The Great Unmasking

We all remember how the COVID pandemic started, as cases climbed and state and local governments closed businesses, put restrictions on activities, and imposed mask mandates. Now we’ll see how the pandemic will end — and how long that process will take.

On Tuesday, Texas Governor Greg Abbott issued an order, to take effect next Wednesday, that will end the state’s mask mandate and allow all businesses of any type to open at 100 percent capacity. The press release from the Governor’s office, linked above, recognizes that “COVID-19 has not disappeared,” but notes that more than 5 million Texans have been vaccinated and about a million vaccinations are being administered each week, and concludes that state mandates are no longer needed and reopening Texas “100 percent” is necessary to “restore livelihoods and normalcy for Texans.” Under the Governor’s approach, Texans, and Texas businesses, will decide for themselves what practices they will follow.

Abbott’s decision has been strongly criticized. President Biden called it a “big mistake” that was the product of “Neanderthal thinking,” for example, and the CDC Director says “now is not the time to release all restrictions” because the next month or two will be “pivotal” in determining the course of the pandemic. And Texas businesses are taking different approaches to mask issues in view of the order, with some lifting restrictions and others still requiring employees and customers to mask up. Some businesses note that the Governor’s order puts them and their employees in an awkward position: if they decide to continue to require masks from customers because the CDC thinks that is the right course, they are putting their employees in a position of enforcing the requirement–and increasing the risk of confrontations with customers who refuse to do so.

One of the more interesting consequences of this pandemic has been the spectrum of risk tolerance we are seeing from businesses and our friends and colleagues. Some people have been out and about for months, traveling and dining out, others have stayed at home and are continuing to avoid any public places, and still others occupy every permutation in between. I think we’ll see a similar range of actions from state authorities, guided by the specific economic and health conditions in their states. Is an abrupt, total lifting of requirements the best course, or a gradual easing of restrictions, or keeping all mandates in place until it is crystal clear that there is no longer any risk whatsoever of a COVID resurgence? And do public health authorities really have the ability to give conclusive advice on when the pandemic, and the risks, have ended?

When you were a kid and scraped your knee in a childhood mishap, you put on a Band-Aid. After the Band-Aid did its work, you had to make a decision on how to remove it: rip it off, tug it off gradually, or do something in between. Texas’ Governor has taken the “rip it off” approach. Now we’ll see how that works out.

Entrepreneurialism In A Pandemic

Many of us are just trying to ride out the COVID pandemic. We stay hunkered down in our houses, where we’ve been for months, fighting coronaboredom and hoping that, one of these days, we’ll get back to a semblance of pre-pandemic normalcy.

Other people are different. They aren’t happy about COVID-19, obviously, but where we experience only apathy they see opportunity and are willing to creatively embrace the many challenges presented by doing business in a pandemic. If you’ve read about some of the innovative ideas that business owners have come up with–like bars that have developed ways to accomplish virtual bar crawls, or businesses that have retooled to provide supplies needed in battling the coronavirus–you know what I mean.

One of those people who is looking for opportunity, even now, is my long-time friend Chuck Pisciotta, who is seen at left in the picture above. Chuck went ahead with a plan he devised to assemble investors and buy manufacturing businesses, even after a pandemic intervened. He’s formed a new company called Valence Industrial and hopes to realize synergies and efficiencies by combining the former standalone businesses, investing in technology, and presenting customers with an integrated business model, and he’s got his eye on Valence being well-positioned when the post-pandemic rebound occurs. He recognizes that some people might wonder about the wisdom of that decision to invest in manufacturing during these unprecedented times and has written an interesting article about his thinking that you can read here.

How will it work out? No one can predict the future, but knowing Chuck I am confident that no one will be more thoughtful, or more hard working, in striving to make his business plan a successful reality. And I also know this: thank goodness for people like Chuck, who have foresight and business savvy and are willing to take risks. They are the entrepreneurs who make our economy work, and create the jobs that employ and benefit the rest of us. We could use a lot more of them.

A Neutral Place In The Bidding Wars

If, like us, you aren’t in the market for a house right now, consider yourself lucky. The real estate market is crazy right now — so crazy that bidding wars for homes are commonplace. It’s not just a seller’s market, or even a seller’s market on steroids. It’s more like a seller’s fantasyland where any imaginable price or egregiously unreasonable condition can be put on a house and some desperate soul will accept it just to get their foot in the door. If you know anyone trying to buy a house right now, you’ve heard ridiculous stories of some listings getting more than 30 offers and selling for prices more than a third above the asking price.

This CNBC article sketches out some of the macroeconomic indicators at play. The number of houses listed for sale has fallen to a record low. More than half of all prospective home buyers are facing bidding wars for the house of their choice, and the primary reason people who are in the market for a new house haven’t bought a home already is that they’ve been repeatedly outbid. More than half of new homes offered for sale are in contract in less than two weeks.

And here’s another sign of a superheated real estate market: a Google search for bidding wars will call up multiple website pieces advising on tips and strategies on how to win the inevitable bidding wars, like “11 Tips To Win A Bidding War On A House” or “Best Strategies To Win A Bidding War.” What are some of the strategies? Stay on top of the market in your target area and go see new listings the minute they appear. Pay cash if you can, or be pre-approved for financing, so you aren’t requesting financing contingencies. Offer more — sometimes far more — than the asking price. Agree to quick closings. And if it’s a house you really, really like, be prepared to waive the home inspection contingency, take the place as is, and hope that such a decision made in a crazy market doesn’t come back to bite you when you discover a new roof is needed immediately. Anybody who has bought a house knows just how risky that last strategy can be.

Those of us who are in the Switzerland position in the bidding wars — that is, neither buying nor selling right now — can view all of this with academic interest, but if you are a first-time home buyer this craziness has to be incredibly frustrating. Those of us who have homes can hope that the superheated market continues until we sell, but unless you’re moving into an apartment or an old age home, you’ll be a happy seller on one hand and a frustrated potential buyer on the other. I’d rather see things get back to normal.

Home Prices In The Heartland

The coronavirus pandemic has had a very unequal financial impact on people. Those who have been laid off, or been forced to close their businesses altogether, because of COVID-19 shutdown orders have been devastated. Many white-collar workers who can do their jobs remotely, on the other hand, are looking back on 2020 as a year where their financial situations surprisingly improved. They didn’t spend as much on discretionary items such as travel, dining out, and trips to the corner tavern, paid off some or all of their credit card bills, and saw their 401(k) accounts enjoy a solid year in the stock market.

Another area of unequal impact is on housing and real estate prices. House prices are up nationally, and the biggest increases are concentrated in the heartland — in the Midwest, the states of the Great Plains, and the Southwest and Mountain West. Cities like Cleveland, Cincinnati, Indianapolis, Boise, and Kansas City have seen 10 percent jumps in house prices over the last year. And the rate of increase in house prices in those markets seems to be escalating.

Analysts attribute the jump to people fleeing the crowded coasts for middle America, where living is a bit less concentrated and house prices are a lot more reasonable. You’re going to get a lot more housing bang for your buck away from the coastal cities. And with remote work becoming the “new normal” for many people — a trend that isn’t likely to change even when vaccines become widespread — people are seeing new possibilities and opportunities in living in flyover country. Salaries are going to go a lot farther in establishing a really nice lifestyle in a place like Kansas City than they would in, say, San Francisco.

The American economy is a huge, sprawling, complicated thing, and expert predictions about it are often dead wrong. One thing is clear, however: unequal economic impacts aren’t good for our society, or sustainable long term. It’s interesting that some people have seen their financial situations improve, and that big-picture demographic changes seem to be underway, but we can’t forget those people who have been directly harmed by shutdown orders. The vaccine rollout, and the lifting of restrictions on bars, restaurants, sporting events, and live music performances, can’t happen soon enough.

The Random Restaurant Tour — XL

This summer we have been trying to support all of the local businesses around Stonington — especially restaurants, which really need the traffic to stay in business and which face unique challenges in achieving appropriate social distancing and sanitation in the coronavirus era. Every week, we’ve tried to go to at least one local-area restaurant for a hearty meal and a very generous tip for our server. This week, as our stay in Stonington is coming to a close, we’re looking to complete a final circuit of all of our summer options.

Last night we went to the Fin & Fern, which has become a mainstay this summer. It’s located next to the mailboat dock and features a really good and diverse menu. It also made the decision to open when a lot of restaurants were still debating their options and resolutely stayed the course all summer, offering fine, and safely served, meals. I’ve become very fond indeed of the F&F short rib and mashed potatoes, and Kish swears they have an amazing Caesar salad. (I wouldn’t know, because when it comes to salads, I came to bury Caesar, not to praise him.)

Last night, though, I went for the lobster stew, shown above, and a bacon cheeseburger with fries. The lobster stew was a creamy treat, served piping hot with lots of big chunks of lobster and accompanied (of course!) by oyster crackers. And the cheeseburger was a grilled-to-perfection medium rare, with thick pieces of smoked bacon and just the right amount of fries. It was a fine way to bid the Fin & Fern adieu until next year.

We’re all going to try to forget 2020, and for good reason. But there are some parts of the year that I will remember, and the restaurants that opened up and offered patrons a dash of normalcy amidst the craziness will be one of them. Thanks to the Fin & Fern for some great food and a friendly atmosphere when we really needed it the most.

A Summer Like No Other

Today is, officially, the last full day of summer.  Tomorrow morning at 9:30 or so the autumnal equinox arrives.  In Stonington, it feels like the northern hemisphere has been moving speedily away from the sun for some time now.  As I write this the temperature outside is a bracing 39 degrees, and you can definitely get a heady whiff of winter in the sharp breeze.

It’s been a unique summer in Stonington, as it has been across the country.  The statue of the stonecutter downtown has been masked up for months, and so were most of the people around town.  Here, like everywhere else, things that used to be strange and different have become second nature — like donning a mask before entering a building, working remotely with your office in a laptop, or automatically veering off to the other side of the street to keep that social distance from approaching pedestrians.   

Some businesses opened, some didn’t, and some found new ways to operate while scrupulously obeying the coronavirus rules.  The restaurants that opened seemed to start slow but gather momentum, and our guess is that grateful patrons will feel a long-term loyalty to the places that figured out a way to safely serve food to customers who just had to get out of their houses during a pandemic.  The shops in town all stayed open through the season and seemed to do a reasonably good trade, and while the Opera House was closed in 2020 it decided to offer drive-in movies on a big screen set up at the old ballfield and experienced a string of sell-outs.  I wouldn’t be surprised to see the summer drive-ins become a permanent part of the Stonington arts calendar.

Of course, it wasn’t like a normal summer, and a lot of the things that we enjoyed in the past — like live musical performances at some of the venues around town, and the end of summer Labor Day party in our neighborhood — just didn’t happen this year, for totally understandable reasons.  But with summer now ending, the key point seems to be that the town and its businesses made it through, and will still be here next year.  That’s not true elsewhere, as thousands of American restaurants and shops and other small businesses closed their doors for good.  We’re grateful that our favorite places dodged that bullet.

The summer of 2020 truly has been a summer like no other.  We’re not sorry to see it ending, but it’s safe to say we won’t forget it.

Masked Messaging

Now that it looks like masks are going to be with us for a while, we can expect to see a trend away from those blue-and-white paper masks and homemade cloth masks to more high-end masks with special messages or corporate branding. The process is already starting, as shown by this mask that is for sale at one of the downtown Stonington shops.

Will masks with the Starbucks logo, for example, become as much a part of the Starbucks employee “uniform” as the barista’s apron? Will the political types among us use masks to alert us to their voting preferences? And will matching masks be offered as part of the complete ensemble at women’s fashion websites? How long will it be before mask ads become a familiar part of the Facebook experience?

The American economy tends to move pretty quickly on this stuff when there is money to be made, and American consumers will lead the way. Before we know it, masks will be just another part of keeping up with the Joneses.

As The Dow Turns

Those of us who have 401(k) plans regularly check on the stock market indexes to see whether the market is “up” or “down.”  One of the oldest and most well-down stock price indexes is the Dow Jones Industrial Average, which is often called a “blue chip” index because it includes some of the biggest companies in the country.  The Dow, the Standard & Poor’s 500, and the NASDAQ are a kind of financial pulse of the United States, consulted to see whether the economy is robust and healthy or weak and failing.

Most of us don’t really pay attention to it, but the Dow is supposed to represent a kind of reflection of the American economy as a whole.  And because the American economy is ever-changing, that means the roster of companies that make up the Dow has to change, too.  The last remaining member of the original Dow, which started in 1896, was General Electric, which ended a 122-year run in the index in 2018.  Sometimes the changes happen because the companies in the Dow falter, or are acquired, or succeed to the point where their stock splits, which would have an affect on the overall average.  And sometimes the index changes because the American economy is just moving in a different direction.

That point was driven home this week when it was announced that some of the well-known companies in the U.S. are being dropped from the Dow index and replaced by some of the companies in our “new economy.”  Energy giant ExxonMobil, which has been part of the Dow since 1928, will end its run at the end of this month.  In its stead, a company I’ve never heard of called Salesforce.com — described as an “enterprise software” concern — will join the Dow.  Pfizer, the drug company, and Raytheon, a well-known defense contractor, also will be taken off the index list, to be replaced by Amgen and Honeywell.  The changes are being made to account for Apple’s stock split and, according to the folks who run the index, are intended to “add new types of businesses that better reflect the American economy.”

The original Dow included companies like American Sugar, National Lead, Chicago Gas, and U.S. Leather, along with General Electric.  Now we’re talking about “enterprise software” concerns, biotech firms, and diversified technology conglomerates, and they are being added because a company that makes computers, smartphones, and other devices has been so successful that it is undergoing a stock split.  That’s a pretty good indication of how our economy has evolved, and how the evolution continues.

The Lure Of Lobstering

The official welcome sign outside of Stonington says the town is Maine’s largest lobster port, and the visual evidence around here supports that assertion. You see the paraphernalia of the lobster business pretty much everywhere, from the lobster boats at anchor in the harbor to the brightly colored buoys, coiled ropes, and stacked rows of lobster traps seen on the properties around town. Especially traps. More traps than you can imagine!

And it appears that the younger generation is embracing Stonington’s traditional occupation. According to statements from this year’s graduates published in the local newspaper, a number of the 2020 graduates of the Deer Isle-Stonington High School — both male and female — are planning on “lobstering” as their career. It’s the kind of future plan you wouldn’t see from a student in, say, Columbus, Ohio.

My hat is off to the kids who are going into the lobster trade. It’s a tough, physically demanding job that requires you to get up before dawn and spend your days on the water, going from buoy to buoy, hauling traps up from the ocean floor, removing any catch, rebaiting the traps with yukky objects that lobsters like, and winching the traps back down again. But it makes a living, and you get to be your own boss. From the decisions of the local high school kids, that’s still an attractive option.

Masked Market

Stonington holds a farmers’ market in the parking lot of the community center every Friday from 10 a.m. to noon.  Last Friday we paid our first visit to the market during the COVID-19 era.

There’s no doubt the coronavirus has had an impact on the market.  For starters, there were fewer tents and tables set up by sellers, and they all were all distanced from each other, which gave the market a more spread-out feel.  There were fewer people walking around, too — and of course everyone was masked.  There was a pleasant young woman at the entrance to the market who was the designated “masking enforcer,” tasked with keeping the unmasked from entering.  She reminded us of the need to be masked and had hand sanitizer that she was ready to share with anyone who wanted to scrub up.  The potential customers weren’t supposed to touch or handle anything and also were supposed to keep their distance from each other — as the posted signs indicated.  As a result of all of these factors, the market didn’t have the bustling, crowded atmosphere that you associate with a good farmers’ market and that we saw at this market last year.

Still, in a weird year where all kinds of performances and events and community gathering opportunities are being cancelled outright, it was encouraging that the Stonington farmers’ market was being held at all.  And my sense from interacting with them was that the artisanal farmers who were participating definitely appreciated just having the opportunity to sell their vegetables and fruits and smoked meats and farm fresh eggs directly to the public.  If you are a small-business owner who is counting on different farmers’ markets as venues to sell your products, outright cancellation of all of your sales outlets would be devastating.  If the economy is truly going to recover, and the recovery is going to small-business owners like artisanal farmers, it is crucial to have events like farmers’ markets.

As has been the case throughout the coronavirus reopening period, Kish and I spent more than we really needed to, just to try to help the sellers get back on their feet and recover from a challenging time.  We bought eggs and cheese and smoked meat from multiple stands, and it all was great.

We’ll be going back to the farmers’ market on Friday, and will try to pay the market a visit on every Friday when we are here.  And I bet that we’re going to see a definite pick-up in the number of people selling and the number of people buying, as the word gets out that you can do so safely and people decide they are willing to accept the risk.  While appropriately masked and distanced, of course.

Coronavirus And Commerce: One Town’s Story

The coronavirus pandemic, and the shutdown orders issued in response to it, have affected pretty much everything, and everywhere, over the past few months. Stonington, Maine is no different.

There’s no doubt that there has been a huge economic impact on this beautiful little town and the surrounding community. Stonington’s economy has two primary engines — the lobster trade, and tourism. Tourism clearly has been affected by Maine Governor Janet Mills’ orders closing hotels until June 1, and requiring visitors to Maine to quarantine for 14 days before interacting with locals. There aren’t many visitors to the town, and the businesses that depend on tourists have felt the resulting pinch. Three of the tourist-type shops in town are closed, and it isn’t clear whether they will open at s as you time this summer. One restaurant has announced it won’t be operating at all this year, another is running at dramatically reduced hours, and a third isn’t nearly as busy as it normally would be. There isn’t much foot traffic in town, either.

The lobster trade has been affected, too. The word is that prices are low, due in part to reduced demand caused by restaurant shutdown orders. The locals are hoping that prices increase when the Canadian lobster fishing season ends and only the U.S. supply is affecting the market.

2020 is going to be a tough year for all of these businesses. Stonington doesn’t have big box stores, chain restaurants, or franchises — it’s a small business haven where all of the businesses are locally owned, and the summer tourism provides a huge chunk of their annual cash flow.

The real estate market, on the other hand, is reportedly very strong, with places going on the market and being sold promptly — in some instances, solely on the basis of a video tour. Realtors are attributing the strong market to East Coast residents who want to establish a second home far away from the overcrowded cities where “social distancing “ is a challenge.

So, the coronavirus giveth, but the coronavirus mostly taketh away. It’s sad to see businesses closed and favorite restaurants going unopened this summer. We’re just hoping that the businesses can ride out 2020 and will be back in full swing in 2021, when things get back to normal — hopefully.

Eating Out (Again)

Last night, to celebrate the end of our 14-day quarantine, we went out to eat at the Harbor Cafe. It was our first dinner out in three months.

It was a little weird, being served by masked wait staff, but the restaurant had erected plexiglass barriers between booths and had implemented procedures to address social distancing, including having a designated “in” door and “out” door to ensure that people don’t bump into each other. And patrons are required to wear their masks until they are seated.

The masks and procedures made it a different experience, but it was a great pleasure to be served a hot meal and an ice-cold beer again. I got the fish and chips, and can honestly report that french fries truly are a revelation after a three-month respite.

We enjoyed our meal and gave our server a hefty tip. Working in a mask can’t be fun, and waiters and waitresses still have to make up for their shutdown period. We all should be generous with the people whose jobs were closed down due to the coronavirus.

Reopening . . . One Step At A Time (Cont.)

Today another German Village business opened its doors to walk-in business after the prolonged coronavirus shutdown.  This time, it’s the Hausfrau Haven, a great wine (and beer) shop that has been a German Village mainstay for decades.  The HH had been open for carryout business — which we gladly took advantage of — but now you can walk in to make your wine selections.  As we spring back from the shutdown period, increased access to adult beverages can only be a good thing.

My guess is that the Hausfrau Haven sign is (no pun intended) a sign of things to come in Columbus and Ohio as other businesses open up.  That is, masks will be required, and the requirement will be enforced by the business itself, out of concern for its employees and its other patrons.  I think most people will happily comply with that.

Next up for Ohio and German Village — a restaurant or bar open for foot traffic and in-restaurant dining.  When G. Michael’s and Lindey’s and Ambrose and Eve and the High-Beck open up to dining and drinking patrons, that will seem like a very big deal.

 

Reopening . . . One Step At A Time (Cont.)

And speaking of reopening, our neighborhood Starbucks is reopening this morning after weeks of shutdown. I walked by before the official opening and the coffee emporium was ready to go with designated lines, signage, ground tape to show proper social distances, and masked baristas.

I never thought I would say I was glad to see a Starbucks open, but I was. These are extraordinary times, indeed.