What caught my eye this week.
Being nothing if not a business nerd, I spent Friday evening enjoying a new report [1] from Waitrose on consumer trends in 2021.
Don’t judge me! It’s not like the pubs were open. Or maybe they were? But I live alone. So I can’t go to them. Or maybe I can go? And sit on my own with a hearty meal? I’ve lost track.
Anyway, there was lots of food for thought in the Waitrose report, served up alongside all that ready-baked pun potential.
A few morsels:
- Waitrose dubs preparing dinner ‘the new commute’, with three-quarters of home workers using cooking to mark a divide between work and play.
- Some 69% of Waitrose shoppers think they’ll continue with online grocery shopping when normality returns.
- There’s been a 222% rise in interest in pickling.
- Rosé sales were up 57% year-over-year in Autumn, as the seasons went by in a blur.
- With coffee shops closed, sales of bean-to-cup [2] machines rose 64%. (Here’s one [3] I prepared earlier.)
- Cash transactions at Waitrose have fallen from 22% pre-pandemic to just 10% now.
- 58% of customers say they’ve secretly enjoyed the lack of pressure to go out.
As an active investor [4] and stock picker, I’ve spent this year trying to divine what has changed [5] and what has not [6] in the wake of the virus.
I’m instinctively a skeptic of overnight societal shifts:
Nah. People love cities. Society is roughly never changed by one-off events. Americans I think particularly struggle with this. Europe saw major cities reduced to 2-foot of rubble in a WW2 and life return to normal. If (/when) technology changes things, it won’t be due to Covid.
— Monevator (@Monevator) November 23, 2020 [7]
I certainly don’t believe all those people who bought bean-to-cup coffee machines won’t soon be back in the cafes as much as before.
And I have to believe that the 58% of us who’ve enjoyed the freedom to lounge at home reading business reports on a Friday night will eventually feel the pressure to get back into the fray.
Cost conscious
What was most striking to me from the report though was what was not in it.
2020 was a year of economic turmoil, but you’d never have known it.
I’ve had a very good 2020, financially speaking, which is kind of depressing given what a rotten year it’s been. I kept my head in March [8] and picked up bargains. This year to forget looks like being one to remember, seen through the heartless lens of returns.
It could have all gone differently, of course.
When The Accumulator wrote his seminal Do Not Sell [9] post during the crash, he wasn’t thinking the market would bounce back within months. I guess it’s conceivable too that the vaccines wouldn’t have proven effective in trials, though that always seemed unlikely to me. There remains a risk we can’t vaccinate ahead of mutations, I suppose.
But one thing I would never have expected in March was that a supermarket could review this year without talk of shoppers cost-cutting, downshifting in brands, and buying in bulk to save money.
We now know it’s been a K-shaped [10] recovery – the richer who shop at Waitrose have been far less affected by the economic tumult than those down the road at Tesco. But I’d still have expected financial hardship to at least feature, given the scale of the economic drawdown.
In many ways this is a clear positive. I posted in March [11] that readers should prepare for a recession. We saw one [12], but for Waitrose shoppers – and I suspect most Monevator – readers it hardly felt like it.
However for me this gives a hint at the hard-to-fathom borrowings the country has taken on to soften the impact of Covid and its related disruptions.
The UK economy saw a record slump earlier this year. But unemployment didn’t soar and while there have been some bankruptcies, it seems small beans for anyone who was around in the 1980s, or even the early ’90s.
We rightly decided to offset the pain of this one-off and unforeseen external shock from the coronavirus. We can debate whether this or that anti-viral mandate was heavy-handed and made it worse, but it’s very hard to argue we shouldn’t have borrowed hard to keep the economy afloat.
The chancellor kicked tax rises down the road in his Spending Review [13]. With the economy still shaky and bonkers Brexit imminent, that made sense.
But we will have to pay for all this one day. Something to think about when you’re next clicking for pickles at Waitrose.
Note: I expect we’ll discuss the economy in this week’s comments. Please keep it civil and on-topic. Virus-specific comment should go on our dedicated Covid thread [14]. I get there’s a huge crossover but let’s try to keep this discussion finance and investment-related please, for wider reader enjoyment.
From Monevator
Is it rational to invest in alternatively weighted index tracker funds? – Monevator [15]
10 ways to lose money trying to beat the market – Monevator [16]
From the archive-ator: Earn more money by tackling your mental beliefs – Monevator [17]
News
Note: Some links are Google search results – in PC/desktop view you can click to read the piece without being a paid subscriber. Try privacy/incognito mode to avoid cookies. Consider subscribing if you read them a lot!1 [18]
David Blunkett says Labour never envisaged 200,000 disabled children struggling to access their Child Trust Fund money – ThisIsMoney [19]
Spending Review: five things that were in the small print – Which? [20]
Only 1-in-4 got these three money questions right [Revealing] – ThisIsMoney [21]
Bank of England told to find out where ‘missing’ £50bn in cash is ‘stashed’ – Sky [22]
Pensions’ problems put a toxic cloud over stock recovery [Sorry, paywall] – Bloomberg [23]
The real virus to fear – Ryan Holiday [24]
Products and services
Lloyds is re-introducing 10% mortgages for first-time buyers – Guardian [25]
Unbiased will match you with an FCA-regulated financial advisor who’ll review your investments for free, with £50 off future advice – Unbiased [26]
British expats left with few options as more UK banks confirm Brexit account closures – Which? [27]
What’s firing up the [nascent, mostly US] direct indexing boom? – Think Advisor [28]
AJ Bell [29] customers see charges rise but exit fees scrapped – ThisIsMoney [30]
Sign-up to Freetrade via my link and we can both get a free share worth between £3 and £200 – Freetrade [31]
AmEx’s latest £5 cashback for £10 spent ‘Shop Small’ scheme starts 5 December – American Express [32]
Rightmove’s five most-viewed properties of 2020 – House Beautiful [33]
Homes for sale in market towns, in pictures – Guardian [34]
Comment and opinion
Never forget that to most employers you’re just a number – via Twitter [35]
How much should you invest in annuities and equities in retirement? – Klement on Investing [36]
How good personal finance habits made possible the Dazed and Confused movie – AWOCS [37]
Game theory: Lessons from the Monopoly board game – Humble Dollar [38]
Digital dollars – AVC blog [39]
Shopping is not the same as buying – Seth Godin [40]
Rich as I say, not as I do – Of Dollars and Data [41]
Our recent FIRE fears [42] article discussed on Animal Spirits [Podcast] – The Irrelevant Investor [43]
Naughty corner: Active antics
Robert Shiller: Making sense of sky-high stock prices – Project Syndicate [44]
A reminder that a market that has been going up tends to keep going up – Crossing Wall Street [45]
Active fund investors earn higher returns for tolerating underperformance [Search result] – FT [46]
The case for investing in non-market assets – Institutional Investor [47]
The top 30 [US] stocks over the last 30 years – Charlie Bilello [48]
Options traders are incredibly bullish – Sentiment Trader [49]
A deep dive into Caledonia Investments – IT Investor [50]
Why most Robinhood investors earn lousy returns [Research] – The Evidence-based Investor [51]
Covid and politics
Note: Any comments on Covid should only go on our special thread [14], please.
Britain approves Pfizer-BioNTech COVID-19 vaccine in world first – Reuters [52]
UK got vaccine first because it’s ‘a better country’, says Gavin Williamson, an actual government minister – BBC [53]
Dr Fauci walks back comment that UK rushed vaccine approval – BBC [54]
Latest REACT study finds UK’s R number is now below 1 – Imperial College [55]
Germany’s second wave has been worst than its first… – CNBC [56]
…country is a victim of its early Covid success, says minister – Reuters [57]
Sweden now recommends children of Covid sufferers should stay at home [Search result] – FT [58]
Boris Johnson and EU chief seek to break trade deal deadlock – BBC [59]
“This has to stop” says US election official sick of staff intimidation [Video, and if you still support Trump even after his post-election behaviour, please get off my blog] – via Twitter [60]
Kindle book bargains
Don’t have a Kindle? Buy one [61] – no need for a house big enough for books!
Amazon FBA Step-By-Step: A Beginners Guide To Selling On Amazon – £0.99 on Kindle [62]
Make Your Bed: 10 Life Lessons from a Navy SEAL by William McRaven – £1.99 on Kindle [63]
Influence: The Psychology of Persuasion by Robert Cialdini – £1.99 on Kindle [64]
Bean Counters: The Triumph of the Accountants and How They Broke Capitalism by Richard Brooks – £1.19 on Kindle [65]
Off our beat
A look behind the curtain of the global virtual assistant boom – The New Yorker [66]
How to handle The Beast – Raptitude [67]
‘There’s a gaping hole in our knowledge’: the scientists studying why gamers invert their controls – Guardian [68]
‘It will change everything’: DeepMind’s AI makes gigantic leap in solving protein structures – Nature [69]
The empty Spanish resorts of Covid summer – Bloomberg [70]
Blogging is dead. Long live blogging! – Abnormal Returns [71]
And finally…
“He who has learned to disagree without being disagreeable has discovered the most valuable secret of negotiation.”
– Chris Voss, Never Split The Difference [72]
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- Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”. [↩ [78]]