Facing Down Our Investment Fears
The comments below are an edited and abridged synopsis of an article by Michael Kosares
Facing down your investment fears can only come from a strategy you can genuinely believe in. One of the great quotes on gold ownership came many years ago from Richard Russell, then editor of the Dow Theory Letters. “I still sleep better at night,” he wrote, “knowing that I hold some gold. If or when everything else falls apart, gold will still be unquestioned wealth.” It is not a complicated strategy, but it is an effective one.
Though rarely discussed, gold ownership has as much to do with personal philosophy and how we wish to conduct our lives as it does finance and economics. In many ways, it is a rational portfolio decision that suits the times, but it is also a lifestyle decision that provides some peace of mind no matter what happens with the pandemic, the mania on Wall Street, or political maneuvering.
The prospect of sleeping better at night was part of Palantir Technologies’ $50.7 million purchase of gold in July—28,000 troy ounces in 100-oz bars. The firm founded by Peter Thiel and Alex Karp purchased the gold as a hedge against “a future with more black swan events.” It is interesting in the context of black swan events that among Palantir’s many data-based products, it offers the AI-ready Gotham operating system, a program that surfaces “insights from complex data for global defense agencies, the intelligence community, disaster relief organizations, and beyond.”
Kosares discusses being fooled by the Fed’s taper talk; the looming stagflationary debt crisis; the folly of ruling out a collapse; and final thoughts.