Creative Reaction

The more I read about George Gilder, the more I love this guy. In an article he wrote last month for Forbes Magazine, he states, “The crucial conflict in every economy… is not between rich and poor, Main Street and Wall Street, or even government and the private sector. It is between the established system and the new forms of wealth rising up to displace it”. (Italics mine)

“The real source of all growth is human creativity and entrepreneurship, which always comes as a surprise to us, especially in the worst of times”.

It’s not so much that difficulties lead to creativity, but that those who persevere (as opposed to those who scale back and hunker down) are the ones who think all the more creatively until they have a breakthrough.

“Because the U.S. remains the world’s largest economy and still leads the world in business and technological creativity, the current crisis is mostly confined to boondoggles of finance. It will pass rapidly and evolve into a new boom”.

(The remainder of the article will only be of interest to Tech investors.)

I share in this outlook and in Gilder’s optimism. During the last bubble-burst, while its competitors were cutting back and laying people off, Apple (then “Apple Computer”) publicly stated that its strategy would be to innovate to carry itself through difficult times. Think about where they are now.