Ron Paul's portfolio (99% gold) | Hacker News Reader

Ron Paul's portfolio (99% gold)

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17 pointswj19 comments

This is the kind of portfolio you get when you have zero faith in free enterprise. They trust cold, dead gold more than they trust work and creativity.

This is my core question for self-styled libertarians anymore... if government regulation is so problematic for people, isn't that just a market opportunity for entrepreneurs? Those of us who think in terms of finding problems and creating solutions for them for money, see a big problem as a big opportunity.

I imagine most do have faith in free enterprise, but I don't think they have faith in free enterprise being a safe investment when government regulations come into play.

Taking AirBnB, Uber or even Tesla as an example. It is clear that there is an issue with the industries in which they operate, whether government imposed or new tech shifting paradigms, and those issues make for an opportunity. The problem is that, while the idea makes for a fairly sound investment, regulators greatly increase the risk involved. What comes of Tesla if their "stores" idea is ruled illegal? The same with AirBnB or Uber and their uses of private property? Unless the return compensates for the increased risk, rational investors will stick with ones that do.

https://en.wikipedia.org/wiki/Parable_of_the_broken_window

I think all libertarians would answer yes to your question.

For example, public transport and housing is terrible in the Bay so private buses are all over SF now.

My whole economic worldview changed when I read the works of Hernando de Soto Polar (http://en.wikipedia.org/wiki/Hernando_de_Soto_Polar). He demonstrated that a huge free market economy of honest, legitimate work (like private buses) exists completely outside the law, technically illegal, all over the world. The more restrictive the regulations, the more free enterprise pops up. There are two problems with this. First, those entrepreneurs lack protection of the law, so they are vulnerable to losing their livelihoods due to crime or motion of power. Second, this shadow economy is simply not measured by mainstream economics, so in countries where the shadow economy is large, our perception of their relative economic status is skewed.

It's sobering stuff for a libertarian to read.

>if government regulation is so problematic for people, isn't that just a market opportunity for entrepreneurs?

Yes it is. We have litigious/defensive corporate lawyers working for companies solely mitigate law suits and shut down competitions on regulation violations. We have multibillion dollar accounting industry who is paid to maneuver through impossibly complex tax code. We have millionaire lobbyists whose sole purpose is to influence politicians to create rules and regulations that favours certain companies or industries.

I love Ron Paul, and the headline is wrong, but his strategy is crazy.

Rational libertarians invest in what they think will, in risk adjusted terms, make them money. I don't think a pure gold (or bitcoin, or whatever) is the way to go.

I am an anarcho-capitalist (Ron Paul's type of libertarian) and I think this kind of portfolio is crazy. Even in a total depression you can still do really well selling food, drinks, support software, ...

Ron Paul is an anarcho-capitalist?

Yes. So is Andrew Napilitano. They admit to it but only in limited circles (e.g. at Mises Institute).

This is pretty much par for the course for hardcore libertarians. I have a good friend who is a staunch Paul supporter, invests with Peter Schiff and tries to convince me on a daily basis that the stock market and American capitalism is at death's door (I'm bullish on the stock market and heavily invested in it on the long side). This is common wisdom among the group- buy and hold gold because tomorrow the dollar is going to be worthless.

Even accepting all of that, can someone please tell my why gold is supposed to be different? I get the fact that gold has traditionally, for the longest of time, been seen as a low-yield, low-risk investment, and that what people see something as is what matters. But if gold's value comes from the fact that people think it's worth something, how is it fundamentally different from stocks of Foo Corp.? On top of that, it doesn't really do anything on its own. I just don't get it, for anything other than perhaps off-the-record physical movement of large values (which I don't suspect mr. Paul of doing… yet, anyway).

Edit: I get that gold is (economically) stable, but I don't understand why. Aren't people afraid that someone will find some huge unknown ore?

Gold is a physical good, has practical uses (in electronics and medicine as well as jewelry and leafing), and has throughout history been both desirable and used as currency. On the other hand, stock (dollars) is either just bits or a piece of paper. Given how valuable gold has been in the past and present, it's a pretty safe bet that it will continue to be valuable in the future.

Misleading title. The article clearly says "64 percent in gold and silver miners, 21 percent in real estate and 15 percent in cash"

I'm surprised that he'd still be making ideological bets like this at his age. Diversification could be his friend.

He's 78. Whatever happens to his money, he likely won't have to live with the consequences for very long. I mean, say gold starts to crash and he only gets his money out when it is down to 20% of what it once was. How fucked would he really be?

Not only is the title absolutely wrong (it's 64%), but I don't see why this belongs on HN.

The Paulbots have to start up the spam machine for Rand Paul's 2016 run somewhere. Gotta keep the money flowing into the Paul family!

The article says 64% in gold and silver miners, 21% in real estate and 15% in cash. The title is wrong.

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