Q. In the past, you have argued that optimism is the only rational outlook for the future. That flies in the face of the current mood in America and elsewhere. Do you still believe that and why?
A. That optimism flies in the face of “the current mood” is almost reason enough to embrace it, all by itself. But I carry in my back pocket more computing power than existed on Earth when I started kindergarten in 1949, and a million times more than E. F. Hutton had when I joined that firm in 1967. I have been almost effortlessly cured half a dozen times in my life of illnesses which, had I been born 50 years earlier, would have killed me. Both these staggering improvements in the quality of life are compounding exponentially, as indeed is all information technology—and all technology is information technology.

As the developing world continues to adopt free market principles, it continues to pull tens of millions of people a year out of poverty—first to become producers and then consumers. America remains the most entrepreneurial, flexible, transparent economy in the world. We virtually own science. Nearly all (if not all) of the revolutionary global companies started since the advent of the microprocessor are ours; this country throbs with opportunity for the path-breaking technologist.

We’re one of the richest countries in mineral resources, and the only one which vests the mineral rights in the landowner—just when we’ve perfected the synthesis of horizontal drilling and hydraulic fracturing. We may very soon be an exporter of hydrocarbons—a major boon to Americans and a source of strength for the dollar. Cheap natural gas is bringing manufacturing back home. I can go on and on like this. I’ve never been more optimistic in my life than I am today.  

Q. If an advisor wanted to focus his or her practice on just one idea for the foreseeable future, what would it be?
A. That when an American (or an American couple) steps across the threshold of retirement, they find themselves facing two doors. Door Number One says, “The money outlives the people.” And Door Number Two says, “The people outlive the money.” And the newly minted retirees must pass through one door or the other. It’s as stark and as simple as that. Forget debt, the demographics of aging, unfunded entitlements, global monetary policy, and all those other amorphous imponderables we can’t predict, much less control. Focus on what we may be able to control, if and only if the client will let us: whether the money outlives the folks, or they outlive their money. There is treasure on Earth and in heaven for those advisors who make it their mission to help people plan their way through Door Number One.


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