Philanthropy and The New Geo-Economic Pandemic

The current meltdown in traditional asset class values can be witnessed by the fall of both stocks and bonds, bonds being the most common offset of hard times in the market, and the concurrent rapid deflation in the most traditional harbor for sheltering liquidity; the bricks and mortar of real property. This is a frightening prospect for any investor, Still, there is opportunity in change and great change brings great opportunity.

On Oct, 10th, the Dow Jones Average fell below 8,000 finally rallying back to 9,000, the Dow lost 18% of its value in one week. From Wall Street to Main Street investors have begun to abandon even the most solid blue chip investments. Recently the US Treasury found it’s periodic T bill sale so fully subscribed that it is paying zero interest. Investors are so panicked that they are literally losing money to park funds in US Government securities. Internationally, Iceland, the nordic economic powerhouse nationalized the banks and is desperately seeking help from the EU, Silvio Berlusconi, President of Italy, was heard to say after a recent meeting that there is a plan to shut down the World’s Stock Exchanges to standardize and normalize regulations to meet these new realities.

At this writing, America and the global economy is a much poorer than it was only a few days ago. All wealth has been diminished. The value on the books will soon have to be “written down” to reflect the realities of the new economy. This applies to all wealth, not just the investment banks. It applies equally to Philanthropies … The big and the small. The Ford Foundation to The Calvert Foundation, all donor organizations will see their reserves shrink significantly.