The sensible use of saved capital in retirement requires good planning. Especially if you want money to flow out of it regularly to secure or sweeten the third stage of your life.

Financial brokers then like to offer pension insurance based on a single payment, often called an immediate annuity.

With a normal life expectancy, the return is usually not generous because insurers usually invest very conservatively. In addition, the costs and profit margins of the insurance company further reduce the return. Consumer advocates point out that you usually have to live to be 94 years or older before you receive the investment sum back via guaranteed pensions.

It is often more profitable to park the money in a call money account.

Investments with regular distributions are an alternative. Investors are spoiled for choice between several thousand dividend-paying equity funds.

What are the relevant selection criteria? Quality and cost structure.

For some, the level of distributions may also be an important criterion in the selection process. But caution is advised here: For example, the payout ratio of the Global X Super Dividend ETF $SDIP (-0,2%) is currently over nine percent. With an investment sum of 100,000 euros, this results in a monthly inflow of around 750 euros before tax.

This is possible because the ETF invests stubbornly in the 100 companies with the highest dividends worldwide, but without any consideration of the sustainability of these distributions and the quality of the companies.

This in turn means that, without the dividends, the ETF generated a return of zero over one year and even minus 14% over three years. Investors therefore received high regular payouts, but the investment capital decreased significantly at the same time.

Savers should therefore always pay attention to how the ETF invests. There are various positive counter-examples, such as the Invesco Euro Stoxx High Dividend Low Volatility ETF $EUHD (-0,55%). Although this also focuses on high-dividend companies, it also selects according to qualitative criteria. Result: Although the payout ratio is currently "only" 5.1% per year, this amounts to around EUR 425 per month before tax for an investment sum of EUR 100,000.

However, the ETF has also achieved growth of almost 36% over the past three years, and including distributions, the gain was even over 60%. There are similarly good ETFs for various other investment regions or sectors.

Bond ETFs, on the other hand, are rarely a real alternative for private investors. Although distribution rates of four or five percent can be achieved, this is ultimately only possible with high-risk bonds or US securities with a corresponding currency risk. In addition, a positive return can rarely be achieved over and above the distribution.

A (possibly riskier) alternative is to invest in individual shares with high dividends. However, quality is even more important here. "We value companies with a strong balance sheet that are characterized by a high equity ratio and above-average returns on capital and sales," says Franz Kaim from Kidron Vermögensverwaltung in Stuttgart.

Continuity is also important. "The so-called dividend aristocrats are the gold standard for income-oriented investors," says Rainer Laborenz, Managing Partner of Azemos Vermögensverwaltung in Offenburg. "Companies that have increased their dividends for at least 25 consecutive years are included in this select group."

There are currently around 150 dividend aristocrats worldwide, 117 of which are from the USA and 33 from the rest of the world. The best-known names include Coca-Cola $KO (+1,67%)Procter & Gamble $PG (+1,17%) and Johnson & Johnson $JNJ (+1,28%) from the USA, Fresenius from Germany $FRE (-0,97%) and Unilever $ULVR (-0,71%) from Great Britain.

Other attractive dividend stocks recommended in a WELT survey of ten leading asset managers in Germany include Allianz $ALV (-0,79%)BASF $BAS (+0,71%)Beiersdorf $BEI (-0,65%)Deutsche Post $DHL (+0,05%) and Munich Re $MUV2 (+0,12%).

In other European countries, they rely on BAT $BATS (-2,66%), BP $BP. (-1,12%), Nestlé $NESN (-0,7%), NN Group $NN (-0,64%)Shell $SHEL (-1%) and Swiss Life $SLHN (+0,14%).

In the USA, names such as Altria $MO (-0,39%), Chevron $CVX (-1,24%)Cisco $CSCO (-2,24%), Coca-Cola, Kimberly-Clark $KMB (-0,51%) , McDonald's $MCD (+1,12%) or Pepsi $PEP (+0,29%).

Source: Text (excerpt) & table: Welt, 05.12.25

$KHC (+0,29%) , $PEP (+0,29%) , $NESN (-0,7%) , $KO (+1,67%)

Various media outlets are reporting on a lawsuit against various food giants over highly processed foods in the USA. What do you think?

I do indeed find it alarming for those who are hoping for long-term organic growth and dividends from these stocks. Actually, the companies mentioned - especially CocaCola - were considered a safe bet. The lawsuit is a risk. Perhaps not comparable with the glyphosate lawsuits at $BAYN (-0,27%) but astonishing amounts can always be won in US courts.

Lawsuit against food giants: Attention, dividend investors and Buffett disciples! Here comes the threat of trouble! - 03.12.2025 https://share.google/AkdCFcfq8JNMzjsPB

(https://www.sueddeutsche.de)

The so-called lipstick effect describes the phenomenon that consumers do not completely forego luxury during recessions, but buy smaller luxury items when large purchases are no longer available.

(The chart below compares the performance of ULTA Beauty and the S&P 500 since March 13, 2020, when the nationwide COVID-19 lockdowns began).

(https://de.tradingview.com/chart/Wl3dkBka)

The term was coined by Juliet Schor back in 1998.

"They are looking for affordable luxury, the thrill of buying in an expensive department store, indulging in a fantasy of beauty and sexiness, buying 'hope in a bottle. Cosmetics are an escape from an otherwise drab everyday existence".

He gained notoriety when Estée Lauder boss Leonard Lauder realized after the 2001 attacks that his company was selling an unusually high number of lipsticks.

Without further ado, Lauder considered lipstick to be a counter-indicator to the economic situation.

Today, the effect is widely extended to consumer goods beyond cosmetics:

Small goods instead of expensive prestige items gain in popularity during crises.

1.

What is the lipstick effect?

In essence, the lipstick effect means

When budgets shrink, consumers cut back on expensive purchases - but indulge in a little sin.

"Consumers will still tend to buy small luxury items even during an economic downturn".

Or:

If you can't afford a car, you might buy the new luxury lipstick instead of nothing at all.

(https://fastercapital.com/startup-topic/People-Will-Actually-Buy.html)

After 9/11, the demand for lipstick shot up by around 11%.

Later, during the 2008 financial crisis $EL (-1,55%) again reported rising cosmetics revenues, while other sectors suffered.

The lipstick effect is not constant; extreme situations such as deep snow or store closures due to the pandemic can weaken it.

However, in normal downturns, studies show that it works quite reliably as a consumption indicator.

https://carlsonschool.umn.edu/sites/carlsonschool.umn.edu/files/2018-10/Lipstick_JPSP_2012.pdf?utm_source

2.

Psychological drivers

(https://www.falstaff.com/de/news/im-rausch-der-hormone)

Why do people reach for chocolate rather than expensive theater tickets in uncertain times?

Psychology is behind the lipstick effect.

Even when money is tight, people want to treat themselves to something good - a sweet consolation or a new make-up.

Consuming lipstick or ice cream can lift your mood and give you the feeling that you are doing something positive.

(https://carlsonschool.umn.edu/sites/carlsonschool.umn.edu/files/2018-10/Lipstick_JPSP_2012.pdf?utm_source)

In a recession, women show an increased interest in beauty and attractiveness products, especially when they feel a high motivation to increase their attractiveness or to attract a partner.

This supports the lipstick effect hypothesis:

Even in times of crisis, people do not forgo small luxury items - especially those that boost self-esteem or attractiveness.

The study explains this in terms of evolutionary psychology:

• In uncertain times, perceived financial security decreases.
• People (especially women in this study) therefore invest more in their appearance to send signals of attractiveness that potentially symbolize access to stable social and economic resources.

3.

Economic impact: Crisis-winning industries

In many downturns, certain sectors have benefited disproportionately. Traditionally, cosmetics providers have flourished - lipstick, mascara etc. are seen as an "affordable luxury".

For example $OR (-1,33%) reported increases in sales and profits for the crisis year 2008 despite the global contraction.

This effect explains why cosmetics shares are often considered stable. Tobacco and alcohol companies are also often robust:

Habitual goods such as cigarettes or beer are considered "addictive" goods - even in bad times, demand remains relatively stable. (Historically, cigarettes were even used as a means of bartering for war).

Fast food chains such as McDonald's do well because people want cheap food when everything is more expensive.

Gambling providers can also boom when dreams become more important than sober calculation.

Streaming services/online entertainment are typical: while physical contact is declining, the need for internet entertainment is increasing (Netflix, for example, grew strongly during coronavirus). Investopedia specifically names "fast-casual restaurants and multiplex cinemas" as winners of the crisis.

• Cosmetics

($OR (-1,33%)
, $EL (-1,55%))

Sales continue to rise in 2008 despite the crisis. The global cosmetics market amounted to around USD 504 billion in 2022 (growth +15% compared to 2021) - a sign of the continued importance of beauty care.

• Tobacco/alcohol

($BATS (-2,66%), $PM (+2,19%), $MO (-0,39%), $DGE (-0,13%))

Habitual drinkers and smokers rarely cut back further, tend to consume the same thing or switch to cheaper brands. Tobacco, for example, was an expensive means of exchange during the war.

• Fast food & entertainment

($MCD (+1,12%), $NFLX (+0,45%), $AMC (-1,63%)
)

Affordable indulgences and distractions are in demand. Reports from the corona crisis document, for example, that Amazon recorded a +70% jump in e-commerce sales in the beauty and care sector during the lockdown compared to pre-crisis levels - an indication that consumers were busy ordering small luxury items online.

4.

Historical examples of crises

Concrete history makes the effect tangible: Already after 9/11 in 2001 $EL (-1,55%) reported unusually high lipstick sales - Leonard Lauder even spoke of a "counter-indicator" to the recession.

The picture continued in 2008/09:$OR (-1,33%) and other cosmetics companies fared better than the market as a whole (they were able to expand their sales), while luxury goods shrank.

Corona pandemic (2020) again brought examples: Although the economy slumped in the first half of the year, online trade in beauty products boomed,

Amazon recorded a +70% increase in beauty/care products in e-commerce in spring 2020 compared to the pre-crisis period and Sephora ($MC (-0,45%)) reported a +30 % increase in online sales compared to 2019.

The effect was even evident in 2022/23: according to market researchers, around a third of make-up customers in the UK bought products as a "reward", with spending on lipstick there increasing by around 12.3% in 2023 (despite the tight cost of living).

In China, the lipstick effect was conspicuously absent in 2022, as a study by the China Institute made clear. (https://cidw.de)

"Despite government efforts to promote moviegoing with subsidies and discounts, consumers remain cautious, especially in tier 1 cities. The "lipstick effect", according to which small expenditures increase in times of crisis, did not materialize in China. In December, the China Film Administration launched a subsidy program."

5.

Stock markets in times of crisis

How did investors react to the lipstick effect? Some consumer stocks are considered defensive securities. Thus $OR (-1,33%) 2008 continued to show a profit - a prime example of stability. Estée Lauder experienced a small price jump in 2001 as investors bet on the strong demand for beauty products.

Tobacco stocks ($BATS (-2,66%) , $MO (-0,39%), $PM (+2,19%)) and food companies ($NESN (-0,7%) ) were also regarded as pullback stocks:

Their cash flows suffer comparatively little as underlying demand continues.

McDonald's ($MCD (+1,12%)) was largely able to compensate for its 2008 share price slump by 2010, and the share price also recovered quickly after the coronavirus slump in 2020.

Netflix ($NFLX (+0,45%)): Its price briefly doubled with the lockdown dividend, after which the situation normalized.

6.

Behavioral economic classification

The lipstick effect fits well into the picture of loss aversion and prospect theory: investors and consumers avoid large losses (e.g. cash tied up in a car) and value small gains relatively highly.

(https://hub.hslu.ch/business-psychology/prospect-theory)

In this sense, an inexpensive luxury item minimizes the feeling of "having done without".

Social influences also have an effect: If you see friends treating themselves to something despite the crisis, you are more likely to justify it for yourself.

Behavioral economics thus explains why people satisfy their unpaid desire for a little happiness during a crisis - often reflexively, emotionally and depending on the context.

(https://www.b2binternational.com/publications/what-is-behavioural-economics)

In both world wars, cigarettes were more a part of survival than chocolate - as a tranquillizer in the trenches and a tangible bartering commodity.

Hitler had smoking banned in many places during the Second World War, but tobacco was still available at the front. Chocolate became scarce in 1939: US soldiers were served sweets in their rations, officially to boost morale. Other goods such as coffee, ice cream and video games have similar stories - in the USA, for example, the chocolate business boomed briefly after the world wars as a nostalgic feel-good store.

What was good as a small consolation in war is considered a luxury in peace.

Sources:

https://www.sueddeutsche.de/panorama/lippenstift-mode-geschichte-1.5360041

https://fastercapital.com/startup-topic/People-Will-Actually-Buy.html

https://fastercapital.com/content/The-Lipstick-Effect-and-its-impact-on-consumer-behavior.html

https://www.investopedia.com/terms/l/lipstick-effect.asp#:~:text=The%20lipstick%20effect%20is%20when,from%20the%20lipstick%20effect%20tend

https://pmc.ncbi.nlm.nih.gov/articles/PMC9636953/#:~:text=consumers%20to%20spend%20more%20on,1

https://www.the-independent.com/life-style/lipstick-effect-recession-luxury-treat-spending-b2501493.html#:~:text=recession%20,”

https://www.loreal-finance.com/eng/news-release/2008-annual-results-difficult-environment-loreal-proving-resilient-and-continues-grow#:~:text=Increase%20in%20Sales%20to%2017,based%20on%20reported%20figures

https://www.zeit.de/wohlfuehlen/rauchen/Rauchkultur/seite-2#:~:text=Auch%20im%20ersten%20und%20zweiten,unterdrücken%20und%20Hungergefühle%20zu%20überdecken

https://medihair.com/de/statistiken-schoenheits-und-kosmetikindustrie/#:~:text=,bis%202022%20um%2015%20Prozent

https://cidw.de/wp-content/uploads/2025/01/250107_CHINAPOLITAN_Chinas-Vorbereitungen-auf-die-zweite-Amtszeit-von-Donald-Trump.pdf#:~:text=zurückhaltend.%20Der%20,China%20Film%20Administration%20ein%20Subventionsprogramm

https://www.capital.de/wirtschaft-politik/ceo-wechsel-bei-douglas--warum-der-lippenstifteffekt-tina-mueller-nicht-hilft--32838150.html#:~:text=geschwärmt,ihr%20der%20Lippenstifteffekt%20nicht%20geholfen

https://en.wikipedia.org/wiki/Military_chocolate_(United_States)#:~:text=rations%20%20since%20the%20original,The

As every Sunday, the most important news from the past week, as well as the most important dates for the coming week.

Also as a video:

https://youtube.com/shorts/aCegNR5bGqI?si=dWuwEVlKmh4sVMK1

Monday:

I used to be a socialist - until I realized that socialism doesn't produce innovation." - Philippe Aghion 💬

Together with Joel Mokyr and Peter Howitt, Aghion receives the Nobel Prize in Economics 2025 🏅 - for their research into how innovation and competition drive growth.

Their conclusion: Progress requires freedom, curiosity and the courage to change. 💡🔥

https://www.handelsblatt.com/politik/international/nobelpreis-wirtschaftsnobelpreis-geht-an-drei-oekonomen/100162616.html

Tuesday:

Jerome Powell sees the US economy on track. He also sees no broad pressure on inflation, but mainly tariffs, which have recently driven inflation. Experts expect an increase to 3.1% for September. The next interest rate meeting is scheduled for the end of October.

https://www.handelsblatt.com/finanzen/maerkte/marktberichte/us-notenbank-powell-sieht-wirtschaft-auf-stabilem-wachstumkurs/100163569.html

Wednesday:

The company $MC (-0,45%) LVMH surprised positively with its quarterly figures. After several poor quarters, sales increased again by 1% in the third quarter. Analysts had expected a decline of 0.7%.

https://www.deraktionaer.de/artikel/commerce-brands-unicorns/aktionaer-depotwert-lvmh-trendwende-nimmt-formen-an-aktie-springt-hoch-20388334.html

Thursday:

The controversial food company $NESN (-0,7%) Nestlé is also on the road to recovery. Organic growth amounted to 3.3% after 9 months. Nestlé was recently in the headlines due to the replacement of the Executive Board. The outlook was confirmed.

https://www.wiwo.de/unternehmen/handel/lebensmittelkonzern-nestle-beschleunigt-wachstum/100164247.html

Friday:

Fears of a new banking crisis are spreading on the markets, which is depressing share prices. This is triggered by two regional banks in the USA, which claim to have been the victims of fraud. There were probably false statements and breaches of contract, which is why USD 60 million has been set aside at $ZION (-0,74%) Zions Bank. The Western Alliance wants to reclaim 100 million euros.

https://www.handelsblatt.com/finanzen/banken-versicherungen/banken-angst-vor-neuer-bankenkrise-in-den-usa-waechst/100164835.html

These are the most important dates in the coming week:

Monday: 08:00 Producer prices (DE)

Tuesday: 14:30 Inflation data (Canada)

Thursday: 16:00 Consumer confidence (EU)

Can you think of any other dates?

#erzeugerpreise
#deutschland
#eu
#verbrauchtervertrauen
#inflation
#kanada

The food colossus $NESN (-0,7%) is moving sharply higher today following the publication of its Q3 figures and the simultaneous announcement of 16,000 job cuts worldwide.

Over the past few weeks, I have repeatedly toyed with the idea of selling the share completely after all the negative reporting in recent months. In most cases, patience pays off on the stock market after all. 🤩

The new Nestlé $NESN (-0,7%) Group CEO Philipp Navratil wants to make savings and is cutting 16,000 jobs. The manager has increased the savings target from 2.5 billion to 3.0 billion Swiss francs by the end of 2027.

In his first major public appearance, Navratil explained that volume growth was his top priority. "To this end, we have increased our investments in a targeted manner and have already achieved initial results. Now we need to do even more, act faster and accelerate our growth momentum."

A lot of work is needed to get Nestlé back on track. Because when it comes to key indicators such as sales growth and share price performance, the food giant, whose products range from ready meals and frozen products to confectionery, coffee, Vittel water and pet food, is now lagging behind rivals such as Danone $BN (+0,62%) and Unilever $ULVR (-0,71%) are lagging behind.

Source text (excerpt) & graphic: Handelsblatt, 16.10.2025

Over the past few days, I have made several share purchases. I have taken the opportunity to diversify my portfolio and selectively add stocks that I consider to be promising in the long term. My focus was on a balanced mix of stable companies and opportunities with growth potential. This allowed me to consistently pursue my investment strategy and further strengthen the basis for the future development of my portfolio.

Energiekontor $EKT (+0,72%) (subsequent purchase)

Novo Nordsik $NOVO B (-0,2%) (subsequent purchase)

LVMH $MC (-0,45%) (subsequent purchase)

Pernod Ricard $RI (-0,13%) (subsequent purchase)

Frosta AG $NLM (-0,76%) (first position)

Adobe $ADBE (+1,2%) (Subsequent purchase)

Nestle $NESN (-0,7%) (Subsequent purchase)

Occidental Petrolium $OXY (-0,57%) (first position)

Sixt Vz $SIX2 (-0,7%) (Subsequent purchase)

Realty Income $O (+0,92%) (Subsequent purchase)

Ping An Insurance (Subsequent purchase)

Volkswagen $VOW3 (+0,93%) (Subsequent purchase)

The Trade Desk $TTD (-1,3%) (subsequent purchase)

Daikin $6367 (+0,34%) (subsequent purchase)

Danaher $DHR (-2,09%) (subsequent purchase)

Have a great rest of the week!

Let's see what the next few days bring🧐

The Swiss food group Nestlé ($NESN (-0,7%) ) has dismissed CEO Laurent Freixe with immediate effect. The move follows an investigation into an undisclosed "romantic relationship" between Freixe and a female employee who reported directly to him, the company announced in Vevey.

The Board of Directors saw Freixe's behavior as a violation of the Nestlé Code of Conduct and internal guidelines, according to the statement. "This was a necessary decision," said Nestlé Chairman Paul Bulcke. He thanked Freixe for his many years of service to Nestlé.

The Board of Directors appointed Nespresso boss Philipp Navratil as the new CEO. The Board emphasized that the strategic direction would remain unchanged, but that the aim was to increase the pace of growth and efficiency.

Navratil has been with Nestlé for 24 years. He began his career with the company in 2001 in Internal Audit. A year ago, he was appointed head of Nespresso. Navratil has been a member of the Executive Board since the beginning of January.

Nestlé does not come to rest

For Nestlé, this is the next abrupt change of leadership in a comparatively short space of time. Freixe only took the helm at Nestlé in September 2024, replacing the German manager and former Fresenius ($FRE (-0,97%)) CEO Mark Schneider at the time.

With around 277,000 employees, Nestlé is the largest food company in the world. According to its own figures, the company sells more than 2,000 brands in 185 countries and has a market capitalization of more than 200 billion euros. The share price has performed poorly in recent years, prompting criticism from investors.