It is always interesting to see economic theories play out in real time. We know that airlines are struggling due to COVID-related travel restrictions and the fast shift in business culture away from traveling and towards video conferencing. Even before COVID, airline fares in the US had been on a near steady drop since 2014 (see the chart directly below). The much smaller number of business travelers is particularly painful because the often rushed, last-minute nature of much business travel has historically produced a nice profit margin for the airlines.
School sure was tougher in the past. For example, back when I was at university, there were 27 letters in the alphabet. You see the ampersand (&), a noble typographical symbol with roots in ancient times, was listed as the last letter of the alphabet in grammar books during the mid-1800's. But as education entered the 20th century, there was a change in the letter lineup. Seemingly overnight, the new law of the land was to ban the ampersand. There were accusations that the makers of Alphabet Soup had lobbied schools to remove the ampersand because all of its curlicues were difficult to render in noodle form. Many just felt that the last letter should be Z because it was full of pizzazz, and it had influential backers like zebras and zillionaires. No real faction appeared to support the ampersand during the replacement process. Former friends such as Bed Bath & Beyond, Ben & Jerry's, and AT&T all turned their back on the character in its time of need. Of course, not all change is bad. The removal of ampersand did force the ending of "The Alphabet Song" to be rewritten, which originally had quite a different and disconcerting conclusion...
"Hannibal is at the gates!" shouted the panicked people of Rome in 216 BC as the Carthaginian general appeared on the precipice of destroying their Republic. An implacable and ingenious enemy, Hannibal had repeatedly defeated the best armies Rome could muster. Running out of options, Rome reluctantly turned to a bold, unorthodox young man for help - a man known to history as Scipio Africanus. With a fondness for long hair and Greek philosophy, Scipio flouted the conventions of Roman society. He was a hippie and an iconoclast before hippies and iconoclasts ever existed. He assumed political offices for which he was not eligible. He had little patience for petty procedures and stuffy statutes in his drive to accomplish great things - and he would accomplish great things. Through a combination of charisma and cunning, he beat the Carthaginians back to North Africa and eventually defeated the once invincible Hannibal at the Battle of Zama in 202 BC. After the victories, Scipio was idolized by the public and placed above the law. Later on, when the Roman Senate would bring charges of embezzlement against him, Scipio would dismiss the accusations as not worthy of his time.
Listen to Bert Herzog, Founder, Director and Private Wealth Advisor at EWM speak with WWJ’s, Rob Mason, on financial planning with the stock markets current volatility.
A new study indicates that the vocabulary of the average American adult has declined in recent decades. To counteract this trend, On A Lighter Note is introducing a "Word of the Day" feature to help its readers apply a more expressive and impactful vocabulary to everyday situations. First up - quincunx. A quincunx (pronounced kwin-kunks) is a group of five objects arranged in a 2-1-2 pattern like the five dots on dice. The word originates from a coin of the same name used in ancient Rome that featured five dots in the aforementioned arrangement.
With many questions turning from COVID to politics, it is important to refresh ourselves about what is important about electoral politics. There is no doubt that people are worried about the election. The electorate is always worried about upcoming elections and the future of this great nation. We get that, and we are also concerned about the future. But we are never convinced that the occupant of the White House has quite the impact that they are credited with in the press. Looking at the chart below tells us the same. Democrat and Republican regimes have had identical stock market returns through 2015.
Just in case you missed Executive Wealth Management's founder and director Bert Herzog live on the TD Ameritrade Network channel this past Tuesday, you can catch his conversation about the stock market with host Oliver Renick by clicking on the screencap below.
To err is human, but to prepare for error is ... well, maybe not divine, but it is a pretty important thing to do nonetheless. In that vein, we wish a belated "Happy Birthday" to software engineer Margaret Hamilton who turned 84 last week.
The school year is starting up again, and virtual classrooms will be prominent. This writer is reminded of how he did distance learning in the old days - by watching television sitcoms. In particular, the field of chemistry didn't seem quite so daunting after viewing The Facts of Life episode "Take My Finals Please". When Natalie got frustrated with her inability to remember the chemical symbol for the element gold, Tootie showed her the value of word associations. She had to come up with a sentence that starts with the letters of the chemical symbol and that references the element. Tootie told Natalie to imagine a thief trying to steal her gold watch and then shout "Eh, you, give me back my gold watch!" (Element - Gold, Symbol - Au). Expanding on Tootie's wise idea, I thought I would create some new chemistry word associations for all students now staying at home:
The pandemic and the subsequent societal response have created difficult situations. It has also allowed us to observe some economic circumstances that we would have never been able to see were it not for these events. We are getting used to seeing incongruous headlines next to each other. Note below the big headline at noon Eastern Time on 8-17-2020 from the front page of Bloomberg.com, and then notice the second small headline below it underlined in yellow. How can these two items exist on the same news feed? 16% of Federal Housing Administration (FHA) loans are in delinquency, yet homebuilders are the most hopeful they've been this millennium.
As gardens grew more elaborate in late 18th century England, some wealthy landowners splurged on the ultimate in backyard decorations – ornamental hermits. Given food and a very modest shelter (such as a shed or cave), an employee was expected to live alone on the grounds in a tattered cloak for the duration of a 7-year contract. The landowner was then provided with the ultimate rustic diorama that had just a bit of live drama. However, the increasing urbanization and industrialization of Great Britain in the ensuing decades made hermit work look less enticing to employees and eventually the fad faded.