Broker Check
A Personal Note from Cam - Dated December 22, 2023

A Personal Note from Cam - Dated December 22, 2023

December 21, 2023

 Personal Note from Cam – Dated December 22, 2023

 
Risks and uncertainties abound as 2023 comes to a close.

The war in Ukraine continues.  The heart-wrenching massacre in Israel and heinous acts of terror on October 7, 2023 turned into war, and is now a fight for survival for the Jewish nation.  And here in America, with polarization in Washington D.C. continuing and a presidential election just 11 months away, both political parties continue to go too far.

How the “Master Narrative” Undermines Our Perspectives

 Each of you, as our clients, are a microcosm of the population in the United States of America.  You cover all spheres of the political spectrum and the religious spectrum of our country.  Some are married.  Some are divorced.  Some are single.  Some are widowed.  Some are gay.  Each of you have abundant talents and gifts to share.

Some of you seem to have a more accurate view of the world.  You tend to have the ability to balance the negative depiction that is promoted 24/7 on social media while others cannot.

In ongoing conversations that Trevor and I have with you, we have found over the past few years what we call the "Master Narrative."  It is relentlessly negative depiction of our nation promoted by academia, Hollywood, and-in particular-the mainstream media.

It goes something like this...

“We live in a racist, sexist, homophobic nation during a perilous period of decline.  Wages are stagnant.  Poverty worsens.  War and terrorism are on the rise.  Violent crime is rampant.  Air and water quality is declining.  Greenhouse gas emissions are increasing.  And it is all underpinned by a grossly unfair economic system-called capitalism-based on greed, selfishness and exploitation, where "the fortunate" get rich and everybody else gets poorer.”

There is not a grain of truth to this meta-narrative.

Sure, we all know people who are racist, sexist or homophobic.  But that hardly defines the nation. 

Polls consistently show that the majority of Americans today favor gay rights and interracial marriage.  No other majority-white country in the world has elected a one term-much less a two-term-Black president.

The average woman in this nation makes less than the average man.  But that is not de facto evidence of discrimination.  After accounting for vocation, specialization, education, experience and hours worked, the difference between what men and women earn in this country is negligible.

I think it is very important to remember that it is against federal law to pay a woman less than a man for the same work.  We certainly have no shortage of tort attorneys that would be filing class action lawsuits right and left if this were true and they had the opportunity to do so.

The United States had never been less racist, less sexist, or less homophobic than it is today.

On the environmental front, air and water quality has been improving for decades.  Urban waterways that had been left for dead-Puget Sound, Chesapeake Bay, Boston Harbor, Lake Erie, and many others-have been recolonized by birds, fish, marine mammals, and intrepid swimmers.

U.S. greenhouse gases fell 10.3% during the COVID-19 pandemic, resulting in the lowest emissions in three decades, according to the private data research firm Rhodium Group.

The United States has not fought a war against another great power since 1945.  And terrorist attacks in America-despite what you hear on the evening news-are down, not up.

Despite an increase in cities like Chicago and Baltimore, violent crime has been declining in the U.S. for years.  And, incidentally, divorce rates and abortion rates are also down.

Wages stagnated during the Great Recession. But they are now raising at the fastest pace in years.

Many Americans believe that poverty is increasing when they hear that the U.S. middle class is shrinking.  Not so.  The middle class is shrinking because Americans are moving up.  More households than ever are earning over $100,000 a year.

Since we live in a knowledge-based society, those with advanced degrees and specialized skills have been getting wealthy faster than others.  But every quintile is rising.  American incomes in inflation-adjusted terms, have more than tripled in my lifetime.  Both household income and household net worth are currently at record levels.

And the idea that our economic system is based in selfishness, greed and exploitation is a laughable mischaracterization.  Yes, Americans are motivated by rational self-interest.  So are people everywhere.

The beauty of capitalism is that it says you can have whatever you want if you just provide enough other people with what they want.  Explain to me how that's a bad thing.

Businessmen are greedy? Here's a reality check...

You can be the greediest business person in the world and no one is going to give you a dime until you provide them with a product or service they want to buy.  Free market transactions are voluntary.  If you do not want to work for a company, buy from a company, sell to a company, invest in its shares, you do not have to.  Where is the exploitation in that? 

In short, the "Master Narrative" put out by the mainstream media, academia and Hollywood is-to put it bluntly-bunk.  No wonder polls show that Americans have less trust in the media than ever.

More to the point, why would anybody risk his or her hard-earned money in the stock market if they live in a horrible nation at a terrible time and the world is truly going to hell in a handbasket?  We do not...and it is not.[1]

Was the Innkeeper Greedy or a Generous Capitalist?

As the year comes to a close, and with Christmas just three days away, I wish to share a reflection first authored about 14 years ago by colleagues at First Trust.[2]

For me and many others, the Bible story of the virgin birth is at the center of much of the holiday cheer this time of year.  The book of Luke tells us that Mary and Joseph traveled to Bethlehem because Caesar Augustus decreed a census should be taken.  Mary gave birth after arriving in Bethlehem and placed baby Jesus in a manger because there was “no room for them in the inn.”

Some people might suggest that Mary and Joseph were mistreated by a greedy innkeeper, who only cared about profits and decided the couple was not “worth” his normal accommodations.

This version of the narrative has been repeated many times in plays, skits, and sermons.  It fits an anti-capitalist mentality that paints business owners as greedy, or even evil.

It persists even though the Bible records no complaints and there was apparently no charge for the stable.  It may be the stable was the only place available.  Bethlehem was over-crowded with people forced to return to their ancestral home for a census–ordered by the Romans–for the purpose of levying taxes.  If there was a problem, it was due to the unintended consequences of government policy.  In this narrative, the government caused the problem.


The innkeeper was generous to a fault–a hero even.  He was over-booked, but he charitably offered his stable, a facility he built with unknowing foresight.  The innkeeper was willing and able to offer this facility even as government officials, who ordered and administered the census, slept in their own beds with little care for the well-being of those who had to travel regardless of their difficult life circumstances.

If you must find “evil” in either of these narratives, remember that evil is ultimately perpetrated by individuals, not the institutions in which they operate.  And this is why it is important to favor economic and political systems that limit the use and abuse of power over others.  In the story of baby Jesus, a government law that requires innkeepers to always have extra rooms, or to take in anyone who asks, would “fix” the problem.

But these laws would also have unintended consequences.  Fewer investors would back hotels because the cost of the regulations would reduce returns on investment.  A hotel big enough to handle the rare census would be way too big in normal times.  Even a bed and breakfast would face the potential of being sued.  There would be fewer hotel rooms, prices would rise, and innkeepers would once again be called greedy.  And if history is our guide, government would chastise them for price-gouging and then try to regulate prices.

This does not mean free markets are perfect or create utopia; they are not and they do not.  Businesses cannot force you to buy a service or product.  You have a choice–even if it is not exactly what you want.  And good business people try to make you happy in creative and industrious ways.

Government does not always care.  In fact, if you happen to live in North Korea or Cuba, and are not happy about the way things are going, you cannot leave.  And just in case you try, armed guards will help you think things through.

This is why the Framers of the U.S. Constitution made sure there were “checks and balances” in our system of government.  These checks and balances do not always lead to good outcomes; I can think of many times when some wanted to ignore these safeguards.  But, over time, the checks and balances help prevent the kinds of despotism we have seen develop elsewhere.

Neither free market capitalism, nor the checks and balances of the Constitution are the equivalent of having a true Savior.  But they should give us all hope that the future will be brighter than many seem to think.

Wishing you a wonderful New Year.

Cam


Footnotes:

[1] How the “Master Narrative” Undermines Investors. Alexander Green. Liberty through Wealth. July 30, 2021, and above.

[2] Greedy Innkeeper or Generous Capitalist? Brian S. Wesbury, Chief Economist and Robert Stein, Deputy Chief Economist, First Trust Advisors, L.P., December 18, 2023, and following


Disclosures:

The information provided is not a complete analysis of every material fact and are subject to change.

Registered Representative offering securities and some advisory services through Cetera Advisor Networks LLC (doing insurance business in CA as CFGAN Insurance Agency LLC, CA Insurance License #0644976), member FINRA/SIPC.

Advisory services also offered through CTA Wealth Advisors, Inc.., a Registered Investment Adviser.

CTA Wealth Advisors, Inc. and Cetera Advisor Networks LLC are non-affiliated companies.

The opinions expressed in this letter are those of Cameron M. Thornton, CFP®.  All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.  All economic and performance information is historical and not indicative of future results.  Past performance does not guarantee results.

For a comprehensive review of your personal situation, always consult with a tax or legal advisor.  Neither Cetera Advisor Networks LLC nor any of its representatives may give legal or tax advice.

A diversified portfolio does not assure a profit or protect against loss in a declining market.

Investors cannot invest directly in indexes. The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.

Websites provided as a courtesy and are not under the control of Cetera Advisor Networks LLC or CTA Wealth Advisors, Inc
Cameron M. Thornton, CFP® is a Registered Representative with Cetera Advisor Networks LLC and may be reached at www.ctawealthadvisors.com or
(818) 841-1746.


.