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As our 60-year secondary-school reunion draws near, my classmate Scott and I found ourselves talking about the past and the future. About the past, we shared memories from the period when Americans were fighting a war in Southeast Asia and we were young enough to wonder how anyone had a life after 50 - the age our fathers were then. We laughed about our recollections of military service during that time – Scott’s in the Army, mine in the Navy – and all the snafus we endured. “I wonder,” Scott asked, “if we are the last generation to use ‘situation normal all fouled up’ to describe how Congress and the Pentagon’s war plans translate into particular orders for soldiers and sailors.” My answer was “yes, but we can be confident that ‘the kids’ have come up with new and better slang to describe what never changes in the military and in war. We are too old and out of touch to know what they are and fortunate enough not to have to worry about our children knowing that particular vocabulary.”
Scott and I are both responsible for making investments on behalf of other people; but we do not live in the same worlds of money. His firm, in which he is both an owner and a manager, is the fiduciary and investment advisor for several hundred accounts whose net assets are equal to or greater than our family office’s entire holdings. Scott‘s performance, as an active manager, is measured against the benchmarks that his firm and its clients choose as yardsticks. Our family office has the much easier task of hanging on to and possibly increasing the sums of money our members have accumulated and continue to save from their day jobs. Since my work can hardly be compared to what Scott does, either in sophistication or in the scale of responsibility, I have never felt comfortable talking to him about the business of investing; but I did share with him the idea that our family office was best thought of as a family farm. As I wrote in my last note, that comparison did prompt Scott to want to discuss the process of making investments. See Judging Quality: Which Cows to Buy? But our most recent conversation was about what is, for both of us, a more important topic. We were born at the end of World War II and are aware of how precious little time we have left in our lives. We can be relatively confident that we will be able to leave our families with far more money than our parents had when they died. What concerns us is the question of what assets we will be leaving our families whose values are not measured by money.
The current wars in Europe and the Middle East have made us think about this value question. As survivors of an older, much different war, we have the luxury of being able to laugh; and we indulge in that great good fortune because joking is the only way to be able to talk indirectly about all the people we knew and still know who were not so lucky. When Sophie Tucker was asked, near the end of her life, if she thought money was important to a successful life, her answer was “No, if you have enough not to think about it all the time. Honey, I have been poor, and I have been rich. Believe me, being rich is better for the soul.” This weekend, Scott and I talked about grandchildren and Sophie Tucker.
Stefan Jovanovich manages the portfolio for his family office that farms common stocks and Treasury notes in Nevada.
