Those who follow the VMS blog are well aware of the benefits of sustaining local investment by urging consumers to eat local foods and to shop in local stores. Amy Cortese insists that this same approach is applicable to portfolio investments. Her most recent publication, Locavesting: the Revolution in Local Investing and How to Profit From It (Wiley & Sons, June 2011), guides readers through the ideas and advantages of investing in local businesses.
Cortese coined the term “locavesting” to describe the movement to rebuild sustainable communities by investing in businesses within 50 miles of where you live. Early in her book, she challenges readers to imagine what the world would be like if 50 percent of investments were made within a 50-mile radius. She agrees that 50 percent is idealistic, but not maybe not five percent and certainly not one percent.
“Right now, there’s an estimated $26 trillion that Americans have invested in the stock market…just imagine if only one percent of that $26 trillion was diverted to locally-owned companies. I think that would have a huge impact.”
Locavesting is about restoring the bonds between investors and companies in a system where locally-owned companies may be ignored by larger financial establishments. It’s about coming up with new ways to make investment capital more accessible to the companies that create jobs, healthy communities and promote sustainable growth.
Locavesting is capitalism for Main Street.