That is why I predict that market crashes will come faster and more severely in the Information Age. How Does One Protect Oneself from These Crashes? The way some of these countries are protecting them- selves from the power of the Electronic Herd is by cleaning up and tightening up their national financial statements and increasing their financial requirements and standards. In his book Thomas Friedman writes: Standards: "If you were writing a history of the American capital markets," Deputy Treasury Secretary Larry Summers 258 Rich Dad's Guide to Investing once observed, "I would suggest that the single most impor- tant innovation shaping that capital market was the idea of generally accepted accounting principles. We need that inter- nationally. It is a minor, but not insignificant, triumph of the IMF that in Korea somebody who teaches a night school class in accounting told me that he normally has 22 students in his Winter term, and this year (1998) he has 385- We need that at the corporate level in Korea. We need that at the national level." Years ago rich dad said a similar thing, but he was not re- ferring to an entire country as Larry Summers is in this quote. Rich dad was referring to any individual who wanted to do well financially. Rich dad said, "The difference between a rich person and a poor person is much more than how much money they make. The difference is found in their financial lit- eracy and the standards of importance they put on that liter- acy. Simply put, poor people have very low financial literacy standards, regardless of how much money they make." He also said, "People with low finalncial literacy standards are often unable to take their ideas and create assets out of them. Instead of creating assets, many people create liabilities with their ideas just because of low financial literacy standards." Getting Out Is More Important than Getting In Rich dad often said, "The reason most average investors lose money is because it is often easy to invest into an asset, but it is often difficult to get out. If you want to be a savvy in- vestor you need to know how to exit an investment as well as how to get into the investment." Today when I invest, one of the most important strategies I must consider is what is called my "exit strategy." Rich dad put the importance of an exit strategy in these terms so I could understand it's importance. He said, "Buying an investment is often like getting married. In the beginning things are exciting and fun. But if things do The Qualified Investor 259 not go well, then the divorce can be much more painful than all that initial excitement and fun. That is why you must really think about an investment almost like a marriage. Because getting in is often a lot easier than getting out." Both my dads were very happily married men. So when rich dad talked about divorce, he was not encouraging people to get divorced he was just advising me to think long term.