There are, perhaps, a number of things that you could call Poulsbo resident Ed Stern but uninvolved, uninformed and un-opinionated are not among the mix.

When he’s not putting in a traditional day’s work as the managing director of U.S. Bancorp Piper Jaffrey’s Poulsbo office, he’s attending city council meetings as an elected council member, sitting in as a board member of a Kitsap Regional Economic Development Council (KREDC) meeting, spearheading a “wiring Kitsap” Telecom Committee meeting, attending Rotary, spending time with his family, penning a magazine article or riding his Harley Davidson through the streets of Poulsbo, the Kitsap Peninsula or, time permitting, en route to Sturgis.

We to trap the 46-year old executive whirlwind in one place long enough to get his take on the state of the (financial) market, on Kitsap’s business market and on why being “wired” could play an increasingly big role in both.

KBJ: This has been an especially difficult and interesting year for the stock market. What’s your take on what’s happened so far and what’s in store?
Stern: It’s always (laughs) an interesting time in the market since the market’s always changing and shifting. We’re just seeing more media coverage right now and a correction to a market that wasn’t being understood properly.
KBJ: How was the market misunderstood?
Stern: I think it’s a huge misconception – one that’s perpetuated by the media – that the market is characterized by a “bear” or a “bull” market. To say that the market is an “up” or “bull” market or a “down bear” market is misleading and besides, we’ve got the animals all wrong. Seriously!

There are two other barnyard animals that are much more appropriate to how the financial market reacts…chickens and pigs. Pigs are motivated by greed, chickens by fear. I think that it’s safe to say that 1998 and 1999, in particular, were pig markets. A lot of what happened in the market was motivated by greed.
KBJ: But aren’t most of us investing in the market motivated by growth and greed?
Stern: Sure, but I think we’ve had almost a “casino” mentality (making) excessive investments with little regard to fundamentals. It really became no different than going to Clearwater Casino.

There was this huge and somewhat irrational belief in the “new age economy.” To a large extent it acted almost like a Ponzi scheme or a pyramid scheme (where) a bunch of people throw money into a pot and the pot pays out and the scheme works out until the last person in the scheme says no. Suddenly, no one can get paid because the chain’s been broken.

Here in Kitsap County we have a large retirement population not to mention a rapidly aging Baby Boomer population (all across the) country. I tell my four hundred clients that it’s not about getting rich but about maintaining lifestyle. I’m big on recommending bonds but I think diversification is the key, including some dividend-paying stocks and other pools of investments.
KBJ: So do you think the market’s in safer waters for a while?
Stern: Well, there’s an old saying that “a rising tide lifts all boats.” The market really deserved what happened and it needed it, too.

As for the future, I think we’ve got some interesting challenges ahead of us. The Baby Boomer generation is aging and will have a huge effect on the market in the mid-part of the next decade. We (the Baby Boom generation) are not a generation about delaying gratification! I think that, much like the pyramid scheme we talked about earlier, if careful planning isn’t done, we could see a similar scenario. I think that what folks will need to learn is that it’s not always about net income but sometimes about net outgo or outflow.
KBJ: You’ve got a unique perspective on Kitsap County not only through your work but also through your position on City Council and with the Kitsap Regional Economic Development Council. What’s your take on Kitsap County’s economic future?
Stern: Well, I’d love to see the county come to peace with its geography. What I mean by that is that we should look at our past and the role that our geography has played to help us determine our future.

A significant chunk of Kitsap’s history in the last century has revolved around timber and fishing or ocean harvesting. We had timber to cut for the growing San Francisco market and we had the ports and waterways to float the timber out or ship it out on boats.

We also had oysters and oyster farming became an economy for the region and then later fishing. Along the same lines, the water and ports caught the attention of the Navy and then we became a community that had the military as an economic factor.

Now, very little of that either plays a role in Kitsap’s real economy or at least (in the case of the Navy) plays a major role in generating tax revenues. Instead we’re seeing people commute to work using roads and ferries and highways and we then need to revamp and build up that infrastructure…an infrastructure that was never part of our original geography.
KBJ: How seriously do you think the rise in commuting is affecting the county?
Stern: Well, there’s no question about it. And at lots of different levels. For one thing, we all know that the region’s highways and transportation systems are inadequate for the demands being placed on it. This impacts the environment, it impacts people’s ability to work and work effectively and it impacts their ability to spend time in their community and with their families.

If you work outside of your community, you’re spending a big part of your income outside of that community. That means that the community you live in isn’t getting the business or the benefit of your spending dollars…they’re going somewhere else. And how can you have a community where people technically live but where they never physically are? That’s not a community…not really. I think that people who can spend more time with their family and their neighborhood make for larger degrees of giving back to the community and in developing stronger social nets.
KBJ: So is there an answer while still considering growth concerns?
Stern: I think there are a number of answers including telecommuting. With the proper infrastructure of (telecommunications) wiring and a commitment to telecommunications technology, there’s no reason that people in Olalla and Kingston and Poulsbo can’t work out of their home. They’re doing it successfully in other parts of the country, places like Golden (Colorado) and Boca Raton (Florida) and they’re doing it successfully utilizing videoconferencing, high-speed (data) lines, etc.

If people could work out of their homes, even part-time, the benefits would be amazing. We’d be keeping dollars in the community, creating a (bigger) tax base and taking pressure off of the ferry system, the roads and the environment. I’m convinced that if you offered the majority of commuters an opportunity to work out of their home as opposed to commuting into Seattle every day, the majority of them would be happy to take a pay cut – maybe twenty percent or even thirty percent – just to avoid the loss and waste of time and energy.

What attracted me to Poulsbo and made me want to move here and live here was the whole “best of both worlds” environment that we have here. We have this beautiful, green environment and then there’s Seattle just a boat ride away for cultural activities and social activity that’s part of a “big city.”

But it’s one thing to have the option of going over to Seattle for culture and enjoyment and having to go there everyday and spending hours each day doing it just to work. And just think what the community could do with the dollars added through the additional local business and taxes, not to mention the dollars saved from not having to build out roads beyond what’s reasonable if we want to maintain an environment that we love.
KBJ: You mentioned that you moved to Poulsbo after falling in love with the location. Where did you move from?
Stern: Livingston, Montana. After earning my degree in special education at the University of California Berkeley, I taught special education and did (what used to be called) Title 1 grant writing for grades one through twelve.

At that time, getting special education funding was tough and was based on your ability to raise those grant monies; I was successful enough at it that it caught the eye of the City of Livingston and they asked me to step in and (laughs) do their grant writing! The next thing I knew I was administering $9 million in community development monies for projects like senior housing. Ultimately, I became the assistant to the mayor, a position that’s sometimes called a city administrator.

It was while I was visiting Seattle in 1984 for business that I fell in love with the area. We visited Port Townsend to see their “Main Street” development projects and traveled through Kitsap and I fell in love with the green and the ferries.

A few years later (in 1986) I was approached by Edward Jones to train in investments and earn my Series 7 license. The understanding was that I could then open a new office for them and I chose Poulsbo. They thought I was crazy (laughs) in not choosing someplace bigger like Seattle but they stuck by their deal and I wound up in a beautiful place.
KBJ: Are there other ways, besides telecommunications and business growth, to foster stronger communities in Kitsap County?
Stern: Sure, and I think one of those ways is to simply get involved. Besides City Council and the KREDC, I chose Rotary as one of the key ways for me to stay involved in the community and in community issues…I can’t recommend it enough to others.

I’ve also gotten involved in other specialty projects that I thought were important (including) becoming part of an advisory group to the board of the Friends of Olympic College, Kitsap Campus. That group, for example, helped make a local campus a reality, including site selection and funding. That’s a good example of how community involvement can play a role in having actually ‘say’ within a community.