“Gray swan is a term used to describe a potentially very significant event that is considered unlikely to happen but still possible. Because there is a slight chance the event will occur it should be anticipated, particularly as it could shake up the world, economy and stock market”
The definition above is pretty self explanatory. But, when potential Gray Swan events begin to actually unfold, things can get very, very dark quickly. Back several months ago in volume 2 of “The Gray Swan” I alluded to the impeachment process being brought against the President of the United States by the opposing political party. Should that process fail (and did) I pointed out that the opposing party would certainly have a “plan B” to make sure the current President would not get a second term. I mentioned violence and (gasp) possible civil war. Yes, the USA is under siege. (please note I do not mention sides or name people to remove all bias. I only point out possible scenarios)
Cities across the U.S. are beginning to experience anarchy. That is a notch above protests and riots. Chicago, Minneapolis, Seattle, Portland, Los Angeles and even Salt Lake City are becoming (right before our eyes) virtual war zones. As pointed out, a Gray Swan event is out in plain sight IF you choose to see it. These cities will be joined by more as the lawlessness spreads week after week. Ultimately where does this end?
Looking forward, will the Gray Swan turn into a Black Swan? You can never be sure but you can be prepared. A very plausible scenario: the spreading of violence continues to spread leading up to the U.S. 2020 November elections. Due to a confluence of factors the actual results of the Presidential election are not known for days, weeks or even months. The leadership of the United States is in limbo. The current President claims victory, the challenger claims victory and the Gray Swan turns into the ultimate Black Swan……Civil War.
Can this happen. IT IS! Whether one chooses to believe it or not, investors need to be prepared. Are you hedged? Many, many decades ago comedian Groucho Marx had a television quiz show. One of the gimmicks he used was this – if a contestant said the ‘secret word’ a duck would come down (on a string) and the contestant would receive $100. Today’s secret word is…..HEDGE!!
To say a civil war can’t happen in the U.S. is being naïve. Around the globe there is turmoil (including right here in Chicago, USA, etc) and not being prepared is inexcusable. The Gray Swan is flapping its wings. Get prepared and hope you are wrong.
(Total transparency; as the CIO of Entoro Wealth I run several portfolios designed for Gray Swan events. All include bitcoin, gold and other forms of protection)
Note; I certainly attempt to be non-biased and only consider what seems obvious. “Those are my principles, and if you don’t like them… well, I have others”. Groucho Marx
Bill Taylor is Managing Director/CIO at Entoro Wealth & is widely published in financial industry media throughout the world