How do you invest during times of war? Do you change investing strategy during periods of heightened geopolitical tensions? These and similar questions need to be asked by wealthy people and those wishing to become wealthy.
The risk, the real risk, is not understanding that there is only one possible outcome that matters. A story on Wall Street about the Cuban Missile Crisis illustrates the matter perfectly.
A young stock broker and an old stock broker watched as the Cuban Missile Crisis reached a critical point. President Kennedy went on TV to inform the American people that 50 Soviet cities were targeted for a nuclear strike if the Soviets tried to run the blockade.
Wall Street was nervous as stocks started to fall from fear. The young broker screamed at the old broker that he needed to sell everything.
The old, seasoned broker sat back in his chair and calmed said, “Buy.”
“What!” the young broker was incensed. “If the nukes fly we will lose everything!”
The old broker repeated calmly, “Buy.” He then smiled, “If the crisis is resolved stocks will rocket higher; if the missiles are launched the trades will not clear.” He smiled again, “Buy.”
Now we face another crisis where nuclear war is a possibility. It could be the end of everything. Or, it could be something much better, with a much brighter future. And this is where the Fermi Paradox comes into play from the field of astrophysics.
What is the Fermi Paradox and. . .
Enrico Fermi and three co-workers at the Los Alamos National Laboratory began an interesting lunchtime discussion over the summer of 1950. It was becoming apparent (and is more so now than ever) that the universe is so large and with so many stars, and likely even more planets, that aliens must exist.
The universe is vast. Really, really vast! We know life is possible because we are here. If it can happen here it must happen elsewhere. A lot.
This leads to a big questions, “Where is everybody?”
If life is so common, or at least should be, and some of that life must be intelligent, and some of that intelligent life certainly must be more advanced than us (unless by some fluke we are the first), then why haven’t we seen or heard from aliens?
There are a variety of answers and the list keeps growing. One of the most concerning answers is that there is some sort of great filter that snuffs out intelligent life before it gets too far. If there is a great filter it must be in our future or we would not be here.
The list of problems that could wipe out humans include, but is not limited to: nuclear war, climate change, artificial intelligence, bioweapons and disease. All serious issues with potential existential implications.
The Fermi Paradox leaves a hollow in the chest. It isn’t hard to imagine one human, just one in the right place and the right time, willing to push the button and then *poof* the story of the human race evaporates into the history books no one will ever read. Any new intelligent life “out there” will never see or hear from us. The Great Filter has spoken.
. . .How Does it Affects Wealth
Of course, things might not be so bleak. It is easy to jump to the worst conclusion. There are so many things that can wipe us out and we seem more than willing to do it to ourselves as well. Yet, we have survived the nuclear age for close to 80 years. (Yes! It has been that long.)
There might not be a filter of any kind. Some intelligent life may end their existence, but surely if it is so pervasive some intelligent species somewhere must have found a way to the other side. And humans have proved resilient cusses. We could be the exception to the rule.
There are more logical answers to the Fermi Paradox. Space, once again, is vast. Getting from here to there is no Star Trek episode. Even a lifetime is likely insufficient. Sending a message has a speed limit. A message to our closest neighbor, Proxima Centauri, if they exist and are intelligent enough to pick up the message, would take 4.246 years to get there and the same amount of time to get their answer once they sent it.
Another answer to the Fermi Paradox, before we move on to a discussion on how to profit from this, is that intelligent life doesn’t want us to know they are there. A sort of Star Trek Prime Directive. Or, it might be wise to keep things a secret in a violent universe.
Out technology is changing. We communicate differently now than in the past. Word of mouth or snail mail were the fastest forms of communication two centuries ago. The telegraph sped that up a lot and the telephone even more. Radio and television took communication to the masses.
Today we have almost instant access to information via computer news outlets and social media. It is hard to imagine what it was like a handful of generations ago when a war in Ukraine would take a week or longer to become local news.
Caution, not Fear
Fear motivated the young broker at the open of this post to make an emotional, and might I say stupid, decision. We don’t feel the fear of 1962. It is history and we know the outcome. We know the old broker was right.
If this time really is different and the button is pushed, there is nothing 99.99999999998% of readers here can do to stop it. The old broker is always right. And if there is no great filter then it is even more foolish to sell over any geopolitical event.
Prudent Behavior
All this said, there is a chance the button gets pushed. Steps should be taken to protect ourselves and our families should that happen.
But more likely than a species ending holocaust is a short-term weather event or other natural catastrophe. You can prepare without becoming Polly Anna.
I will share a few items you may wish to have at hand. Amazon has changed the way I am allowed to link products I recommend. I will provide a list of things to consider using an Amazon Native Ad. You can use the search bar in the ad for items on the list. The first item is pre-inserted. This is an affiliate link.
During a crisis basics can become unavailable for days or even weeks. Some things, and information, are best in hard copy, as the internet might not be available.
Here are a few items that are vital if the button gets pushed and can help in natural disasters as well:
- Book: Nuclear War Survival Skills. (Helpful in a variety of other ways. A must if the missiles fly.)
- Book: If the Universe Is Teeming with Aliens … WHERE IS EVERYBODY?: Seventy-Five Solutions to the Fermi Paradox and the Problem of Extraterrestrial Life (Science and Fiction) by Stephen Webb (Because speculation is fun!)
- Emergency Hand Crank Radio Solar Charging, 5000 AM/FM/SW/NOAA Weather Alert Radio with LCD Display, Phone Charger, Camping Flashlight, Read Lamp&SOS, Portable Survival Kits Radio for Emergency Home. (I recently bought an emergency shortwave radio just in case. It is cheap and could make a serious difference in a crisis. The best way to pick up broadcasts is to use a coil of wire. Stretch the wire 150 feet in either direction and use a roach clip to attach to the antenna. You can pick up stuff around the planet with this setup. Fifty feet is still a pretty darn good antenna. Small works, but if you are a geek like me, bigger is better. I want to pick up the aliens. In case Fermi was wrong.)
- Hanchen Nuclear Radiation Detector Geiger Counter Dosage Alarm Device Dosimeter Monitor Portable Digital Meter High Sensitivity Accuracy. (This is a low cost radiation detector. Good to test for radiation around the home (radon in the basement) and a lifesaver if the unthinkable happens.)
Coda
You should not live your life in fear. Preparation is intelligent, no doubt. But living in fear is a waste of time.
Prepare to protect yourself and family. Then live life as you always have. Your investment strategy should not change due to geopolitical events!
In all but the rarest of cases, emotional decisions do more harm than the event, if it even happens. More wealth is lost over fear of that which has not come to pass.
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