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I’m a bit surprised that no one else has chimed in to outline the substantial and uncontrollable risks in such a strategy.

First you have the currency risk: if unhedged holdings are dominated in a foreign currency and the dollar moves the wrong way relative to your holdings, you have lost value losing value if your holdings must converted back into dollars for US purchases. Essentially an unhedged bet on such holdings in foreign currencies is a bet against the dollar and against the US economy, which is still the 400 pound gorilla in the room.

The second is liquidity risk: If major economies become substantially more disrupted than currently, will there be a ready domestic or international market market for (for example) preferred shares in a foreign bank? You might have to end up selling at a very deep discount if you need to liquidate such holdings on short notice.

The third is sector risk: Investments in the preferred stock of any bank is in part a bet on the general health of the banking portion of the financial sector as the preferred stock of a sound bank will almost certainly lose value irrespective of its objective worth as subjective opinion devalues the entire sector.

The fourth is diversification risk: To the extent you have concentrated your net worth in any particular asset class or sector of the economy, you’ve “bet the farm” on its fortunes at the point at which you must liquidate your investment. A sound investment program attempts to minimize the risks of over-concentration in any particular asset class, and an investment program that recommends over-concentration on any asset class is inherently risky.

The fifth is confiscation risk: if the economy gets bad enough in any advanced economy the government is eventually going to consider bank nationalization, which will wipe out - or at least greatly reduce - shareholder and bond holder value.

None of this is a reason not to hold foreign investments including foreign currencies in reasonable proportion in a diversified portfolio.

But IMO a recommendation for wholesale conversion of personal wealth into holdings in foreign banks is extremely risky strategy, and almost certainly runs much higher real risk of substantial losses than the possibility that the FDIC will fail to reimburse insured depositors in US institutions.