Jin+Guice wrote: ↑Wed Jul 27, 2022 2:38 pm
Confiscation vs. sequence of returns risk: Aren't I mitigating sequence of returns risk to a certain extent by continuing to work?
I'd say that is correct. From what I gathered you only plan on fully retiring only in case of infirmity. In that case your stash is a kind of floating insurance. However, this would seem to imply that you do not know when you'll be drawing from your stash. This argues for large cash positions and/or long volatility (see the Dragon Portfolio). It was switching over 20% of my paper portfolio to long vol and having that tucked into my Roth IRA that I finally felt peace with my equity exposure.
Jin+Guice wrote: ↑Wed Jul 27, 2022 2:38 pm
For those of you who are worried about confiscation, what would you do in my position on July 27th, 2022 to mitigate this risk?
In short, broadly diversify as much as possible, including branching out into physical goods. There is so much plunder to be had in digital wealth, and it is all so conveniently laid out for the taking, that it will be a while before they get to physically held stuff, especially for those who stay under the radar. Another strategy is to be so wealthy that you can get away with anything. . . This would be flying over the radar, I suppose.
Physical cash -- actual dollar bills ya'll -- is among the easiest physical stores of wealth to get your hands on (for now). And yes, you would be forfeiting the difference between what you would get from cash equivalents and the full rate of inflation, but you gain a measure of protection against bail-ins and some bonus protection against cyber attack. For the really paranoid, the "real" cash can be seen as a buffer during the first part of a crisis before you have go to real goods.
Other than that, "lifetime supplies" are best -- that way you never get hit by a higher price by restocking later. Stuff I bet an average, stationary ERE practitioner could store a life-time supply for: razors, metal fasteners (screws, nails), saws, drill bits, chisels, sharpening stones, hard liquor.
Also, time for the obligatory nod toward precious metals. I'm more of a silver bug. But it's like this: physical gold is for those who think they can make it over a border with small personal possessions not taken (nowadays, you probably should have landing spot and bank account/physical notes already set up), silver is for those who are going to stay and aren't sure other people will able to make change.