Kingsmill’s Investment Miscellanea: Friday June 19, 2020

Jun 19, 2020 | Joshua Kingsmill


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Key Takeaways:

  • Mass social gatherings, despite the risks, a reflection of our times.
  • Lobsters and the stock market: some parallels.
  • "Summer Homework," reaching out to assess and plan.

There is a video that is making the rounds: The New York backdrop is unmistakable. The scene is more akin to a New Orleans Mardi Gras celebration:

Twitter Post by EvGrieve of Friday Night St Mark's Place in Manhattan New York - Video Link

 

Much has been made of these "social acts of defiance". These gatherings are taking place all over the world. On the one hand, it's easy to react by thinking: "this is just dangerous behaviour, and going to cause a "Second Wave" (side note, are we even out of the "First Wave"?)

On the other hand, for most of these participants, they no doubt feel "robbed". Maybe it's just me, but I also have empathy for the mostly young people in videos like these, who have had what could have been the best summer of their lives never come to fruition.

They have memories and experiences robbed. Most of the people in these gatherings are likely unemployed, their futures uncertain. In some ways, their optimism, exuberance and wanting to be engaged socially, albeit misguided and arguably reckless, is not done out of malice. They are in it together.

Lobster

 

Who knew that I'd find a link between an article I read about the Lobster industry, and the investment market. Lobsters, whose biggest purchasers are restaurants, are selling at an all-time low, mostly due to lack of demand. There are also near-term and long-term weights hanging over the lobster industry.

Lobster fishers are getting $3.60 a pound. That's roughly half the rate lobster would usually fetch at this time of year.

While this quote from the Lobster fisherman is about his business, he sounds like an investor: "I've been fishing for 40 years. This is the worst. This is a tense time and a very nervous time. The price is terrible, and I assume it will get much worse. There are not many people fishing right now, but once more guys start fishing for the summer, it's not going to be good."

He concludes with a pithy observation, applicable to all of us: "You have to sleep at night, so you can't worry too much. It's hard to plan too far ahead or worry about what's next. I just keep going along. We do what we do and see what happens."

While it is true that we will all wait and see what happens, I'm going to double-down this summer, reaching out to each of my clients to set up another round of calls and meetings: go through your investments, look at long-term planning, further bullet-proof your portfolios. In this set of calls, we will be taking advantage of the new technologies and online tools that RBC DS has invested.

As investors, there is much that we ought to do to be pro-active while being mindful of the backdrop. So over the next few weeks, expect meeting requests from Peter and me. We are excited to do this, incorporating some new best-practices and excellent remote online collaborative tools - we are excited to share them with you all.

This weekend is Father's Day. On Sunday, I will go out and try to get some discounted Lobsters and celebrate with my family (see, there was a link with the Lobsters and the post!). I hope you all get to celebrate in some way with your significant Fathers, Grandfathers, sons, and other Fatherly figures and members of your family that are important and reminisce about ones that are no longer with us.