Economic growth is still tepid and myriad problems confront the U.S. and the world. But take a step back: There’s lots of underappreciated progress occurring or about to. That positive outlook is vital for investors – and everyone else – to understand.
Certainly, the backdrop of gloom and doom is pervasive. A recent Rasmussen poll indicated 60% of U.S. voters surveyed think our nation is on the wrong track. Fear, uncertainty, and doubt can cloud one’s thinking and personal resolve as well as career and investment progress.
While the Rasmussen survey highlights discontent with the current political and economic situations, recognize that change, progress and growing abundance is a constant process.
Charles Kettering (1876-1958) was an engineer and inventor, holder of 186 patents. He founded Delco and was head of research at General Motors from 1920 to 1947. Featured on the cover of Time magazine in 1933, Kettering invented the electric starting motor and Freon for air conditioning, among other things.
Ask yourself, “Would you rather be the age you are right now, or in 1930s?” Back then, the country was struggling with the Great Depression, war clouds were gathering that would culminate in World War II and segregation ruled. Think about what did and did not exist then, what you now take for granted. For those coming of age in the late 1950s, consider the car you drove then, versus the technological marvel of today.
Kettering said, “Every time you tear a new leaf off a calendar, you present a new place for ideas and progress.” Excitement about possibilities in 2015 and beyond is easy to generate if you look around. This year I will forego a paper calendar and appointment book. It’s all in my iPhone and iPad. And so we see the future.
Bloomberg Businessweek in December focused on 85 years of ideas and technological progress, illustrating a key reality: The handmaiden of progress is disruption, obsolescence, winners and losers.
Take the iPhone, introduced by Apple in 2007. What do I not need now that I have a smart phone? I don’t need a Rolodex (kids, ask granddad what that was), a watch, stopwatch, alarm clock, compass, flashlight, calculator, paper airline ticket, camera, pay phone, directions or deposit slips to put checks in the bank.
In the 1970s, I took my family on a six-week tour of the American West. We relied on a printed TripTik from AAA as a navigation aid. Now I use the GPS in my phone or car. That technology stems from President Ronald Reagan’s 1983 order permitting civilian use of the military’s Global Positioning System, in turn based on growing space capability.
In the 1950s, when Charles Kettering passed away, a marker of progress was that almost two-thirds of American households had at least one phone, virtually all leased from AT&T, which monopolized the industry. Long distance phone calls were expensive. Western Union thrived with telegrams carrying brief messages across the country and globe. Now one can phone, text, tweet or email someone across the ocean or across the street in seconds for a pittance.
Kettering helped GM become a global behemoth, until it wasn’t. GM did not see the Japanese and the Germans coming. Remember when BlackBerry was a status symbol among busy executives on the go? BlackBerry did not see Apple coming, and neither did Nokia.
Innovation expert Peter Diamandis, chairman of the X Prize Foundation, points out that in 1980 it cost almost $600 for the average round-trip flight in the U.S. (about $1,823 adjusted for inflation as of 2014). In 2013, the average round-trip cost was $385, with low-cost mass travel commonplace.
Recently, this writer flew 8,433 miles non-stop, 16.25 hours, between Atlanta and South Africa on a Delta long-range Boeing 777 aircraft. Remember the 1960s when the Boeing 707 jet was a marvel, even as air travel was expensive by most measures?
The point: Progress and technology will continue creative destruction as entrenched legacy-bound companies give way to upstarts, altering investment dynamics. Change will present both opportunities and barriers. Gross domestic product will grow globally and at home, but leave the low-skilled and uneducated behind, as well as those who pine for “the good old days,” while not advancing in skills and knowledge.
Progress requires risk-taking and flexibility in your approach to career and business advancement and long-term investment accumulation. Kettering observed, “No one would have crossed the ocean if he could have gotten off the ship in a storm.” That’s something to remember when the ride gets bumpy.
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Lewis Walker, CFP, is president of Walker Capital Management, LCC in Peachtree Corners, Ga. Securities and certain advisory services offered through The Strategic Financial Alliance Inc. (SFA). Lewis Walker is a registered representative of The SFA, which is otherwise unaffiliated with Walker Capital Management. 770-441-2603. lewisw@theinvestmentcoach.com.
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