Today I am writing more basic philosophical thoughts about investing. What are your goals for your money? One primary goal for most people is and will be to multiply your money for present and future financial needs and desires. But another goal may be to promote a particular area of development.

For example, you may want to promote space exploration. There are a few public companies involved in that holistic effort or in developing and supplying major systems necessary for it. For you, that could be just as important as earning an eventual profit from it. An investment in the science is almost always a long-term project.

If you have billions of stock value like Warren Buffet at age 94, you too could be focused on creating value 20 to 30 years from now. Warren is not, however, a client of ours.

But to earn money now and continuously should probably lead to a shorter time frame focus. Most of our clients are not wealthy enough to put money to work and at risk in order to potentially reap a harvest 20 years from now. Therefore, we try to invest in companies not only good for society, but which will provide returns of annual income or the expectation of a capital gain from increasing stock prices.

This is the genius of our capitalist system; the ability to write a check and buy even a small piece of ownership in a company. I often opine that this one feature of American life has enabled the prosperity of the middle class.

In order for this to continue, two principles must be protected. First, the rule of law is essential. Federal laws enacted in the 1930’s helped to tame our Wild West environment of investing then in place. It was simply Buyer Beware before then and this was a major contributor to the boom and bust of the late 1920’s. This includes the protection of owners’ rights.

Second, we must keep the federal government from picking winners and losers. Remember Solyndra, the new solar wonder company? We, the people, picked up another $535M tab for it.

When government funds, protects, or enables companies to have favored status and uses them, they become monopolies or oligarchies. You have the essence of a fascist state. You may still have personal freedoms of speech and financial decision. As in Nazi Germany, good luck getting along very well against all that power.

This is why it is so important that we all get to vote with our money. When honest information is available, we have the freedom to make our own decisions and collectively decide which technologies will grow and prosper or rather die from lack of support. Investing is democracy in action.


(Past performance is no guarantee of future results. The advice is general in nature and not intended for specific situations)