3 ms·

If you were in Zimbabwe 15 years ago would you rather buy shares in the top 100 Zimbabwean companies, or gold?

by missedthecue 5y ago

Scoundreller 5y ago
Definitely the Zimbabwean companies, their debts are about to get zero’d out.
- arodyginc 5y ago
  Debt wouldn't be zeroed out if it was made on external markets, right?
  - Scoundreller 5y ago
    Then there would be no impact. If you’re a company producing stuff and Zimbabwean dinars are worth 1/10th as much, you would charge 10x as much. If you’re a shell company with Zimbabwean dinar cash assets and external USD debt, you’re screwed but you’re also not a going concern.
mywittyname 5y ago
Why isn't shares in the top 100 world companies an option?
- missedthecue 5y ago
  Because Palantir is worried about the USD (and presumbably other major currencies such as the pound and euro) devaluing. There isn't an escape from that. Mars doesn't print its own currency yet.
  - gameswithgo 5y ago
    So this is ultimately all about Thiel and Musk having a fued about the mars colony and whether that will work out.
  - Scoundreller 5y ago
    Why wouldn’t a stock (e.g. a gold mine or google) escape a USD devaluation? The only companies I see screwed are those that make long-term loans at fixed interest rates.
    - missedthecue 5y ago
      Because the cost of production inputs rise faster than they can pass on the costs to their customers. If no one suffered from inflation, we wouldn't bother measuring it.
munk-a 5y ago
If you, as a large share holder, were so bearish on Palantir's outlook - why would you bother keeping your money invested in them at all. Keeping your money in the company is a choice you've made above the option of divesting and just buying gold yourself. And for the company, it seems incredibly silly - companies don't exist as things if they lose their employees (which would happen if anything catastrophic enough to justify gold happened) and their shareholders. Alternative reading - Palantir (being in the business of spooky levels of information) is predicting a global currency collapse... or a return to the gold standard - which is sort of just a slightly different flavour of a global currency collapse.
- Scoundreller 5y ago
  > why would you bother keeping your money invested in them at all. I wouldn’t. They’re a money losing company that raised money by selling shares and didn’t even have a plan for that money. Then they did the least creative thing possible: bought gold. Something any investor can do with a dozen different funds. If you want to share in palantir’s gold bet, save their fees and buy a gold etf/closed end fund or coins/bars directly that you can keep in YOUR basement.
  - munk-a 5y ago
    That's exactly my point - buying gold in bulk like this is a clear way of signalling they're a bad investment since any sane investor will do just that - purchase gold that they control and that won't be subject to any bankruptcy collections exercised on palantir if they are in a really bad place.
nonameiguess 5y ago
The point is investors can just buy gold. They don't need to buy stock in Palantir and then have Palantir buy gold for them. If you don't need cash and can't buy productive assets, give cash back to your investors and they can find something else to do with it, possibly buy gold.
adventured 5y ago
> If you were in Zimbabwe 15 years ago would you rather buy shares in the top 100 Zimbabwean companies, or gold? The interesting thing about that context, is you're likely screwed either direction. You're existing under a very dangerous dictatorship 15 years ago, totalitarian. Gold isn't going to save you either, they'll just confiscate it. Gold in particular they'd want. It's the very rare situation where things are so dire that a giant pile of gold is particularly useful, and somehow you're not going to get it taken from you by the people with all the guns. Even in the US, at its most dire, and minus a dictatorship, gold was taken from everybody, confiscated; revoking the ability of companies and people to shield themselves from the substantial debasement of the currency. One of the first things the dictator of Zimbabwe would plausibly do during hyper inflation is go after large piles of private gold.

If you were in Zimbabwe 15 years ago would you rather buy shares in the top 100 Zimbabwean companies, or gold?

Scoundreller 5y ago

Definitely the Zimbabwean companies, their debts are about to get zero’d out.

arodyginc 5y ago
Debt wouldn't be zeroed out if it was made on external markets, right?
- Scoundreller 5y ago
  Then there would be no impact. If you’re a company producing stuff and Zimbabwean dinars are worth 1/10th as much, you would charge 10x as much. If you’re a shell company with Zimbabwean dinar cash assets and external USD debt, you’re screwed but you’re also not a going concern.

mywittyname 5y ago

Why isn't shares in the top 100 world companies an option?

missedthecue 5y ago
Because Palantir is worried about the USD (and presumbably other major currencies such as the pound and euro) devaluing. There isn't an escape from that. Mars doesn't print its own currency yet.
- gameswithgo 5y ago
  So this is ultimately all about Thiel and Musk having a fued about the mars colony and whether that will work out.
- Scoundreller 5y ago
  Why wouldn’t a stock (e.g. a gold mine or google) escape a USD devaluation? The only companies I see screwed are those that make long-term loans at fixed interest rates.
  - missedthecue 5y ago
    Because the cost of production inputs rise faster than they can pass on the costs to their customers. If no one suffered from inflation, we wouldn't bother measuring it.

munk-a 5y ago

If you, as a large share holder, were so bearish on Palantir's outlook - why would you bother keeping your money invested in them at all. Keeping your money in the company is a choice you've made above the option of divesting and just buying gold yourself. And for the company, it seems incredibly silly - companies don't exist as things if they lose their employees (which would happen if anything catastrophic enough to justify gold happened) and their shareholders. Alternative reading - Palantir (being in the business of spooky levels of information) is predicting a global currency collapse... or a return to the gold standard - which is sort of just a slightly different flavour of a global currency collapse.

Scoundreller 5y ago
> why would you bother keeping your money invested in them at all. I wouldn’t. They’re a money losing company that raised money by selling shares and didn’t even have a plan for that money. Then they did the least creative thing possible: bought gold. Something any investor can do with a dozen different funds. If you want to share in palantir’s gold bet, save their fees and buy a gold etf/closed end fund or coins/bars directly that you can keep in YOUR basement.
- munk-a 5y ago
  That's exactly my point - buying gold in bulk like this is a clear way of signalling they're a bad investment since any sane investor will do just that - purchase gold that they control and that won't be subject to any bankruptcy collections exercised on palantir if they are in a really bad place.

nonameiguess 5y ago

The point is investors can just buy gold. They don't need to buy stock in Palantir and then have Palantir buy gold for them. If you don't need cash and can't buy productive assets, give cash back to your investors and they can find something else to do with it, possibly buy gold.

adventured 5y ago

> If you were in Zimbabwe 15 years ago would you rather buy shares in the top 100 Zimbabwean companies, or gold? The interesting thing about that context, is you're likely screwed either direction. You're existing under a very dangerous dictatorship 15 years ago, totalitarian. Gold isn't going to save you either, they'll just confiscate it. Gold in particular they'd want. It's the very rare situation where things are so dire that a giant pile of gold is particularly useful, and somehow you're not going to get it taken from you by the people with all the guns. Even in the US, at its most dire, and minus a dictatorship, gold was taken from everybody, confiscated; revoking the ability of companies and people to shield themselves from the substantial debasement of the currency. One of the first things the dictator of Zimbabwe would plausibly do during hyper inflation is go after large piles of private gold.