Throughout the book, Cortese discusses alternative forms of investing. He titles this ideal locavesting. Locavesting is a recognition of the vital role that community- rotted businesses of all kinds play in our local economies (Cortese, 2011). These smaller stores, such as mom-and-pop shops, create large economic and social value for their communities. Benefits of smaller stores include creating more jobs, a healthy tax base, increase in charitable giving, civic engagement, improving the quality of life, and an appreciation for the sense of belonging they foster (Cortese, 2011).
Lovecasting attempts to restore a sense of connection to financial transactions, and to broaden the concept of (mutually beneficial) “return” (Cortese, 2011). The author emphasizes that local investing is not meant to replace the current global financial system, but rather to complement it. As noted in the reading, “Ultimately, unless we have really strong local economies, we’re not going to have a functioning global economy” (Cortese, 2011).
There are many benefits to locavesting. Local companies have a connection with the communities they serve. Local companies are profitable as they tend to serve smaller, geographic, areas. Additionally, local companies present less of a risk and can even be an asset to investors as they can help diversify their portfolio.
Cortese, A. (2011). Locavesting: The revolution in local investing and how to profit from it. Hoboken, NJ: J. Wiley & Sons.