Fool-Proof investments for the Future

What Will Hold Value in the Future?

Short answer: No single asset is guaranteed to preserve value across decades. The best strategy is a diversified mix of assets whose value comes from different pillars: scarcity, productive cash flows, social consensus, legal protection, and real-world utility.

Key ideas

• Value rests on three pillars: utility, scarcity, and trust. Survivors usually have at least two.
• Regime changes break backtests: past decades were defined by globalization, cheap energy, and falling rates. That may not persist.
• Liquidity is cyclical: in crises, it concentrates in the safest collateral and evaporates elsewhere.
• Portability and seizure risk matter in tail scenarios.
• Carrying costs compound: storage, taxes, insurance, maintenance, obsolescence.

Critique by Asset Category

1) Monetary metals (Gold, Silver, Platinum Group Metals)

Scarce, No counterparty, Liquid

• Bull case: Millennia of monetary use, global liquidity, low tech risk, hedge vs. fiat and geopolitics.
• Bear case: No yield, storage/insurance costs, sensitivity to real rates, possible taxation/confiscation risks.
• Outlook: Gold remains a core hedge; silver is more cyclical/industrial; PGMs carry tech/regulation risk.
• Takeaway: Keep a strategic slice; avoid overconcentration.

2) Broad equities (global, quality, dividend growers)

Productive, Inflation pass-through

• Bull: Ownership of cash flows, innovation, long-run real returns, liquidity.
• Bear: Valuation/multiple risk, concentration in mega-caps, sequence risk during draw downs.
• Outlook: Still the long-term engine; emphasise quality balance sheets and reasonable valuations, diversify globally.
• Takeaway: Primary growth driver alongside stores of value.

3) Real estate (residential, farmland, timberland, prime industrial)

Tangible, Cash-flowing

• Bull: Inflation-linked, local scarcity, potential tax advantages; farmland/timber have biological yield.
• Bear: Illiquid, leverage/interest-rate sensitive, property taxes, climate/insurance risk, local dynamics.
• Outlook: Favour quality-located residential, industrial/logistics; farmland with secure water rights; office remains bifurcated.
• Takeaway: Be selective, keep leverage modest, underwrite climate resilience.

4) Energy & critical commodities (oil/gas, uranium, copper, lithium, nickel)

Inflation hedge, Macro-sensitive

• Bull: Energy is foundational; electrification and AI/data centers raise power and grid metal demand; uranium renaissance.
• Bear: Cyclicality, policy/regulatory risk, substitution, geopolitics, environmental liabilities.
• Outlook: Structural support for copper, grid metals, uranium; oil/gas vital through transition with volatility.
• Takeaway: Prefer diversified producers, royalty/streaming, or indices to reduce single-asset risk.

5) Cash, T-bills, high-grade bonds

Liquidity Ballast

• Bull: Optionality, low volatility, recession/deflation protection, collateral value.
• Bear: Inflation/debasement risk; duration pain if inflation is sticky.
• Outlook: Useful for dry powder and stability; favour short duration unless strong disinflation view.
• Takeaway: Maintain an emergency/opportunity reserve.

6) Bitcoin and digital assets

Programmatic, scarcity, Portable

• Bull: Seizure-resistant if self-custodied, cross-border portability, growing institutional access.
• Bear: Extreme volatility, regulatory/protocol risks, liquidity-cycle dependence.
• Outlook: Credible high-volatility store of value for top four alongside gold; broader crypto much riskier.
• Takeaway: If included, size small; secure custody; be able to withstand 70–90% drawdowns.

7) Collectibles and cultural assets

Scarcity, Taste driven

• Bull: Non-financial enjoyment, low correlation in normal times; top-tier pieces can appreciate.
• Bear: Tastes shift, illiquidity, high fees, provenance/forgery risk, storage/insurance costs.
• Outlook: Market polarized to ultra-top-tier and culturally resonant modern categories; “antiques” broadly have lagged.
• Takeaway: Treat as passion, not core store of value.

8) Human capital, skills, and optionality

Highest ROI, Regime resilient

• Bull: Drives career income, adaptability, and agency; compounds regardless of markets.
• Bear: Industry/geography concentration; health risks.
• Outlook: Durable domains: AI/data, cybersecurity, energy systems, biotech, climate adaptation; mobility and languages add resilience.
• Takeaway: Always invest here; it complements financial assets.

9) Specialty “resilience” assets

Utility, Local scarcity

• Examples: Water/timber rights, productive smallholdings, backup energy, tools.
• Bull: Real-world usefulness in disruptions; sometimes cash-flowing.
• Bear: Local legal/regulatory complexity; management burden; illiquidity.
• Takeaway: Consider if aligned with your location and lifestyle.

What’s Likely to Be Coveted in the Next 10–30 Years

• Core stores: Gold (and selectively silver) for monetary hedge; a modest Bitcoin allocation for portability and debasement hedge; high-quality bills/notes for liquidity.
• Productive assets: Diversified global equities tilted to quality/profitability; exposure to energy, mining, midstream, and royalty companies.
• Resilient real estate: Supply-constrained, economically dynamic, climate-resilient residential; farmland with secure water; select industrial/logistics.
• Critical materials & infrastructure: Copper, uranium, grid/electrification supply chains via diversified vehicles.
• Human capital & resilience: Education in AI/data, energy systems, cybersecurity, biotech; healthspan; geographic optionality (language, residency/citizenship planning).
• Select collectibles: Only top-decile, culturally enduring pieces with clear provenance; small allocation and expect illiquidity.

Illustrative Resilient Allocation

This is educational, not financial advice. Tailor to your time horizon, jurisdiction, and risk tolerance.

• Long-term core (60–80%): Global equities diversified by region and factor; high-quality bonds/treasuries (short to intermediate duration per your inflation view).
• Real assets hedge (10–25%): Gold (physical or vaulted), commodity exposures (energy, copper, uranium), and/or real estate/farmland where feasible.
• Optionality/convexity (0–10%): Bitcoin (possibly ETH if you accept smart-contract risk); long-volatility or tail-risk sleeves if accessible.
• Liquidity (5–15%): Cash/T-bills for life events and buying during drawdowns.
• Human capital: Ongoing spend on skills, tools, and health.

Risk Controls and Practical Tips

• Diversify across value pillars: financial, hard, digital, and human capital.
• Minimize leverage on cyclical/illiquid assets.
• Custody matters: vaulting choices, Bitcoin self-custody practices, real estate title/jurisdiction rule of law.
• Tax efficiency: use tax-advantaged accounts where available; know collectibles tax treatment in your country.
• Rebalance periodically to enforce buy-low/sell-high.
• Scenario test: inflationary boom, stagflation, disinflationary recession, energy shock, geopolitical fracture.
• Match allocation to horizon: for sub-5-year needs, prioritize liquidity and low volatility.

What to avoid over-relying on

• Single narratives or maximalism (all-gold, all-crypto, all-tech).
• Illiquid collectibles as a retirement plan.
• Long-duration bonds without a strong disinflation view.
• Overleveraged real estate in climate/insurance-stressed regions.
• Esoteric private funds you can’t price or exit.

Other ideas

Share your time horizon, jurisdiction, risk tolerance, and current allocation. I can suggest maps from this framework to specific implementation options (e.g., ETFs, custody choices, position sizing) tailored to you.  Please note that noting in this page constitutes financial advice. 

Chinese version of this post also available.