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«Money is one of the greatest instruments of freedom ever invented by man». So beginnt der aktuelle Newsletter des erfolgreichen Portfolio Managers Incrementum (Englisch).

Friedrich August von Hayek
Friedrich August von Hayek was an Austrian (-British) economist and philosopher who shared the 1974 Nobel Prize in Economic Sciences with Karl Gunnar Myrdal.

Money as an Instrument
«Money is one of the greatest instruments of freedom ever invented by man.» With this quote Friedrich August von Hayek claimed that money in our existing society opens an astounding range of choices to the poor man, a range more significant than that not many generations ago was open only to the wealthy.

I could not agree more, however, depending on where and in what social context one was born, obtaining a minimum amount of money may still represent a significant challenge that should not be underestimated. One question I would have for Mister Hayek is if more money means more freedom to him? Although we live in a world of monetary expansion, I do not feel «freedom» expands at the same magnitude, if at all. Now, I know it is a question of definition. The question is, what does freedom mean to the individual?

Your Feedback
Ladies and Gentlemen, thank you very much for your positive feedback to my last weekly mail, «No Stopping for the Prophets of Doom». I would like to share the following feedback with you because the statements coincide with my thoughts:

«I never saw volatility as a risk (if you do not sell when prices are low, you cannot crystalise the loss). In my view, the biggest risk for investors (which by definition I take to mean long-term capital allocators with a desire to build multi-generational wealth) is politics: changes in regimes. For example, far more dangerous is a shift in legal systems from a set of values that respects private property to one that does not - this, in my opinion, is a greater risk than fluctuations of prices because it has the genuine chance of forever destroying wealth for some people.»

And:
«As long as the risks that these doom prophets are trumpeting about are market vicissitudes, there should be a little worry. After all, if money moves out of stocks and their prices go down, they will go into other asset classes until the panic passes and then back into equities, as they usually do.»

Quelle: Incrementum AG