7 SAGES HOSTEL, XI’AN – Yesterday, we got off the train and went to the wrong hostel.

First, the young people there went out in the rain and tried to flag a taxi for us.

When that didn’t work, they ordered a car for us through a ride-sharing app. We realized they’d paid for it, too, only when we got to the hostel and the driver wouldn’t accept any money…

Completing the Loop

Greetings from China! My family and I are traveling around the world, living out of a suitcase, hopping from cheap hotel to cheap hotel, traveling by train and bus.

We’ve crossed North America, Europe, and Africa so far. We’ve almost finished crossing Asia. Soon, we’ll cross the Pacific Ocean and land in Vancouver, and we’ll have completed the loop.

We’re currently in Xi’an, one of the biggest cities in the world with a population of 12 million people, staying in a hostel. Our room costs $23 a night.

Here we are doing our schoolwork this morning in our new room…


Penny (7), Miles (9), and Dusty (11) doing schoolwork in our latest digs

False Prejudice

Along the way, we’ve been hosted by families, been guests at many hotels, been fed by hundreds of restaurants, shopped in a lot of convenience stores, and shared transport with many other passengers…

We’ve been here in China for five weeks, and the Chinese we’ve met are the kindest, most generous people we’ve encountered so far on this around-the-world trip. It’s the little things. The way they go out of their way to help us in restaurants. Or how they love taking selfies with us.

We’ve had meals bought for us, and we’re always being offered food. And the taxi drivers never try to rip us off. My trust levels are so high, I often just hold out a wad of bills when I need to pay the fare, and I let the drivers help themselves to my money.

Before we arrived in China, I had a personal prejudice about the Chinese being an unfriendly and rude race. I’m not sure where I picked up that prejudice from, but it’s false. We’ve found the people we’ve met here to be very friendly…

Yesterday, we received a handwritten letter from the daughter of our hosts in Dunhuang. She asked if she can be our pen pal!

– Tom Dyson


Reader comment: When you say, “But my gut feeling is, there’s a fragility underneath the growth and prosperity,” you could be doing your readers a great disservice. Such dismissive views are not new. The initial awe at the empty buildings, followed by negative comments, has been the modus operandi for the Western observers for decades, as underlined by one of your readers who visited in 2001 and saw the same level of construction.

I am not a fan of central planning. However, I have seen numerous benefits of this in a number of countries where major facilities like subways, gardens, parks, boulevards, pretty oceanfronts, festival sites, wide sidewalks, bicycle lanes, etc., provide the public a better daily life… something that in the Western “democratic” systems would be dismissed offhand for budgetary, political, or any other reasons.

As another one of your readers has said, I also believe that China is building for the future so that their present efforts will yield benefits for decades to come, during which they can focus on other worthwhile endeavors. If anything, the Chinese are masters at long-term planning, and you now have an incredible opportunity to come to grips with what could turn out to be a brilliant move by China. But first, you will need to ditch your preconceived notion that because you don’t understand it, there must be a “fragility underneath.”

Tom’s response: I take your point very seriously. The ghost cities are a classic example of this. Western observers laughed at them initially. But it turns out, some of them have become successful cities.

All I can tell you is, I’m aware of these prejudices, I’m aware I’m personally susceptible to prejudice too, and I’m trying hard to keep an open mind about everything we see…

I also saw brand-new cement bridges in the desert this week on our way back from Dunhuang. Bridges not attached to roads… bridges no car or truck will ever drive over. How do you explain that? Is it possible these bridges are isolated examples? I can’t believe that…

Reader question: Love reading about you and your family’s world-trekking adventures. I have a question regarding your Dow-to-Gold ratio concept. If and when the ratio gets down to around the 5 level, do you have an idea or prediction on what the spot price of gold may be in U.S. dollars? Wishing you all safe travels!

Tom’s response: My best guess would be a gold price around $4,000 an ounce, which puts the Dow around 20,000. I think the highest-probability outcome is some sort of stagflation where stocks don’t fall that much on a nominal basis but fall much more on a real (inflation-adjusted) basis.

Reader comment: What an incredible journey y’all’ve been on. The Swiss Family Robinson for sure. What an incredibly audacious “trader” Kate is to take a chance on the “devalued” Dyson stock and go all in on a sharp rise in value. I’m only sad I found out about your postcards on the tail end of your journey.

Reader comment: Really enjoying your postcards, and it’s great to hear you’ve found what sounds like a much happier space for yourself with Kate and your children.

Reader comment: G’day. Receive your postcards here in New Zealand and enjoy your commentary. Love your style out there in the wilderness. Safe travels.

Reader comment: About the P/E chart… it would be interesting to see this in relation to interest rates. It’s been above the black line for a long time. Not saying it’s different this time, but I believe “history rhymes rather than repeats” is also quite true.

And, aligning with your point about the financial experiment underway – maybe the real trigger to getting back to the average is when that all unfolds. Which could take longer than many expect. Your thoughts?

Tom’s response: Thanks for the thoughtful questions. I agree that low interest rates are lifting P/E ratios. And I agree interest rates could go lower and stay there longer than anyone thinks.

The thing is, while we wait, there’s no penalty or downside to owning gold. With interest rates having fallen for 37 years, stock market valuations don’t have that tailwind anymore. And with savings rates near zero in most of the world, we’re not losing out on any interest.

My Dow-to-Gold bet is a great high-upside, low-risk bet, with a high probability of success, but we may need to be patient. It’s really encouraging, too, that it started falling again last year and we have a clear downtrend…

Reader question: Can you explain why you are going for the Dow-to-Gold ratio? I thought the Dow was flawed as a stock market tracker due to the way it is calculated. Wouldn’t you be better off using the S&P 500?

Tom’s response: All I need is an index that broadly represents “equities.” Professional investors would use the S&P 500. The Wilshire 5000 is technically even more representative. Then, there are the global stock market ETFs. Those might be an even better proxy.

But the Dow works fine for our purposes. And it’s my favorite index to track. So I’m sticking with it.

Reader comment: Love reading about your adventures. Thank you for writing a nice summary of the Dow-to-Gold ratio; it really solidified my understanding of your theory. I recently retired and am seriously thinking about sitting on the sidelines with gold and traveling the way you are with your family. Regards from a fellow homeschooler.

Reader comment: I wonder if it wouldn’t be a good idea to remarry your wife and get a divorce from Bonner and Partners. Maybe some of the strains are from working for “the man”?

Tom’s response: I love the company. It’s definitely not them. Actually, they’ve held me together… been a source of stability and strength for me. I just needed a sabbatical to recharge.

Reader comment: You were the only reason I joined Palm Beach Infinity. I don’t think you realize how important you are to us, and not just because of your financial prowess, but for who you are as a person. When I didn’t see you as the face of Palm Beach, frankly, I was devastated. I’m so happy that this journey is making you whole once more!

Reader question: I’m curious if you would tell your readers to ever pull things out of a safe deposit box? I am hearing that the laws and rules of banking are leaning toward a more “nosey” approach on what one stores there. Your take? I too enjoy reading about your family’s travels.

Tom’s response: I’m okay with safe deposit boxes.

As always, keep sending us your questions and comments at [email protected]. Kate and I read every one of them, even if we can’t publish all of them.