From Currency to Capital

BY L’MONIQUE KING QNOTES STAFF WRITER

Two hundred years ago most Black individuals residing in the United States were slaves: bought, sold and used as currency. It was Jan. 1, 1863, when the Emancipation Proclamation made humans owning other humans illegal and began the process of ending chattel slavery across the country.

In effect – Black people in America have since gone from being currency, to turning their earned money into capital by investing in stocks, bonds and small businesses.

The idea of economic mobility isn’t new for Black folks. In fact, there was a time, particularly during the era of segregation, that Black Americans had no choice but to build and invest in our own communities. Communities like the Greenwood area in Tulsa, Okla. and Parish Steet in Durham, N.C. were both areas of distinction and influence and both known as Black Wall Streets.

According to history.com, the largest number of Black townships after the Civil War were in Oklahoma. Between 1865 and 1920, African Americans founded dozens of Black townships and settlements in the region. The Greenwood area was the first.

In 1906 O.W. Gurley, a wealthy Black landowner, purchased 40 acres of land in Tulsa, naming it Greenwood after the town in Mississippi. Restaurants, hotels, luxury shops, pool halls, barber shops, salons, nightclubs and offices for lawyers, dentists and doctors could all be found on Tulsa’s Greenwood Avenue.

But the area was also home to less affluent African-Americans, as well. A significant number still worked as janitors, dishwashers, porters and domestics. The money they earned outside of Greenwood, however, was largely spent within their own community.

“It is said within Greenwood every dollar would change hands 19 times before it left the community,” said Michelle Place, executive director of the Tulsa Historical Society and Museum.

As you might imagine, the investing this community and others like it were involved in at the time was often community driven. That is to say, it wasn’t all about banks and businesses, it was also about people investing in the empowerment of their people. Sadly, however, this wasn’t championed by everyone. It wasn’t long before Tulsa’s community of affluent African-Americans attracted the attention of local white residents, who resented the upscale lifestyle of people they deemed to be an inferior race.

This resentment would eventually lead to what is now known as The Tulsa Race Massacre or Tulsa Race Riots. During the massacre, scores of Black lives were lost while white Tulsa residents burned and destroyed property worth millions of dollars. No assistance in rebuilding was received from the city, though Greenwood residents, with the help of the NAACP, other Black townships and Black churches, really tried. Today, what’s left of Tulsa’s Black Wall Street area pales in comparison to what it once was.

A similar story can be told about Durham’s Black Wall Street area. The fourblock area of Parish Street in Durham was once a bustling area for Black business and Black economic empowerment. In the early 1900s, Durham’s national success was said to have been due to this [former] hub for Black business and the Black middle-class.

N.C. Mutual Life Insurance Co. and Mechanics & Farmers Bank were among those businesses – successes that were also celebrated by well-known authors like Booker T. Washington and W.E.B. DuBois.

By the 1960s desegregation and eventual gentrification brought about the regrettable demise of Durham’s Black Wall Street, though the influence still remains.

Today, however, when Black Americans are not purely restricted to patronizing Black-owned businesses as a result of segregation, Black folks investing for their families and in their communities looks a little different. Many invest in their families and communities via owning and operating their own businesses.

Bloomburg.com reports that after suffering a crippling blow early in the pandemic, Black-owned firms are seeing the strongest rebound among U.S. racial or ethnic groups. The number of AfricanAmerican business owners in operation surged to almost 1.5 million in August of 2021, up 38% from February 2020, before COVID-19 hit the United States, according to new research from Robert Fairlie, a professor at University of California, Santa Cruz. The ranks of Hispanic owners rose by 15% in the same period, while White and Asian entrepreneurs fell by three percent and two percent, respectively.

For others seeking to invest outside of owning a business, information on investing is more accessible than in days past. With the advent and popularity of apps like Acorn and Robinhood investing has become less scary and more tangible for African Americans.

Charlottean and local business owner Dianna Ward has found great success in a hybrid of investing. Beginning with mutual funds as a middle schooler to arriving where she is today: owning multiple properties, both private and commercial, and continuing to invest in stocks and community. Clearly, Ward is an entrepreneurial force to be reckoned with.

She has lived in Charlotte since 2001 and is the owner of Charlotte NC Tours LLC. Her company provides Segways, bikes, buses, walking tours and team building activities for groups and organizations. In discussing her journey of Black economic mobility, she shared her experiences and a few suggestions.

“I started investing when I was in middle school. It was nothing big; we had a church member who sold mutual funds, and so I invested in a mutual fund out of Kansas City, Miss. – every month I invested $25 in that mutual fund.

“We were middle class, we were not rich. Many of the good things that helped me to become who I am were in church. In church, I was introduced to people who opened my world. These people opened my mind to something that I didn’t have to wait to become an adult to understand. I learned about financial investing, golfing and other things.”

While pondering the state of Black economic mobility, Ward lamented that she’s not a financial advisor, but believes anyone working at a company willing to match a 401K by a percentage should acquire one. “Everybody should be maxing out their 401K and contributing the maximum amount, especially if your company is going to match your contribution.”

Regarding property ownership, Ward continued, “Many times in our efforts to get away from urban areas, we move to areas where our properties don’t appreciate. People need to be looking for their primary residence to be appreciating. I’ve made money off every house I’ve purchased, and I’m now on the sixth house. Every one of my homes has appreciated at least 50%. We kept them for the mandatory two years so that we wouldn’t have to pay capital gains.”

With all of Ward’s success, she was vehement in expressing that she hasn’t found success solitarily. “Everything that I’ve done was a matter of great partnerships. There are very doable things that everyone should be able to do to increase their net worth and in the process of doing, make sure that you’re also doing good, investing in the community, investing in yourself. More than anything, we need to do the small things first.” Those small things Ward spoke of begin with sharing information, “If you know something share it.”

As the country grapples with an affordable housing crisis, there’s an even larger issue of closing the gap in homeownership rates among Black Americans. “People are waking up to how we got to this point. They’re learning about redlining and deedrestricted covenants, things that made it impossible for Black families to own homes,” says Dr. Tiffany Manuel, founder of TheCaseMade, a social justice leadership training organization.

A report by the Urban Institute shed additional light on the inequities of residential property ownership today. Whereas redlining and deed-restricted covenants may be a thing of the past, “Since the 2008 financial crisis, the Black homeownership rate has fallen behind; and the gap between Black and white homeownership is now wider than it was more than 50 years ago. The