Birds, Bees, and the Extinction of Greed
It is easy to think that the investment industry is a system of greedy people helping other greedy people to be better at being greedy. Sometimes it is precisely that, and that is why a new type of financial firm needs to evolve to serve investors that don’t fall under the heading of “greedy people”.
Going all the way back to the “father of modern economics” Adam Smith, we've taught people that the key to a healthy economy is everyone working in their own self-interests (“every man for himself”). A more contemporary view might incorporate the work of John Nash (think: Russell Crowe in “A Beautiful Mind”). Professor Nash explained that if we try doing well for ourselves while also thinking of what is best for others, then everyone could be better off! But as Nash built upon the work of Smith, to take the good of the group into consideration, it is now time for another evolutionary step in economic thought. Why can’t we continue thinking about what is best for everyone while reducing the traditional importance of self-interest?
This type of evolution would not be unique to the world of money. You can find several versions of it in nature. It is widely believed that an animal has one primary drive and that is to live long enough to reproduce and pass on its genes. The science of evolutionary biology is often boiled down to the over-simplified term “the survival of the fittest”. A more accurate term might be “extinction of the least fit”. After all, a deer does not get faster in order to survive. The slow deer just gets eaten before it can pass on its genes and give birth to more slow deer.
This understanding of nature seems incomplete when looking at some examples of altruism and sacrifice that can be found in animals. Some male birds intentionally distract predators from their mates. A beehive has tens of thousands of ideal examples of individual beings working for the good of the whole. The worker bee is a perfect model of complete disregard for both survival and the need to reproduce. She is not only sterile (thereby unable to pass on her genes) but her anatomy guarantees that she will die from delivering a sting in defense of the hive. Despite these facts, every hive has thousands of workers who spend their entire lives contributing to the greater good. Some species of ants have even been found to carry home their wounded soldier ants and tend to their injuries!
We diminish ourselves when we exaggerate the importance of self-interest. It is easy to find human examples of generosity, selflessness, and even self-sacrifice for the well being of others. It is clear that humanity has evolved beyond “every man for himself” or even “survival of the fittest”, and yet we cling to the notion that these are the keys to society’s economic success.
Where can you turn if your goals exceed simple greed? Can you expect an investment manager to understand your motivations if their prototypical client is in it only for themselves (or if the advisor himself is)? Consider Upleft if you are building wealth to improve the lives of those around you, be they your family, employees, or community. We pride ourselves in being the next step in the evolution of investing. We are generous people helping generous people to be better at being generous.