Despite the conflict in Ukraine and the sanctions imposed on Russia for supporting insurgents, Jim Grant is bullish on Russian stocks.
"These values are extraordinary and to the extent that saner, cooler heads prevail in the Ukraine- Russia dispute, these stocks stand to do very well," said the founder and editor of Grant's Interest Rate Observer in an interview with CNBC's "Closing Bell."
"In buying them, one is actually on the side of peace and prosperity and rationalism."
Many of the stocks are trading at 3, 4 or 5 times earnings, Grant noted.
U.S. and European leaders agreed on Monday to impose wider sanctions on financial, defense and energy sectors in Russia. That may make many investors uncomfortable, but Grant said most trades that are any good often make people uncomfortable.
"The risks are self-evident and frightening, but sometimes the worst does not happen. Sometimes it does. That's the gamble. This is truly a gamble," he said.
Another contrary investment he has his eye on is mining stocks, which are "almost as thoroughly hated as Russia." He thinks they are a sound inoculation against the Federal Reserve's monetary policy, of which he's been a critic.
"Gold is to me the legacy monetary asset, and it stands to benefit from the demonstrated as opposed the theoretically likely crack up of these monetary arrangements."
The credit market, on the other hand is overvalued, particularly the sovereign debt markets.
"The central bank imposed interest rates are the source of global financial instability now and in the future," he said.
"The Fed … has manipulated us into a period of quite eerie stability and measured volatility. It has manipulated us into a time of remarkably artificially low credit spreads," Grant said.
—By CNBC's Michelle Fox. Reuters contributed to this report.