Welcome back and Happy New Year, Byron. Glad to see you posting again. Your interview series in Poland is so good, have you considered putting them together into a YouTube playlist on a dedicated channel? Also, I read A Gentleman in Moscow over the holidays based on your recommendation and enjoyed it immensely.
Bonjour Serena, Great to hear from you. Glad you enjoyed A Gentleman in Moscow.
At present, I’m leaving the YouTube channel business to my publisher in Poland. His marketing team really drives things on that end. I am deliberating on how much exposure online I want. Recent security issues here at the chateau have given me cause to pause, if you know what I mean.
this morning I watched the entire video on wealth preservation, with a lovely coffe, gently kissed by the sun and with your company: thank you.
During the discussion, you mentioned gold and cash… a few questions arose in me.
While I completely agree on allocating a percentage of your estate to gold, I still have doubts on physical cash in other currencies (for the kind of emergency situations mentioned in the interview): in those cases you can always pick up the metal from the vault and sell it for the local currency of the safe place you happen to be.
Gold is, at the end, the ultimate, liquid and global currency while being more “robust” to inflation than all the others.
Would you skip the allocation the physical cash and just keep enogh to reach your safe destination?
Also, in regards of actual percentage allocation, what would you consider enough or too much?
I always stood for the conservative 1% to 5% allocation of net worth… do you think the actual percentage might change if your estate is, let’s throw a number, 100K, 10M or 100M?
Hoping to hear your kind response, I wish you a wonderful friday from sunny Liguria.
Bonjour SCB. Thank you for the comment and the questions.
First, I do not give investment advice. However, most investors I know hold 10 to 30% of their portfolio in physical gold. Often in various forms (smaller coins, one ounce gold coins, bars, etc) for ease of liquidity and transport.
Cash is usually 5%, depending upon the portfolio, individual, and country of residence. Good thought on keeping just enough to get out of town, but sometimes capital controls can take effect, making it difficult to liquidate gold.
The higher the net worth, the more numerous the international bank accounts, vault storage facilities, residences, and contingency plans for emergency exits. Most investors I know who are worth over 10M can exit to 3 or 4 countries in a matter of hours and not worry about much. There’s a residence, a friend, a family member, a bank, and a vault, usually all within walking distance of each other (major European cities).
Hope that gives you an idea behind the video conversation. Thanks again. – BGT
Absolutely, nobody here is giving investment advice, just constructive knowledge.
I must say I’m kind of surprised by the high allocation to physical gold: living in Europe I’m used to seeing a lower allocation to “risky” assets like equities than what is the norm in the US, but the percentages you mentioned seems incredibly high even for the local standards.
Maybe it is because my family is still “young” and in the accumulating phase (just at the third generation), but our assets are heavily spread into public and private equity with little percentages in “safe” assets.
Could it be that 50, 100 or 200 years from now our portfolio would look different and similar to what you mention?
I remember I read a couple of comments on some other posts of yours, where there was a very knowledgeable visitor, username OMGM, having a very intelligent conversation with other users on the danger of the counterparty risk:
“Can any of you share ……… owners present at least one share with your name on it?
Can you present any evidence that the shares ……. are registered on your name?
Aren’t they registered on brokers’ name?
Is not the SEC the only owner of “your” shares, stocks ……..?
David, can you name at least ten paintings that gone bankrupt?
Have you ever heard of Odiot silverware gone bankrupt?
Or have you ever heard of E type 61, XK 150 or 1938 BENTLEY 4 1/4 gone bankrupt? “
His quote really struck me and it is still making me reflect on so many things.
On another comment he made a list of very interesting books on finance and history of money that I’m still going through.
What is your experience regarding his sentence?
Since you previously mentioned other investors, what is the most common percentage allocation on risky assets (the ones with counterparty risk)?
Maybe you’ll find my comment a bit annoying, intrusive and technical Byron, but please bear with me, I’m just a young guy really trying to learn as much as I can from centuries of time tested ways a way to “keep it in the family”!
Thank you again for your patience.
SCB.
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Bonjour SCB. Good questions and a good comment. To be sure, OM families have a healthy portion of their portfolio in equities and other assets that are growing annually to keep up with inflation, pay dividends, and increase in value. Gold is a no-brainer way to retain purchasing power, hide and protect wealth, and have instant liquidity. Fine art, less so, but still an ace in the hole if you’re talking about Old Masters or Renaissance household names.
So yes, you are talking about a ‘centuries old’ perspective. Currencies come and go, like it or not. They devalue and/or correct when governments become fiscally irresponsible or when world events overtake the best laid plans.
For you, yes, invest for growth, but plan for preservation should a worst case scenario occur.
“Oh, that could never happen here,” is a fool’s response. As I posted before, I’ve socialized with some aristocrats since living in the French countryside. I’m also talking with wealth managers who are very aware of global government debt, as it relates to GDP, and are parking themselves in a higher percentage of physical gold. And these are guys who love them some financial markets.
Something to think about, and if you’d like to have a personal, off the record conversation about this, let me know. I’ve shared insights with others, and they have benefited.
Thanks. – BGT
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Bonsoir Byron,
thank you for the wonderful explanation that is helping me getting the right perspective.
I’d love to continue the conversation and receive the insights and knowledge you mentioned, please let me know how you prefer to be reached.
Thank you again.
SCB
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I agree with so many points that you made, Byron, especially the importance of adopting a cautious and informed approach, being prepared, situationally aware, and planning for the long term. In addition, preparing for multiple scenarios including worst-case situations while being mindful of the costs associated with holding assets in various asset classes.
Welcome back and Happy New Year, Byron. Glad to see you posting again. Your interview series in Poland is so good, have you considered putting them together into a YouTube playlist on a dedicated channel? Also, I read A Gentleman in Moscow over the holidays based on your recommendation and enjoyed it immensely.
Bonjour Serena, Great to hear from you. Glad you enjoyed A Gentleman in Moscow.
At present, I’m leaving the YouTube channel business to my publisher in Poland. His marketing team really drives things on that end. I am deliberating on how much exposure online I want. Recent security issues here at the chateau have given me cause to pause, if you know what I mean.
Thanks. We’ll talk soon. – BGT
Good morning Byron,
this morning I watched the entire video on wealth preservation, with a lovely coffe, gently kissed by the sun and with your company: thank you.
During the discussion, you mentioned gold and cash… a few questions arose in me.
While I completely agree on allocating a percentage of your estate to gold, I still have doubts on physical cash in other currencies (for the kind of emergency situations mentioned in the interview): in those cases you can always pick up the metal from the vault and sell it for the local currency of the safe place you happen to be.
Gold is, at the end, the ultimate, liquid and global currency while being more “robust” to inflation than all the others.
Would you skip the allocation the physical cash and just keep enogh to reach your safe destination?
Also, in regards of actual percentage allocation, what would you consider enough or too much?
I always stood for the conservative 1% to 5% allocation of net worth… do you think the actual percentage might change if your estate is, let’s throw a number, 100K, 10M or 100M?
Hoping to hear your kind response, I wish you a wonderful friday from sunny Liguria.
SCB
Bonjour SCB. Thank you for the comment and the questions.
First, I do not give investment advice. However, most investors I know hold 10 to 30% of their portfolio in physical gold. Often in various forms (smaller coins, one ounce gold coins, bars, etc) for ease of liquidity and transport.
Cash is usually 5%, depending upon the portfolio, individual, and country of residence. Good thought on keeping just enough to get out of town, but sometimes capital controls can take effect, making it difficult to liquidate gold.
The higher the net worth, the more numerous the international bank accounts, vault storage facilities, residences, and contingency plans for emergency exits. Most investors I know who are worth over 10M can exit to 3 or 4 countries in a matter of hours and not worry about much. There’s a residence, a friend, a family member, a bank, and a vault, usually all within walking distance of each other (major European cities).
Hope that gives you an idea behind the video conversation. Thanks again. – BGT
Good evening Byron,
thank you for the detailed explanation.
Absolutely, nobody here is giving investment advice, just constructive knowledge.
I must say I’m kind of surprised by the high allocation to physical gold: living in Europe I’m used to seeing a lower allocation to “risky” assets like equities than what is the norm in the US, but the percentages you mentioned seems incredibly high even for the local standards.
Maybe it is because my family is still “young” and in the accumulating phase (just at the third generation), but our assets are heavily spread into public and private equity with little percentages in “safe” assets.
Could it be that 50, 100 or 200 years from now our portfolio would look different and similar to what you mention?
I remember I read a couple of comments on some other posts of yours, where there was a very knowledgeable visitor, username OMGM, having a very intelligent conversation with other users on the danger of the counterparty risk:
“Can any of you share ……… owners present at least one share with your name on it?
Can you present any evidence that the shares ……. are registered on your name?
Aren’t they registered on brokers’ name?
Is not the SEC the only owner of “your” shares, stocks ……..?
David, can you name at least ten paintings that gone bankrupt?
Have you ever heard of Odiot silverware gone bankrupt?
Or have you ever heard of E type 61, XK 150 or 1938 BENTLEY 4 1/4 gone bankrupt? “
His quote really struck me and it is still making me reflect on so many things.
On another comment he made a list of very interesting books on finance and history of money that I’m still going through.
What is your experience regarding his sentence?
Since you previously mentioned other investors, what is the most common percentage allocation on risky assets (the ones with counterparty risk)?
Maybe you’ll find my comment a bit annoying, intrusive and technical Byron, but please bear with me, I’m just a young guy really trying to learn as much as I can from centuries of time tested ways a way to “keep it in the family”!
Thank you again for your patience.
SCB.
Bonjour SCB. Good questions and a good comment. To be sure, OM families have a healthy portion of their portfolio in equities and other assets that are growing annually to keep up with inflation, pay dividends, and increase in value. Gold is a no-brainer way to retain purchasing power, hide and protect wealth, and have instant liquidity. Fine art, less so, but still an ace in the hole if you’re talking about Old Masters or Renaissance household names.
So yes, you are talking about a ‘centuries old’ perspective. Currencies come and go, like it or not. They devalue and/or correct when governments become fiscally irresponsible or when world events overtake the best laid plans.
For you, yes, invest for growth, but plan for preservation should a worst case scenario occur.
“Oh, that could never happen here,” is a fool’s response. As I posted before, I’ve socialized with some aristocrats since living in the French countryside. I’m also talking with wealth managers who are very aware of global government debt, as it relates to GDP, and are parking themselves in a higher percentage of physical gold. And these are guys who love them some financial markets.
Something to think about, and if you’d like to have a personal, off the record conversation about this, let me know. I’ve shared insights with others, and they have benefited.
Thanks. – BGT
Bonsoir Byron,
thank you for the wonderful explanation that is helping me getting the right perspective.
I’d love to continue the conversation and receive the insights and knowledge you mentioned, please let me know how you prefer to be reached.
Thank you again.
SCB
I agree with so many points that you made, Byron, especially the importance of adopting a cautious and informed approach, being prepared, situationally aware, and planning for the long term. In addition, preparing for multiple scenarios including worst-case situations while being mindful of the costs associated with holding assets in various asset classes.