https://gadonias.com/posts/ Recent content in Posts on Geoflly Adonias, PhD Hugo -- gohugo.io en-gb Mon, 19 Oct 2026 00:00:00 +0000 https://gadonias.com/posts/no-brick-house/ Mon, 19 Oct 2026 00:00:00 +0000 https://gadonias.com/posts/no-brick-house/ <h2 id="tldr">TL;DR</h2> <ul> <li>Shares fell, but defensive stocks offered only partial protection. The S&amp;P 500 lost 7.41% in the first month of the Iran war, while US utilities rose 7.5% over the first quarter as a whole.</li> <li>Gold failed to provide its usual refuge. After reaching a record $5,595 an ounce during trading in January, gold fell 13.75% in the first month of the conflict and continued to slide.</li> <li>Bonds offered little protection either. US government bonds fell alongside shares and the 10-year Treasury yield rose above 5%, a sign that inflation, not recession, was the worry.</li> <li>History shows that the type of shock matters. Government bonds helped cushion losses in the growth-led crises of 2008 and 2020 (apart from a brief dash for cash in March 2020), but struggled in the inflationary periods of the 1970s, 2022 and 2026.</li> <li>There is no single house of bricks. No asset class held up against every kind of shock, and the bricks may be all three shelters together, in a well-diversified portfolio.</li> </ul> <h2 id="the-wolf-of-geopolitical-instability">The wolf of geopolitical instability</h2> <p>We are probably all familiar with the tale of the <em>Three Little Pigs</em>, in which each pig, sensing danger, runs to the house he has built for himself. One is made of straw, one of sticks, and one of bricks. When the wolf arrives and huffs and puffs, the first two houses fall. Only the brick house stands.</p>