Ya Gotta Save It

(First published December 7, 2007)Do you remember that spooky series from the 80s (I think) called “Tales From The Darkside”? Like so many other shows of the time, it is, of course, now in syndication- so it is never totally lost which is a good thing. In the introduction to each episode, a funereal voice intoned darkly about how there is another world (to paraphrase) which is just as real but not so brightly lit- A DARKSIDE. It has been my experience that, in the real world (where most of us live), there is indeed a darkside- only I call it THE FINANCIAL SIDE. Its just as scary, not very well known or understood either. It has evolved over the years to become my purpose to show you how you too can master this side. Its that important. I’ve also found that showing people the way to success in the world of money- a calling that has become my passion- can lead right on to success in other areas of living as well.

Another blog I have read for a number of years is called POORANDSTUPID.COM. The writer has always maintained that there exists a powerful elite in America whose purpose is to arrange affairs (most especially information) so that you stay poor and stupid to the end. While I would generally agree, I would probably use the word “ignorant” or more accurately simply uninformed. For instance: what did you learn about managing money in school? I’ll bet little to nothing. Think that’s an accident? I don’t. I have known people who were finance and accounting majors in college who also knew next to nothing about how money really works. Now, I’m sure you already know that people seem to be completely dumbed down by what passes for an education system. What you may not know is that the original design of what we now call public schools (circa the late 19th century) was to turn out, like on an assembly line, regimented, conditioned drones for the up-and-coming industrial state then in its formative stages. The truth is that the minimal amount of “schooling “you received should have motivated you in the direction of a process of lifelong learning. All it was ever realistic to expect, considering all its inherent limitations, was to get up on a launching pad. Learning never really ends. When we cease to learn, we cease to grow- and therefore exist. If you are reading this, you have exercised a degree of personal initiative that the system never expected you to have. Good for you!
Now, I’ll get to my point. If you weren’t watching closely, you would have missed three recent incidents that illustrate this darkside I am speaking about. I outline them next:

1) Lately, there has been a minor dust-up in the media over the subject of investments in the USA on the part of so-called country or “soverign” funds. Seems some of the more wealthy or possibly better-managed countries- Saudi Arabia, Taiwan, Britain- are employing massive pools of investable funds buying stock in a number of American companies. None of this is illegal. But I have seen a number of alarmist-type articles in FORBES, BUSINESS WEEK, even in THE NEW YORKER of all places. The total amounts only seem to number in the multi-billions (so far). The overall undertone of the reportage has been suggestive of sinister motives on the part of these investing countries. My personal take on it, is that its mostly a case of sour grapes- and it probably originates in the federal government. (Always a hotbed of envy anyway). The truth you won’t hear, is that these funds come to the USA open and aboveboard from foreign countries who do a much better job than us at managing the tax money their citizens entrust to them. Rather than resisting the entry of this foreign capital, we ought to welcome it. Since these nations find a way (obviously) to run a capital surplus (ie. They don’t run fiscal deficits like a certain superpower we could all mention), we might want to take notes. Or better yet, maybe even join them. That would be novel. Since capital goes where it must in the world seeking its highest returm, we ought to be flattered. You probably won’t see much more coverage of the soverign fund issue in the future- it could quite possibly cause ordinary folks to start asking tricky questions: like why can’t we run a surplus and start investing internationally like that?

2) Another recent darkside event made a surprise appearance courtesy of (of all places again) the Clinton campaign. In an October (I’m late on this) stumping appearance, Sen. Hillary Clinton D-NY and Presidential candidate, floated the idea of the government funding an amount of money ($5000) upon the birth of a child to set aside for the future. This came to be called (by critics mostly) the “baby bond”. Its not the so-called Demogrant- a 1972 proposal from then-Presidential aspirant Sen George McGovern of $1000- but at least its adjusted for the inflation that’s happened since then. This might just be one of the reasons (I mean the historical connection) that the proposal was abruptly withdrawn to so many hoots of derision from various right wing conspirators too numerous to mention. I have the sneaking suspicion, however, that some of Hil’s Big Money Wall Street contributors yanked hard on her chain over this one. The reason, by my lights, is that it dredged up the mostly taboo subject of compound interest working in favor (in this case) of the average person.What a golden opportunity to bring a unique level of understanding in this complex subject to all of those little people she claims to care so much about. Sort of a LET THEM EAT BANKRUPTCY attitude, don’t you think?

3) There was a big flap, just last week, over the investors from the emirate of Abu Dhabi purchasing a large amount of stock in CITIGROUP. The final amount was 4.9%. There ensued a huge discussion among panelists on a Sunday morning show I like to watch called “The Wall Street Journal Report”. After the other flap just last year over the attempt to contract out several port operations to Dubai Ports World, it amazes me that these guys are risking rejection again. I admire them for both their resiliency and their eye for value. CITI stock is a bargain right now, and this large American financial corporation obviously can use the infusion of capital- whatever the source. Look, you either believe in globalization or you don’t. We have made the commitment to open up our economy, so we either mean it or we don’t. There has always been a very influential minority in the highest reaches of society and government that would like to shield our domestic companies from all forms of foreign influence and pressure.Nowadays, they even find common cause with some of the unions (an event that should make you doubly suspicious). Back in the Republic’s earliest days this so-called “infant industries” argument for high tariff walls and other trade barriers was favored by our very first Secretary of the Treasury- Alexander Hamilton. It made some sense then, but absolutely none now. Either respect the markets, and their decisions about the global allocation of always-scarce capital, or prepare to go the way of Argentina and Brazil. It’s the right thing to do. Its also how the real world works.

For The Nonce——-PV