Wednesday, December 21, 2011

Oh Brother, Now The Wall Street Journal Attacks Ron Paul

I am not making this up.WSJ is reporting on Ron Pauls "extreme" portfolio:
Republican presidential candidate Rep. Ron Paul marches to his own drummer in politics – and in his investment portfolio, too.

Here at Total Return, we’ve looked at hundreds of the annual financial-disclosure forms in which the members of Congress reveal their assets and trades – and we’ve never seen a more unorthodox portfolio than Ron Paul’s.
Then they put this in which has nothing, zero to do with Ron Paul:
(In fact, The Wall Street Journal revealed problematic trading in Congress more than a year and a half before the “60 Minutes” episode that recently raised a ruckus over the same topic, but that’s another matter.)
Here's more from WSJ on Dr. Paul's "extremism":
But Ron Paul’s portfolio isn’t merely different. It’s shockingly different...
Then we get this idiotic comment which clues you in the the article is a total hit job:
Rep. Paul appears to be a strict buy-and-hold investor who rarely trades; he has held many of his mining stocks since at least 2002. But, as gold and silver prices have fallen sharply since September, precious-metals equities have also taken a pounding, with many dropping 20% or more. That exposes the risk in making a big bet on one narrow sector.
Could a WSJ writer possibly be clueless to the fact that, even with this pullback in the gold price, gold has more than quadrupled since 2002! Is there any mention of this and how successful an investor Dr. Paul is? No. The only thing that is mentioned is the recent pullback, of which there have been many through out the years.

Here's more of the absurd hit on Dr. Paul, from WSJ:
At our request, William Bernstein, an investment manager at Efficient Portfolio Advisors in Eastford, Conn., reviewed Rep. Paul’s portfolio as set out in the annual disclosure statement. Mr. Bernstein says he has never seen such an extreme bet on economic catastrophe. ”This portfolio is a half-step away from a cellar-full of canned goods and nine-millimeter rounds,” he says.

There are many possible doomsday scenarios for the U.S. economy and financial markets, explains Mr. Bernstein, and Rep. Paul’s portfolio protects against only one of them: unexpected inflation accompanied by a collapse in the value of the dollar. If deflation (to name one other possibility) occurs instead, “this portfolio is at great risk” because of its lack of bonds and high exposure to gold.
The signal is clearly out to get Ron Paul, if the WSJ runs an absurd article like this on probably the most successful investor in Congress.

Note: Although Bernstein's firm appears to be Efficient Frontier Advisors, WSJ appears to incorrectly identify the firm as Efficient Portfolio Advisors.


  1. They're losing and they don't know which way to turn or WTF to do. In a pinch, they turn toward childish antics and outright obfuscation.

    It is par for the course, but this time it is focused and directed, which makes it all the more obvious.

  2. The wolves will stop at nothing to corral the sheep. Any competent fool can recognize the wisdom and success in Ron Paul's investment strategy. The numbers for the past decade speak for themselves. Sadly, the hit-piece was written for incompetent fools who'll most likely gobble it up (or be gobbled up I should say).

  3. Evidently Mr. Bernstein doesn't know Ron Paul very well. First of all, Ron Paul knows that the Fed will not stop inflating (in general). They may slow the rate of inflation, but the Fed will avoid deflation at all costs.

    That's why the Fed exists! To inflate!! Inflation transfers wealth and gives the big banks a call option on every individuals purchasing power.

    For Ron Paul to take positions based on the above fact is not "extreme" at all. To think the opposite would be extreme. To lend the government money at 2% return is "extreme". The foreign lenders who think they will ever be repaid are "extreme."

    Ron Paul is savvy.

    Meanwhile, Ron Paul champions policies that would *hurt* his portfolio. Granted, he knows the Fed will never listen to him. They can't. But if they did, Ron Paul for sure knows he may take a financial hit.

    Mr. Bernstein mentions deflation.

    Actual deflation (i.e. monetary contraction) would mean the government would have a harder time paying its debts, a harder time getting more credit, a harder time maintaining its welfare & warfare, a harder time buying off votes.

    Does that sound like something helicopter Ben is about to do?

    Does that sound like something Ron Paul would be worried about?

    Sure, Ron's portfolio would lose some value, but he'd be tickled pink to see deflation, as would every other person that desires an increase in purchasing power.

    The above article is beyond lame.

  4. It is obvious that Ron Paul wants to prevent the FED from aiding the economy so that there is a huge downturn and his gold stocks can go up due to the fear. Free speech is one thing, but when you use free speech to spread economic ideas that are meant to harm all of society to benefit your gold stocks and religious fundamentalism... that is where we should draw the line!!! Back in the day when we were all farmers anyone could say anything about the economy, but given the interconnectedness and complexity of today's economy, we really can't just let people spread falsehoods which can lead to unstable markets. Obviously Ron Paul and those Austrians need to be locked up!

  5. I wish more people would talk about Paul's portfolio. An equal weighting of his top 10 holdings have returned better than 800% since 2001. No, that's not a type-o, eight hundred percent.

    Of his top 10 positions, the weakest performer, AngloGold Ashanti, is up over 250%. His best performer, Silver Wheaton, is up over 1500%. Plus the HUI index has pulled back 20% since September, at which point his top 10 were up over 1000% on the decade.

    Forget politicians, can you find a single hedge fund manager on Wall Street who has made returns of this magnitude in the last decade?

  6. Hope Ron has that in physical gold and not paper gold, cause the paper is going to be worthless.

  7. Wow, I wonder if WSJ attacked Soros as viciously when he went almost all in in (successfully) attacking Sterling?

  8. @ anonymous

    Ron Paul's gold stocks went up because of all the money the Fed created. He knew this was going to happen long ago. If he wanted to up the price of his stocks, he would want to print lots of money. Dr. Paul's economic beliefs would not create inflation like Keynesian beliefs. Notice how gold hasn't been going up. Why do you think that is? Its because quantitative easing stopped. You want to make it go up more, all you have to do is more quantitative easing which is what he doesn't want to do. His policies would stabilize the dollar if they were put in place which is bad for gold because people would sell their gold and trade it in for dollars. Of course Bernanke's work is already done and we still haven't seen its full effect which is likely bullish for gold once price inflation starts hitting more. The reason he bought gold is because the government can't print gold and destroy its value.

    You really don't understand any of the economists that predicted the recession and housing bubble at all if you say something like this. I am not an economist but even I can see you have no idea what you are talking about. Un-molested recessions end quicker than Fed-encouraged ones and they are deflationary for prices which would not drive gold up but down. The first recession the Fed "helped" turned in to the Great Depression and the economy didn't rebound until after WWII.

    You are the one that needs to stop spreading falsehoods about the economy. Go read a book by an economist that predicted this recession (eg. Peter Schiff) instead of listening to the ones who didn't see it until after it was here.

  9. I like the WSJ's piece better the first time... when it was written by Barron's

  10. This makes me like Ron Pal even more. Even in his portfolio he walks his talk.
    I would be worried if his portfolio was mainly filled with Pfizer, Monsanto, Lockheed and RBS!

  11. This is pretty funny. Wenzel, suppose they discovered RP held mutual funds that had a conservative mix of the S&P500 and Treasuries. Then people would be flipping out about what a hypocrite Ron Paul was. "Ohhh, he warns everyone about massive inflation, and that's why they should vote for him and buy his books! But look what he does with his own money. Apparently he trusts 'helicopter Ben' after all! Hypocrite."

  12. I read a book by Bernstein years ago. Like Ron Paul, he's a medical doctor by training and a smart, polymath kind of guy. Unlike Paul, he's not a particularly critical or independent thinker. He pushes pure "passive investing" (modern portfolio theory, stock/bond index funds, typical asset allocation stuff). After the last decade and what's brewing ahead, you'd think his crowd would see the writing on the wall now.

  13. " this on probably the most successful investor in Congress." Well, I'm not sure he's been as successful as the Congressional members who made million$ by insider trading on impending legislation. Hard to compete with that...

  14. He bets against the american economy.
    He hates america

    This man is not a patriot, hes a shill for the rich elite, an anti-semite, a racist, a flat earther, a koch crony, he hates every part of our great government and wrongly believes EVERYTHING is unconstituional. After reading this story ron paul is the first one to blame for the economic catastrophe, he bets against the economic recovery and bets FOR its failure.

    Couldnt be more unpatriotic!

  15. Wow anonymous @ 11:32

    Where do you come up with this stuff? That couldn't be any further from the truth. Did you know the founding fathers advocated and used gold as a currency because they knew the problems with fiat money? Does that mean they hated America and were unpatriotic? Did you know central banks everywhere hold gold reserves? Does that mean all of them are unpatriotic? How is he an anti-semite and a racist? Is this because he wants to treat people as individuals and not as groups that you think this? Who do you think hurt minorities the most? Perhaps the people in charge that caused this recession which put many of them out of work? Would you rather him make money by insider trading and corruption instead of knowledge of the economy? Do you not want a president who has been warning about bubbles and busts? You want people who are going to continue the destructive policies that caused the situation we are in and cause more of them in the future? That sounds unpatriotic to me. If I hated America, I wouldn't be voting for Ron Paul.

  16. Sounds like a backfire.
    They think they are saying bad things about him but I would have to say that to most, these things sound good!

  17. Here's the real rub on all of this. Ron Paul realizes that his investments WILL continue to gain in value if policy remains as it is now. The funny thing is he WANTS TO CHANGE POLICY. What kind of investor deliberately works against himself to try to make his investments DECREASE in value?

    If this isn't the clearest picture of a non-corrupt candidate for higher office, I don't know what is...

  18. I sure hope that when Ron Paul becomes President that he excludes WSJ, FOX, and CNN reporters from the White House press corps.

  19. Peter Schiff also talked about Ron Paul's portfolio when Barron's tried to undermine him in August 2011.

  20. Ron Paul has only saved his earnings, while the FED devalued the dollar.

  21. Wish my professionally run portfolio and 401K had increased in value like Paul's rather than going down during the same period. If I had switched to his investment model in 2002 I could retire as planned. Now retirement is nowhere in sight )-:

  22. I love that the h8rs and paid shills have found EPJ! That means that they are scared of Dr Paul and his power!!!

    RD Fizgerald

  23. It's interesting to me that the few individuals here that attack Ron Paul do so with purely ad hominim vitriol. Notice the lack of logic and substance. Contrast that with the well articulated arguments of the pro-Paulian posters.

  24. @ Anonymous 9:59
    "Obviously Ron Paul and those Austrians need to be locked up!" You need to be locked up as you are insane.

  25. I've been arguing with a fascist merchantilist over at Mac Salvo's SHTF Plan blog for awhile now, it sure does look like he followed one of the links I posted to this site.
    Of course there's probably millions out there just like him, but the words and phrases are just too similar.
    I feel like apologizing for leading him here, but then again, maybe some People will learn from this exchange?

  26. Ron Paul most certainly did not invest against the American economy, he made an all-in bet that the US Dollar would decrease in value. He made the correct assessment that unpatriotic elements of the government would continue to rob the citizenry via runaway money printing. It is these unpatriotic types that create the inflating bubbles that predictably lead to economic catastrophe. Paul isn't unpatriotic, and he didn't aid the meltdown one iota. He did everything he could to prevent it, and made the wise decision that his warnings would fall on deaf ears and blind greed.