Now, about your specific concerns. You’re right about bitcoin’s volatility and the S&P 500’s track record, but you’re missing the allocation context. I’m suggesting 10% in bitcoin and 10% in gold and silver as portfolio insurance — not a religious conversion.
But you still need professional guidance to navigate this rigged game. Find a financial planner who’s kept clients solvent for at least 10 years. Check references.
Given this track record, I don’t give investment advice. I write about what I see in markets based on three decades of watching them separate fools from their money.
I’ve spent 30 years watching financial markets operate like organized-crime syndicates, except the mob delivers what it promises. When they say your portfolio will sleep with the fishes, at least the fishes are well-fed.
Thank you for the email. Your skepticism reflects the kind of financial discipline that keeps people from chasing unicorns off cliffs.
I get that government debt is high, but people have predicted dollar doom for decades while being consistently wrong. Japan has 200%-plus debt-to-GDP and they’re managing fine. What makes this time actually different?
Your U.S. dollar DXY collapse predictions sound exactly like what I’ve been hearing since business school. The dollar weakened in the 1970s but came back stronger. It rallied 20% during 2008 despite the crisis starting here. Every time there’s global uncertainty, money flows to dollars, not gold or crypto.
You keep pushing bitcoin as some kind of salvation, but it crashes 75% regularly. How is that better portfolio management than just owning the S&P 500 SPX? The U.S. stock market has delivered 10% annually and come through every crisis you’re worried about — the Great Depression, World War II, stagflation, 2008, COVID-19.
I read your latest piece about BlackRock BLK backing gold GC00 and bitcoin BTCUSD, and Jeffrey Gundlach recommending gold. You make me laugh, which is why I follow your columns , but I still have serious issues with this thesis.
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Keep 80% in traditional investments. This isn’t abandoning proven wealth building; it’s acknowledging that proven wealth builders need protection from proven wealth destroyers.
Yes, bitcoin crashes 75% regularly. It also has compounded at 60% annually over its entire existence — the financial equivalent of a great white shark in a swimming pool full of goldfish.
The volatility that terrifies you is exactly what feeds the returns. You can’t have one without the other — it’s like wanting fire’s warmth without its capacity to burn.
Your dollar-resilience argument worked when America’s debt was 70% of GDP. Today it’s 120% and climbing toward 200%. By 2030, interest payments alone will consume 20% of federal revenue.
China has already reduced its Treasury bond holdings to $731 billion from $1.32 trillion — the lowest level since December 2008. When one of your biggest creditors starts heading for the exits, that’s not a fire drill — it’s a fire.
The S&P 500’s 10% historical returns occurred when governments occasionally pretended fiscal responsibility existed. But here’s the real question: Why own the entire index? It’s like ordering a tasting menu where seven dishes are Michelin-starred and 493 are reheated airport food.
The so-called Magnificent Seven big tech stocks represent 33% of the S&P 500’s weight but delivered 63% of its gains in 2023. The Roundhill Magnificent Seven ETF MAGS returned 64% in 2024, versus the S&P 500’s 25%. These aren’t just seven large-cap stocks — they’re trillion-dollar fortresses with technological moats that widen every quarter.
Speaking of slow-motion disasters disguised as stability, let’s discuss Japan. They’re not “fine” — Japan is a cautionary tale in a business suit. Three lost decades, 1% GDP growth, wages moving backward. Japan survived the way zombies survive: technically not dead, but nobody wants to be one.
Here’s the critical difference: Japan had deflation, the U.S. has inflation. Japan robbed grandmothers who were too polite to complain. America’s trying to rob Chinese central bankers who’ve already called the cops.
Japan had captive domestic savers with 20% personal-savings rates buying bonds at zero percent. Americans save 5% and keep wealth in stocks that demand returns. When your creditors are walking away instead of rolling over, you can’t run the Japanese playbook.
When BlackRock starts backing bitcoin and gold, when DoubleLine’s Jeffrey Gundlach—the “bond king” himself — recommends a 25% gold allocation, they’re not following conspiracy theories. They’re following mathematics. The real scheme is believing a government burning $2 trillion annually that it doesn’t have will avoid debasing your savings to pay its bills.
So here’s how you protect yourself without chasing unicorns: 60% in equities (the Magnificent Seven and a few high-dividend compounders, not the entire zoo). Put another 10% in bitcoin, 10% in precious metals and 20% in income strategies that don’t require Federal Reserve life support — details I’ll explain in future columns about how to get paid while everyone else gets played.
This isn’t abandoning conservative principles. It’s conserving purchasing power when conservative no longer means what it used to.
From the bunker,
Charlie
P.S. History shows that when Wall Street discovers assets it spent decades dismissing, the smart money has already left. The only question is whether you’ll follow before the door closes.
Dear Charlie,
Great piece on MarketWatch. It made my day. Your metaphors were brighter than a sunset in Carmel and I live in dreary southeast Kansas!
SF Retired Marine
Dear SF,
Thank you for the kind words. When a Marine finds financial metaphors entertaining, that tells me my analysis still has some bite. But comparing anything to a Northern California sunset while retired in Kansas suggests either excellent perspective or the kind of optimism that gets people through boot camp.
Since you signed SF (Semper Fi), I should mention I’m a retired Air Force officer who completed U.S. Marine Corps Command and Staff College, where I learned that everything the Air Force considers a tactical challenge, the Marines call “Monday morning.” I also started a hedge fund called Leatherneck Partners with Marty Schwartz (you might remember him from the book “Market Wizards”), the legendary trader and former Marine whose license plate read “Pitbull.” If you haven’t read his book “Pit Bull: Lessons from Wall Street’s Champion Trader,” I highly recommend it.
My days in combat convinced me that hoping bad situations will fix themselves is about as effective as wishing for world peace while loading your rifle. Financial markets operate on similar principles, except the casualties are portfolios instead of people.
Thanks for your service and stay sharp out there in Kansas — at least your cost of living isn’t competing with Carmel real-estate prices, where they made Clint Eastwood mayor so Dirty Harry could get permission to renovate his own house.
Semper Fi,
Charlie
P.S. If a piece about monetary collapse can brighten a Marine’s day in Kansas, either I’m doing something right or we’re all in deeper trouble than I thought. Probably both.
He holds positions in gold, silver and bitcoin.
More from Charlie Garcia:
When the world’s largest asset manager and the ‘bond king’ both agree — run to gold, silver and bitcoin
And now for Washington’s next trick — sawing the dollar’s value in half
America’s key lenders are snubbing Treasurys for gold — putting your 401(k) at risk. Here’s what to do now.
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[SRC] https://finance.yahoo.com/news/people-keep-pushing-bitcoin-crashes-220900381.html
