(Part 4) Implementing Bitcoin into the Permanent Portfolio
Channel: Marc De Mesel
Date: 2013-06-02

( To see part 5: http://www.youtube.com/watch?v=bKfHzaHAlZo )

Why giving bitcoins an equal standing to the other assets (20% x 5) does make sense. Lack of market cap and lack of track record for bitcoins are not valid counterarguments. Also the fact that bitcoins are risky is not a valid counterargument. 
1. Harry Browne also allowed assets to have a much larger allocation in the Permanent Portfolio than the market cap of that asset would allow. For instance the market cap of gold is at least 10 times smaller than stocks but still he chose to give it an equal standing. 
2. Although the Permanent Portfolio today has strong track records, when Harry Browne initially designed it it did not, as track records could go back only 10 years. Harry Browne did not design the Permanent Portfolio based on track records, backtesting or proven performance, but designed it based on logic and simplicity. We can do the same today.  
3. It is true that bitcoins are risky, but so are stocks, bonds, gold and cash.