I have been an advocate of the permanent portfolio for over 20 years now.  It was probably around 2002 or 2003 when I first read Harry Browne’s little book titled “Fail-Safe Investing”.  I got the honor of meeting Harry Browne in 2004 during the Libertarian Party of Florida’s state convention.

I had the chance to tell him that I really appreciated his political work and that his book on setting up a permanent portfolio was really great.  He was quite kind and told me to send him an email, and he would send me an updated list of funds to consider for the portfolio.  I emailed him after the convention was over, and he replied as promised.

I haven’t exactly followed the portfolio in a rigid way through the years.  I have made modifications.  I have also used the mutual fund PRPFX, which does have some variations of its own.  PRPFX holds Swiss francs and also holds a small amount of silver.

But overall, I have used the permanent portfolio as something of a home base.  There is always a chunk of investments there for relative safety.  Of course, you can never have absolute safety with any investments.

Not Flashy

The hard part about investing in the permanent portfolio (or something similar) is that you will feel left behind at times.  This has been especially true since 2009 when the last major downturn in stocks ended.  To be sure, there have been bad periods since that time, but the overall trend for stocks has been up.

There are so many financial advisors and financial pundits out there who give you some formula for your portfolio.  Sometimes it is just a mix of stocks and bonds that changes based on your age and risk tolerance.  There are surprisingly many people who advocate that you just put everything in a no-load mutual fund or ETF that tracks U.S. stocks if you don’t need the money in the next five years or so.

This strategy has worked reasonably well since 2009 because we haven’t had a major bear market since that time.  The problem is that it doesn’t mean it will keep working well.

I always like to point to Japan – a first-world country – where the stock index peaked in 1989.  It was still down 3 decades later.

If anything even half as bad as that occurred in the U.S., many people would be financially devastated.  It would ruin a lot of plans.

We could also have other scenarios.  In the U.S. in the 1970s, stocks didn’t do well during much of that time while price inflation was raging.  Again, another scenario like that would ruin the retirement plans of a lot of people.

The permanent portfolio is dull and boring until it isn’t.  If we experience a bear market in stocks where the overall stock market goes down about 50% over the course of 2 or 3 years, your permanent portfolio will be looking good.  It may go down during that time, but it will likely be a lot less than 50%.

And one of the great things, if you can stay disciplined, is that you can rebalance the portfolio by selling off some assets that have done relatively well and buying assets that are down in price.

The Gold

The most controversial part about the permanent portfolio is the holding of 25% gold or gold equivalents.  This is why it doesn’t get much attention from the more establishment financial world.

Even here though, there are many more “mainstream” financial gurus who will now recommend holding something like 5 to 10 percent in gold just to level out the wild swings of a portfolio.

This isn’t an all-or-nothing game, or at least it doesn’t need to be.  If you are skeptical about holding 25% in gold and gold funds in your portfolio, you can always just go with 10 to 15 percent.  Just having that amount will add great diversification and help smooth out the wild rides.

War, Inflation, Lockdowns, Political Chaos

A lot has happened just in the last decade.  We have had Trump, Biden, and Trump again.  There has been political chaos.  There have been many wars and conflicts, including in Ukraine and several countries that produce significant oil.  We had COVID lockdowns.  We had a brief but significant period of high price inflation that hit around 2022.

A lot has happened, and it continues to happen.  Stocks have stayed strong through most of this, especially when there are assurances from the Federal Reserve that it will give us easy money when needed.

If you had known in 2009 what would happen – politically speaking – over the next 16 years, you might not have invested in stocks.  If you had known in 2009 what investments would do, you would have put your money in stocks for the next 16 years instead of in the permanent portfolio, if you had to buy and hold.  Actually, you probably would have bought something like Bitcoin when it was $10.

Of course, we don’t know what the future holds, and that is the reason for the permanent portfolio.  We also buy insurance for things because the future is uncertain, and we want some protection.

Overall, the permanent portfolio has done its job well.  There have been big gains over the last couple of years because the price of gold has exploded while stocks have continued to trend higher.

I am fine with a slightly lower return if it means more safety and less anxiety when the next form of political or economic chaos hits.

The permanent portfolio will continue to act as a great home base and something of an insurance policy for our uncertain future.

For anyone paying attention and dealing with the situation honestly, it is apparent that Donald Trump is completely unhinged at this point.  He stepped it up this past week and went to a whole new level of evil.

On Easter Sunday, Trump put out a message that, if Iran didn’t open up the Strait of Hormuz, he would destroy the bridges and power plants in Iran.  He used some course language in the process.

A lot of people shared their disgust that Trump would use the “f” word, especially on Easter.  And maybe this would be an appropriate response for a message that is less consequential.

But using the “f” word on Easter doesn’t come close to the fact that Trump just threatened to destroy the infrastructure of an entire country made up of over 90 million people.  To be clear, Trump wasn’t threatening to blow up bridges that were used within Iran to transport military equipment.  He was threatening to blow up all of the bridges in Iran.

To follow up on his social media post, the next day Trump threatened to destroy an entire civilization.

Even if Iranian officials had been the ones to start the war (which they weren’t), and even if Iranian officials were making similar threats (which they weren’t), these words from Trump are unacceptable and pure evil.  He was threatening an entire civilian population with death and destruction.

The Supposed Ceasefire and Emboldening Trump

Just before Trump’s self-imposed deadline, he announced that there was a ceasefire for two weeks and that Iran’s 10-point proposal was a good start for negotiating.  Apparently, Israel didn’t get the memo and kept up the attacks, at least on Lebanon.

There was certainly a big sense of relief throughout the planet because most people didn’t want to see an entire civilization wiped out.

There was one bad thing I saw from this ceasefire.  If Iran capitulated because of Trump’s threats, then it could just embolden Trump even more (if that’s possible).  Trump is already psychotic enough.  If he thinks he just needs to threaten total annihilation to get his way on things, then he is more likely to do so in the future.

The good news is that I tend to think that Trump did not really get his way.  I am almost starting to wonder whether Iran even really agreed to a ceasefire and opening up the Strait.  We certainly can’t trust what is coming out of the mouth of Trump or anyone in his administration.

Perhaps Trump had a moment of sanity and realized that it wouldn’t be good if he tried to wipe out an entire civilization.  Or maybe it was all talk from the beginning.  Maybe some of his idiot and evil advisors realized that Iran would unleash missiles all over the Middle East and would destroy a lot more.  They realized that $200 oil wouldn’t be a good look.

I don’t know if the Prime Minister of Pakistan really did anything at all other than serve as a messenger.  He offered a way out for Trump, or Trump found someone who was willing to go along with him.

The 10-Point Plan

The 10-point plan that Trump referenced had already been on the table for a couple of weeks before this.  Maybe it seemed like a new plan to a lot of people because the U.S. establishment media didn’t report about it much.

For Trump to even say that this is a starting point is to admit defeat.

This proposal from Iran states, among other things, the following:

• The U.S. would withdraw combat forces from all bases in the region.
• Iran would be paid reparations for war damages.
• Iran would have the right to nuclear enrichment.
• All sanctions against Iran would be lifted.
• Iran would maintain control of the Strait of Hormuz.

This is unbelievable.  If anything close to this proposal goes into effect, it would be a total defeat for Donald Trump and the U.S. empire.  To be sure, it would probably actually be a long-term win for the American people if U.S. forces exited the Middle East.

Trump is the one who threw out the JCPOA that was put in place when Obama was president.  That agreement allowed inspections of Iran’s enrichment to make sure they couldn’t get a nuclear weapon.  It didn’t include anything like having all U.S. forces leave the region.  It didn’t include giving Iran control over the Strait of Hormuz.

Great negotiation there, Donald.  You tore up Obama’s deal in order to get a much worse deal, at least in the eyes of the U.S. empire.  Maybe this really is 5D chess and Trump was determined to play the role of buffoon in order to diminish the power of Israel and the U.S. empire.

The Fallout

Iranian missiles have likely destroyed or severely damaged many of the U.S. bases in the region.  Now would be as good of time as any to bring U.S. military forces home.

Again, this would be a major loss for the U.S. empire and a major win for the average American.

If anything close to this happens, expect the war hawks to turn on Trump.  Trump won’t have much of a base left.

Tucker Carlson finally fully turned against Trump.  Tucker Carlson had been critical of the Trump administration’s policies while going out of his way to not personally criticize Trump.  He probably thought that he was the only person left who opposed the war machine who still had Trump’s ear.  But he finally had enough after Trump threatened to destroy an entire country.  Not only did Tucker criticize Trump directly, but he essentially said he was working against Christian values.  Some are saying that Tucker was suggesting that Trump was the anti-Christ.

When the likes of Lindsey Graham and Mark Levin also turn against Trump (who have been never-Trumpers since 2015), he will be a lonely man.

Trump is a pathetic human being, and he will deserve going down in history as pathetic and evil.  He made these choices.  He chose to attack Thomas Massie and MTG.  He chose to listen to the war hawks and attack Iran, Venezuela, Syria, Yemen, Nigeria, and others.  He let his ego and lust for power get in the way of good decision making.

Hopefully we can get out of this conflict without too much more damage being done.  If the U.S. empire is severely weakened because of it, then the world will be better off.

Since the U.S./ Israel attack on Iran, U.S. stocks have been more volatile.  They had periods of high volatility in 2025 with tariff announcements, and now the war has brought the volatility back.

One of the big concerns for investors is the price of oil.  On days where it seemed like there was a possible end in sight to the conflict, oil would generally go down and stocks would generally go up.

On days where threats were intensifying and the oil price would go up, then stocks were more likely to take a fall.  It hasn’t been a perfect correlation, but this has been the trend.

Interestingly, gold investors have not been rewarded during this conflict, at least to this point.  The price of gold (in terms of dollars) has generally gone down as tensions have gone up.  This seems to break the narrative that gold is a safe haven and generally goes up during times of uncertainty.

Higher Oil Prices

While the price of oil is bad for our living standards, it doesn’t necessarily have to be bad for stocks. Obviously, energy companies could benefit just because of the higher prices for energy.  Of course, companies operating in the Middle East could be hurt badly.

But if you are a company that drills for oil in the United States, then you are doing much better, financially speaking.  At least for now, you are paying the same prices to extract oil, but you get to sell it at a much higher price.

The problem is for all of the other companies that get hurt by higher oil prices because it means higher expenses.  This seems to be the main reason that stocks, in general, are going down in response to higher oil prices.

This also impacts consumers.  If you have to pay more to fill up your car with gas, then you won’t have as much to spend on other things.  Maybe you won’t buy that expensive sweater.  This means lower profits for the clothing company.

This is why higher oil prices alone is not generally inflationary in the long run.  Higher oil prices make some things more expensive, but it means people have less money to spend in other areas.  This can actually drive down other prices.

The only way you can have a sustained inflationary environment is by having more money in the system.

Stocks, War, and Inflation

Wars being fought overseas has not necessarily been bad for U.S. stocks.  Let’s look at Iraq and Afghanistan.  U.S. stocks performed poorly from 2000 to 2002.  This was the crash coming off of the tech bubble.

The war in Afghanistan started in late 2001.  The war in Iraq (or the bigger phase of the war that was started in 1991) started in 2003.  Stocks actually went up after the war in Iraq started in 2003.  They went higher until the financial crisis of 2008.

When wars are being fought in other parts of the world, they don’t seem to have that much impact on U.S. stocks.  They are quite beneficial for the military-industrial complex.  If anything, wars can actually be beneficial for stocks in general because they are inflationary.

The U.S. is able to fight expensive wars because of the central bank’s ability to create money out of thin air.  If taxpayers were told they had to pay for wars with higher taxes, then the wars probably wouldn’t happen or would not last as long.

When new money is created, it does have a tendency to drive prices higher.  This includes asset prices.  Stock investors often benefit with the inflationary environment.

War in the Middle East

The war in Iran could be a bit different than what we have seen in recent decades.  The war in Iran isn’t just in Iran.  Israel is getting hit hard by missiles.  U.S. military bases are getting hit hard throughout the Middle East.  While the U.S. establishment media hasn’t covered this much, there are reports that there has been extensive damage to U.S. bases.

Iran has also been able to fully control the Strait of Hormuz and stop the shipping of oil from any countries that are not considered friendly.

There are discussions about the U.S. possibly exiting the war, but it doesn’t end the problems.  Iran can keep firing missiles.  Iranian officials will continue to keep the Strait restricted until it gets some assurances that it won’t be attacked again anytime in the near future.

In other words, this is a different animal from the war in Iraq.

At the same time, as with virtually all wars, this war will be inflationary.  There was already a major spending problem in Washington DC.  We could be seeing trillion-dollar deficits over the course of 3 or 4 months.

Tug-of-War in Stocks

There are a lot of different things happening to pull stocks in different directions.  The same could be said for gold.

It’s easy to forget that there was an inverted yield curve in 2023 and 2024.  It has gradually normalized.  This is a warning sign of a recession, which we obviously haven’t seen yet.

Will this economy defy the inverted yield curve?  Or will the economy fall into recession regardless of what is happening in the Middle East?  Will the added inflation from war spending delay us from going into recession and prop up stocks?

If we do go into recession, the higher oil prices from the war will get the blame.  But perhaps it was baked into the cake already.

There are a lot of major factors going on here.  We have a recession threat and higher oil prices threatening stocks.  But we also have monetary inflation pulling stocks in the other direction.

The economy is complicated enough without a major war and disruption in the flow of oil.  One thing that is likely is that we will continue to see high volatility in the stock market.