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Last week, an entrepreneur I know who's worth hundreds of millions of dollars told me about his new investment philosophy.
“I'm not looking for a big return on assets,” he said. “I just want my assets returned.”
So it goes for people with millions and billions of dollars to lose as they look out at careening stock markets, crises in Europe and a slowing Asia. Wealth management has become risk management, and the wealthy are all about preserving their fortunes, rather than making new ones.
According to an article in Reuters, some of the most fearful rich are creating “catastrophe portfolios.”  Ivan Adamovich of the Swiss bank Wegelin said that the catastrophe portfolio is one-third gold, one-third blue chips and one-third debt in safe, developed countries  (whatever those are).
Adamovich told Reuters the interest comes from the most “paranoid” clients in Europe, who hear about other periods in history with massive social breakdowns and financial collapse.
“It’s people who have been listening to their grandmother … They are not necessarily that old. It’s people who are really afraid,” he said.
Real-estate has also come back into vogue among the rich, since it won't disappear over night like stock-market gains.
Who cares? Well, if the rich are putting money into gold bars, IBM stock and U.S. and Japanese treasuries, they're not putting money into start-ups, business expansions or job creation. Â That's going to make any recovery even weaker.
What else do you think should be included in a “catastrophe portolfio” for the rich?
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Invest in defense attorneys. The 99% are coming after you with handcuffs jingling.
Cruise ships – something along the lines of the movie 2012…
I was born.
Keep what is truly necessary. And figuring that out takes some measure of conscious examination. Do what you can to help where you are currently planted. There is no “somewhere else”. We are related to whatever their is wherever we are. It’s not a sin to be rich. It is a sin to die rich. As so many have pointed out in comments above, nothing avails in the end (can’t eat gold or dirt, money worthless when no backing, stocks illusory). ” Forever priceless is kindness, generosity, compassion, positive encouragement to a better future. Truly wealthy are those who have these to give. Invest there now for our future. Because whatever “happens”, its OUR future, not YOUR or MY future. Our shared future. We can create a better future. .
Gee MaryG, you are one stupid woman. Not that the rich are useful now, but in a catastrophe, gold is uselss, blue chips are useless, land is useless. I’m betting you’ll be useless to given you are too decrepit to eat. But we can always use you as compost in the underground gardens of the emergency bunkers.
See? The rich are useful after all!
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The Wealth Report is a daily blog focused on the culture and economy of the wealthy. It is written by Robert Frank, a senior writer for the Wall Street Journal and author of the bestselling book “Richistan” and the forthcoming book “The High-Beta Rich,” to be published in November.
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