Spitznagel on Austrian Economics-Inspired Investing
The New York Times online today profiles Mark Spitznagel, author of The Dao of Capital: Austrian Investing in a Distorted World:
Still, Mr. Spitznagel’s approach is unusual for a money manager. To invest with him, you have to believe in a philosophy that is grounded in the Austrian school of economics (which originated in the late 19th century in Vienna). The Austrian school does not like government to meddle with any part of the economy: when it does, adherents argue, market distortions abound, creating opportunities for investors who can see them.
When those distortions are present, Austrian-school investors will position themselves to wait out any artificial effect on the market, ready to take advantage when prices readjust.
In Mr. Spitznagel’s recently published book, “The Dao of Capital,” he applies this approach and his Austrian grounding to Chinese Daoist thought — the art of taking a circuitous path to an endpoint. Or, as Mr. Spitznagel says, “Learn to invest in loss.”