I am interested, what are Austrian's thoughts on investing in the stock market? And is there a difference between stock market investing today versus stock market investing in a capitalist anarcho (still don't have the term down lol) system?
On another somewhat related note, I noticed Peter Schiff saying how he suggests buying gold. When you buy gold on the market, are you actually buying gold or just speculating on the price (or is there even a difference)? Like if I "invest" in gold, what does that mean? Do they actually mail me gold? Or can I access it in someway?
Anarcho-capitalism.
Stock market investing today is a speculation racket that is heavily regulated, and thus, completely corrupt and tilted towards insiders.
Before you invest in the stock market, you should listen to Nassim Taleb talk about investing. If you still think you should invest, then go for it.
Schiff sells gold certificates for physical stock held at the Perth Mint in Western Australia. Most Schiff-ian type investors like to hold stock in mining companies and real physical gold, stored at home or in secure storage like a safe deposit box. Since gold was confiscated during the Depression, some people don't trust safe deposit boxes. You can talk to your local coin dealer about what he thinks is a good way to store metals.
Gold is used as a hedge, not necessarily as an investment. I think I remember hearing or reading Mark Thornton (LvMI) say something about maybe being 50/50 gold to cash, and that way you are hedged as one goes up or down, the other does the opposite, and "theoretically" you should be able to maintain your purchasing power. That's from memory and should be confirmed.
Don't trust me on any investing. I blow all of my money on comic books and chocolate bars.
I'm not a stock broker or investment analyst so don't take anything too seriously here, but I can tell you about what I've heard on the subject.
Peter Schiff is who I was going to suggest looking up so you're on the right track. I can't say for sure what "most" of his clients do (although I am one) but in addition to gold they also invest heavily in overseas markets. Canada and Austrailia are good choices (particularly energy sector right now but probably raw materials as well), and Asia in particular is probably "safer" than most areas.
There is always the political risk in Asia, but then again we have that here in the US too (look at the news). Japan has a hobby of destroying it's currency, China's government is insane (although, the country itself still has high potential for growth due to the high savings rate, and there is Hong Kong which I think is a little more detached), other areas such as South Korea have their own political risks as well, so there's no perfect market.
But generally investors have funds in the tens of thousands to work with (although there's no minimum funding level), and Perth Mint (gold) is a 10k minimum.
I agree that the US market is based almost entirely on price speculation. That's not investing, it's, well... speculation. Technically gold is speculation as well, but like LS says it's also useful if you think there's a lot of risk in holding "US dollar denominated" assets. Austrians definitely agree that the US dollar is in trouble, so buying gold makes sense from that perspective. I think the investment opportunities are out there for us (if we have the savings of course), but they're not as easy to reach as logging on to etrade.
My personal thoughts on investing are that every now and then one can find a good company. But most of the time, it probably makes more sense to index and be widely diversified as this theoretically limits your overall risk.
As far as gold goes, you can buy stock in funds that invest in gold and move with gold or you can actually buy the real thing. Schiff advocates the latter I believe.