Real Assets vs the Dollar
Ben Huang@b3nhuang
+1.1%
since Oct 6
The idea
I believe persistent deficits will keep eroding the dollar's purchasing power, so I want to own things that can't be printed. This basket spreads across land and timber, gold, broad commodities, energy producers, and miners, roughly equal weight across the themes so no single name carries the bet. I keep a cash reserve to add on dips and plan to hold for years, revisiting the thesis only if deficits and debasement pressure actually reverse.
What it owns
- Farmland, timberland and raw acreage cannot be printed and their owners collect rent and royalties, real assets that hold purchasing power as currency weakens. · Texas Pacific Land CorporationIt owns a large Texas acreage and collects royalties on oil pumped from it, combining land ownership with energy income in one holding., Weyerhaeuser CompanyIt owns millions of acres of timberland that grow in value while the dollar shrinks, and pays out most income as dividends., Gladstone Land CorporationIt owns farms and collects rent from farmers working the land, owning the real asset itself that cannot be printed away., Farmland Partners Inc.It owns row crop acres and earns rent that resets higher as crop prices and land values rise, a bet that farmland holds purchasing power as the dollar weakens., Rayonier Inc.It is the purest timber play here, with nearly all value in forests owned, betting that real assets hold purchasing power while the dollar does not.22%
- Gold cannot be printed and historically rises when currency loses purchasing power, anchoring the take with the metal and two companies that profit from its price. · iShares Gold TrustIt holds physical gold directly, the most straightforward hedge against a weakening dollar when deficits keep growing., Franco-Nevada CorporationIt collects royalties from other companies' gold production without running mines, so rising gold prices flow almost directly to the bottom line., Newmont CorporationIt is the largest gold miner, so each dollar gold gains widens the spread between its selling price and mining costs.20%
- ETFs holding oil, metals, crops and farm goods track real commodity prices directly, capturing the core bet that a weaker dollar pushes the cost of real stuff higher in dollar terms. · Invesco Optimum Yield Diversified Commodity ETFIt tracks a basket of oil, metals and crops in one fund, capturing broad real commodity price gains if the dollar loses purchasing power., Invesco DB Agriculture FundIt tracks prices of corn, wheat, soybeans and sugar, crops everyone buys regardless of conditions, gaining value as a weaker dollar pushes food prices higher in dollar terms., United States Copper Index FundIt tracks copper prices directly, the metal needed for grids, wires and construction that gains value in dollar terms when currency weakens.17%
- Oil and gas producers earn more as energy prices rise and pay dividends while waiting for further gains. · Exxon Mobil CorporationIt owns oil and gas reserves and pays a dividend, earning more as energy prices rise in a weaker dollar environment over time., EOG ResourcesIt pumps oil from US shale at low cost, so when oil prices rise with a falling dollar, more of each barrel becomes profit., Chevron CorporationIt is a major oil producer with a long record of raising dividends, income that compounds while energy prices track a weakening dollar.16%
- Companies that extract metals from the ground see earnings rise faster than the commodity price itself when prices climb, amplifying gains from a falling dollar. · Freeport-McMoRanIt mines copper from the ground, so rising copper prices flow to earnings faster than the metal price itself when the dollar weakens., BHP GroupIt owns iron ore, copper and other mines globally, real assets that earn more as commodity prices rise in dollar terms, with a dividend., Rio Tinto GroupIt owns iron ore and copper mines that cannot be printed, earning more as a weaker dollar pushes metal prices higher.15%
- Cash10%