Marvin R. Shanken, Gordon Mott
From the Print Edition:
Jay-Z, May/June 2009
How many times in the last six months have you heard this phrase: "I've never seen anything like this in my life." There is no other way to look at this time in our history. If your elderly parents or grandparents are still alive, and they were around during the Great Depression, they may be quick to talk about some of the similarities they see between then and now. But it's our guess that what they notice the most is the fear that has grabbed hold of every one of us. And it is a kind of fear that no one under the age of 70 can remember.
We can argue about the origins of this economic calamity, and we can certainly argue about the best solutions to get us out of this mess. But in the end, we should be able to agree on one thing: no matter where or how it started, we are all in it together. In reality, we are all going to get out of this together too. What each of us does in the next six months will contribute to that outcome.
First, we'd like to report that the cigar business has been doing fairly well. While there are real concerns of the effect of increased taxes since April 1 resulting from the expansion of the federal State Children's Health Insurance Program, and higher prices at the retail level, we have come to believe that for the smoker of premium, hand-rolled cigars, the step-up in prices is not going to dramatically change his buying habits. We recommend that while you may be tempted to cut back on cigars, don't. Now is the time when your purchase decisions can help keep retailers alive. Both retailers and manufacturers need your support.
The liquor business is doing pretty well too. While sales of some ultra-premium brands are off slightly, the overall industry is holding its own. This suggests that people are looking for ways to relax. We can't think of a better way than with an occasional glass of your favorite spirit.
Apart from stocking up on cigars, and spirits, we also suggest you keep a close tab on your lawmakers. Many of them automatically look to the so-called vices for new tax revenue; this approach usually ends up backfiring by reducing sales, or forcing people to find lower-tax alternatives. So make sure your legislators know that you will protest higher taxes on cigars and alcohol.
Finally, everyone needs to just take a deep breath. Focus on the positives out there. We live in the greatest nation on earth, and we've just come off an incredibly long period of economic expansion and prosperity that spanned two different administrations. More than 90 percent of Americans are still working, and most of those who have lost jobs will eventually go back to work—we hope sooner rather than later. While times are tough, with more rough times to come, this downturn will eventually end. If we keep our heads on straight, and begin to think about buying and investing in the things we need and want, we will all get through this time together.