It’s Time for Investors to Go Green with Their
Portfolio
Positioning your portfolio so that you add enough
‘green’ to your bottom line
By Jeffrey D. Voudrie, CFP
June
23, 2008 - Everyone is feeling the pinch at the pump. And just about
everywhere else it seems. No matter where you look: the grocery store,
utility bills or airline tickets; prices are going up. We all hope
these increases are just a temporary ‘road bump’ on the financial
landscape, but unfortunately, I believe we’ll be experiencing the
effects of the energy crisis for years to come.
With all the talk about going ‘green’ for the
environment, it’s time for investors to go ‘green’ with their
portfolio. And I don’t mean investing only in ‘earth-friendly’
companies (though you certainly can.)
What I mean is positioning your portfolio so that
you add enough ‘green’ to your bottom line to allow you to weather the
effects of inflation and without lowering your standard of living.
First, let’s take a closer look at the current
energy crisis.
To make a long story short, the problem is based
mainly on supply and demand. As the standard of living has been rising
around the globe, and particularly in large Asian nations such as China
and India, the demand for oil has exploded. And this trend will only
continue.
While
demand has risen, supply has not. Non-OPEC countries are actually
seeing supply decrease, while our domestic exploration has been hindered
by environmental concerns. So while China can drill off the coast of
Cuba, we aren’t tapping new oil off our own coast or in ANWAR.
While it is true our known reserves would not solve
the current crisis, they would certainly lessen our energy dependence
and help keep prices in check.
There are only three ways to solve a supply and
demand issue: reduce demand, increase supply, or do both.
On the demand side, there is no way we can simply
‘conserve’ our way out of this mess. Any oil we conserve in our nation
will be more than offset by rising demand globally. That’s not to say
that hybrids, carpooling and alternative energy sources are bad ideas,
just that they alone aren’t enough.
Take
wind farms for instance. They work great, as long as the wind is
blowing. But the power grid must have a constant flow of energy into
it. And because wind energy flow isn’t constant, traditional power
plants have to be constructed to cover the energy needs when the wind
farm isn’t generating power.
On the demand side, we need to open up more
drilling and exploration. Environmentalists will resist this move, but
the fact remains that currently there is no viable substitute for oil.
The world will continue to depend on oil to survive for years to come,
even with all the research going on in alternative fuels. We can’t go
back to horse and buggy days while waiting on a miracle solution.
Ethanol, bio diesel and other sources won’t make
the problem go away, either. And they each have their own issues to
contend with. Take ethanol for example. Increased production has caused
corn prices to rise, affecting food costs across the board, not to
mention the energy it takes to produce it.
To combat the energy crisis, we will need to pursue
all means available to both reduce demand and increase supply. This
will be a herculean task to accomplish, but a lesson from history can
give us hope.
My youngest daughter and I have been watching a new
television series on the early days of the space program that put man on
the moon. Our country had the will, determination and desire to
accomplish the impossible. And we did it.
It
took the hard work, ingenuity and creativity of a multitude of motivated
people. It also took a large investment of time and money to bring
about. But in the end, a giant leap for mankind touched not only
America, but the entire world.
And we can do it again. As prices continue to rise
at the pump, I am optimistic that we as a nation will gain the political
grit to do what it takes to attack this issue head on. We still have
some of the brightest minds on the planet, and if we could put a man on
the moon, surely we can find a way to solve the energy crisis.
Next week, we’ll look at how you can add some
‘green’ to your bottom line and avoid turning the energy crisis into a
financial one.
If you have a specific question or would like more
information, give me a call toll-free at 1-877-827-1463 or you can also reach me by email at
jeff@guardingyourwealth.com.
I will answer your financial question FREE.
About Guarding Your Wealth:
“Guarding Your Wealth” is a
nationally syndicated weekly personal finance column written by Jeffrey
D. Voudrie, CFP. Mr. Voudrie is the President of Legacy Planning Group,
a private wealth management firm that employs sophisticated proprietary
strategies designed to protect and grow its clients' investments. Visit his website,
www.guardingyourwealth.com to read past articles under the Guarding
Your Wealth Article Archive that may not have appeared in
SeniorJournal.com.
Guarding Your Wealth for Seniors, on
SeniorJournal.com, is
a collection of columns by Voudrie that deal with issues of particular
interest to senior citizens.
Click here
for all columns.
In addition to being a nationally
syndicated columnist and Certified Financial Planning Practitioner, Mr.
Voudrie provides personal, private money management services to select
private clients
nationwide.
Looking for an energetic expert who
is passionate about financial and wealth management? Mr. Voudrie is an
excellent speaker who will excite and inspire your audience. Mr. Voudrie
is available for a limited number of speaking engagements, television
appearances and radio talk shows. For bookings, email
jeff@guardingyourwealth.com.
Keep up with the latest news for senior citizens, baby
bommers
June
23, 2008 - Everyone is feeling the pinch at the pump. And just about
everywhere else it seems. No matter where you look: the grocery store,
utility bills or airline tickets; prices are going up. We all hope
these increases are just a temporary ‘road bump’ on the financial
landscape, but unfortunately, I believe we’ll be experiencing the
effects of the energy crisis for years to come. 
While
demand has risen, supply has not. Non-OPEC countries are actually
seeing supply decrease, while our domestic exploration has been hindered
by environmental concerns. So while China can drill off the coast of
Cuba, we aren’t tapping new oil off our own coast or in ANWAR. 
Take
wind farms for instance. They work great, as long as the wind is
blowing. But the power grid must have a constant flow of energy into
it. And because wind energy flow isn’t constant, traditional power
plants have to be constructed to cover the energy needs when the wind
farm isn’t generating power.
It
took the hard work, ingenuity and creativity of a multitude of motivated
people. It also took a large investment of time and money to bring
about. But in the end, a giant leap for mankind touched not only
America, but the entire world.