From printing press and steam engine to cars, phones and computers, countless inventions transformed human life and our economy.
It’s unfathomable how different life would be without them. Imagine a world without oil refining, light bulbs, assembly lines, indoor plumbing or adhesive bandages. Few people fathom that since capitalism started, you can’t find a year without great inventions. Sometimes widespread adoption takes time, but creativity keeps conceiving the unfathomable.
Consider everything spawned from the integrated circuit and laser! Personal computers, video games, smartphones, Kindles and 3D printing. Or GPS, which will soon allow mass-marketed driverless cars.
From health care came endless vaccines, the pill and heart valve replacements —enabled by the heart-lung machine. Advanced treatments for cancer last year. HIV and hepatitis meds have prolonged millions of lives.
We also revolutionized life’s start with in-vitro fertilization — how four of my five grandkids were conceived. And caring for babies became far simpler thanks to disposable diapers.
If modern medicine hasn’t yet saved your life, perhaps the three-point seat belt has. The Department of Transportation estimates it saves 15,000 lives annually.
Search online, and you can’t find a year without major new inventions. Try: www.edinformatics.com/inventions_inventors if you’re skeptical. Market deployment of innovations is often delayed by the economy’s ups and downs. Or by regulations. But arrive they do. Creative thinkers are hard at work on futuristic fancies like healthier, synthetic — and hangover-free — booze, or electric clothes that vary temperature to fit changing weather and your needs, or sensors to catch potential tooth cavities. How about non-water, non-chemical electronic fire-extinguishers? Blood tests to presage depression? Some of these won’t “make it.” But many — and others currently unimaginable — will.
Innovators are getting ever younger. Hence Mark Zuckerberg and Jeff Bezos. The flow won’t stop, likely ever in your lifetime. Breakthroughs will continue as people keep solving new problems. Life will improve.
Existing things may become less valuable. Some will become as worthless as buggy whips or the cracked flower pot on your porch. Homes, as I’ve discussed before, only gain value from inflation or if GDP growth and household formation outruns home building.
Only true antiques, like a Model T, become more valuable just sitting there, through increased scarcity. Or rare art, like a Monet, Van Gogh or Picasso.
But business flourishes, generating real growth, because of the cumulative compound effect of these innovations. Look at Google and Apple today. Microsoft before them.
This doesn’t just mean we get more and better things. Quality of life also improves. And our wealth. Not just for the 1%!
Stocks let regular folks share in the creators’ wealth. Human creativity channeled through capitalism is what stocks are all about. It’s why economies grow above inflation and why stocks have beaten all other similarly liquid assets cumulatively since capitalism began.
It’s also why buying stocks in your 401(k) when you’re young, and holding them for the long term, is your best investment. It lets these inventions transfer wealth to you. You can enjoy the better life they bring soon — and the wealth they generate, too.
What could be better?