What’s the most visible legacy of Covid in everyday life?

Ben Hutton (Business Development Manager for 7IM)
June 2024 • 5 min read

What’s the most visible legacy of Covid in everyday life?

The odd mask still being worn on public transport? A faded sign explaining, in intense detail, how to wash your hands? A Perspex screen somewhere it really doesn’t need to be?

I think it’s something else. Office fashion.

In fact, in the UK, men’s suits were taken out of the ‘representative’ inflation basket in 2022* – if no one’s buying them, they aren’t representative!

Loaded question: imagine I’d given you perfect foresight on this trend towards casual and away from formal back in 2022. Armed with this information, if you had to buy the shares in athleisure super-brand Lululemon or ‘stuffy’ Marks & Spencer, who would you have backed?

Prepare to be as shocked as someone seeing the price tag of a pair of premium-brand leggings for the first time.

In the past couple of years, Lululemon’s stock has basically gone sideways, while M&S’s share price has doubled.

The thing is, even if you know exactly what the world is going to look like, it doesn’t always translate to share price performance.

There are lots of specific reasons Lululemon has struggled – there’s only so much money you can spend on tracksuit bottoms, clothes wear out less quickly at home, other brands have emerged to grab a slice of the market.

But the more interesting case is why M&S has thrived. As a business, it does something we think investors can learn from. It diversifies.

From food to clothing, to homeware, and even finance. So as their formalwear struggled, the rest of the business kept going, giving the fashion side time to adjust, ditch the formalwear, and evolve.

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What’s the most visible legacy of Covid in everyday life?Jemima Thomas2024-06-20T12:22:12+01:00

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TODAY’S BLOG

BROWN PAPER PACKAGES…

It’s that time of year when the parcels arrive in brown paper packages, tied up with strings and yes I’m sorry I cannot help but fill in “these are a few of my favourite things” such is the embedding of “The Sound of Music” in my psyche having raised a family that love musicals and Julie Andrews in particular!

I was struck by something I saw online – “Is there anything more saccharine than The Sound of Music”. Red flag, hold the phone, don’t overreact! I know musicals aren’t to everyone’s liking, and yes, it’s not Tolstoy, it is the Hollywood version of a true story, so some sugar and spice (or lack of) are part of the package. I didn’t think it was quite “fair”. This is after all, a story about the repressed being oppressed and finding a way to liberate themselves in more ways than simply crossing the alps to Switzerland, but perhaps I should try to see the other point of view.

It did get me thinking about the actual story, which is a little more real-life gritty. So perhaps a bit more background is necessary. Firstly, Georg Von Trapp (31) married his first wife Agathe Whitehead (20) on 14 January 1911. Agathe was the daughter of Robert Whitehead a highly successful engineer who designed the Whitehead torpedo. Her mother was part of the Austro-Hungarian nobility and the assassination of Archduke Franz Ferdinand and outbreak of war resulted in the family assets being frozen and forbidden from leaving the country. Georg was a naval officer having followed his family vocation that had resulted in elevation through the social ranks to nobility. He became an early submariner commanding the SM U-5 and was decorated for the sinking of various British, French, Italian and Greek vessels. Their first child Rupert was born in November 1911, over the next 10 years they had six further children. As we live with covid, 100 years ago scarlet fever was much more common and in Christmas 1921 five of the children suffered from scarlet fever during an epidemic, including Agathe who eventually died as a result at the age of just 31 in 1922.

HOW DO YOU SOLVE A PROBLEM LIKE MARIA?

In 1926 Von Trapp hired a novice from the local Abbey in Salzburg, Maria Kutschera. Maria’s own mother died when she was 2 and her father left her with his cousin to care for her whilst he travelled the world to manage his grief and died when she was 9. Despite a difficult childhood she completed school with good grades and eventually received a scholarship to the State Teacher’s College in Vienna from which she graduated in 1923. At age 19 she entered Nonnberg Abbey intending to become a nun.

Within a few months of her position at the von Trapp home, Georg asked her to marry him and according to Maria she returned to the Abbey to seek advice from the abbess. They married in November 2027, Georg being 25 years older unlike Julie Andrews who was just 6 years younger than Christopher Plummer (unusual for Hollywood). Maria wrote that she was really marrying the children, that she wanted to be a nun, she liked Georg but did not love him. They had their first of three children in 1929.

FINANCIAL RUIN

The Whitehead family wealth was largely held in England, but by 1935 with growing tensions in the now land-locked Austria from a hostile Germany, Georg transferred the savings into an Austrian Bank which unfortunately collapsed, resulting in the loss of most of the family fortune. The family had to discharge most of their servants and lived on the top floor of their home whilst renting rooms to others.

One tenant was a newly graduated young catholic priest, Franz Wasner who taught the children music. German soprano Lotte Lehmann heard them sing and suggested they perform paid concerts with Wasner as musical Director. Germany took over Austria in 1938 and Georg was offered a commission in the German Navy, he declined and it is also alleged that he declined an invitation for the family to sing at Hitler’s birthday. Later that year the family left Austria by train initially to Italy and headed for the US via London. They returned for a singing tour of Europe in 1939 avoiding the Third Reich but by September made their way back to the safety of the US, where they lived for the remainder of their lives. Georg died in May 1947 from lung cancer. Maria eventually died in March 1987.

On reflection, perhaps The Sound of Music is rather saccharine, by comparison to the difficulties that the von Trapp family experienced. The basic skeleton of story is there, but many of the traumatic, life shaping experiences are glossed over. What is interesting from a financial planning perspective is how quickly fortunes can alter. Within no more than two decades the Von Trapp’s had lost their wealth, their status, their home, their country. They took on a new vocation, touring as a family singing group.

CLIMB EVERY MOUNTAIN

Unlike the Von Trapp family, with good financial planning, assuming that your lifestyle doesn’t become significantly more elaborate than it is, we work together to ensure that funds survive you and that you provide a legacy for those you wish to. Whilst we can never know the future (fortunately) we can prepare for it as well as possible, doing our best.

One of the main advantages of a global stock market is the ability to diversify assets around the world, reducing risk of permanent loss considerably. Your portfolio now has between 16,000 and 30,000 securities – that’s an enormous amount of diversification around the world.

Anyway, as the year draws to a close, perhaps Julie Andrews will be on screen again. Wherever you are this Christmastime I do hope that you receive some packages, some perhaps in brown paper tied up with string.

So long, farewell…

The Sound of Music (1965) Directed by Robert Wise

Dominic Thomas
Solomons IFA

You can read more articles about Pensions, Wealth Management, Retirement, Investments, Financial Planning and Estate Planning on my blog which gets updated every week. If you would like to talk to me about your personal wealth planning and how we can make you stay wealthier for longer then please get in touch by calling 08000 736 273 or email info@solomonsifa.co.uk

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BROWN PAPER PACKAGESDominic2023-12-01T12:12:59+00:00

CONTEXT IS EVERYTHING

TODAY’S BLOG

CONTEXT IS EVERYTHING

Whatever your view about coronavirus, I would prefer to trust explaining and treatment of any virus to a properly qualified medical expert rather than a member of Parliament. The focus on deaths is purely one measure of the virus, nothing more. As yet there is no (or very little) data about the long-term impact of the virus on individuals. A life lesson I learned many years ago is that investors over-estimate the short-term and under-estimate the long-term. That is true of everyone, not simply investors. We have short, flawed memories.

As for covid, many suffer ongoing symptoms months (currently known as long covid) after first contracting the illness. To measure the danger of virus based purely on deaths is rather like measuring road traffic deaths and concluding that they are low.

A NEW GREEN CROSS CODE FOR HEALTH

In 2018 in the whole of Britain 1,784 people were killed in reported road traffic accidents, yet there were 25,511 (14x) seriously injured casualties and a further 133,302 (74x) slightly injured casualties. Focus on the number that died out of a population of about 66.27million does not mean that just because “only” 0.003% died none of us should wear seatbelts or observe the highway code.

The uncomfortable truth is that we do not yet know the long-term (or even short-term) impact of covid on public health. We hope and look forward to a vaccine. However as with road accidents, there are a great (vast) number of people that will be impacted with poorer health.

BEYOND HEADLINES

In a related theme I noticed a fairly stark statement by a local politician. “10,000 deaths a year in London from air pollution”. Let me be clear, I am not a climate change denier, but I didn’t believe the statement. Instinctively it didn’t feel right. So I checked. In London (inner and outer) there are about 50,000 deaths a year in total. That’s everything from infant mortality, “old age”, cancer, road deaths, murder, suicide – the works. There is no way that 20% of those are due to air pollution. Everyone dies in the end.

IN A HAZE

Certainly you may notice the air quality in London being poor or awful at times, there is room for improvement (always). However, this is to forget the context. Take the Great Smog 5-9 December 1952. Estimates at the time were that 4,000 people died as a direct result, with 100,000 made ill, some of them very seriously indeed. Actions were taken to improve the quality of London air and have been ever since. The number of deaths registered in London has fallen enormously over the years. I have found data to 1966, some 14 years after the Great Smog there were 87,991 deaths (London) in 1966 some 5 years later this has reduced to 84,990 in 1971. Thereafter each subsequent decade later the numbers reduce. By 2011 the number had fallen to 46,685. Last year the figure stood at 49,007. Admittedly increased since 2011, but then so has the population from about 47.9m in 1966 (England and Wales) to 57.4m by 2014.

PAST, PRESENT, FUTURE

Data always requires a context and this invariably requires looking back. The main problem with financial planning is that we look forwards, often forgetting how far we have come. It is important to remember what things were like, this provides confidence that the future is hopeful. As for wondering if financial planning is important, think back to your own childhood and the cost of a stamp – look it up (if you were born before decimilisation you will have to convert imperial). One of the basics of financial planning is to keep your spending power rising or at least equal to inflation so that you can still afford your lifestyle, fear of the future is likely to be your worst enemy. Do not under-estimate the future or forget the past.

Dominic Thomas
Solomons IFA

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GET IN TOUCH

Solomon’s Independent Financial Advisers
The Old Mill Cobham Park Road, COBHAM Surrey, KT11 3NE

Email – info@solomonsifa.co.uk Call – 020 8542 8084

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CONTEXT IS EVERYTHINGDominic2023-12-01T12:13:13+00:00