134: The Economics of Tourism

Welcome to The Invested Dads Podcast, simplifying financial topics so that you can take action and make your financial situation better. Helping you to understand the current world of financial planning and investments. Here are your hosts, Josh Robb, and Austin Wilson.

Austin Wilson:
All right. Hey, hey. Hey, welcome back to The Invested Dads Podcast, a podcast where we take you on a journey to better your financial future. I am Austin Wilson research analyst at Hixon Zuercher Capital Management.

Josh Robb:
And I am Josh Robb director of financial planning at Hixon Zuercher Capital Management.

Austin Wilson:
You are the man with two names.

Josh Robb:
That’s right.

Austin Wilson:
Two first names.

Josh Robb:
That’s right. Three if you count my middle name.

Austin Wilson:
Oh man. Let’s not go there. That’s too many. So yeah, we would love it if you would subscribe on whatever podcast platform you listen to us on. We’re on all of them.

Josh Robb:
Everything.

Austin Wilson:
So subscribe there. Even if you’re one of our three people who listen to us on Google, subscribe. And we will also love it if you would leave us a review specifically on Apple Podcasts or Spotify, but really anywhere you’re listening. Give us a review. That will help us to be more easily located by other people looking for something in our genre. That’s a big word. It’s a little word that’s really good. So today Josh, we are going to be talking about the tourism industry. The world is reopening, summer’s here. Let’s go.

 

[1:14] – Josh’s Travel Story

Josh Robb:
Let’s travel. Yeah. Funny story about traveling. You ready? So we went on a trip recently with my kids and some of the things you get used to that you don’t realize, maybe it’s a new experience for your kids. So we went to the airport and so flying would be a new experience for my youngest. She’s four. And I think she’s flown once, but because of COVID and everything, she missed a couple years worth of the opportunity to potentially fly.

But anyway, so we went to the airport and we were getting to go down an escalator. So I jump on the escalator. I’m behind two of my kids, then two kids and then my wife, kind of spaced out. I’m carrying two luggage plus two backpacks, you know, loaded down. So I’m taking care of that. I turn around because I hear this noise. And my youngest had decided that she wasn’t sure about escalators because she may have never been on one for as all as I know. I couldn’t remember. But this moving stair thing was a new experience for her.

Austin Wilson:
“What is this thing doing?”

Josh Robb:
So she thought the best approach to stairs for a little kid and it’s true. I know you’ve said the same thing is, you scoot on your butt.

Austin Wilson:
Oh yeah.

Josh Robb:
When you see stairs, you’re like, you know what? It’s easier if I’m just I’m on the butt.

Austin Wilson:
Absolutely.

Josh Robb:
So she sits down and scoots forward. Well it’s a moving escalator. Somehow it took her shoes off. So I turn around and look and there’s this two little pair of mini mouse shoes heading down the escalator with no feet in them. And then about four rows behind the shoes, this little girl on her butt heading down the escalator as well.

Austin Wilson:
Oh that’s funny.

Josh Robb:
So I’m like, oh no, what am I going to do? So I get off the escalator and set the luggage to the side and my backpack’s off. The other two kids, plop them in a spot. So I turn around, well, I got to grab those shoes. And then grab this little girl before she gets stuck on the bottom part of the escalator. So pull her off. And she’s just having the time of her life riding this thing down. But without shoes apparently because you know, you got to make yourself at home when you’re on escalator.

Austin Wilson:
She got more used it throughout the vacation?

Josh Robb:
Yes, on the way back. It was like, “you stand up on this thing”.

Austin Wilson:
Yeah. You don’t have to move at all.

Josh Robb:
Yeah. She loved the walking…

Austin Wilson:
I was just going to say…

Josh Robb:
Whatever. I don’t call it an escalator, but a walking-scalator.

Austin Wilson:
Tread thing.

Josh Robb:
Walk-scalator.

Austin Wilson:
So here’s a question. Are you one of the people who stands on that and lets it take you or do you walk on it and get double fast?

Josh Robb:
Oh, I walk on it to speed through that.

Austin Wilson:
Me too. Me too.

Josh Robb:
Yes.

Austin Wilson:
I’m always a get there early, grab a bite to eat. Don’t be rushed to get to your plane.

Josh Robb:
Oh, I hate being rushed. I like to get there early, Too early probably for other standards. One of my last business trips when it ends, they say schedule your time to be taken to the airport, which is fine. And for whatever reason, the way it’s scheduled, I got to the airport, I want to say four or five hours early.

Austin Wilson:
Oh that’s a little too much.

Josh Robb:
But there was no other option based on transportation. But I didn’t mind because I grabbed some food, found a spot. Sat down, worked on my little iPad, typing away. It was great because in fact I was there so early that they moved my gate like three times.

Austin Wilson:
Oh really?

Josh Robb:
Just because of how busy and everything. Had I got there at a normal time I would’ve just seen one gate number. But I was getting moved around, which was totally fine. But sad story, I bought a blueberry muffin and I was like, I’m going to have this blueberry muffin.

Austin Wilson:
Don’t do it. Don’t say it.

Josh Robb:
And I was like, I’m not going to eat it until I get on the plane. That’ll be my snack on the plane. Left it. For four hours I carried this thing around, carried it waiting…

Austin Wilson:
You were just waiting.

Josh Robb:
From spot, to spot, to spot. Left it in the last spot before I got on the… Oh I was so mad.

Austin Wilson:
That was $5 you never got back.

Josh Robb:
Oh I was so upset about it because it looked really good too. Airport, I’m like, eh, but this looked like a very good muffin. And I’m sure it was probably amazing.

Austin Wilson:
That’s crazy.

Josh Robb:
So yeah. Hopefully somebody enjoyed it.

 

[1:14] – Austin’s Travel Story

Austin Wilson:
I had a similar experience with my last business trip, which was pre COVID because it’s been pretty much shut down. So yeah, I was in LA and conference wrapped up and they arranged a nice transportation. They had a bus for us to get us back to the airport. I was with another guy who was going to Detroit from LA, nice guy. So anyway, we’re looking at our clocks, like holy crap, we got to get moving.

Josh Robb:
Too close.

Austin Wilson:
We got to get moving. And we can’t control the travel.

Josh Robb:
It’s what it is.

Austin Wilson:
We can’t control the traffic. It’s LA. Oh my goodness. It’s terrible. You can’t control the airport. You can’t control anything. So we get there and we were like, if we have a long TSA wait or anything, we are just…

Josh Robb:
In trouble.

Austin Wilson:
We’re going to be in trouble. No. We walked right through pretty much everything.

Josh Robb:
Aw, great.

Austin Wilson:
And we had enough time, sat down, had a beer, chilled, just hung out and had a nice half hour rest before we got on the plane.

Josh Robb:
That’s nice.

Austin Wilson:
So I hate being rushed.

Josh Robb:
Oh I don’t like it. I will get there…

Austin Wilson:
I will say it’s just much different traveling with kids.

Josh Robb:
Oh man.

Austin Wilson:
Than it is with your spouse. With your spouse, it’s a lot easier than it is with kids. But when you travel by yourself, it’s even another level faster.

Josh Robb:
It’s so convenient.

Austin Wilson:
My standards for food on the road and my standards for stuff are a little bit lower. So I’m quick.

Josh Robb:
Yep. We just flew, my wife and I…

Austin Wilson:
Luggage.

Josh Robb:
And I have the TSA pre-check and my wife does not. And I was going through the regular TSA line with her, staying together.

Austin Wilson:
Nice guy.

Josh Robb:
And I look up and the guy looks at me. He’s like, “What are you doing here?” I said like, “I’m flying.” He goes, “No, what are you doing in this line?” I said, “Oh, I’m with her and she doesn’t have it. So, I’m trying to keep those arguments to a minimum.”

 

[6:03] – The Guys’ Travel Plans

Austin Wilson:
So Josh, are you doing any more traveling this year?

Josh Robb:
I do have a business travel later this year and we are driving to a family trip with my wife’s family. We have a-

Austin Wilson:
South Carolina?

Josh Robb:
Yep. Go on a trip this late summer for that. And so that’ll be the big one. And then later in the fall I got some business travel, but nothing too big. What about you?

Austin Wilson:
Yes. Similar, business trip, couple maybe coming up this year. As I said, business travels opening back up as well. Haven’t done a whole lot of that since COVID so in my role, a lot of what that is is due diligence with managers of mutual funds or whatever investment vehicles we’re investing client’s money in. So that’s always a good time to be able to go to different places and see those. So, a couple of those coming up as well as we are also driving to South Carolina with both my parents and my in-laws.

Josh Robb:
Oh, that’d be fun.

Austin Wilson:
So then my little brother and my daughter, obviously, so it’s just going to be a party. We’re getting a beach house late summer as well. Maybe we’ll be gone the same week. I don’t know. We’re waving at each other across the beach.

Josh Robb:
That’s right.

Austin Wilson:
But anyway, that, and then I have my annual motorcycle trip coming up. So we’re actually going north, don’t go south in the summer. It’s hot.

Josh Robb:
Humid.

Austin Wilson:
Go north. Why don’t we go north? So, we’re going north. So anyway, that is our travel plans. But as we said, yeah, the world’s opening up, travel’s opening up. Things are getting back to normal, and we thought we would talk about tourism. So, Josh here are a few facts.

 

[7:22] – Tourism Facts

Josh Robb:
I love facts.

Austin Wilson:
About the economic importance of the tourism industry globally. Now some of this data is a little bit dated, but it still should get you in the right direction.

Josh Robb:
Well you’d almost want some dated tourist information because last two years are kind of an anomaly.

Austin Wilson:
Don’t look at 2020 don’t look at 2021. Think about a little bit more normal.

Josh Robb:
’18, 19, yep.

Austin Wilson:
The tourism economy represents 5% of the world gross domestic product, 5% is a chunk. It’s 1/20th. Tourism contributes to 6% to 7% of total employment around the world. International tourism ranks fourth after fuels, chemicals, and automotive products in global exports. Big tourism industry is valued at about a trillion dollars a year. It accounts for 30% of the world’s exports of commercial services and 6% of world total exports. 1.4 billion, with a B, international tourists were recorded in 2018. That’s according to a big tourism industry database. In over 150 countries tourism is one of five top export earners. And tourism is the main source of foreign exchange for one third of developing countries and one half of less economically developed countries. So definitely some big numbers there. Tourism is important to the economy. Not just here but around the world.

Josh Robb:
Yes. And like you mentioned those emerging countries, that’s a big chunk of things.

Austin Wilson:
Oh it’s huge. Yeah, and it’s actually helped some of those emerging countries become a little bit less emerging and more developed of economies. And one of the reasons that they’ve been able to do so well is often because governments encourage tourism because they understand the economic opportunity there. So here are a couple thoughts on why governments encourage tourism in general.

So, number one, it brings in foreign exchange. So that comes really in the forms of two things, people exchange. So international travelers are often some of the most generous and lavish spenders. This is really good for the local economy, which ultimately turns into taxes. They often also bring in currency from their home country. So, for example, we’re dollar denominated. We’re United States, American citizens. When we go to developing nations or even a place like Mexico, we’re taking our dollars with us. They’re happy to take our dollars.

Josh Robb:
Yes. They love our dollars.

Austin Wilson:
Because our dollar is a lot stronger and a lot more stable than something like the Peso. So think about that times millions of people and you’ve got a dollar denominated locality in a developing country with a developing currency. That locality is going to be a lot more stable and economically independent, which is pretty good.

Josh Robb:
Now I’ve never exchanged my dollar for Peso, but I have exchanged it for queso.

Austin Wilson:
I would take that exchange every day.

Josh Robb:
Any day, every day.

Austin Wilson:
Any day. Another reason that governments encourage tourism is because it generates employment, obviously. More demand for services and goods equals more jobs and more jobs equals more income for the economy to thrive. And ultimately again, more taxes. Taxes are good for governments. And there are two forms of employment, really. There’s direct employment, which is like the jobs that are immediately associated with tourism industry. This might be like hotel staff, restaurant staff, taxi drivers, things like that. There’s also indirect employment in this industry. And that includes jobs which are not technically based on tourism, but they are related to the tourism industry. So, like a fisherman, for example, he does not directly serve a tourist, but he does have some sort of way of where he’ll sell his fish to the hotel, which then serves to us. So, he is indirectly employed by the tourism industry. Because without those tourists, he would not be supplying fish to the hotel.

Austin Wilson:
So all of this really combines to create economic activity and economic activity is quite lucrative for governments who want to grow.

Josh Robb:
Yes. And a lot of developing countries, one of their most valuable resources is their land. Think around for us, for instance, it would be some of those islands in The Bahamas and the Caribbean. There’s a lot of natural beauty there that they can utilize to increase their income in their taxes.

Austin Wilson:
That’s interesting. We don’t necessarily have a booming tourist industry in Northwest Ohio.

Josh Robb:
Nope.

Austin Wilson:
Not a lot to see here.

Josh Robb:
Corn.

Austin Wilson:
Corn, beans.

Josh Robb:
Beans. Wheat.

Austin Wilson:
Depending. That’d be a really good gig to be a wheat planter this year with the Russia/Ukraine situation going on. So yeah tourism, depending on, yeah you can use those natural resources, beautiful places. My brother lives out in Jackson Hole, Wyoming, big tourism industry, because it’s so pretty out there with the Grand Tetons. And everything like that. The Snake River and very small community outside of tourism. Because some of these places are really hard to get into, get out of, get things into and out of. But the natural beauty brings people there. So, Josh.

 

[11:59] – Dad Joke(s) of the Week

Josh Robb:
Yes.

Austin Wilson:
I think you got something for me.

Josh Robb:
I do. I actually have two dad jokes of the week.

Austin Wilson:
Ooh. Yeah.

Josh Robb:
They’re both travel related and animal related. So it’s-

Austin Wilson:
Two of Josh’s favorite things.

Josh Robb:
Yes. Where do cows go on vacation?

Austin Wilson:
Mm. That’s a cow noise almost. I don’t know.

Josh Robb:
Moo York.

Austin Wilson:
Moo York. I was thinking of something moo.

Josh Robb:
Now sheep do not go to Moo York, obviously. Do you know where they go?

Austin Wilson:
Boston.

Josh Robb:
No Bahamas.

Austin Wilson:
But mine was good.

Josh Robb:
Yes. Bahamas.

Austin Wilson:
Bahamas. That’s good.

Josh Robb:
Yes. So that’s what I got for you.

Austin Wilson:
Good job Josh. I like it. Those are the dad jokes, plural, of the week, our animal jokes of the week. So, couple things-

Josh Robb:
Last one.

Austin Wilson:
Aw, bring it.

Josh Robb:
What happens when a pig gets sunburned on the beach? It’s bacon.

Austin Wilson:
Something about bacon.

Josh Robb:
Yeah. It’s bacon on the beach.

Austin Wilson:
I love bacon. It is a food that I don’t think I ever get sick of. Now, I don’t eat it by the pound, but…

Josh Robb:
Because it’s not healthy for you?

Austin Wilson:
I eat it a lot, in moderation.

Josh Robb:
That’s good.

Austin Wilson:
In moderation.

Josh Robb:
That’s a good call.

 

[12:56] – Tourism Life Cycle

Austin Wilson:
So let’s talk about the tourism life cycle. Because as we talked about governments encouraging the industries to grow in their areas and the benefits of the employment and things like that. These things, they don’t happen overnight. It takes time and they don’t always work out forever. So there are six stages of the tourism life cycle I’d like to talk about. And number one is the exploration stage. This stage, tourists really have not yet discovered the area that we’re talking about or whatever. It’s considered remote and exotic by adventure tourists. Only a very few amenities are even there. There are a lot of possibilities for expansion in the future, because there’s not a lot there.

Josh Robb:
Like the moon.

Austin Wilson:
There’s a lot of room, a lot of room.

Josh Robb:
The restaurant on the moon.

Austin Wilson:
The cheese?

Josh Robb:
Great food, no atmosphere.

Austin Wilson:
No atmosphere. You’re on a roll today.

Josh Robb:
I’m just telling you.

Austin Wilson:
Stage number two is the involvement stage. At this stage as tourist numbers increase, infrastructure develops such as airports, accommodations, attractions. Employment expands into direct and indirect like we talked about. Jobs and the place become more known to people. So that’s the involvement stage. Then becomes number three, the development stage. At this stage, there’s rapid growth in tourism investments. Jobs increase as demand for services and amenities increase. Promotion campaigns increase. Effects on the landscape are present. Improvements to infrastructure and elaborate accommodations are made. Sometimes, even tourists may outnumber the local population and that may involve importing labor and tourists from elsewhere because local demand has been exhausted for both. So that is an interesting stage there.

Then fourth comes, the consolidation stage. So at this stage, the destination is part of the domestic and international tourist industry. It’s critical to the economics of the area. Large proportion of employment is in tourism and the investments include both domestic and foreign. Fifth, stagnation. So at this point, the area loses its attractiveness becomes overused and there’s overcrowding facilities are no longer being planned or developed. It’s not as lucrative. And then sixth and finally, there are a couple different ways this can go. Once you’ve reached the stagnation phase and that is, rejuvenation or stability or decline. Because at this point, the area’s kind of lost its attractiveness. It becomes overused. It’s not necessarily great. So you have to say, this could be an area that’s just been overdone and that would then leads to decline. You could say, it’s just going to maintain where it is, but not really anything new happening. And you could get a new wave of investment or a new opportunity or a new take on it. So that is the six stages of the tourism life cycle.

Josh Robb:
The hope is to stay somewhere around three and four, right?

Austin Wilson:
Yeah. Or even…

Josh Robb:
Prolong that as long as possible?

Austin Wilson:
Three, four, yeah. Because the key is probably not to overgrow. Because if you overgrow, you’re going to hit that real quick and then it’s going to slow down real quick. So steady and stable growth. And that’s how governments can incentivize to kind of manage that over time. So it seems like it’s all roses, right? Nope.

 

[16:01] – Downsides to Tourism

Austin Wilson:
There are actually some downsides to tourism. And number one of those is leakage and it may sound gross.

Josh Robb:
That’s if you don’t follow the drinking regulations for the local water?

Austin Wilson:
We don’t want to talk about leakage, but leakage in terms of economic leakage in tourism, that’s when money, when it’s spent in the country, it doesn’t remain in the country. It ends up elsewhere therefore limiting the economic benefits of tourism to the host destination. The biggest culprits of economic leakage are multinational and internationally owned corporations. All-inclusive holidays and enclave tourism. Enclave tourism is where you keep all the money flow relatively contained. So, like cruise ships, small, condensed tourist areas, things like that. So those are areas that create leakage and really don’t do the ultimate economic good for the local.

Josh Robb:
So an example would be, I mentioned The Bahamas. So, let’s say there was like a Hilton hotel in The Bahamas. They’re owned here in the United States. They would then-

Austin Wilson:
Oh yeah, they’re sending profits back.

Josh Robb:
The money to come right back out and not be staying in the local…

Austin Wilson:
Or at least a portion of it, for sure.

Josh Robb:
Gotcha.

Austin Wilson:
Another one downside is infrastructure costs. So tourism development can cost the local government and local taxpayers a great deal of money. Tourism may require the government to improve their airport, roads, other infrastructure, and that’s very costly. Money spent in these areas may reduce government money needed in other areas such as education or health. So there’s only-

Josh Robb:
They’re so focused on that, they’re not…

Austin Wilson:
There’s a finite amount of dollars.

Josh Robb:
… actually helping the citizens.

Austin Wilson:
Exactly, finite amount of dollars there. Another one is potentially an increase in prices. So increasing demand for basic services and goods from tourists will often cause price hikes that negatively impact local residents, who their income does not increase proportionately. So what this does is it may cause rise in real estate demand, which may dramatically increase building cost and land values. And this often means that local people are actually going to be forced to move away from the area that the tourism is. This is known as gentrification.

Josh Robb:
Yep.

Austin Wilson:
And another one is economic dependence. So many countries actually run the risk of becoming too dependent on tourism. The country sees dollar signs and places all of its efforts to grow tourism. And while it can work out well, it’s also risky. If for some reason, tourism begins to lack in a destination then it’s important that the destination has alternative methods of making money. And if they don’t, they run the risk of being in severe financial difficulty if there’s a decline in a tourism industry. And another example of this is 2020.

Josh Robb:
Yes, ouch.

Austin Wilson:
Think of some of these emerging market economies, beautiful beaches, great tourism, locals or whatever. And then… Their entire economy is dependent on this and then boom, none. You have zero for all of 2020. That was a tough economic year for those areas. And they had to pull it from somewhere. Now a lot of them probably just took on debt to flow along, but not great. Now a lot of them are probably making up for it now, because they can charge whatever they want and people are happy to do it.

Josh Robb:
Yep.

And last but not least, foreign ownership and management is often an interesting challenge or downside to tourism. So, as enterprise in the developed world becomes increasingly expensive, many businesses are choosing to go abroad. And while this may save the business money, it is usually not so beneficial for the economy of the host destination. Foreign companies often bring their own staff, which limits the economic impact of those employed locally. They will also usually export a large proportion of their income to the country which they’re based, like I said earlier. So those are some of the downsides to tourism. It’s not all rosy. It’s obviously huge though. And it works some places.

Josh Robb:
With it making up 5% of the global GDP there is money to go around. It’s just a matter of, do you have the natural resources that would be a desire for people to come visit or see? You can’t have a ski resort here in Ohio that compares to…

Austin Wilson:
Have you been to Mad River Mountain?

Josh Robb:
… that compares to Colorado because what we have here versus there they’re totally different.

Austin Wilson:
We have a bunny hill. Which I grew up skiing on, Josh.

Josh Robb:
On that nice hill.

Austin Wilson:
It was a hill. I’ll give it that. You are exactly right. So the question I like to ask myself when thinking about these themes and trends is how can I invest in it?

 

[20:12] – How Can You Invest In This Trend?

Josh Robb:
How can you invest in Austin?

Austin Wilson:
And I’ll tell you Josh.

Josh Robb:
Thanks.

Austin Wilson:
There are some stocks. Now this is not a recommendation to invest in any of these stocks.

Josh Robb:
Obviously not.

Austin Wilson:
Do your own due diligence. Talk to your advisor. Make the decision that’s best for your financial situation.

Josh Robb:
Only pick it up as a good ticker.

Austin Wilson:
Only pick it up if a good… I’m getting good tickers.

Josh Robb:
You got a couple good ones. I’m excited.

Austin Wilson:
So some stocks that really aren’t great tickers except for airline stocks. LUV. Southwest Airlines, ticker L-U-V. That’s a great ticker.

Josh Robb:
Grab that one. They grab that one.

Austin Wilson:
That’s a great ticker.

Josh Robb:
Now I read an article, they’re struggling because they expanded during 2020, 2021. And now they’re struggling with their own infrastructure to keep their flights going. So be careful of them.

Austin Wilson:
And a lot of it staffing.

Josh Robb:
Yes. Well that’s, yeah, they expanded saying, oh, look at all these opportunities to grab new space. They did not anticipate or did not do a good job of making sure they’re fully staffed to cover those consistently.

Austin Wilson:
Exactly. And another airlines, obviously Delta DAL, American Airlines, AAL. Some hotel resorts, one of them is near and dear to Josh’s heart and that’s Disney, been there a lot, given them a lot of your money.

Josh Robb:
That kind of going back to what you’re talking about is the number of people they employ at their resorts.

Austin Wilson:
Oh my goodness. It’s crazy.

Josh Robb:
Yes. And so, there’s a lot of sub industries that support just the people there working.

Austin Wilson:
And they have their own hotels. They have their own resorts. They have their own cruise ships. They have their own theme parks, in addition to movies out the wazoo.

Josh Robb:
And sports and everything.

Austin Wilson:
Yeah. Another one is Marriott, Marriott International, ticker MAR. Another one, it’s kind of newer is Airbnb, ABNB. Airbnb, which is vacation rentals by owner. So those are some individual stocks to capture this trend, but here’s where Josh gets excited. Because there are some ETFs or exchange trade funds that give you more broad diversification to multiple companies in a particular theme. And as a reminder, if you ever want to know the difference between an ETF and a mutual fund, we have an episode.

Josh Robb:
That’s right.

Austin Wilson:
And we’ll link it in the show notes. So, one of them is the ETF MG Travel Tech ETF, ticker AWAY.

Josh Robb:
Away.

Austin Wilson:
AWAY travel. Another one is the Defiance Hotel, Airline and Cruise ETF. And what is it being defiant of? I don’t really know. It’s defiant of something.

Josh Robb:
I guess.

Austin Wilson:
But the ticker is CRUZ.

Josh Robb:
Cruise. I like it.

Austin Wilson:
Those are pretty good tickers, Josh approves. But Josh, the question for you, but I always ask.

 

[22:35] – Should You Invest in Tourism?

Josh Robb:
You always ask me this. I changed my answer every time.

Austin Wilson:
I feel like I could almost answer it for myself. But I want to hear it from you. Josh, should you invest in travel and leisure, tourism, all of these things?

Josh Robb:
Just depends, Austin. It really does.

Austin Wilson:
Aw.

Josh Robb:
It comes down to, again, your strategy, your goals, your objectives, your risk tolerance. But again, as we talk about in a broadly diversified portfolio, chances are you have some exposure to this sector because 5% of global GDP means a globally diversified portfolio.

Austin Wilson:
It’s probably in there.

Josh Robb:
You probably have that somewhere. And again, airlines, hotels, they’ve been around for a while. They’re in some of the larger passive investing funds if you’re using some sort of tracker for the index. The indexes are going to hold these. So if you’re globally diversified, you probably do.

Austin Wilson:
Absolutely.

Josh Robb:
Should you focus in or be heavy weighted? That really depends on what your goals and objectives are. But chances are, you have some exposure to this because of how big it is in the overall global economy.

Austin Wilson:
So Josh wrap us up. Anything for our listeners?

Josh Robb:
The big thing is when you’re thinking through this from an investment standpoint is people historically, I mean, I’m not just talking about recent, but all the way back. I mean they want to explore and see what else is out there. We live here in Ohio and I could describe to you a cornfield, but I’d love to see mountains. And I’d love to see other things. The ocean, that’s nowhere near us. So travel is something that I don’t think is ever going to go away from the standpoint of people wanting to see other and experience other things.

Josh Robb:
So from a long term trend, I do think this is something that is there. Now, how it’ll happen and how people do it, that’ll vary over time. Airlines, they’ve been around, but not forever. The Wright brothers helped us figure that out.

Austin Wilson:
Well over a hundred years ago.

Josh Robb:
Yeah. So the idea is, is this something long term trend to be invested in? And I would say travel, yes. How and where and what? That’ll vary depending on what’s going on.

Austin Wilson:
Because guess what’s coming? Space.

Josh Robb:
Yes, that’s right.

Austin Wilson:
But yes, it is a good theme that is not going anywhere. I think naturally as humans, we are curious and curiosity is where you go. You get the fix when you go somewhere that’s not where you live every day. It’s also good to go home. It’s good to go home. And we are happy that you have made our podcast player you’re home for listening to this episodes.

Josh Robb:
That’s right.

Austin Wilson:
And we would love it if you would share this episode. If you enjoyed it with friends and family, talking about tourism, travel, whatever they’re thinking about share this episode with them and email us any ideas to hello@theinvesteddads.com. We would love to hear from you. Or if you have any ideas for future episodes.

Josh Robb:
Or a good place you want us to come see.

Austin Wilson:
Ooh, come see or record a live episode on the beach? I think that sounds like a great business trip, Josh.

Josh Robb:
I would be fine for that.

Austin Wilson:
Let’s do it. So we would love it if you would do that. Thanks for being here and until next Thursday, have a great week.

Josh Robb:
Talk to you later.

Austin Wilson:
Bye.

Thank you for listening to the Invested Dads Podcast. This episode has ended, but your journey towards a better financial future, doesn’t have to. Head over to theinvesteddads.com to access all the links and resources mentioned in today’s show. If you enjoyed this episode and we had a positive impact on your life, leave us a review, click subscribe, and don’t miss the next episode.

Josh Robb and Austin Wilson work for Hixon Zuercher Capital Management. All opinions expressed by Josh, Austin, or any podcast guest are solely their own opinions and do not reflect the opinions of Hixon Zuercher Capital Management. This podcast is for informational purposes only and should not be relied upon for investment decisions. Clients of Hixon Zuercher Capital Management may maintain positions in the securities discussed in this podcast. There is no guarantee that the statements, opinions or forecasts provided here in will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses, which would reduce returns. Securities investing involves risk, including the potential for loss of principle. There is no assurance that any investment plan or strategy will be successful.