They may be biased, but specifically regarding the period of rising interest rates like in the 70's, stocks didn't do well. The other period of high inflation was the 40's, and that was just after a World War and we were still on the gold standard (technically) so whether that's an appropriate analogy is questionable. Considering that now we're at a record high valuation of market cap to GDP, is someone who is buying the index now going to keep up with the coming inflation? That's up for debate. But either way, no one says to put everything in one asset class - it's about having a mix of assets to hedge for different scenarios. With low, predictable inflation sure stocks probably outperform gold. But in a scenario where there are serious questions about the future of fiat, having exposure to hard assets starts to make sense. Will FAANG cashflow be keeping up with inflation AND all the growth expectations built in when people are more worried about putting food on the table than virtue signaling on social media?
The point about taxes is very valid and definetely a factor to consider, I'm sure there are various loopholes out there with a creative accountant, and there are supposedly some metals funds to invest in that allow you to avoid the collectibles tax. Many metals stackers are prepper types who are preparing for the death of fiat and so don't view capital gains taxes as relevant.
We had inflation in the 70's and the dollar only survived because we had the political will to take the pain of high interest rates with Volker. Could you imagine that happening now? Highly doubtful given the extreme debt and insolvency, or at least they will wait until fiat looses 75% of its value, and only then raise interest rates once debt level shrink to a more manageable ratio to GDP. This is what Luke Gromen thinks will happen.
The brain surgeon's 401K is doing fine in 2020, sure, because the big tech firms that make up a huge proportion of the index benefitted the most from the lockdown. Are we sure that this is going to continue in the future if there is a shift from disinflation to inflation? And is it healthy that just to hold onto their purchasing power savers are forced to put their money in the index and deal with the stomach churning volatility while zombie corporations get loans far below what a non-manipulated market will give them? Additionally, Michael Burry has warned about passive investing causing price distortions in the economy. Obviously as an hedge fund guy he's biased but we won't really know until it's too late.
Would suggest checking the Bitcoin thread and other political threads if you are so confident in the system and the power of the elite. We're having an ongoing conversation on this forum about civil war and secession in the US and the need to rebel against the evil globalists - under those conditions having 100% faith in fiat seems a bit strange. The Bitcoiners are extreme as well, but any major change requires its fanatical vanguard. The fact that people are saying 'government will ban it' is a tacit admission that Bitcoin is superior to fiat and that in a free system people don't want to save in depreciating currency and don't want financial repression.
I think we both believe in diversification though, and the generalist investor shouldn't be a fanatic and go al-in on any one asset class.
