As I live and plan to retire in Singapore, my retirement fund should preferably be invested mostly in Singapore dollars. Also, I find that Singapore STI index stocks performs reasonably well over time. Singapore government bonds are rated highest AAA, and Singapore government's first 30 year bonds are brand new (first issued 1 April 2012) and probably has more room to grow in price compared to US treasuries. My analysis of Singapore Permanent Portfolio of past 10 years also gave me confidence that Singapore Permanent Portfolio will work for my purpose - results are here: http://singapore-permanent-portfolio.blogspot.sg/2012/07/how-has-singapore-permanent-portfolio.html Since I have no foreign currency exposure, there is no trouble and added cost of creating and adjusting my currency hedge monthly/quarterly. I prefer my investment assets to be near me and for me to know who is the asset custodian, which in this case is Central Depository of Singapore (CDP). Also, Singapore stocks and bonds are not subject to capital gains tax, interest tax and estate duty tax. There is also no added cost due to higher foreign currency exchange rate charged by brokers during transactions.
Permanent Portfolio is designed to work using assets in the the investor's own country. If economic cycle goes normally, we could see both portfolio growth (consistent returns) and protection (avoid big losses) in Permanent Portfolio using investor's own country assets, such as in the U.S. There are also cases where there are disruptions to normal economic cycle, which is when we need our portfolio to automatically provide sufficient capital protection. An example is Japan where since 1989, deflation exists and the stock market has been in negative growth generally. A Japan Permanent Portfolio using Japanese assets would likely have almost no positive growth since 1989, yet the portfolio would likely provide much more protection to purchasing power of the Japanese Permanent Portfolio due to its long term bonds and gold allocations, compared to traditional portfolio such as a 50% stocks and 50% short or intermediate term bonds portfolio. In another extreme case such as Iceland, which let its banks default on their debt obligations in 2008, the Iceland stock market dropped drastically that year and Iceland currency krona lost its value significantly against other currency. The 25% 'only' in stock limited damage to Iceland Permanent Portfolio, while the 25% gold became worthed significantly more kronas and helped preserve or increase buying power of the portfolio. Iceland Permanent Portfolio would have given its investor much more protection compared to traditional portfolios that uses greater percentage of stock and lack gold protection. A case study for Iceland Permanent Portfolio can be seen here: http://europeanpermanentportfolio.blogspot.sg/2009/08/permanent-portfolio-in-iceland.html
A comparison of different country's Permanent Portfolio can be seen here: http://europeanpermanentportfolio.blogspot.sg/2010/06/historical-returns-overview.html
Different portfolio provides different benefits and disadvantages. There is no sure thing in investment, and investor always need to analyse the risks and rewards and decide what strategy is best for themselves according to their individual needs and wants, their risk tolerance level and their level of investment competency. It is my hope to provide enough insights to how Permanent Portfolio works so that new investors can have sufficient info to make an informed choice for themselves.