Tesla Leads Investors into Alternative Stores of Value

The “dash for cash”: It’s what you often see among companies, consumers and investors when uncertainty rises and people are seeking protection from losses.

That’s not what we’re seeing today.

What we’re seeing is something entirely different — a dash for alternatives. By “alternatives” I mean anything but cash. And there’s a good reason for it: Washington is doing all it can to trash your cash.

Just look at the bombshell that Tesla Inc. (Nasdaq: TSLA) dropped on Monday via a Securities and Exchange Commission filing.

The electric car giant said it would change its investment policy so it could direct corporate reserves into other assets besides cash. The goal? To “diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity.”

Most news coverage focused on Tesla’s $1.5 billion Bitcoin purchase.  After all, Tesla’s CEO Elon Musk has been an outspoken proponent of cryptocurrencies — and Bitcoin has more than quadrupled in the last 12 months.

But crypto isn’t the only alternative Tesla highlighted. The company also named gold bullion and gold-focused exchange-traded funds (ETFs) as alternative stores of value it would direct money toward.

So, it’s no surprise gold, silver and mining shares all caught a bid this week as well.

In fact, the Sprott Physical Silver Trust (NYSE: PSLV) I’ve favored for Safe Money Report subscribers is showing a one-year total return of more than 50%. The VanEck Vectors Gold Miners ETF (NYSE: GDX) is up almost 27%.

Both handily beat the 20% return of the SPDR S&P 500 ETF Trust (NYSE: SPY) during the same timeframe.

We wouldn’t be seeing these persistent, powerful gains if Tesla was alone in its hunt for alternatives. Clearly, it’s not.

Many other investors are looking at all the cheap, easy money churning from the Federal Reserve and the trillions in additional spending measures flowing from Congress. They’re judging that all this “stimulus” will have consequences.

That’s why alternative stores of value are on fire.

If you’ve been following my advice over the last couple years, congratulations. You’ve done well.

If you’re still on the sidelines, there’s still time to add alternatives and precious metals to your portfolio. It’s still early.

And, yet, given the weight of the evidence thus far accumulated, I’d also wonder, what are you waiting for ...

Click here to learn more about adding alternatives the “Safe Money” way.

Until next time,

Mike Larson