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Examiner
  • Ron Finke: The future is positive

  • I begin today with President Truman’s words: There is nothing new in the world except the history you do not know. That is why I am optimistic about the future of business and investing at this time in history.

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  • I begin today with President Truman’s words: There is nothing new in the world except the history you do not know. That is why I am optimistic about the future of business and investing at this time in history.
    What do I mean? Business is just the activity of groups of people meeting specific needs and/or wants of people. Investing is simply the way anyone can participate in helping businesses meet those needs and be rewarded with gains from the use of their financial capital.
    This is the greatest time in the history of the world for both business and investing. It has never been easier with less cost to take advantage of more opportunities by putting money to work anywhere in the world. Why? Freedom of individuals, new technologies, and greater availability of education for the world masses are primary factors.
    Thirty one years ago when I started in the financial industry, not even your downtown stockbroker had a real time quote for any stock. If you wanted to buy 100 shares of something, it would cost you several hundred dollars. You had better be right about your pick because the transaction costs were massive. Therefore, you stayed with it, often even if it cratered. Buy and Hold was the strategy.
    You could buy stocks, individual bonds, or choose from a few hundred mutual funds that were all collections picked by a fund manager. Most days, the Kansas City Times would have the closing prices for most stocks and funds in time for its morning edition, delivered to you before you arose. You had to buy or sell through a broker unless you bought your own personal seat on an exchange. Information was slow if you could even get what you wanted.
    Today, you can get real time pricing of most investments for free (if you are not a financial professional), information from your pick of myriad websites and other sources, pay as little as a few dollars per trade, have access to several thousand mutual funds without paying a sales charge, . . . and, oh yes, invest in almost any country on the planet where there is economic activity of any kind. You can do it all yourself or still hire a commissioned broker, an adviser paid by fee, or visit a retail office with salaried employees.
    The rest of the story lies in the human problems that are being tackled and solved with new technologies. That is for another column coming soon.
    This column ends with the fact of historical trends. If you look at the prior recurring periods of horrible stock market results such as 1916 through 1920, 1929 through 1942, and 1973 through 1981, you will find that when everything seems to be broken beyond repair, the bad trend ends. Despite all doom and gloom, there begins an uptrend in values for investors for the next decade, sometimes 15 to 20 years.
    Page 2 of 2 - We could all stand to make up for some lost time, don’t you think?
    (Past performance is no guarantee of future results.)
    Ron Finke is president of Stewardship Capital in Independence. He is a registered investment adviser. Reach him at rcfinke@stewcap.com.
     
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