May 14, 2008
End of the World Insurance
End of the world hedge funds? Cool. Apocalypse investing… Armageddon insurance…a whole new way to look at diversifying your portfolio. I was thinking about gold but this is much more interesting.
I became intrigued by an oddity that I came to think of as the end-of-the-world trade. The trade is the purchase of insurance against what would in effect be the failure of the modern capitalist system. It would take a cataclysm – around a third of the leading investment-grade corporations in Europe or half those in North America going bankrupt and defaulting on their debt – for the insurance to be paid out.
I’m a Vice Fund man, myself. http://www.ViceFund.com When times are good, people tend to celebrate by drinking, smoking, and gambling. When times are bad people tend to drink, smoke, and gamble to relieve stress. You’re good either way.