Wow, 5000 years?
That's not just aiming for generational wealth, that's, like, about the length of human civilization.
I'm not sure whether to be impressed or amused.
-W
The Long Now foundation is working on a 10,000 year clock to be built in mountain in Texas on Jeff Bezos’ land. Not everyone is so short sighted as myself with only a 5,000 year outlook.
The foundation encourages ultra long term thinking. I personally think that true risk can be mitigated by thinking in ultra long terms as opposed to focusing on short term volatility. For instance in 5,000 years basically every human event imaginable has happened. Empires were built and destroyed, frontiers were opened and closed, religions were formed and vanished, religiosity waxed and waned, world wars were fought and the world powers sued for peace and won (temporarily), famine gripped the planet, and agriculture was established and improved, and diseases spread, and cures were found, the planet warmed and the planet cooled, etc. Monarchies gave way to Republics. Socialist experiments were responsible for approximately 100 million deaths in the 20th century as well as the destruction of whole societies and their capital stock.
Everyone expects society that they live in to continue on much in the same way it has with minor gradual changes. I know I do. But a study of history tells a different story. Much of history is a list of surprises and how people reacted to them. Change is often so rapid and disorienting that it causes people to behave in irrational and counter intuitive ways. There is also a tendency to view history through the lens of “another time, another place” and view historical actors with contempt and/or treat other countries as an isolated box where such-and-such event occurred. But, in reality anything that happened in history could happen anywhere including here (in the U.S.) if the collective will of the people permits it to occur (consciously or unconsciously), or more precisely is unable to prevent it. Look only to the severe way the pandemic has changed human behavior and thought in a matter of months for an example (and in the grand scheme this pandemic is minor compared to historic upheavals).
So all one needs to do is design a portfolio that can survive 5,000 years, and this means that the portfolio should be able to survive what any given year can throw at it.
Gold doesn’t produce a return. It preserves value when all else fails. So it makes sense to accumulate some as part of an investment portfolio. One never knows when the tide will turn and they have to leave with the clothes on their back and only what they can carry.