None. Zero. Zilch.

In fact, 35% of Americans said they would have difficulty covering an unexpected $400 expense.

This has brought on the predictable complaints about economic inequality, our “rigged” system and how capitalism is broken.

That’s Bravo Sierra. And you know it.

Let’s consider a few basic facts… always a good starting point.

In 2019, U.S. median household income reached a record $68,703.

Unemployment is declining. Wages are growing.

And, as the Federal Reserve recently reported, U.S. household net worth is also at a new all-time record.

If capitalism is broken, please do me a favor. Don’t fix it.

“But not everyone is sharing equally in the prosperity,” critics say. What they don’t say is that people in free societies everywhere have unequal outcomes.

You want great economic equality? Visit North Korea. Or Cuba. Or Venezuela. Everyone is equal in their misery.

Capitalism isn’t broken. What’s broken are public education and today’s context-free journalism.

For starters, academia and the mainstream media apparently don’t realize that capitalism is an economic system, not a political one.

In a free market system, highly skilled people who work the most get paid the most. Less skilled people get paid less. And people who can’t or won’t work don’t get paid at all.

Then our political system – through taxes and transfer payments – leavens that inequality.

Of course, millions of folks, whether they have high incomes, low incomes or something in between, don’t live within their means.

They have comfortable salaries. (And homes, cars, trips, meals out… and closets, attics and garages full of stuff.) What they don’t have are savings. Not because the economy is broken but because they don’t live within their means and set something (anything) aside.

Or perhaps they saved but – because they’re risk-averse or uninformed – never invested those savings to earn higher returns.

True, some lucky ones are born with higher IQs and into more affluent households with better or more devoted parents. That’s life. And, as your mother told you when you first complained about it at age 4, it isn’t fair.

No politician, no law, no social program and no magic wand can change that.

Good or bad, we all must play the hand we’re dealt. You do that by 1) making the very best choices you can and 2) taking responsibility for your actions.

If you don’t do those things, trust me – you will not have a happy, successful life.

Yet some today – especially politicians running for office – don’t want you to feel responsible for the life you’ve created with your choices.

Didn’t stay in school? Not your fault.

Don’t have any marketable skills? Not your fault.

Can’t keep a job? Not your fault.

Can’t stay out of trouble with the law? Not your fault.

Had kids you can’t support? Not your fault.

Never saved a dime… and certainly not $400? Not your fault either.

Welcome to the new “post-responsibility” society, where individual efforts don’t matter and it’s wrong to judge others by their character and actions.

Sorry. I don’t buy it.

I have a middle-class background myself. I grew up in the South in a home without air conditioning. (I also went to crummy public schools that weren’t air-conditioned.) I had no great genetic gifts, no connections, no inheritance.

In college, I could not afford to call home except on Sundays after 7 p.m. (Remember those days?) I didn’t take (because I couldn’t afford) a commercial flight until I was in my mid-20s.

As a young man, I worked a succession of tedious, brain-dead, low-paying jobs, including waiting tables in a tavern, maintenance on a truck terminal and the night shift in an auto parts warehouse.

I lived in modest accommodations, drove a beater car (the stereo was worth more than the vehicle), never ate out, owned no valuable possessions, spent little on entertainment (hiking, swimming, reading and tennis are free) and virtually never traveled.

(When I did, it wasn’t far. I had no passport and certainly no money to spend abroad.)

Yet two things stick out from this period.

One, never in my wildest dreams did I imagine the system was rigged, capitalism was broken, or some friend, family member or government bureaucrat would bail me out…

And two, those were some of the very best times of my life. After all, none of my friends had money either, so we made our own fun. (A good meal and lively conversation don’t cost much.)

I never felt poor. Why? Partly because I saved a little bit of every paycheck. (Frankly, I was afraid of what might happen if I didn’t.)

Being broke is a temporary condition. Being poor is a state of mind.

I fully support most social welfare programs, incidentally.

Some adults are constitutionally incapable of making a good decision, but there are often kids to consider.

Others are struggling, and it really isn’t their fault. They have severe physical or mental disabilities, emotional problems, terrible luck, or truly lousy circumstances.

But could this possibly describe 35% of Americans? Of course not.

We all make regrettable decisions. But the best of us face up to them. We don’t search for some person, circumstance or aspect of society to blame.

The people who encourage you to do that really aren’t your friends. “It’s not your fault” is not empowering. It’s disempowering.

After all, if you didn’t help create your circumstances, how can you change them?

It’s when we take what Navy SEALs Jocko Willink and Leif Babin call “extreme ownership” that we can solve our most pressing problems, financial or otherwise.

If you are an able-bodied adult who cannot get your hands on $400, you haven’t maximized your marketable skills, or worked long and hard enough, or lived within your means, or regularly saved and invested a portion of your income.

Or all of the above.

Fortunately, you have the power to change that.

There will always be some who expect to thrive and prosper in a “post-responsibility” society. But they are headed for inevitable disappointment.

Why? Because we do not live in a “post-reality” world.

Good investing,

Alex

Click here to watch Alex’s latest video update.

The post Welcome to the New “Post-Responsibility” Society appeared first on Investment U.

I’ve written often about how the best investors beat the market.

It’s not by guessing whether to be in the market or out. It’s by owning individual stocks that give higher returns than the broad market.

Ask an auditorium full of investors “Who’s the greatest stock picker of all time?” and you’ll get a variety of good answers (starting with Warren Buffett).

But ask that same auditorium “Who’s the greatest market timer of all time?” and you’ll hear some low murmuring and then… crickets.

It validates Vanguard founder Jack Bogle’s famous quote…

After nearly 50 years in this business, I don’t know anybody who has [timed the market] successfully and consistently. I don’t even know anybody who knows anybody who has.

If market outperformance is your goal, drop your subscription to the psychic network and pull out your calculator instead.

Because analyzing businesses is partly about evaluating products, processes and quality of management. But it’s mostly about numbers.

Companies that experience rising sales, increasing market share, double- or triple-digit earnings growth, and high returns on equity see their share prices rise.

Those that don’t… don’t.

However, just as individuals experience an awkward start (adolescence), a period of mastery and success (maturity), and then a slow or sudden decline (old age), companies have a limited number of prime years too.

We saw this in June 2018 when the last original Dow Jones Industrial component, General Electric (NYSE: GE), was dropped from the index after more than a century.

Hard as it may be to believe, someday other corporations will replace market leaders like Apple (Nasdaq: AAPL), Amazon (Nasdaq: AMZN), Netflix (Nasdaq: NFLX) and Google’s parent, Alphabet (Nasdaq: GOOG).

But almost certainly not anytime soon.

Readers who have run businesses of their own recognize that companies often find a profitable niche and work it for all it’s worth, then something changes that completely alters their outlook.

That “something” could be a disruptive new technology, the rise of tough new competitors or just changing consumer tastes.

But once a company starts losing market share – for whatever reason – it is often difficult (if not impossible) to get it back. That’s why few companies are worth hanging on to forever.

(Just ask any buy-and-holder of Montgomery Ward, Circuit City, Borders, RadioShack, Shearson Lehman, Kodak or Sears, to name just a few.)

The two things every investor needs to beat the market with individual stocks are a strict set of criteria for what to buy… and a strict discipline for when to sell.

In my 35 years in the business, the three best methods I’ve found for selecting stocks are momentum investing, value investing and riding the coattails of industry insiders.

Momentum stocks are companies that lead the market in sales and earnings growth, product innovation, and price action. They tend to rise faster in a bull market and fall harder in a bear market or correction.

Value stocks are companies that are cheaper than most on the basis of price-to-sales, price-to-earnings and price-to-book value. They often pay bigger-than-average dividends too.

These stocks may rise less in a bull market but hold up better in a bear market. They are a fine example of why the tortoise beat the hare.

And insider stocks are ones where the officers, directors and beneficial owners are buying substantial amounts of their own companies’ shares with their own money at current market prices.

Given that these individuals have access to all sorts of material, nonpublic information about their companies’ business prospects, it’s no surprise that these stocks tend to outperform in good times and bad.

These are three different approaches requiring entirely different metrics. Yet they all work over time… and none involve trying to outguess the market.

Of course, anyone can plunk for a few shares of stock. Successful investing also means knowing when to get the heck out.

Good investing,

Alex

Click here to watch Alex’s latest video update.

The post Understanding the Life – and Death – of Great Stocks appeared first on Investment U.

An hour later, he stepped onto the balcony of his room and paused a second, debating inwardly whether to take a jacket.

Somewhere off to his right, James Earl Ray brought the crosshairs of his rifle sights onto King’s neck and squeezed the trigger.

It was the end of a life… and the beginning of a powerful legacy.

This week millions of Americans will pause to remember and celebrate the life and achievements of Martin Luther King Jr., the 20th century’s most influential civil rights activist.

King spoke passionately, wrote persuasively, and led countless marches and sit-ins, crying out for justice for oppressed minorities in the United States.

In 1963, he was Time magazine’s Man of the Year. The following year, he was awarded the Nobel Peace Prize at 35, the youngest Peace Prize winner ever.

In 1977, he was posthumously awarded the Presidential Medal of Freedom, the nation’s highest civilian honor.

Like Washington, Jefferson and Lincoln, King was unequivocally the right man in the right place at the right time. It wasn’t just that Blacks were systematically denied equal rights and opportunities. There were the daily humiliations as well.

As a boy in the Deep South, King was regularly shooed away from white stores, white restaurants, white bathrooms, even white water fountains.

On a long return bus trip from a debating contest, he and his teacher were told to stand so that white passengers could sit.

In a downtown department store, a matron once slapped him, complaining, “The little n—– stepped on my foot!”

King later recounted that he became determined to hate every white person. But his father, a Christian minister, taught him otherwise. (Though he too chafed at the indignities.)

When his father was stopped by a traffic policeman who addressed him as “boy,” the senior King pointed to Martin on the seat beside him and snapped, “That’s a boy. I’m a man.”

On another occasion, the two were told by a shoe clerk that Black people could be served only in the rear of the store. His father grabbed the boy’s hand. “We’ll either buy shoes sitting here or we won’t buy any shoes at all.”

America was two societies, separate but unequal.

Yet King became convinced that racial hatreds were driven not by individual convictions but by attitudes deeply ingrained in society. He made it his mission to change those attitudes. And he insisted it could only be done without violence.

His commitment to peaceful change came from three primary sources.

The first was the Gospel. The second was Henry David Thoreau’s theory of nonviolence, famously articulated in his essay “Civil Disobedience.” The third was the nonviolent thoughts and actions of Mohandas Gandhi with his strikes, boycotts and mass marches against British colonial rule.

Following these examples, King urged his followers to stand up to taunts, threats and harassment – not to mention clubs, police dogs and water cannons – with peaceful resistance. It wasn’t easy.

One evening, a bomb exploded on the front porch of his house, wrecking the front parlor. King rushed home to find his wife, Coretta, and their infant daughter safe in a back room.

The street and his yard were quickly filled with more than 300 angry Blacks, many armed with guns and knives.

Sirens wailed. Skirmishes broke out with police. Reporters and onlookers pressed in, adding to the pandemonium.

Yet standing on the shattered glass and rubble of his front porch, King raised his hand and shouted, “We are not advocating violence! We must love our white brothers no matter what they do to us. Love them, and let them know you love them.”

To King, forgiveness was not an occasional act. It was a permanent attitude.

Today he is best recognized for his civil rights activism. But the Baptist minister really fought for something more. His goal was nothing less than the moral reconstruction of American society.

He became an outspoken opponent of the war in Vietnam. Blacks were disproportionately serving and dying in the conflict and, in a television interview, Mike Douglas asked King whether his opposition to the war might be misinterpreted.

King replied that he hoped not, since he opposed any American fighting and dying in a senseless war.

Watching film clips of Dr. King this week, I marveled again at his courage and intellect, his calm demeanor, his sense of hope.

King insisted we all have an amazing potential for good, that there exists in each of us a natural identification with every other human being, and that if we diminish others, we diminish ourselves.

Enjoy the day… and celebrate the man,

Alex

The post The Man With a Dream… Who Shared It With the World appeared first on Investment U.

This is tough for some folks, especially those new to the investing game.

Every day they see changing interest rates, commodity prices, currency values, economic indicators, political events and stock market valuations.

As a result, they often feel a strong compulsion to “do something.” But what?

Unless you have strong contrarian instincts – and the willpower to follow through on them – the best answer is to sit on your hands.

Success comes not from timing the market but from time in the market.

True, every portfolio needs to be tweaked occasionally.

But it is a mistake to find yourself in a constant state of reaction to the day’s events, news that is guaranteed to seem less dramatic in hindsight.

While bid/ask spreads and trading commissions have come down dramatically in recent years – all the way to zero in some cases – there are still two strong arguments against hyperactivity in your brokerage account.

The first is short-term capital gains taxes.

Take profits outside of your qualified retirement plans in less than 12 months and you will be hit not with the maximum 20% long-term rate but a rate pegged to your ordinary income, which may be as high as 37%.

And that’s before tacking on any state taxes.

Regret is the second argument against a continual flurry of activity.

How many millions of investors have owned great stocks but sold them too quickly, either because they were afraid the market would tank or the stock itself would?

Yes, we witnessed the fastest market crash and subsequent recovery in history. That has provided countless opportunities to sell too soon.

But it’s important to remember that a share of stock is not just an electronic blip or a price on your statement. It’s a fractional interest in a business.

If that business is thriving – sales are up, market share is increasing, profits are rising – you want to hang in there long enough to benefit from the growth of the company.

In the 1960s, investors held a stock an average of eight years. Today it’s less than four months.

Unless you’re a dedicated short-term trader, that’s not enough time to maximize your returns.

Of course, you can’t know with certainty how long an economic expansion will last… or when a bull market will end… or where the stocks you own will peak.

Nor do you need to guess.

Rather, you can capitalize on uncertainty by hedging your bets and protecting your stock positions.

Hedge by making sure a significant portion of your money is invested outside equities.

Aside from the home you own and the cash you hold, good alternatives are real estate investment trusts (REITs), high-grade bonds, high-yield bonds and Treasury Inflation-Protected Securities (TIPS), all parts of our Oxford asset allocation model.

Within your stock portfolio, you should also run trailing stops. These allow you to cut any losses short and let your profits run.

Ignore this step and – in the next severe correction or bear market – your unrealized gains will slip through your fingers and small losses may become unacceptable losses.

The alternative – trying to outguess the market – may sound good in theory but doesn’t work in practice.

(Although there are plenty of stock market gurus who make a good living trying – and failing – to do just that.)

By diversifying your portfolio and running trailing stops, you are managing risk, not running from it.

That’s what successful investing is all about.

Good investing,

P.S. Thank you so much to all of you who have already contributed to our GoFundMe fundraiser for the Kinder family. We are just about one-third of the way to our goal of $70,000. If you’re able to, please consider making a donation to this incredible family that is doing so much to help children affected by the opioid crisis. Simply click here to donate.

Click here to watch Alex’s latest video update.

The post How to Cut Your Risk and Maximize Your Gains in Today’s Market appeared first on Investment U.

After all, there are so many things that can make a life worth living: good health, a loving family, close friends, creative passions, a great cup of coffee…

At the end of the day, you’re already richer than you think.

Would you like to become exponentially richer in less than four minutes?

That may sound improbable – even ludicrous. But you can make it happen.

In the process, you’ll also sleep better, improve your health and increase your “happiness set point” by up to 25%.

Skeptical? Good.

Because I’m about to reveal the transformative, life-changing, scientifically proven benefits of feeling and expressing gratitude on a daily basis.

Many people – perhaps most – wait for special occasions to feel grateful.

Like when they graduate, or get that raise or promotion, or finally pay off the mortgage.

That’s a mistake. You should let everyday things – small things – spark a sense of gratitude.

The weather is fine. The meal is delicious. That rainbow is glorious. The grandkids are precious. That stranger was so kind.

You don’t have to wait for an opportunity to feel grateful. You have the power to savor the feeling every day. You only need to wake up to it.

No doubt you have problems, perhaps serious ones. Health problems. Financial problems. Relationship problems.

Welcome to the real world.

Feeling grateful doesn’t mean everything in your life is swell. It doesn’t require you to be oblivious to what’s wrong with the nation or the world.

It simply means you take three or four minutes every day – not just a few seconds – to contemplate what’s right with your life.

Author Kurt Vonnegut used to talk about his beloved “Uncle Alex.” (No relation.)

Whenever a moment was particularly sweet – even if it was just drinking lemonade under a shady tree in the summertime – he’d say aloud, “If this isn’t nice, what is?”

If I’m out with family members or friends and one of them says something like this, I always feel like someone just hit the “Refresh” button.

I take a breath, look around and say, “Yeah, how right you are.”

Yet we let moments like this pass every day without noticing.

Change that. Look for opportunities to make a positive assessment, to recognize just how good it is to be alive.

And say it out loud. Then notice the people around you nodding their heads.

After all, we have much to be grateful for if we only stop and recognize it.

Our ancestors were born into a world where survival itself was a struggle.

They labored hard to find food, clothing, safety and shelter from the elements. Many died young, usually of unnatural causes.

There are plenty of people reading this column now who grew up without electricity, running water or vaccinations against deadly diseases.

I can only imagine what they think when they hear someone like Rep. Alexandria Ocasio-Cortez say, “An entire generation, which is now becoming one of the largest electorates in America, came of age and never saw American prosperity.”

Never saw prosperity? We live in the wealthiest country at the most prosperous time in the history of the world.

As I’ve noted before, a middle-class citizen today is better off than the richest American ever: John D. Rockefeller.

Constantly comparing what you have with what someone else has creates an impoverished state of mind.

It makes you feel poorer, even when you aren’t.

How can you become richer – instantly? By adopting the opposite mindset.

Dwell on your assets rather than your liabilities, your blessings rather than your grievances, your opportunities rather than your problems.

Even setbacks can be viewed in a positive light if you see them through the lens of gratitude – and ask yourself a few questions:

• What can I be thankful about in this situation?
• Could it have been worse?
• Is there an important lesson to be learned here?
• How can I grow from this?

My good friend and Liberty Through Wealth colleague Joel Wade – author, practicing psychologist and life coach – recommends keeping a gratitude journal, one where you take a few minutes each night before retiring to write down the good things – both large and small – that made you thankful that day.

What are the benefits?

Studies show that grateful people have an easier time falling asleep and snooze longer. They enjoy a host of health benefits, including greater resilience and longevity. Gratitude has even been shown to boost your happiness set point – your basic genetically determined level of happiness – by up to 25%.

In short, in order to feel – and be – wealthier, you need only recognize how rich your life already is.

Good investing,

Alex

Click here to watch Alex’s latest video update.

The post How to Become Wealthier… Instantly appeared first on Investment U.

We gave thanks for our health, our friends, each other… and a 26-pound bird stuffed with cornbread dressing and surrounded by cranberry sauce, squash soufflé, parmesan-garlic green beans with almonds and sweet potato casserole.

(No wonder the Pilgrims had the Wampanoag tribe over.)

With all our blessings, however, one day of thanks can never really be enough.

In his book Discovering the Laws of Life, famed money manager and philanthropist Sir John Templeton recommended a different approach. He called it thanksliving.

Thanksliving means practicing an attitude of perpetual gratitude.

That’s not hard when times are good. But many Americans are dealing with the financial, personal or health issues that every family encounters from time to time. That can make an attitude of continual thankfulness a tall order.

Yet Templeton offered a radical perspective. Don’t just give thanks for your blessings. Be grateful for your problems, too.

This seems wildly counterintuitive at first blush. But facing our challenges makes us stronger, smarter, tougher and more valuable as parents, mates, employees… and human beings.

Solving problems is what we’re made for. It’s what makes life worth living.

Says Templeton…

Adversity, when overcome, strengthens us. So we are giving thanks not for the problem itself but for the strength and knowledge that will come from it. Giving thanks for this growth ahead of time will help you to grow through – not just go through – your challenges.

Circumstances alone never decide our fate. We have the ability to shape our destiny. And it starts with believing we can.

Worries, regrets and complaints solve nothing. They change nothing. Rather, they undermine your health, your social environment and your quality of life.

Difficult situations are rarely resolved with positive thoughts or gratitude alone, however. It takes another crucial ingredient: sustained action.

Even then, some problems are intractable. Others – like the death of a loved one – are insoluble. In certain circumstances, only an attitude of acceptance moves us forward.

Most of our day-to-day problems, however, are created by the person in the mirror.

We made them. And we can fix them.

According to pastor Preston Bradley…

The world has a way of giving what is demanded of it. If you are frightened and look for failure and poverty, you will get them, no matter how hard you may try to succeed. Lack of faith in yourself, in what life will do for you, cuts you off from the good things of the world. Expect victory and you make victory. Nowhere is this truer than in business life, where bravery and faith bring both material and spiritual rewards.

This lesson is best learned at an early age. Once when I was about 7, my father asked me to load some heavy-looking boxes into his car.

I looked them over doubtfully. “I can’t,” I said.

It was one of the few times I ever saw him angry. “What was that word you just used?” he demanded.

“Can’t?” I asked, sheepish.

“I don’t want to hear that word again,” he said. Then he strode off as I (ahem) loaded the boxes.

Journalist Sam Levenson had a similar experience:

It was on my fifth birthday that Papa put his hand on my shoulder and said, “Remember, my son, if you ever need a helping hand, you’ll find one at the end of your arm.”

It’s not wrong to ask for help, of course. Under certain circumstances, you won’t succeed without it. We could all use a boost from time to time.

But it’s much more satisfying – and dignifying – when we solve our problems ourselves.

In addition to demonstrating what we’re made of, working through our setbacks makes us more sensitive to – and more compassionate toward – the problems of our fellow man.

Look around and you’ll see plenty of good people with more troubles than you. And this is the season to remember them, incidentally. (Although the true spirit of thanksliving means remembering – and giving – all year round.)

Whatever problems you’re grappling with – personal, social or financial – the best course is always to face them with courage, patience and equanimity.

And, if possible, be grateful. Opportunity often shows up disguised as hard work.

On occasion, of course, our problems are simply bigger than we are. In an address in 1859, Abraham Lincoln recounted the tale of King Solomon:

It is said an Eastern monarch once charged his wise men to invent him a sentence, to be ever in view, and which should be true and appropriate in all times and situations. They presented him the words: “And this, too, shall pass away.” How much it expresses! How chastening in the hour of pride! How consoling in the depths of affliction!

Whatever your problems, few of them can withstand the onslaught of optimism, persistence and a genuine spirit of gratitude. So get moving.

As the poet Robert Frost put it, “The best way out is always through.”

Good investing,

Alex

The post Sir John Templeton’s Advice on How to Give Thanks appeared first on Investment U.

Conscious leaders connect people to purpose and hold themselves – and their organizations – to the highest ethical standards.

Businesses that do this have higher employee retention, dependable suppliers, loyal customers, better reputations, fewer regulatory and legal hassles, greater market share, and bigger profits.

How do you become a conscious leader?

It begins with a robust commitment to self-improvement.

Before we can consciously lead others, we have to learn and grow ourselves.

John cites Benjamin Franklin’s famous commitment to a lifetime of personal betterment.

Franklin formulated a system of 13 virtues – he called it the “path to personal perfection” – and concentrated on developing just one virtue each week.

Franklin found it difficult to meet his own high standards, writing, “I was surprised to find myself so much fuller of faults than I imagined.”

Yet he remained committed to incremental improvement and – over a period of years – those virtues became second nature, part of his character.

Conscious leadership requires wisdom.

And John emphasizes that it can be developed only through meaningful experiences and deep reading.

We live in a data-rich, news-saturated age. Throw in social media and most of us are swimming in a sea of trivial, meaningless and even false information.

To break free of this, John writes that “We must dive more deeply into the long-form article, the absorbing book, the engaging documentary, the enriching dialogue, the inspiring inquiry, the edifying conversation. It means committing to depth – going beyond the superficial and seeking out the substantive.”

Before you can inspire others, you have to become a more mature, more self-aware individual yourself.

The challenge is to rise up and become a more evolved person. Only then can you inspire others.

Over the course of the past three columns, I’ve described conscious leadership, what it is, what it does, and even pointed out publicly traded companies that exemplify it, including Amazon (Nasdaq: AMZN), Apple (Nasdaq: AAPL), Starbucks (Nasdaq: SBUX) and Tesla (Nasdaq: TSLA).

(All high-returning investments, by the way.)

Conscious leadership is not just about business, however. It informs every aspect of our lives.

The Humane Society, the Nature Conservancy and Doctors Without Borders also typify it, for example.

We can all become conscious leaders, whether we’re businesspeople, investors, teachers or parents.

First, by setting an example. Second, by connecting people to purpose – and making them feel appreciated.

I’ll leave you with one of my favorite examples of conscious leadership.

It’s from Forbes columnist Rich Karlgaard and excerpted in my book The Secret of Shelter Island: Money and What Matters.

Karlgaard relates a story he was told by Nancy Ortberg, an emergency room nurse who was finishing up work one night before heading home:

The doctor with whom I loved working was debriefing a new doctor, who had done a very respectable, competent job, telling him what he’d done well and what he could have done differently.

 

Then he put his hand on the young doctor’s shoulder and said, “When you finished, did you notice the young man from housekeeping who came in to clean the room?” There was a completely blank look on the young doctor’s face.

 

The older doctor said, “His name is Carlos. He’s been here for three years. He does a fabulous job. When he comes in he gets the room turned around so fast that you and I can get our next patients in quickly. His wife’s name is Maria. They have four children.” Then he named each of the four children and gave each child’s age. 

 

The older doctor went on to say, “He lives in a rented house about three blocks from here, in Santa Ana. They’ve been up from Mexico for about five years. His name is Carlos,” he repeated. Then he said, “Next week I would like you to tell me something about Carlos that I don’t already know. Okay? Now, let’s go check on the rest of the patients.”

 

Ortberg recalls: “I remember standing there writing my nursing notes – stunned – and thinking, I have just witnessed breathtaking leadership.”

Good investing,

Alex

Click here to watch Alex’s latest video update.

The post Better Business, Bigger Profits… Happier People appeared first on Investment U.

It’s called Conscious Leadership: Elevating Humanity Through Business.

The book won’t just make you a better businessperson and a better investor.

It will make you a better human being.

That’s an audacious claim, to be sure. It doesn’t stop it from being true, however.

What do conscious leaders do?

1. They put purpose first, connecting the team to a vision of how it meets customers’ wants and needs and contributes to the world.
2. They lead with love, treating the business as a way to serve and uplift people and communities.
3. They innovate and create value, anticipating, harnessing, and adapting to technological and societal change.
4. They act with integrity, following not just the letter and spirit of the law but the highest ethical standards.
5. They seek win-win-win solutions to every challenge, so that all stakeholders – workers, customers, suppliers and investors – feel rewarded and appreciated.
6. They think long term about the impact of their actions and choices.
7. They have a commitment to learn and grow, both professionally and personally.

Conscious leadership is not just about running a more successful organization or a more profitable business.

It’s also about unifying people around a higher purpose.

In the book, John gives several examples of companies that embody conscious leadership, including parent company Amazon (perhaps the world’s most customer-conscious company), Disney, Panera, Trader Joe’s, Apple, Starbucks, Nike, Tesla, Unilever and many others.

It’s not a coincidence that these companies have also delivered fantastic returns to investors.

In my research, I actively look for companies with conscious leaders. And they show up in the most unlikely places.

Take CVS Health (NYSE: CVS), for example.

On the face of it, CVS is just a chain of 10,000 drugstores. Ho-hum, right?

Hardly. CEO Larry Merlo is a man on a crusade.

He pledges that CVS will challenge and disrupt the status quo, creating a better, more effective and more affordable U.S. healthcare system.

How could a profit-seeking drugstore chain possibly do that?

Here’s how…

CVS operates more than 1,100 walk-in MinuteClinics in its stores with expanded healthcare offerings, including in-house blood work.

It is capturing patients who can’t get quick appointments with their primary care doctors – or don’t want one because of the pandemic – as well as those who use emergency rooms for routine care.

The company has five initial areas of focus:

1. Improving chronic disease management with care management plans that improve outcomes
2. Preventing readmissions by supporting patients during and after discharge
3. Increasing the use of lower-cost sites of care, including home infusion where appropriate, to prevent unnecessary ER visits
4. Expanding the scope of its MinuteClinic services to help with early diagnosis, better disease management and optimized primary care
5. Launching complex chronic disease initiatives that include new oncology products, heart disease interventions and chronic kidney disease management.

CVS targets five common conditions – diabetes, cardiovascular disease, hypertension, asthma and behavioral health.

The goal is to both improve the quality of healthcare and reduce costs through health and wellness services, site-of-care management, and tighter integration of pharmacy and medical claims.

The company exhibits conscious leadership in other ways too.

It has removed all tobacco products from its stores.

It has embraced new technologies, allowing customers to refill prescriptions through an app and pick them up at any store location.

And it delivers medications directly to patients’ homes with an electronic prescription.

Merlo says, “We’re creating a pathway that no one has gone on in an effort to make healthcare more local and make it more simple.”

His vision is rapidly becoming a reality.

And customers, employees, suppliers, shareholders and local communities are all benefiting.

This is conscious leadership.

John argues that conscious leaders often begin with an inner journey of character development and personal transformation.

I found this the most fascinating part of the book – and perhaps the most important.

So I’ll turn to this idea in my next column.

Good investing,

Alex

Click here to watch Alex’s latest video update.

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