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Lazy Cash Wandering Docks at Newport Boat Show

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By nyker @ Shutterstock.com

“Permission to board? Should we remove our shoes?” Becky and I asked. A polite way to board a brand-new boat on display at the Newport International Boat Show last weekend. With docks loaded with giddy, lazy cash looking for some fun next summer, you can imagine the challenge it is to keep the decks free and clear of excess debris.

As Becky and I spoke with our local Grady White dealer and boatyard owner, we learned that if you want a new boat, you’ll have to get in line because dealer allocations are a fraction of what they were pre-Covid, thanks to a lot of things like a shortage of workers and supplies. Combine the shortage with the excesses of the lazy cash hoards looking for places to be spent, and you know where prices are anchored. And it’s not just last weekend’s intelligence gathering that’s concerning.

In speaking with a client, an owner of a major manufacturing business in the South, yesterday, he told me demand is great, but because of the supply chain issues, he can only meet fifty percent of it. On top of that, the forty-foot shipping containers he uses cost three to four times what they did pre-Covid, making that a major cost to consider like never before. It makes margins that much thinner and an over-order of supplies that much more costly.

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Action Line: You can see the tug of war between demanding lazy cash and discerning suppliers making the world go round.  Meanwhile, lazy cash is throwing itself at the stock market like a drunken sailor. Look at my chart below of the companies in the S&P 500 trading at ten times sales, before factoring in costs of goods sold, never mind profit. Stay tuned.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zildjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West (RIP JB) and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com To sign up for my free monthly Survive & Thrive letter, click here.
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