2001, the compound annual growth rate of gold was only 1.54%. That's pretty rotten. Since September 11, the value of gold has definitely increased. It's looking better right now. But you can't deny nearly two centuries of consistently poor performance.

Notice what he has done. He uses the era of America's gold coin standard, 1833-1933, to show that gold made a poor return. That was the point of the gold standard: stable money, with gold at a fixed price. People owned gold coins, not to get rich, but to keep from getting poor. They bought coins rather than deposit them in a local bank. Gold preserved purchasing power.

Then he included the era of the gold-exchange standard, 1933-71, when the U.S. government sold gold at $35 an ounce to governments and central banks. Again, gold's price was rigged by the U.S. government: fixed. Of course gold's did not rise. Only after 1968 did the system of gold price rigging begin to break down. Only those people who thought the U.S. government would cheat the central bank holders of dollars and abandon the gold standard bought legal gold coins. I was one of them, and I made a lot of money on this assumption.

In 1970, gold was at $40 per ounce. You could legally buy British gold sovereigns for $10. I did. I still own them. I have made 45 to one, before taxes. But Ramsey dismisses all this.

In 1970, he was ten years old. In 1970, I had written multiple articles on gold. Here is one of them. But Ramsey is the expert on gold. Just ask him. Or his staffer.

He stopped at 2001 -- the bottom for gold at $256. That was the year I begged my subscribers to start buying gold.

This man is either intellectually dishonest or just not too bright. He talks a good line -- confident enough to fool the walking wounded.

Gold is the new Snuggie. You buy it off late-night cable and end up looking stupid. Everyone is talking about it, and everyone wants to get involved. But think about it. If you were going to invest in gold at all, would you really want to buy it at its 176-year high? Absolutely not!

So what's gold good for--other than wearing it around your neck or wrist? Well, if you're in debt--or if you just need a little extra cash--sell it!

Selling jewelry is a great way to build traction on your starter emergency fund, to knock out debt, and to clean up clutter around your house. If you've become gazelle intense, but you're not quite ready to sell the kids, then peek inside the jewelry box. Do you really need everything in there--the trinkets, bracelets, rings and old watches?

Clever! Sell that jewelry!

When did this appear? On October 13, 2009. On that day (using Kitco's data), gold was at $1,057.50.

It is up by almost 80%.

Now, Dave isn't endorsing gold as an investment. He never has, and he never will. Companies like offer an outlet for you to make some money on your unwanted or unneeded jewelry. Dave will only endorse companies that he trusts, and Gold Stash is reputable, honest and absolutely trustworthy.

It could not be clearer. Dave Ramsey will not endorse owning gold for any reason, ever.

Listen to this audio clip. He makes his position clear, "Gold is horrible. Never invest in gold. Never invest in gold. Never invest in gold."

He was as confident as he was dead wrong.

Then there is this nagging question: "Why is GoldStash buying gold?" As a favor? As a charity? Or as a way to buy low and . . . oh, no! . . . sell high? Yes, my friends, GoldStash is buying gold in order to sell it. It is buying from people who do what Dave advises and selling to those who don't.

Dave Ramsey is the company's go-between. He is a broker. A middleman. He is getting his followers to turn in their gold. What about the people who buy gold from GoldStash? What does Dave think about them?

1. Nail 'em, the schmucks! (They didn't take my advice.)
2. Pretty smart. (They didn't take my advice.)

Dave Ramsey is not an investment expert. He is an economic fool. Anyone who tells a staffer that he will never recommend an investment, other than for a moral reason, such as pornography or gambling, and then has the staffer post it on his site, is an economic fool. He is saying, "Conditions mean nothing to me. I will not buy gold." This is not investment advice. This is a religion -- an anti-gold, pro-fiat money religion. This is what Isaiah preached against (Isaiah 1:22).

We know what Ramsey thinks of Isaiah. "Nutburger."

If you want to know why Ramsey does not know what he is talking about on the gold issue, read my report: The Gold Wars.


The reason I set up my free site on getting out of debt,, was simple. I did not want to go to my grave knowing that I did nothing to help desperate people get out of debt. But I decided not to sell them advice in their hour of need, the way Ramsey does.

I did not want to refer people to Dave Ramsey, who gives such terrible investment advice, year after year.

My site is free. He sells his information on getting out of debt.

We have different philosophies on what to charge, whom to charge, and when not to charge.

I do not charge desperate people for my advice. He does.

I do not call a man a nutburger in public, merely because his father was given a prison sentence. There is a biblical principle of ethics here:

The fathers shall not be put to death for the children, neither shall the children be put to death for the fathers: every man shall be put to death for his own sin. (Deuteronomy 24:16)

That ethical principle did not restrain Ramsey, who was not about to pass up a chance to vilify an investment adviser who recommends gold. The man is ethically untrustworthy.

He presents himself as a debt-free Christian, and recommends that we all be just like him. That, too, irks me. Why? Because he has only one claim to fame. Dave Ramsey stiffed his creditors legally, got back on his feet, and is now making a financial killing by selling rotten investment advice to poor people who do not know enough about investing to recognize that he has been faking his non-existent financial expertise for a decade.

Dave Ramsey is not to be trusted.

Pass it on.

[Note: If you lose track of this article and wish to find it on the Web, search for "Dave Ramsey," "$55 million," and "nutburger."]

Printer-Friendly Format

 Tip of the Week
Sign up for my free
Tip of the Week
Verification Characters:    Type     P  5  B  9  Q     here   

Tip of the week archives
On what this icon
means, and how it
can help you,
click here
 Q & A Forums
General Q&A Forum
Advertising and Resumés
American History Topics
Backyard Food Gardening
Banking and Politics
Blog Sites and Web Sites
Books Worth Reading
Bumper Sticker Slogans
Business Forum
Buying Smart
Christian Service Forum
College -- The Cheap Way
Education Alternatives
Food Storage
For Women Only
GNC Benefits
GNC Testimonials
Gold and Silver
Great Default Forum
Health and Diet
Health Insurance
Investments Forum
Iran War
Job, Calling, and Career
Leadership Development
Legacy Building
Less Dependent Living
Local Political Action
Non-Retirement Forum
One Good Idea
Police State
Public Speaking
Real Estate Forum
Remnant Review Forum
Safe Places Forum
Taxation Policy
Typographical Errors
Video Production Basics

Reality Check
 Discussion Forum
Search Discussion

Recent Forum Posts
• Negative interest rates
• Looking for educational material
• Safe currencies to hold
• Benjamin Graham?
• A Motif masochist investor asks
• "Asset Based Long Term Care" annuities
• Buying pipelines at the next crash
• RE:Concierge Doctor
• Discover Bank 0.9% APR?
• getting out of the euro
• Amazing Dollar Strength
• Stuck in 401K. Help!
• Currency Wars
• Need Any Adjustments?
• What is the third question?
• Developing a mobile home park
• Word press plug in
• Rent controls in mass inflation:where to go?
• How to calculate ROI for a rental property?
• How should I sell a house?
• location Vs. amenities
• DFW Real Estate - Bubble Economy
• Rental houses: cash flow
• RentoMeter site
• Renting individual Rooms vs. Whole house
• Are real estate agents driving this phenomenon?
• Intro to Real Estate
• best-and-worst-m arkets-for-rent al-returns
• Establishing a rental farm away from where I live
• 9 out 10 Most Expensive Cities are in California
• US Pop update: 78% pop decline by 2025 !
• Price Book- End of America
• Time to leave America while you still can ?
• Impact Fees for New Florida Residents
• New Hampshire and Florida
• Ecuador and PR
• Survivor library
• Missle Silo converted to Condos
• Does the South suck?
• Moving TO the US?
• No City for Old People
• Will you die getting to your bug out location?
• teaching English overseas - some questions
• The state with the most Liberty
• Switzerland and Firearms
• Kurzweil on Financial Times
• Why is this fantasy world stuff?
• One change could help saving for retirement
• Forced retirement - lump sum - legal work
• Moving Retirement Funds
• Sudden Wealth Advice
• Sudden Wealth Advice
• Question on Traditional Pensions
• advice on how do I interact with my older parents?
• Do You Sincerely Want to Be Rich? Why?
• Req. For No 401(k)/Other Pensions via Relocatio
• Cashing out 401K to pay student debt?
• SS @ 62 and still working
• Desolation or Prosperity?
• I take it Retirement Armageddon is not available
• How to get rid of comments on YouTube
• Is this the apocalypse? ask locals.
• Negative bank interest in US -Booming stock market
• Psychological Principle.
• My local plumber and yellow page advertising
• Turing Test for Financial Advisor
• Jade Helm 15
• Broken Window Minimum Wage Churchill Discussion
• I'm at a Checkpoint
• What's Holding Homeschooling Back?
• Buying Rental Properties
• Wikipedia: Dr North has missed the point
• marketing question
• The Industry in Which Costs and Revenues....
• How to Overcome Fear
• A Low-Cost Weekend Business to Retire Into
• Questions for small business owners
• Leasing Question
• New Motor Technbology
• MBA programs that get you where you want to go
• a different marketing - using academia
• Video Interview Equipment
• Beginner Business Structure
• Apply 80/20
• Good Recruiting wins Championships = $$$
• Meeting with the State
• Family earns $1 Million from YouTube vids
• Customer Service and Ethics Still Rule?
• Business Loans Question
• The life value of a customer ?