At Last: How to Invest During the Collapse of Civilization

Finally, a journalist has had the courage to pen an article on this vitally important topic: What is the correct investment strategy during a period of something that closely resembles fascism?

For too long, writers have focused on the fears of the potential victims of a Trump presidency and, even if he loses the election, the groups of people who might be targeted by the increasingly muscular populist right wing in the U.S.

Reporters covering Brexit have too often relaxed into the comfortable role of merely documenting the rise in racist and xenophobic hate crime since the referendum.

But now at last, courtesy of the Wall Street Journal, we have a fearless article that tackles the elephant in the room: How should investors respond to the rise on both sides of the Atlantic of something which appears to have a lot in common with fascism?

In ‘The Trump Trade: A Bet on the End of Reagan’s Market Legacy’, James Mackintosh doesn’t actually use the f-word, preferring such formulations as “the populist backlash against global elites”, but the message nevertheless is clear: This trend will be around for a while, and “investors should prepare.”

“Betting on the rise of populism is at least as tough” as betting on Reaganomics was in the 1980s, the hack sagely notes, “even for investors who are proved right”.

The article refers back mainly to the 1970s and ‘80s for comparison purposes, rather than the decade that the current one most resembles, the 1930s, which I thought was a missed opportunity.

I began to wonder if anyone had been brave enough during the rise of actual, historic Fascism in Europe to provide the investors of the day with some much needed advice. Perhaps even an article with a title along the lines of: ‘The Hitler Trade: A Bet on the End of the Fragile Democracy of Weimar Germany’.

As it happens, the U.S. media’s coverage of the rise of Adolf Hitler is the subject of a 2009 student research paper by a fellow named David Rabie. The paper is available online and makes interesting reading.

On 24 January, 1933, the New York Times began reporting on the plight of a Jewish professor in Germany called Ernst Cohn, who had been the subject of violent protests by Nazi students.

“The following day the paper had a follow-up article on Cohn, stating that he had resumed teaching despite the fact that Nazi students used tear gas and firecrackers in protest,” writes Rabie.

“The article does not criticize all the protests and violence, and only has one sentence saying that Cohn was being singled out for his Jewish faith. Towards the end of the article, however, the paper does mention that academic freedom was being threatened. The Wall Street Journal did not choose to report on the Cohn incident, but rather on the fate of Americans who held German bonds.”

Acknowledgements: Thanks to Gabriel Suprise for bringing Mackintosh's article to my attention.

Wall Street Journal article from 1 February, 1933, the day after Hitler became Chancellor of Germany