Nature and the economy

photo credit: Fort Photo

What has nature got to do with the economy? John Bogle mentioned about a gardener from the movie "Being There", and what we can learn about nature that is analogous to our economy. Chance was just a gardener who got kicked out from the house after his owner died. Being forced to go out to the world for the first time in his life, he met a President's advisor, Rand, who mistook Chance as a failed businessman (and also mistook his name as Chauncey Gardiner). Chance worked under him and was often seen as someone who has great wisdom through his analogical explanation of the garden on the complex world.

Here is a dialogue from the movie between the gardener and the President (Taken from imdb):

President "Bobby": Mr. Gardner, do you agree with Ben, or do you think that we can stimulate growth through temporary incentives?
[Long pause]
Chance the Gardener: As long as the roots are not severed, all is well. And all will be well in the garden.
President "Bobby": In the garden.
Chance the Gardener: Yes. In the garden, growth has it seasons. First comes spring and summer, but then we have fall and winter. And then we get spring and summer again.
President "Bobby": Spring and summer.
Chance the Gardener: Yes.
President "Bobby": Then fall and winter.
Chance the Gardener: Yes.
Benjamin Rand: I think what our insightful young friend is saying is that we welcome the inevitable seasons of nature, but we're upset by the seasons of our economy.
Chance the Gardener: Yes! There will be growth in the spring!
Benjamin Rand: Hmm!
Chance the Gardener: Hmm!
President "Bobby": Hm. Well, Mr. Gardner, I must admit that is one of the most refreshing and optimistic statements I've heard in a very, very long time.
[Benjamin Rand applauds]
President "Bobby": I admire your good, solid sense. That's precisely what we lack on Capitol Hill.

John Bogle further explained in "Common Sense on Mutual Funds", "Like Chance, I am basically an optimist. I see our economy as healthy and stable. It is still marked by seasons of growth and seasons of decline, but its roots have remained strong. Despite the changing seasons, our economy has persisted in an upward course, rebounding from the blackest calamities."

The economy like nature, has cycles. Long term investing requires one to go through seasonal changes, economic ups and downs. Losing money is unnatural and is going against our human instinct. However, we must have faith in the economy, that it will continue to grow through the seasons and in the end, allow us to share a part of the prosperity.