optimism

Can Happiness Buy Money?

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A very long time ago, I attended a convention and heard something worthwhile. In those days, a convention was mostly a rah-rah meeting to crank up insurance salespeople to get out there and sell more. Some of the content was not that great, as you might imagine.

But at this particular meeting, the featured speaker posed a pair of questions that resonated very deeply. Whether the incident changed my life or not would be hard to say. I may have been born this way.

The speaker started off by saying he wanted to ask two questions. “The first one, raise your hand to say yes—do you do more business and make more money when you are happy, as opposed to upset or mad?” Of course, everyone in the crowd raised a hand. Obviously, people dependent on making calls and taking the initiative would be more active when not upset—with an impact on their income.

The second question contained the hook. The speaker said, “No need to raise your hand on this question. Just think about it. Since we have all agreed that we do more business and make more money when we are happy, WHO IS IN CHARGE OF THAT?”

Friends, I cannot tell you where the meeting was, what year it occurred, or anything else about the agenda. But the notion that each of us is in charge of our own happiness is burned indelibly in my brain.

Life is not all puppy dogs and rainbows, of course. Some people are not happy, and none of us is in position to judge anyone else. Each of us has challenges. The pessimists among us are the ones doing the disaster planning, and pulling us back when our thinking goes too high up into the clouds.

We’ve written before about investing with the confidence that things work out even when they look bad. And it is easy to believe that our current challenges are the biggest yet, although history suggests otherwise. Perhaps happiness is a productive state.

We cannot prove that happiness brings money. But I will continue to act as if that is the case, since life is better when I do. Clients, you will each have to make up your own mind, but I will do my best to improve your happiness and your wealth—no guarantees on either. Please write or call with questions.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Niche Market of the Mind

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In every field of human endeavor, it seems that the best of the best are specialized. From the doctor who specializes in one form of cancer to the CPA who works mainly with trucking companies, specialists rule.

In business, the shorthand term is “niche marketing.” Financial advisors may work with people of a specific religion, those with shared hobbies or interests, people who work in a particular field or for a certain company, or those with some other traits or characteristic.

If you know us, it should not surprise you that we are different. Our niche market encompasses retirees and workers and truck drivers and executives and nurses and engineers and teachers and accountants and married couples and widows and single people. At first glance, this may seem to be a poorly defined client group.

But our clients represent a very well-defined group: it is a niche market of the mind.

We work hard to qualify clients by productive attitudes toward investing—and we are not afraid to try to train clients if the right attitudes don’t come naturally. A tolerance for volatility and a fundamental confidence, as a society, we stumble our way through our problems are two of the elements we need to have.

The rewards for pursuing this niche have been amazing. While other advisors cope with massive defections from informed strategy when the outlook darkens, our clients tend to stay the course. We avoid the curse of “cash on the sidelines,” waiting and waiting for that comfortable moment to get back in the game after selling out. We never promise stability, so we spend less time apologizing for the inevitable volatility.

In short, we can do our best work for people who are in the best position to profit from it over the long haul.

Is it always easy? Is it always fun? Of course not. The market goes up and down, and “up” is a lot more fun than “down.” Pessimism and optimism ebb and flow, and it can be tough to buck the crowd. Any rational person has to scratch their head in the toughest times and wonder whether they are doing the right thing. But together we have tended to make appropriate decisions.

Good information communicated well helps drive effective behavior. Behavior can help determine investment outcomes. Good outcomes can increase account balances. And we get paid on account balances. This is why we are doing what we do.

We don’t care if you engineered the truck, or drive the truck, or own the trucking company… if you have what it takes to invest successfully, we specialize in you. This is why we strive for a niche market of the mind.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results.

Poverty, Prosperity, Optimism, Pessimism

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“What causes poverty? Nothing. It’s the original state, the default and starting point. The real question is, What causes prosperity?” – Per Bylund, Ph.D.

Some believe that my persistent native sense of optimism must be evidence of a traumatic brain injury in my youth. A more pessimistic person once asked me if I wasn’t reading the papers or watching the news. But one of my aims every day is to see and understand the world as it is around us. So let us dispense with talk of being dropped on one’s head, and ponder the megatrends that shape our part of history.

The World Bank calculates that in 1990, 37% of the population of Earth lived in extreme poverty, with incomes of less than $1.90 per day (2011 dollars). One can imagine the privations that accompany such massive and grinding poverty, from poor sanitation and dirty water to disease and lack of basic health infrastructure.

In twenty-five short years, the population count in extreme poverty declined to less than 10% of the people—down from 37%. These 700 million have all the same challenges and problems of the nearly 2 billion poor back in 1990, and we cannot minimize the gravity of the situation for these people. Yet never in history has so much progress been made in such a short amount of time for so many people—hundreds of millions of people were lifted out of extreme poverty.

Measuring progress another way over a longer time frame, global life expectancies have been calculated to be less than 30 years in 1870, and around 71 years in 2013. Life spans more than doubling in 150 years! In either of these cases, poverty and longevity, it seems unlikely that anyone around at the beginning could have believed the progress that was about to unfold.

One naturally wonders about the factors behind the wonders of modern times. I’d like to think our progress depends on the degree of freedom that each of us has to make the most of our own potential, in societies with the rule of law and respect for the rights of the people. My idealized concept of our economic system is that the surest path to prosperity is being of value and service to others, a sustainable and ever-improving system.

We have challenges, problems, issues, aggravations, and troubles—as always. But my optimism remains based on reality.