 St. John's Confidential File
JAMES SALTER is a young man with dreams. He watched and learned how his parents developed and built their food business and decided at a very young age that he had a passion to go even further. He could have easily become a unique part of the entertainment business as a director, manager but he decided that his talent for business investment possibilities presented him the kind of challenge that he needed.
1. Did you have an idea when you were a young kid that going into some kind of business might be something you would enjoy? If so, why?
Our parents had a health food distribution business that was very cool. They sold whole wheat and other grains along with the mills to grind them to flour. It was a little before its time but still a nice way to be introduced to business because it was a win-win situation. We helped people stay healthy.
2. What did you observe at that time that really impacted your interest, one way or the other? Was it an organization, what you watched and listened to on TV or was it a person who seemed to be quite successful in his or her business efforts?
I loved all the athletes and celebrities that used our products. Or, more specifically, the people who frequented the businesses that used our products.
3. How did your university experience impact your determination to do what you have decided to concentrate on?
Unfortunately, my dad's business partner and CPA stole some of the company cash and ran off with the prepayments for inventory. My dad basically had just enough inventory to settle all previous orders. All 40 employees (12 of which were family members) had to be let go. The business was closed down soon thereafter. Anyway, as this was happening my dad made us swear that we'd learn finance and accounting so that we'd never suffer a similar fate.
4. What have you learned about business and how it is run and maintained in our country today? What changes would you make in order to more fully develop or secure safe investment opportunities?
I've learned that the people with the most fulfilling careers as small business owners treat their clients and employees extremely well. They feel like they are members of a community who have a larger responsibility than just making a profit. We've all heard how these same principles seem to crumble as Wall Street begins to scrutinize these companies after they go public but an IPO doesn't always mean that principles will be destroyed. Costco, for example, still enjoys an excellent reputation not only for the treatment of its employees but also for low prices. The management hears calls from Wall Street on a regular basis to squeeze their employees and raise their prices but to no avail. It is a good example of a firm sticking to a vision.
5. What do you predict about our current state of economy — why should people invest — especially after the ups and downs in the last seven or eight years? Would you say that it is safe for senior citizens, the neuveau rich, especially in the entertainment world, to invest heavily in what you are offering up to them?
Diversified portfolios have always been able to weather economic storms. By blending growth and value, diversifying globally, rebalancing and incorporating alternative investments, it is still possible to enjoy good absolute returns without having to endure extreme peaks and valleys. Alternative investments — that have a low correlation to the broader markets — have proven to be key ingredients to a well balanced portfolio. Most recently we watched our oil and gold holdings offset many of the losses in the equities. By rebalancing regularly we are able to sell high and buy low while at the same time keeping the risk of the portfolios in line with our clients' comfort levels. We look at investing not as an event but rather as a process. Adjustments are continually being made to maintain the balance of risk and return.
6. What kind of chance does one face when putting a lot of money into your investment care? Can you assure them of a profit or that their investment is safe from a Wall Street crash?
It really depends on the portfolio. We have clients that had 25 percent in global stocks, 25 percent in fixed income like bonds and the rest in oil and gold. Those clients did extremely well but they are not the norm. We can never promise a profit. However, we can watch trends and employ concepts like regression to the mean. In other words, if an investment averages 10 percent historically and it has been averaging 4 percent for the last five years, there is a good chance that the investment will do better than 4 percent in the future to get back up to its historical average. We understand that this isn't always the case but it seemed blatantly obvious to us in a few recent cases; real estate and MBO's are a couple of examples.
7. After being in the business for quite some time now, what have you learned about yourself and how realistic do you now view capitalism which, in many ways, represents the projection of who we are in this country?
That's a tough question. I'd have to say that capitalism has its costs. Perhaps I've seen too many documentaries but it is hard for me to understand how the CEO's of HMO's can make so much money while average people don’t have health coverage. As a financial planner, I can tell you that major disabilities are often the cause of financial ruin. It is sad sometimes to see how warped our priorities are as a people. George's wife recently had a baby and the cost was $35k! Luckily insurance covered most (but not all) of these bills. Unrealistic expenses like this and, later down the road, day care have made it impossible for many in the lower middle classes to have children. This class has always been the backbone of society so I'm not sure our brand of unbridled capitalism is sustainable. My guess is that change is coming…and we won't have to wait long.
Perhaps a better model is Western Europe. It seems like these social democracies have done a better job aligning limited resources with real public needs.
Other political models are risky. I could never condone a system where talented people are forbidden from participating in certain jobs. Any workable system has to have elements of a meritocracy.
So to answer your question, I'm worried that our priorities are lost in platform squabbles. It would be nice to have a strong third party to keep the others off balance. This will enable us to keep long term goals aligned in the interest of all elements of society.
8. Do you ever regret ending up where you are, especially when you had so many other options?
Never. I've always wanted a job where I could help people realize their goals. What I didn't know is that I'd be an active participant in the creation of their dreams. For some people it is a second house in Mexico, for others it is an annual trip to Europe. Everyday I get to help formulate the most efficient path for them to get from where they are to where they want to be. I feel like I'm part of the family story.
In speaking for both of us, I know that we are very curious people. We love to read the news and analyze its potential impact on our client portfolios.
Everyday we get to learn about businesses. This job is very fulfilling.
9. What do you enjoy most about your life now?
The freedom. I know that I can leave tomorrow for two weeks and George would be able to watch after things.
Similarly, we get to meet some very successful people on a daily basis. Their stories of sacrifice and risk are very interesting. In short, we have the freedom to surround ourselves with people that we want to be like.
© Copyright 2011 by canyon-news.com |
