Today’s missive comes to you from a small Swedish city called Lund, where I’m staying with some good friends before heading to London to wrap up my European tour. This is my second stop in Scandinavia after a week in Copenhagen, the capital of Denmark.
It was my second visit to Copenhagen, so I largely knew what to expect from the city. The most important thing to know before going to Denmark is that the stores probably won’t be open when you want them to be. I learned this the hard way on my first visit, which coincided with an obscure national holiday. This time I was prepared.
Most Danish shops close by 6 p.m. on weekdays, at 2 on Saturdays, and don’t open at all on Sundays. Interestingly, several Danes I spoke to about this said it was required by law, but a little Googling (and translating) shows that the law governing shop opening hours, the lukkeloven, was revised in 2010 to remove all restrictions on opening between 6 a.m. Monday morning and 8 p.m. Saturday evening.
Nonetheless, good luck finding anything but a 7-11 open after 6 p.m. It seems Danes, including shopkeepers, are fine with sacrificing some convenience for shorter working hours, despite their government’s encouragement.
The law is still plenty convoluted when it comes to Sundays though. In general, everything is closed Sunday, but technically shops are allowed to be open until 5 p.m. on four Sundays a year, and on the first and last Sunday of the month, and on all Sundays in December. Certain kinds of goods—including bread, milk, newspapers, pets, plants, fuel and boats—can always be sold on Sundays. And stores that primarily sell groceries and take in less than a maximum level of revenue can also stay open Sunday.
Finally, the government dictates that all stores must be closed on national holidays. In addition to the major holidays—Christmas, New Year’s, Constitution Day—stores also close for the holidays of the Church of Denmark, a Lutheran denomination that is still the country’s official state church. I found this out when everything was closed Friday for a holiday called Great Prayer Day, which no one knew much about, but gave everyone the day off work.
I was surprised to learn that Denmark has a state religion, because it also has the world’s third-highest proportion of atheists and agnostics. According to a 2005 poll, only 31% of Danes believe there is a God. Another 49% believe “there is some sort of spirit or life force” and 19% believe no such thing (the other 1% are unsure altogether). Fewer than 5% of the Church of Denmark congregation attends regular church services.
Nevertheless, 80.9% of Danes belong to the state church, even though members must pay a small Church Tax.
As far as I can tell, most remain members out of tradition, and christen their children in the Church (making them members) for the same reason. Another theory is that—because the Ecclesiastical Minister has said Church and State could be separated if non-members ever represented over half Denmark’s citizens—they stay members for the extra holidays.
While this structure is frustrating for a visiting New Yorker like myself, the Danes seem pretty happy with their limited working hours—after all, even when the government relaxed its rules, not much changed. And Denmark is consistently ranked among the world’s happiest countries, nabbing the #1 spot in last year’s Gallup World Poll.
Another of the world’s happiest countries, ranking fourth in last year’s poll, is Sweden. I haven’t been in Sweden long enough to get a real feel for their work ethic, though I suspect it is similar to the Danes’. There is one glaring difference between the two countries though. In Denmark, one of the few things you can buy anytime—even on Sunday—is beer.
From what I can tell, beer is integral to the Danish national identity. The country is home to the world’s fifth-largest brewery group, Carlsberg, and Danes like to tell visitors about how brewery workers went on strike last year when their on-the-job beer rations were reduced. Danes can buy alcohol in stores at age 16, and drink in bars, restaurants and nightclubs at age 18. There are no rules against drinking in public, and it’s not uncommon to see people walking down the street with a beer in hand.
In Sweden, on the other hand, the government has created a tight net of restrictions on when, where and what their citizens can drink. Beverages with over 3.5% alcohol content by volume can only be bought from government-run liquor stores. The government stores aren’t open in the evening or on the weekends, and they only sell to customers 20 years old or older. However, Swedes 18 years old and older can drink in bars and restaurants.
Rules are even more complex for low-alcohol beer: so-called “people’s beer” up to 3.5% alcohol by volume can be sold in regular stores, but only to customers 18 years old or older, while “light beer” with up to 2.25% alcohol by volume can be sold without restrictions.
I asked my hosts here what the rationale behind all these rules is, since religion is an important factor behind similar “blue laws” in the U.S.
However, Sweden is possibly even less religious than Denmark: The country separated the Church of Sweden from the state in the year 2000. Approximately 71.3% of Swedes still belong to the Lutheran Church, but only 2% attend regular services. Members here also have to pay a Church Tax, but, unlike in Denmark, no other taxes (i.e., those of non-members) are used to support the Church. And as in Denmark, Church membership is declining by about 1% per year, partially because fewer babies are christened in the Church and partially because of immigration. Finally, Swedes and Danes are similarly spiritual: 23% of Swedes believe in a God, 53% believe in some kind of spirit, and another 23% do not believe in any God.
So why can you only buy 3.5% beer in Sweden on Saturday? My hosts explained that it’s the government’s way of protecting their citizens. The proof lies in the fact that you can drink anything you like at a bar anytime, the rationale being that the bartender will keep an eye on you. The rest of the time, the government is looking out for you.
I’m not sure it’s working though ... my hosts also tell me that most Swedes in the south of the country go to Denmark or Germany to buy their alcohol, and in the north, moonshine is popular.
Today’s Investment of the Week comes not from Denmark or Sweden, but from the good old U.S. of A. However, it has a Swedish connection: It’s the former owner of Saab Automobile, Sweden’s #1 car company (although it’s now owned partly by the Dutch and Chinese). And, since it’s an epic turnaround story, it’s only appropriate that George Putnam III, editor of The Turnaround Newsletter, profiled the company in the last Dick Davis Investment Digest. Yes, it’s General Motors (GM):
“In an unusual government-dominated Chapter 11 case, General Motors Co. was able to dramatically restructure the company in a short period of time. Among other actions, it reshaped labor contracts, shed debt, replenished cash, eliminated several brands and slimmed down its dealer network.
“As a result, the key parts of the business were able to emerge in July 2009, only about a month after first filing for Chapter 11. The U.S. government provided $50 billion of support for the company during its reorganization, and upon emergence from bankruptcy the government owned 61% of GM’s stock. The company offered a portion of its stock to the public last November.
“Back in the December issue, we looked at GM when it first began trading. Our recommendation then was to wait on GM, to consider some of the automotive parts suppliers instead. That turned out to be pretty good advice. Since the end of November, GM stock is down about 6% while the nine suppliers that we highlighted are up an average of about 28%. (The S&P 500 gained 15.5% over the same period.)
“Now, however, we are ready to recommend the GM stock. ... GM’s new management team has brought a level of discipline to the company that it hasn’t had in decades. Operations are now leaner, and the finances are better managed than they have been in at least a couple of generations. The company’s product line appears to be experiencing good success both domestically and abroad. Its new models in the U.S. have been well received, and it has others in the pipeline. GM’s joint venture in China is the leader in that burgeoning market. Worldwide auto sales are expected to continue growing nicely over the next several years, and GM is well positioned to participate in that growth. Even if auto sales stagnate, the new, leaner GM should perform decently. ... We recommend buying GM up to 40.”
Wishing you success in your investing and beyond,
Chloe Lutts
