Dividends and Can the coronation boost Britain’s economy?

Every economy in the world depends on many aspects but tourism or hospitality industry ranks as a large contributor to the GNP. Within the tourism sector are the local and the international aspects. International is people travelling across borders to visit a country, local are the people who live in the country. Sometimes the local tourism is based on the weather, if you were to visit New York City in the summer, you would notice it is hot and humid. There is a reason why people leave the city to feel better – past the suburbs are parks, cottages and cooler temperatures. There is another topic of how much money people spend – from camping to five-star resorts, there usually many price points for tourism.

In an article by Eshe Nelson of the New York Times News Service, an event was held in London, England during the first week of May. The event was the coronation of King Charles. With the royal party, there is many traditions and pomp and ceremony for the event and the public was invited to watch on the screens.

The issue of what happens to the Coronation can be related to the Championship event for sports. People gather at the stadium as well as bars and restaurants to watch and cheer to the teams. The bars and sponsoring beer companies will have put up signs and encourage everyone to participate and spend money at their establishment.

In England, the coronation of the King started a 3 day celebrations and even if someone does not like the monarchy, they were likely watching because the coronation of a new King and Queen does not happen every generation. In this case, the King is in the position until they die or just before they die. Charles is about 70 years of age and if he lives to 90ish, there will not be another coronation for 25 years.

Stephen Millard, a deputy director at the National Institute of Economic and Social Research, believes there will be a upswing in consumer confidence but unlikely to fundamentally change the British economy. The UK Hospitality, estimates an additional $600 million in spending on hotels and at pubs.

Linking to dividend paying stocks, in the hospitality industry, there needs to be events on a regular schedule to ensure occupancy and spending on food and beverages. For a dividend producing company, it should not rely on big events, it should rely on normal day to day spending. If the company has to rely on events, then as investor you need to pay attention to how it makes it money and does it? If you invest in a local or national utility, then you need to know does the lights work when I turn the switch on. There are a number of methods to invest your money, but always try to find relatively boring ways which is very consistent and high margins.

There are more questions than answers, till the next time – to raising questions.


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