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Change? Everybody talks about it, but how often does real change occur? September 15, 2008

Posted by shaferfinancial in Uncategorized.
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Change seems to be the buzzword for politicians these days.  But how often does real, structural change occur?  Less than most people think.  And what causes change? Usually technological advancements pushes the forces of change. The last period of real technological advancement occurred in the 1940-1970 time period.  Previous to this was the post Civil War era which saw significant change.  Silicon chips were developed for missile technology leading to changes from computers to refrigerators.  The internet and communication technology (satellite, cell phones) again came from the pentagon to capitalists to you. Container technology (developed during the Vietnam War to get military equipment to Asia) made it possible to efficiently move parts and consumer items around the globe.

Along with this technological change came new companies with new ideas, applying enormous pressure to the old guard.  Hence, that period of time from 1945-1975 of stable capitalism, stability in employment, stable investor returns was turned on its head.  The king and queen (large manufacturing firms and organized labor) were beheaded.  The new king and queen were consumers and investors.  They demanded cheap products and high returns resulting in enormous pressure on companies and labor.  The result was unstable employment, and bankruptcy (failure) for many companies.  Ask yourself what has happened to IBM, General Motors, Merrill Lynch,  Eastman Kodak, US Steel, AT&T, Penny’s, K-Mart, many banks,  etc.  Organized labor is only a small percentage of what it was with little if any power.

Not only was this process happening in the US, but in Japan and Europe the same process was occurring.  The change was deep seated, world-wide, and permanent.

Nothing any politician says about change, nothing public policy can do, nothing any political party can do, will change what has happened.  Of course, some future technological change will, but that it at some undetermined point in the future.

The truth is, it is the golden age to be an investor and a consumer.  The entry cost to enter the business world has dropped to almost $0.  Knowledge is critical, experience helps, and those that act as if these changes haven’t occurred will mostly fail.

Call me at 727.804.9271 or e-mail me at dave@shaferwealthacademy.com.  I await your contact.  You need a guide if you are still behaving like it is 1975.  



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