www.globeandmail.com

The Globe and Mail
leaftheglobeandmail

  You need more vacation

BENJ GALLANDER and BEN STADELMANN

Friday, August 6, 2004

Our columns focus on making money — most of the time, via a stock that we feel is undervalued, and usually it is a stock we already own.

Statistics show, however, that during the summer the market does not make much headway. In fact, it acts much like a sailboat searching for a wind.

Buying in the late autumn — or, when we normally do, during tax loss season — is far more likely to catch an updraft and achieve better financial returns.

Why this seasonal pattern? A primary reason simply seems to be that in North America, people take more holidays during this time period. Attention switches from making money to enjoying it, a natural with the arrival of warmer weather and the children's summer vacations.

This trend became eminently clear over the past few summers while we called around to CEOs and CFOs who often were on vacation. In addition, stockbrokers and financial people depart the street for the country, making their sales pitches to fish rather than clients.

While this bodes well for quality of life, it does not encourage an upside to the market — and we're okay with that. Especially since we believe Canadians work exceedingly hard, far harder on average than Europeans.

Canadians would profit more from additional vacation time. Many of us struggle along with only two or three weeks per year, far less than the four to six weeks enjoyed by many nations overseas.

While this plan would result in some added costs to corporations, we'd bet that workers would be more productive and absenteeism would therefore fall. In addition, the overall health of the population would increase, as Canadians got off their duffs for more physical activity.

The resulting change of mental pace, as thoughts spin from work to other subjects, should also prove beneficial. True, for many people the subconscious would return to working thoughts, but often in more creative, fruitful ways.

We have to wonder what the other political stripes would say if Prime Minister Paul Martin mandated that, as of 2006, all Canadians would be guaranteed a minimum of three weeks' vacation — and four weeks after four years.

Perhaps it's not a political issue from which coalitions are forged, but we'd venture that a solid majority of working Canadians would greet the policy change with a collective thumbs-up.

And while a direct line to improved financial returns might not be evident, companies embrace other things that don't lead directly to a better bottom line, such as giving to charity or contributing to political parties. There are many aspects of corporate citizenship that don't hinge on selling an extra widget or making an artful deal with a supplier. A decent amount of vacation for overworked Canadians should be one of them.


back