Financial Myths: It’s Better to Light a Candle Than Curse the Darkness, Part I

Michael McTague  |

Best-known from Adlai Stevenson’s comment about Eleanor Roosevelt, this phrase offers a fertile line of investigation for the Myth Buster. Let’s start with the literal meaning. According to, the US generates roughly $2.3 billion a year in candle sales. Since household product master Procter & Gamble (PG) makes candles, the product lives in the winner’s circle. Candles are one of a number of low-technology commodities such as baking soda and whales that have undergone a rebirth. Beyond lighting a home, candles now produce fragrances. Fewer people use baking soda for cooking than for improving refrigerator aroma. Whales have shifted from producing the substance of perfume, ambergris, to the showpieces at theme parks.

Don’t forget candlestick holders. Waterford (WTFU) makes them and Tiffany’s (TIF) sells porcelain, silver and crystal models. Investors will take note that while high technology – iPhone, supercomputers, MRIs – grabs most of our attention, low technology offer great opportunities. Antique candlesticks and chandeliers might be a pièce de résistance of a successful business.

Electricity and Diminishing Profits

With world economies dragging through a slow period, utilities stand tall. According to, the US has nearly 8,000 power plants. The industry preference for dividends raises the attractiveness of electric stalwarts such as Southern Company (SO) and Duke Energy (DUK), which shows increasing Property, Plant and Equipment and steady profit. American Electric Power (AEP), a favorite of Vanguard, Blackrock and State Street, reveals an attractive pattern of steady revenue and rising profit.

Leisure Explodes

The Myth Buster seeks opportunities. People value leisure more than ever before. Investors know that leisure means much more than those thin white suits worn with straw hats. Leisure business is enormous and growing rapidly. Consider the multiplication of cruise ships, Caribbean vacations, endless lines to see the Trevi Fountain, the Mona Lisa and the Pieta. Travel and tourism have exploded.

A powerful concoction developed through the expansion of wealth since World War II and the rapid growth of tourism. Disposable income, savings and early retirement have tilted the nature of the workforce in developed countries. Many more people travel both for pure leisure and for cultural enrichment. For example, Italy, the country with the largest amount of cultural material (paintings, mosaics, buildings, museums, etc.), ranks fifth as a travel destination, with nearly fifty million a year, according to Ahead of Italy are China, Spain, US and France in ascending order. An interesting top five! China and the US are enormous and draw visitors for many reasons. Spain, Italy and France offer great cultural and historical depth. Spain also has a huge beach industry as does France. Pure fun outranks cultural inquisitiveness: according to, the big Disney (DIS) parks get about twice the number of visitors as the Roman Forum and the Colosseum.

Cruise ships are everywhere. More ships are being launched and the cruise lines, despite some ugly incidents a few years ago, are booming. For example, Royal Norwegian’s (NCLH) revenue rose approximately $500,000,000 from year end 2013 to year end 2015. Gross profit for Carnival Cruise Lines (CCL) rose from $4.9 billion to $6.3 billion in the same period. Total revenue is leaping forward. Those with degrees from prestigious universities are deluged with travel brochures offering cruises to anywhere and everywhere. Viking River Cruises features ten days of Tulips and Windmills and an eight day Danube Waltz cruise. Tourists enjoy “delicious cheeses and sumptuous wines.” No doubt, Carnival and Royal Norwegian are watching and are finding Caciocavallo Podolico, Pule and Elk House Cheese – the most expensive cheeses according to

Everyone is getting in the game. Tourism is so widely available, tourists are easily bored. How many tourists yawn when they see ads for another trip to Florence and Paris? The Myth Buster wonders if there are any Florentines left in Florence. The city has been taken over by American students and tourists. Imagine that you own a hotel in the Faroe Islands. Every day you ask yourself, “How can we get some of that tourist money?” Then it hits you, maybe we can build up a historical or cultural event that might draw tourists who have been to London and Paris five times. Every Caribbean nation extols the beauty of its beaches. Even nations with political turmoil and failing businesses still attract tourists.

This myth has allowed us to look at how seemingly unrelated forces can come together and open enormous business opportunities. A dormant tourist industry explodes as people take more time off live for leisure. Wealth rises faster than the contestants in a balloon race. A peculiar mixture of the profound and the superficial occupy the hopes and dreams of travelers. And everywhere, there is someone to cater to their inexhaustible desire for fun and enrichment. Next month, the Myth Buster will pursue more insights into real business opportunities.

Michael McTague, Ph.D. is Executive Vice President at Able Global Partners in New York, a private equity firm.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:

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Symbol Name Price Change % Volume
PG Procter & Gamble Company (The) 125.55 0.11 0.09 2,270,119 Trade
SO Southern Company (The) 68.74 0.13 0.19 1,786,356 Trade
TIF Tiffany & Co. 134.18 -0.07 -0.05 820,451 Trade
DUK Duke Energy Corporation (Holding Company) 101.16 -0.27 -0.26 949,020 Trade
AEP American Electric Power Company Inc. 102.62 -0.88 -0.85 1,095,864 Trade
DIS The Walt Disney Company 139.30 -2.00 -1.42 2,805,513 Trade



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