Technological advancement leading to times of prosperity has always been followed by times of dark despair and deep peril. There have been four such periods, going back to 1870, in which technological advancement centering around communications, energy, transportation, and medical breakthroughs arose from these bleak periods. In each example below, we ask the same question: “Who awoke during these tough times and said to themselves, ‘Hey, let’s go invest in America’s greatest companies’?” Even though history shows these were periods of great opportunity, very few investors can possess the Clarity to see the forest from the trees. Today, we believe we are in the midst of the fifth Great American Technological Revolution and will cite the great investment opportunities we see over the decade in the last section.
Source: https://www.morningstar.com/features/what-prior-market-crashes-can-teach-us-in-2020
The Five Great American Technological Revolutions
- 1870 – Following the end of the Civil War, with 500,000 American lives lost, our nation was literally split. What followed this bleak period was known as The Second Industrial Revolution, aka The Technological Revolution. Advancements included manufacturing and production technology systems such as railroad and telegraph lines, gas and water supply, and sewage systems, which had earlier been concentrated to a few select cities. This was the longest bull market of all-time from 1870-1901 and of course it followed the bleakest period in America’s history.
- 1920 – Following the end of the World War and the Spanish Flu, which combined took the lives of 70 million people, were technological advancements such as the automobile, the airplane, the washing machine, the assembly line, and the television. Other advancements during this period included the discovery of penicillin and the invention of the bulldozer, which led to the building of skyscrapers during this period. It was the quickest stock market advancement, known as The Roaring 1920s and lasted a decade.
- 1950 – Following the end of the Great Depression and World War II, which took the lives of 75 million people, was the laying of the transatlantic cable between Europe and North America and the introduction of the jet-propelled aircraft leading to nonstop air travel across and between continents. Artificial valves were implanted in hearts, and electric shock waves were employed to control heartbeats during this period. This was one of the longest bull markets in U.S. history — a period of low inflation, high productivity, and record corporate profits.
- 1980 – In the midst of a trifecta of double-digit inflation, unemployment, and interest rates, which led to something we called the Misery Index, what followed this period of dark despair were many of the most popular consumer products we use today, such as the Internet, PCs, Macintosh, and cell phones. Medical advancements included the MRI scanner, surgical robot, and radiosurgery. Known as the Greatest Bull Market in U.S. history, this period happened from 1982-2000 — with only one negative year, 1990.
- 2020 – In the beginning of a global Pandemic the likes we have not seen in 100 years, amidst lockdowns, and mandated social distancing and travel restrictions, who said to themselves: “Hey, let’s go invest in some of America’s companies”?
We see these recent technological advancements that will foster in a new era of prosperity:
- Eradicating food waste and greatly reducing world hunger
- Carbon capture that can be used to generate electrical power
- Cyber Security and greatly eliminating online theft
- Medical advancements eradicating deadly diseases
- EV and solar power greatly eliminating carbon emissions
We believe that history will again repeat itself and show that technological innovation used to help us get out of times of deep despair far overrides fear — and in doing so, permits society to make strides of great advancement. However, it’s still as important as ever to remember not to fall victim to Addiction to Prediction®. It’s times like these that financial news industry’s use sensational headline and fear tactics to target the susceptible investor. At Nepsis®, we believe in leveraging unbiased information to make educated and informed investment decisions and Investing With Clarity®.
Fatality Statistic sources:
- Civil War: Battlefields.org
- WWI: FacingHistory.org
- WWII: LumenLurning.com
- Spanish Flu: CDC.gov
