I have many vices, but listening to talk radio (Internet or otherwise) is not among them. Reading Chris Waltzek’s Wealth Building Strategies in Energy, Metals, and Other Markets (Wiley, 2010) doesn’t tempt me to change my mind. Waltzek is the host of Goldseek.com Radio, a weekly two-hour broadcast. He has thousands of enthusiastic followers, some of whom have written glowing reviews of this book on Amazon.
Well, it’s certainly different from the run-of-the-mill investment book. Where else can you read about survivalist techniques to ensure against food shortages and rationing, commonplace in times of rampant inflation? If you really want to know, “a home-based safety net can be purchased for less than $5 per week, by simply adding a few canned items and/or a 5 lb. bag of rice to the grocery store shopping cart on each visit.” (p. 79) And then there’s the home garden, which I happen to have but never viewed as a key to survival in the event of runaway inflation. Waltzek even explains how to grow potatoes which, “pound for pound of yield, … requires 75 percent less garden space than does grain or rice.” An interesting statistic, but how many home gardeners grow grain or rice? Perhaps more telling, “Since potato tubers grow underground, unlike tomatoes, corn, and so on, hungry neighbors are far less inclined to borrow a meal without express written permission.” (pp. 79-80) He also recommends replacing credit cards with a cash emergency fund, best kept in a fireproof home safe in the event of a prolonged bank holiday.
It is within this “build the bunker” framework that Waltzek recommends investing in precious metals (especially silver) and energy. “Thanks to Fed monetary gamesmanship the greenback has relinquished 99 percent of its purchasing power since the unconstitutional Federal Reserve seized control of the national money supply.” (p. 47) The United States is following a monetary path similar to Voltaire’s France and risking Voltaire’s doomsday prediction: “Paper money eventually returns to its intrinsic value—zero.”
Waltzek also devotes considerable space to the housing crisis and offers rules of thumb that “every home hunter needs while stalking real estate prey” in 2012. And for those not familiar with Sun Tzu’s The Art of War and the uninspired Sun Tzu’s Art of War for Traders and Investors, Waltzek provides a few summary points.
“Standing on the shoulders of the great philosopher and mathematician, Vilfredo Pareto, as well as Taleb and Mandelbrot,” the author presents his major theoretical contribution: the Pareto-Waltzek Hypothesis. It comes in the form of two rules. First, “although prices typically gyrate in a random manner, eventually all markets enter protracted trends.” (p. 10) And second, “all primary market movements (trends) are the result of at least one fundamental event, the significance of which is rarely recognized at the time.” (p. 13) Punkt.
If you are anti-government and anti-Fed, and if you think it’s essential to prepare for a financial Armageddon, you may like this book. If you really want to learn about commodity investment strategies, much better alternatives are available.