3 Aspects of Risk, 2019 Edition
Destruction, volatility, and uncertainty.
Here, I revisit a column originally published in September 2013.
Yesterday's column highlighted one aspect of risk: the possibility that an asset becomes destroyed (either fully, such as by a government confiscating assets, or partially, as in a large inflation-adjusted loss sustained over multiple decades). The source was Bill Bernstein, who listed the "four horsemen" of destruction: hyperinflation, severe deflation, government confiscation, and war/devastation. To Bernstein, an investment adult is one who worries less about monthly fluctuations and more about avoiding catastrophes.