The author argues that these four types of investments are very unlikely to go down at the same time - if one loses a lot, the other types grow.

    "	It might seem that a Permanent Portfolio
    containing these four contradictory investments would
    be neutralized: As one element rose, another would fall
    and nothing would be gained.
        	On a day-to-day basis, that can be true.
    But over broad periods of time, the winning investments
    add more value to the portfolio than the losing 
    investments take away."

He gives some numbers in the book, from 1970 till 2002 the portfolio lost money only in four years: 6.2% in 1981, 0.7% in 1990, 2.4% in 1994, and 1.0% in 2001. Three of these four years were followed by double-digit gains. The average gain was 9.5% per year.

70-02 period is pretty irrelevant in today's world though. how did such portfolio perform during Great Depression, which is more like what we face today?

Would it have been possible to raise $8m in VC funding for a glorified slideshow during the Great Depression?

I think the author wrote from personal experience, so he could be either too young or not even born yet during Greate Depression.

unfortunately investment advice written from personal experience is pretty useless if not harmful.