In part 12 of SMSFs for Newbies, we're still identifying sharemarket themes to help us pick stocks.
When it comes to sharemarket themes that have only just scratched the surface of what will be, this is the elephant in the room.
The first regular commercial transactions were only beginning to be done online 15 years ago, and with hundreds of years of development to go it is laughable that stockbroker analysts judge listed internet businesses as being cheap or expensive on the next two years' forecasts because the commercial possibilities have only just begun to be unwrapped. The internet is in its infancy.
Consider the internet in 100 years' time - 10 years' time, even. I can tell you a few things. There won't be any logging on, no talk about speed or data allowances, no contracts, no lock-ins.
The internet will be as essential to us as water and power and it won't cost a thing and it will be taken so much for granted that we may not even give it a name.
The internet is already an indispensable utility and although it may not be carried by today's conventional infrastructure its physical presence will represent the most valuable asset in the world. But like all utilities it will be earning negligible returns, and because of that the security of its performance will become too onerous for private enterprise.
After the first one or two global internet interruptions the governments of the world will take on its responsibility because without the internet there will be no commerce, no financial markets, no banking system, no banks, no central banks, no government and no economy to govern. In just a few years from now the idea that you wouldn't "trust" the internet with your credit card number will be an anachronistic joke. Your current conservatism and reluctance to do commerce will shut doors and consign you to the Dark Ages.
We won't be buying anything without the internet. We're almost there already, and through our interactions and because of the internet's infinite data collecting capacity it will come to define us all through "credit" ratings, our own personal credit ratings.
At the moment only the online extremes of criminal behaviour are judged online, but soon the internet's judgment will become more subtle. As a house or car might define us now, a high-level online credit rating will open the internet's most privileged doors and at the same time close them to those that have not earned it or have recklessly blown it.
The internet will become our financial judge, jury and executioner and we will preserve, guard, nurture and progress our own personal rankings at all costs with our every online action.
Nothing will go unseen and unheard and nothing will be without consequence. Every online posting, picture, comment and tweet will become our whipping boy and on top of this constant judgment of our actions will come the judgment of us by our associations. No right-minded AAA+ rated individual or entity will be seen liking or friending those that might drag them down.
The internet and its possibilities have a long way to go and the beauty of Australia is that we are even further behind the growth curve than more developed online markets such as the US that already show us the potential.
Stocks such as Realestate.com and Carsales.com succeed through first-mover advantage. There is nothing more investable than something that grows exponentially from nothing. But keep an eye out for the last-mover advantage.
Ultimately the companies that will thrive and survive the next 50 years of online commercial development are not the companies offering the cheapest prices today, it will be the ones with the money that are developing an online asset, database or commercial platform with integrity and credibility that will endure.
We're worrying about Myer being attacked by the internet but let's just stand back for a moment. Who's going to win in the end? Big money invested in building long-term online assets, or a cheeky price from Dave in Wagga Wagga? My money's on the big money.