Ideas Worth Spreading

by Paul Sutherland

Posted August 10, 2010

Current Observations

August Edition

Is it Still Winter?

by Jeff Lokken, CFP®, ChFC®

Taxing Issues

by Jim Frye, CFP®

PDF Version

There are so many things in the world to be positive about – socially and economically. There are, of course, negative, awful things that happen. But as investors we don’t have to go there. So in this article and Jeff’s, we invite you to walk with us on the bright, refreshing, sunny side of the street.

And Now the Good News

I consider myself supremely lucky. In my world I get to hang out with creative and successful people and work with clients who are gifted, accomplished and concerned citizens. As investors we seek companies that have great businesses, in great industries, with management that anticipates competition, government regulations and views a slow economy as a challenging period during which opportunities are created.

Thankfully, except for the black swan global financial tsunami in 2008, we feel we have successfully been consistent about making money for our clients for more than 25 years. Actually, if a client had fallen asleep 10 years ago and woke up today to see their portfolio, they might ask, “What tsunami?”

I invite all FIM Group clients to our website – www.fimg.net – to view a publication that a typical prospective client might read in their quest to find an investment manager. Without pretense or eloquence the piece is titled “Investing Without Borders.” Barry Hyman, Jeff Lokken and I also recently conducted a webinar titled “What Do You Own and Why,” in which we presented our thoughts on the current economy, markets and investments. The webinar is posted on our site or can be ordered free of charge as a CDROM by calling our office.

Opportunity in the Mayhem

At FIM Group we believe in transparency, and our statistics are reflective of that belief. For example, we don’t cherry-pick accounts. Instead, we clearly show how we arrive at our performance statistics, all of which reflect amounts after fees, commissions and non-tax expenses have been deducted. The secret to our success is actually quite simple: We look for opportunity everywhere (Investing Without Borders). We don’t get caught up in the short-term groupthink, or mental malaise, that plagues the average investor who succumbs to the “mass behavior” and ends up with disappointing investment results.

Darwin aside, humans are herd animals. And while the herd is quite often safe, especially from an emotional perspective, it can be quite damaging when it comes to financial or life success. The downside of herd behavior is illustrated in the news excerpt reprinted below:

Turkish shepherds stunned after flock of 1,500 sheep leaps off cliff.
ISTANBUL, Turkey (AP) – First one sheep jumped to its death. Then stunned Turkish shepherds, who had left the herd to graze while they had breakfast, watched as nearly 1,500 others followed, each leaping off the same cliff, Turkish media reported Friday.

Source: http://www.zgeek.com/showthread.php/38285-Turkish-shepherds-stunned-afterflock-of-1-500-sheep-leaps-off-cliff

We all know the real victims in 2008- 2009 were the ones who “jumped off the cliff,” sold everything and moved to the sidelines to watch passively as literally trillions of dollars were made by those who just stuck to their plan, held on or saw opportunity in the mayhem.

TED

For years I’ve attended the World Futurist Society’s World Futurist Conference each summer, often as a speaker. This year, however, I attended the TEDGlobal event in Oxford, England. TED is a small nonprofit organization devoted to propagating “ideas worth spreading.” TED started out in 1984 as an annual conference that brought together people from three industries: technology, entertainment and design. Since then its scope has broadened to include: economics, business, education, environment, psychology, health care and other disciplines at its conferences. TED has grown significantly, and a ticket to TED is coveted.

Despite all of my current obligations, I was encouraged by my wife, friends and colleagues to attend this year’s conference, the theme of which was, “And Now the Good News” which demonstrated many others who see opportunities during mayhem. For that I am grateful, and I invite all of you to take the opportunity to attend TED if it ever presents itself.

Clients can hear TED talks by simply visiting www.fimg.net, under “client updates.” You will find hundreds of discussions that will inspire, sadden, anger, challenge, enlighten, amuse and certainly entertain. For your convenience we have highlighted some of the chats below, including photos of the speakers.