The 20 Hour Watch ... Why The Smart Russians & Even Smarter Americans Aren’t The Smartest

By Chester Billingsley

After the fall of the Berlin Wall, the Russians sent me a Russian. I was to teach him about capitalism. He was amazed at the concepts of discounts, the emotion of advertising and the possibility of stiff commercial competition. After his internship, we exchanged $40 watches. As I was an avid jogger then, he got a waterproof sports watch, digital and accurate to 3 seconds a year, with dual time zones, alarms and lap times.

I quite happily and smugly traded for his new Red Star analog military watch. I was a little chagrined when he told me it had a winding stem like by Dad’s old watch. I quickly found that it lost 4 minutes per day, fogged in the shower, and the band came un-sewn. This all didn’t matter much, because the watch stopped within a month.

The stem fill out. But what left me with the biggest lesson, was that one winding of the watch lasted 20 hours. Who the heck designs a winding watch that you can’t just wind once a day? Well, the answer is any worker in a centrally planned economy, not subject to the competition of the market.

This is all in great contrast to Costco blueberry muffins. My hard working friend, Jesus, ran a trucking company that delivered muffins to Costco. A vendor of his was trying to introduce a new blueberry muffin into Costco stores. At the taste-off there were thirteen competing brands of blueberry muffins.

With just the right mix of sweetness, the best oil, a few pecan chips (never walnut), full blueberries and snappy packaging, Jesus and his vender won. In a similar way, mini-muffins, muffin tops and giant muffins were all introduced to Costco. The same type of vetting and re-vetting is going on today at WalMart and any number of stores across America.

The reason capitalism works and socialism does not is the genius of Jesus and a million other experts in their daily jobs that keep striving to make their particular product and work a little bit better than the competition. Even though the many advisors around you are all smart, none of any of us is as smart as the collective Jesus’ of the world.

A president, especially a competent and intelligent president, must keep the effective and distributed dynamic of capitalism in mind and not substitute the centralized judgments of a well meaning elite.

Chet Billingsley did his undergraduate work at West Point. He attended Harvard where he received a Master’s Degree in Applied Physics with concurrent study at Harvard Business School and MIT’s Nuclear Engineering Department. He spent the major portion of his early career at General Electric in the energy and high tech sector in project turn-around and international management positions.

Currently, Billingsley is the CEO of Mentor Capital (Symbol:MNTR). For more information on Mentor Capital see: http://www.MentorCapital.com.

“The Prince” by Chet Billingsley can be purchased at http://www.amazon.com.

(Disclosure: Bob Meyer owns Mentor Capital stock.)