Cheap Vices Virtues For Investors After The Recession
Invest in petty vices.
Looking back at which industries had solid gains after the crash of '29 that set off The Great Depression, the WSJ found that one clear standout were the makers of "cigarettes, cigars and tobacco, sugar and confectionery products, and fats and oils." While many industries were the tank, the companies in these industries gained between between 1.6% and 7.5% annually (however, the gains weren't seen until the fourth year after the crash, when the market came back 54%). Even when times are tough, people will still find room to indulge in those cheap fast and dirty gratifications.
1930s Lessons: Brother, Can You Spare a Stock? [WSJ] (Photo: dM.nyc™)
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mmmm ... fats and oils. Thanks, Consumerist, now I want carnie food!
if I finish my PhD and can't find a job, I'm opening a bar. first drink for consumerist readers is free!
Other industries not on the NYSE: prostitution, bootlegging, moonshining, mob-bossing. All growth industries.
Also helps that those manufacturers are the sources of cheap proteins, sugars and stimulants.
McDonalds and Hershey will thrive because folks scale back on high end and still want the brief rush that the stuff can provide.
I dont see Tobacco going up though, since governments all over just keep cranking up the taxes.
@alexburrito: The U.S. Government is now the #1 growth industry!
I'm not sure how to make a buck on it though -- they're growing, but they've got shitting returns. Hmm, must be 'management'.
government should legalize and tax it and that'll help solve their deficit issues.
If they allowed smoking everywhere like they did in the 50's & 60's like the grochery store!!! We'd have more people dying faster solving all the budget concerns in Social Security!
TransFat & Cigarettes FTW!
Just as Ozymandias predicted!
We need to invest in baby food, people.
This is not a surprise at all. If we could track it, I'm sure we would see a similar resistance to recession with illicit drugs, gambling, and prostitution.
People like to feel good; no economic conditions will change that at all.
"Of course, some of the industries in the [Center for Research in Security Prices] CRSP sample scarcely exist today. It doesn't do us much good to learn that we could have earned a 5.9% annualized return by investing in leather tanning and finishing stocks, for example."
Interesting article nonetheless -- now if I could only find where I put those cigarettes and pork rinds...
Well I know I've been drinking more. I keep a bottle of tequila at my desk just for those special moments.
i work at a liquor store [okay, technically for the state of PA, thanks state-owned liquor!] and i know i have just about the safest job on the planet. unless someone chooses to hold us up, which is a bad idea because they will face the wrath of the whole state.
thank god for vices.
@katieoh: Yeah, luckily you vend one of the vices that, for no good reason, is legal while others aren't.
You want to create jobs and lessen the government's financial burden? Legalize pot.
Based on the article...I think I'll go invest every dime I've got into "Leather Tanning and Finishing".
Yum...tanned and finished leather. :-)
Tell that to the vice fund (VICEX) part of my 401k is invested in...
/down almost 50% in the last year
@Eyebrows McGee: Carnie food? I hope you mean "food I can get at carnivals" like corn dogs and funnel cakes, and not "food that carnies eat." Because I imagine that would consist of cigarette butts, broken bottles, and used chewing gum.
@katieoh:
Where can I find more about this at? I was thinking of opening up a liquor store in PA/Ohio.
@CthulhuRlyeh: was thinking the same thing! first invest in sex toys and/or porn industries then in diapers for when the economy changes!
I think I will invest in Ben and Jerry's. Everyone loves some good ice cream with a crazy name to make them feel better.
Good, at least you can die fat and happy as you go broke.
@TracyHamandEggs: the higher my bills go, the more i find myself chain smoking. i'm aware it costs more but it keeps me from strangling people
Nobody mentioned pornography, which is featured in the photo.
@unajuaner: Second investment should be a shotgun and a bunch of shells. Start with rock salt and move up from there (depending on how bad things get).
I've spent years cultivating my vices. I resent the implication that any of them could be petty.
I invested in mace just before society crumbled.