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I was musing to myself the other day about how nice it would be to have the MacArthur Foundation lay one of those $500,000 grants on me. The only problem -- my problem and not theirs -- is that I don't really deserve one. There are other people in the financial industry who are certainly more deserving than me.

It sometimes takes awhile in the world of economics to recognize when a breakthrough has been achieved and who achieved it. Harry Markowitz, the inventor of what we now recognize as the earliest version of Modern Portfolio Theory, was interrupted during his thesis presentation by Milton Friedman at the University of Chicago.

Friedman said, "Harry, this isn't economics; this isn't even business management." In the end, Markowitz was awarded his doctorate, later won a Nobel Prize and pioneered what we now recognize as a separate discipline known as "finance."

Modern Portfolio Theory, as we know it today, is the keystone of a disciplined approach to investment. It recognizes that the construction of a portfolio of investments can benefit from the knowledge of the extent to which different investment types can have widely varying results during different periods of an economic cycle.

Assembling and adjusting these investment types has become the "value added" component that money managers bring to the table. I call it "building a path of 'minimum regret'." By comparison, earlier versions of money management depended largely on a manager's stock-picking ability, and this explained why 80 percent of the average small investors lost money in any five-year period of time.

I thought about the invention of Morningstar, the premier mutual fund ranking service conceived by Joe Mansueto in the mid 1980s. The idea that one database allows us to slice and dice the entire mutual fund industry and sort for every conceivable aspect of fund performance, risk, cost and quality has had a huge effect on the investing public's ability to shop for optimal investments.

I recall that in the early days of Morningstar, as its database became more customized and interactive, the complaint from financial advisers was that Morningstar would make their profession obsolete.

Beyond Mansueto, we have John Bogle, who founded Vanguard and poked his finger in the eye of the financial services industry. Even with the presence of Vanguard -- a giant co-operative effectively owned by its mutual fund clients -- the industry overall charges too much for what they do.

With a 30 percent pretax profit, the mutual fund industry is the world's most profitable because buyers focus on immediate past performance and ignore costs for which they never see a bill or write a check.

Without Vanguard's demonstration of how little it costs to offer great investment results and top-notch service, one wonders how much the rest of the industry would still be charging.

Then, we have Warren Buffett who demonstrates year after year that you don't have to churn investments to beat market averages. You buy businesses for all the right reasons, starting with the quality of human beings running the enterprise you are considering.

My favorite story from his annual letter is about the business he bought from a seller who showed up late for the negotiations because he was looking for a parking meter with time left on it. Or, better yet, Warren asking Katharine Graham of the Washington Post for change for a quarter so he could make a 10-cent phone call.

We owe a lot to these creative people who have broken the mold in our behalf. The question is, "who might be next?" What financial invention is just around the corner that could lift us all to the next plateau and create an additional 10 percent in asset value by the time we hit retirement?

With a year and $500,000, I think I could probably find it. Does anyone know the MacArthur people?