passage of time

Does Money Go Stale?
photo shows various jars full of noodles, rice, and other food goods

An old proverb suggests “nothing ventured, nothing gained.” It seems like a great tagline for an action movie, huh? Maybe some adventurers go chasing lost treasure, a tale of bravery and throwing caution to the wind and winning it all!

Okay, so our work isn’t always quite that exciting, but it is thrilling to us. And we believe “nothing ventured, nothing gained” has a story to tell about our financial adventures.

Some of us still know folks who feel best with their money in cash under the (literal!) mattress. We need to know where our cash is coming from, but when we say that, we mean that we need enough liquid resources available to cover what we need to cover in the shortest term. It does not need to come from the mattress, the pantry, or the piggy bank.

It’s more important than that, though. When we leave money sitting, we are letting its power go to waste. It’s just like letting an ingredient go stale: the flavor and the potential power are gone, and then it has less utility than it had when you first got it.

This is also part of what people mean when they say “avoid leaving money on the table.” You let it sit, you forfeit some of its power. Keeping it close doesn’t necessarily keep it safe. Inflation, time, and other forces will do their work whether your money gets out in the world or not.

“Nothing ventured, nothing gained”? It makes a certain sense. No guarantees, but we’re glad to be on this adventure with you.

Clients, when you’re ready to get things in motion, reach out.

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Does Money Go Stale? – 228Main.com Presents: The Best of Leibman Financial Services

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The Long View

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The unemployment rate dropped to 3.5%, a fifty-year low, according to the Labor Department’s report for September. Like clockwork, some observers were quick to find the clouds around this silver lining.

That got us to thinking about life fifty years ago compared to today. Looking at the facts, it is hard to think of it as anything but unimaginable progress. In 1970, more than three quarters of homes lacked air conditioning. Televisions were only in 61% of them. 38% had washing machines. One in twenty lacked indoor
plumbing. There was about one land line telephone for every two people.

More startling are the things that nobody had in 1970, because they had not yet been invented. Mobile phones, digital cameras, post-it notes, email, video games, inkjet printers, MRI scanners, fiber optics, personal computers, GPS, and the internet, to name a few of them.

Median household income, adjusted for inflation, grew 37% over that half century. The rich got richer, but the average household made a lot of progress, too.

However, life isn’t all puppy dogs and rainbows, as an older acquaintance of mine likes to say. The economy grew and shrank in its cycle of expansions and recessions. The stock market, measured by its major averages, also went up and down year to year, sometimes sharply.

In between the record low unemployment rates at the beginning and end of the fifty years, we had three episodes of unemployment in excess of 10%.

We have noticed that when times are bad, some have difficulty imaging a recovery. And when times are good, some can scarcely think about the possibility of poor times returning. We humans like to believe that present trends and conditions will persist, good or bad.

The bad news is, the economy and the markets will continue to go up and down. The good news is, over the long term we have made amazing progress on almost every front. The past is no guarantee of the future, of course. In our opinion, there are many reasons to believe our progress will continue.

Clients, if you would like to talk about this or anything else, please email us or call.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.

The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful.