The Livery Newsletter and Gazette Issue 30 Spring 2019 | Seite 7

The Tobacco Pipe Makers and Tobacco Trade Benevolent Fund
The
lunch the
was
deliciously
catered
by Mark banking
Grove
In 2008,
catalyst
was the
international
and
team investors
at Cook sold
& Butler
and
we sat
cracked
crisis his
when
shares
and
on cash.
along
at
a
goodly
pace.
Our
guests
were
admirably
The fragility of the financial system required central
introduced
by Liveryman
Fran
Morrison
and our
banks to increase
cash in the
system
(liquidity)
Principal
Guest,
Tim Wonnacott
generous
and
through the
reduction
of interest gave
rates a and
eventually
very
humorous
reply
to
which
I
responded
initially
resorting to the process of quantitative easing - the
by
drenching
poor
Tim in the
a glass
of water
- he was
injection
of cash
through
purchase
of bonds.
very
kind about
it (sorry
I was very
pleased
Effectively,
central
banks Tim!).
were propping
up asset
to
show
off
the
newly
found
Livery
Grant
of
Arms
prices by purchasing bonds in the market; a state
and
Letters
Patent
been missing As
for the
many
of affairs
that
could which
not go have
on indefinitely.
years
-
our
Clerk
tenaciously
sought
them
out,
and
economic indicators improved in the US and growth
the
Past
Master,
Chris Allen,
and his
had new
been Immediate
recorded for
several
quarters,
the Federal
IPM,
Mark
Gower-Smith
have funded
a beautiful
re-
Reserve
wound
down quantitative
easing
and began
presentation
and
they
are
now
resplendent
in
frames
a series of modest interest rate rises which continued
carved
with of tobacco
leaves interest
(or close
to); rise,
Sandra
also
to the end
2018. When
rates
equities
located
a
huge
banner
not
seen
since
1985
and
Angus
(shares) tend to be less attractive, particularly when
Menzies,
Clerk
to above
the Master
Mariners
and never
interest rates
rise
the rate
of inflation.
Risk shy
of
a challenge
saw
to it be
that drawn
it was to displayed
on the of
averse
investors
would
the attraction
Quarterdeck.
low risk cash deposits or bonds that could provide an
The audited Annual Report and Financial Statements
for the year to 31 March 2018 may accessed through
this LINK
Incoming resources were significantly higher than
the previous year at £461,264 due mainly to the
timing of donations to the Welfare Fund from
one of the tobacco companies and higher levels
of investment income. Expenditure on charitable
activities was 6% higher at £336,253. At the end
of the financial year, total funds were 2% lower at
£7,710,016. The slight decrease in the value of the
funds is due to market volatility and the valuation
taken on the final day of the accounting year.
FTSE 100 January to December 2018
above
return.
commentators
often
Whilst inflation
all this was
going Market
on, apparently
biblical-
refer
to the impact
on share
a “rerating”
style downpours
were
being prices
had all as over
London or
“market
correction”.
Global
markets
are
having
- oblivious to all that drama we ended our now
lunch
to
how back
to work
on quarterdeck
their own fundamentals
and learn
trooped
to the
where Coffee,
without
the
excess
liquidity
Cigars, and Cognac awaited that
us (I has
did propped
mention up
that
valuations
for
a
decade.
This
transition
produced
our Livery enjoyed dining on the High C’s..) and
higher
levels of to volatility
during
2018.
which seemed
hit the mark
– Liveryman
Jemma
Freeman
had there
kindly
the factors
torpedo at cigars
In addition,
are provided
geopolitical
play:
and
had
had
them
placed
in
souvenir
tubes
with
our
President Trump’s tariff threats could trigger a global
Crest
emblazoned
on
it.
Several
of
us
also
sported
trade war; China’s economy has slowed; the US$ has
a continued
limited edition
Livery Smoking
hat - originally
to strengthen,
commodities
prices have
conceived
as
a
sort
of
shooting
hat,
it
serves
its
been volatile, economic recovery in some European
purpose
well
as a “team”
hat, political
that of orders
the twenty
countries so has
faltered,
the old
have
ordered,
but
one
remained
by
the
close
of
the
day!
been threatened by the rise of populist parties …
Thank
you there
to the
Master Mariners
for allowing
us the
and then
is Brexit.
While Brexit
dominates
use
of the in venue,
to Tim
for context
being a of perfect
Principal
the news
the UK,
in the
the global
Guest,
and
for
everyone
attending
and
giving
my
economy, it is less of an issue.
year such a special start.
The Trustees hold regular meetings with Quilter
Cheviot and these uncertainties have been monitored
closely. The Welfare Fund was established The
150 Master
years ago and the General Fund over 60 years ago.
Source: London Stock Exchange
Investment performance and market volatility
The Trustees receive quarterly investment reports
and monthly valuations from the Benevolent Fund’s
investment managers, Quilter Cheviot. During 2018,
the value of the funds peaked at £8,321,000 at the
end of August. Since the recession of 2008, there
had been a decade long “bull market” and, during
the 18 months to mid-2018, many stock markets
rose with historically low levels of volatility. All
economies and stock markets are subject to cycles
where economic growth fuels investors’ confidence
and the markets rise until an event or other factors
undermine the confidence and stocks are sold and
valuations fall.
3 7