Often times, our perception of things, places and people is unwittingly clouded by our biases and preconceived notions. What we think we see and know becomes an intimate part of who we are and how we come to see the world. The challenge is to remain open to new information and reevaluate our positions for a better understanding of how we interpret our world.
I started out on a very overcast day driving down I-91 in Vermont to a introductory meeting with an partner of a New Hampshire trust company. The forecast was for increasing rain as the first drops from Tropical Storm Nicole splattered my windshield. Lucky for me, it was foliage season. The hills were covered with brilliant red, orange and gold bursts of color. The drive became somewhat hypnotic as mile after mile brought endless vistas of quaint little towns nestled in a bouquet of fall colors. I smiled at my good fortune to be taking in the breathtaking views in such a wonderful setting. I sipped my coffee and flipped on the radio to catch the morning's news.
The commentary turned to a story on the local Vermont economy and how families have been coping the past few years. I had always heard that Vermont was a relatively poor state. I knew that local tax rates were quite high (and increasing), there were less job opportunities than the big urban areas and just about everyone I knew was belt tightening and being conservative with their money and investments. What the announcer said next was what stopped me short. "In 2009, 19% of Vermont children lived in poverty". According to the US Department of Health and Human Services, the poverty level for a family of 4 is in a range of $22,000-$27,000 per year depending upon which state you live in. In Vermont, they define it has roughly less than $900 per month for a single person. A report by the Kaiser Family Foundation found a record number of Americans signed up for Medicaid last year bringing the total to 48 million people or almost 16% of the US population. I'm a financial planner and, to be honest, I don't know how you feed, clothe and provide shelter for 4 individuals in America on so little let alone go to the doctor or pay for kids' schooling, music, camps, sports, etc. The countryside was indeed incredible, an idealist's paradise. Yet, it also contained a lot of people struggling just to get by everyday.
The rain was picking up now and the incoming fog muted fall's colors into a mottled, mosaic of its former brilliance. The radio switched gears to a discussion of the upcoming general elections in Brazil. The two-term President of the eighth largest economy by GDP, the popular Luiz Inacio Lula da Silva was stepping aside as the law required. Highlights of his presidency include paying off early the nation's IMF debt; overseeing an expansion of needed infrastructure and social programs; stabilizing the economy; enacting a pragmatic foreign policy; and an upgrade in the nation's credit rating from speculative to investment grade. Since his term began, the announcer stated the impact of Brazil's success has resulted in an amazing 30-35 million people added to the middle class. This is an astounding number! Imagine over 30 million additional US buyers of cars, homes, washing machines with additional Starbucks to serve them all coffee! The investment opportunities that have been created in manufacturing, the service industry, banking, trade and construction create exciting possibilities for foreign investors. No longer a nation known only for its slums, the beaches of Rio, Brazilian futbol and rain forests, this nation has transformed itself to become the dominant economy of the southern hemisphere and an increasingly important player on the world stage.
We take false comfort in what we see with our eyes and what we believe to be true in our minds. Yet, that is no substitute for reality. In an instant, a few simple facts can change your entire view of a nation or a small, New England state. I've reoriented my thinking so that when I stop at a local farmer's market, I may be helping put money on the table of a family that so desperately needs it. I can also see a country like Brazil with new eyes and realize its great investment opportunities and can understand some of its dynamism.
Rain and spray kicked off the highway in front of me. You could still see the trees but there was less clarity and more uncertainty in the driving and the view. Having an accurate world view is important for investing opportunities or identifying problem areas in your own backyard. We need to see things they way they really and not fall back on comfortable assumptions of what we think we know.
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