ALEXANDRIA, VA (October 15, 1999) -- Exactly 12 years ago today -- on October 15, 1987 -- investors were exchanging shares of Microsoft (Nasdaq: MSFT) for around $71 a stub. For argument's sake, let's say you bought 10 shares that day -- a meager $710 investment. Only seven trading days later, in the midst of the famous crash of '87, those shares lost 45% of their value, and closed at $39.25 each. How dumb would you have felt? $318 of your hard-earned savings vanished practically overnight. If only you'd paid closer attention to inflation, the government bond yield, the trade-weighted value of the dollar...

If only we'd all bought 10 shares of Microsoft on that day, and had the iron-lined stomach necessary to hold through all the ups and downs of these past 12 years, our 10 shares would now be 720 shares, and our $710 original investment would now be worth more than $63,000.

Today's market jitters are just another episode of the same inflation worries that have accompanied our rise over the past 5,000 Dow points. And, even if we are entering a period of higher prices, the most important question for an investor to ask is: Does rising inflation change the best place for my long-term savings?

The answer is definitely no. In periods of inflation, stocks have historically fared much better than bonds. And for the investor of a focused portfolio of 6-12 holdings, there is a definite opportunity to find those commercial enterprises that are poised for such great success that they will dramatically outperform the major market averages during an otherwise flat market.

One of the emerging technologies that holds great promise for our economy is XML, or Extensible Markup Language. Basically, it's the next iteration of the Internet's language. Unlike the Internet's current standard, HTML -- hypertext markup language -- XML will allow information to be shared among websites in exponentially greater detail and precision. The benefits will include lower costs for business -- which, I might add, is disinflationary -- as well as entirely new ways of conducting business. XML is the key to allowing businesses to integrate their applications and services on the Internet. The result is that this technology makes the Web programmable. Microsoft is making XML a core part of its next generation of products, as I wrote in a Fool Plate Special last month.

More recently, I read a fantastic article in CFO Magazine that more fully explains XML, its benefits, and the companies that stand to benefit. I'm going to cut short tonight's report so you can take time to read this great article and ponder some of the companies that stand to win.

The XML Connection

Here's a quote that gives you the flavor of the article:

"XML, on the other hand, enables a computer to identify the kind of information received, whether it's a purchase order, a medical record, or a customer query. Platform independent, it seems destined to become a universal format for data exchange, which has led some observers to call it an Esperanto for the Internet. The implications for electronic commerce and communication are enormous."

With emerging technologies like XML, I expect individual investors have every reason to remain optimistic about the stock market's future. Instead of getting caught up in the doom-and-gloom scenarios of the Wise, take some time to look out five or ten years into the future and imagine what Rule Breaking or Rule Making companies might be changing the world.

Fool on!