Insuring Wealth against Unprecedented Risk

(Egon von Greyerz - Oct 15^th 2015)

Egon von Greyerz interviewed by Campden Wealth - a leading Family Office event company

Matterhorn Asset Management AG / GoldSwitzerland - Founder & Managing Partner - Wealth Preservation

Throughout his career in financial investments and corporate business, Egon von Greyerz has always focused on understanding and protecting risk. Matterhorn Asset Management (MAM) are wealth preservation experts. Since 2002 MAM has specialized in physical gold as a means of insuring assets against unprecedented risk. MAM is well known worldwide in its sector and has clients in over 40 countries.

Why did you found MAM? 

EvG: Throughout my working life I have always focused on understanding risk both in my corporate life as well as in my investment activities. As we all know, the upside takes care of itself but the downside is where things can go really wrong. This always stood us in good stead as we built up Dixons from a small  company to a FTSE 100 company. After 17 years in a public company, I wanted to create an investment business that specialised in wealth protection. 

What do you mean by wealth preservation?

EvG: Wealth preservation means different things to different people. Some investors for example believe that government bonds represent ultimate security. Yes, at certain times in history this is the case. But today, most major governments are on the verge of bankruptcy whether you take Japan, most EU countries or the US. Remember that the US has not had a real budget surplus since the early 1960s and that their debt is growing exponentially. Many government bonds at zero or even negative yields are a very risky investment that will not be repaid in today’s money. We realised in the early 2000s that the build-up of debt worldwide combined with over $1 quadrillion of derivatives represented a major risk. Therefore it was critical to have portfolio “insurance” that protects investors against these risks.

So how do you protect against these risks? 

EvG: Most asset markets are today overbought and overvalued whether it is stocks, bonds or property. That doesn’t stop them from going higher in the short term but this would only increase the risk further. Markets now remind me of the Nasdaq in late 1999. It absolutely exploded then and subsequently fell by 80%. I firmly believe that we are in a similar situation now. Physical gold, stored outside the banking system is the best protection against the risk of imploding asset markets and money printing (QE) which leads to the destruction of currencies. In addition we have geopolitical risk which is also increasing.

So why gold and how do you invest in it? 

EvG: Throughout history, gold is the only money that has survived. All currencies have been destroyed by mismanagement of the economy and money printing. Since 1913 all major currencies have lost at least 95% of their purchasing power whilst one ounce of gold buys a man’s suit today just as it has for over 2000 years.