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And in banks, all your money can be frozen by a hostile government, for example. Diversification. I DO keep all my money in Western financial institutions, but that's laziness, not out of some misguided perception of stability. If I were optimizing, I'd have some in US institutions, some abroad, some in land, some in blockchain, some in gold, etc. The US has had a nice 250-year run. Past performance doesn't always predict future performance, and more importantly, if I live 100 years, that means the US has been around for 2.5 of my lifetimes. I think that's a good indicator of the level of stability. There's perhaps a 1-in-2 chance of some major event within my lifetime, consider things like the American Revolution, Civil War, or Great Depression to be major events. Not all of those would wipe out my assets, but I'd say about a 1:5 chance of my assets being neutered or neutralized within my life. We tend to plan for the common, minor stuff (typo, guy loses $50k), and overlook big, rare events (like the current, entirely predictable pandemic). |