Sunday, August 5, 2012

Top finance gurus make annual pilgrimage to Grand Lake Stream ...

GRAND LAKE STREAM, Maine ? This little plantation of 109 people in Washington County is known mostly for the great fishing, hunting and other activities it offers to the flocks of outdoorsmen who travel here every year.

But if a recent tradition continues, it also will be the go-to destination for vacationing economists and finance industry insiders, some of whom have gathered at Leen?s Lodge on the shores of West Grand Lake every year for the past two decades.

David Kotok, chairman and chief information officer of Cumberland Advisors in Sarasota, Fla., has been traveling to Grand Lake Stream for 20 years. He began bringing fellow economists along shortly after, and the event has grown ever since. This year, about 50 economists, financial advisers, analysts, hedge fund managers and bankers from around the world arrived with Kotok for the four- to five-day excursion.

They were joined by Gov. Paul LePage and a slew of reporters and news crews from national media outlets, including Bloomberg, National Public Radio, the Wall Street Journal and Dow Jones News. The journalists punctuated the would-be vacation with interviews and news segments shot lakeside.

Kotok said the retreat is a time for the top minds in economics and financial markets to get together to candidly talk shop, debate and discuss the top issues of the day in a place of serene beauty.

On Friday, that meant the July jobs numbers from the U.S. Department of Labor, which showed the unemployment rate unexpectedly rising to 8.3 percent (a loss of about 195,000 jobs), while businesses ramped up hiring to create 163,000 more jobs ? far more than economists had predicted.

The economists on hand Friday said it?s dangerous to try to glean too much information from the seemingly contradictory trends in job creation and unemployment claims.

?Any month?s data is a mixture,? Kotok said. ?There?s great danger in presuming a trend, but it was stronger than people expected. The stock market obviously celebrated.?

Martin Barnes, chief economist for BCA Research in Montreal, said economic data are sufficiently varied that there is evidence to back up bullish or pessimistic predictions.

?Economists will tell you the numbers mean recovery, but for a lot of people it doesn?t feel like it,? he said, referring to the steady unemployment rate hovering around 8 percent. ?It?s still tough out there.?

For the first time, Camp Kotok welcomed Maine?s governor to Leen?s Lodge for dinner. Perhaps because LePage was their guest, those in attendance were hesitant to offer specific opinions on the governor?s plan to hold off on issuing voter-approved bonds until 2014 in an attempt to pay down Maine?s debt. LePage has come under criticism from some lawmakers and towns who say his refusal to borrow money is hurting their recoveries.

Said Kotok: ?All other things equal, of course paying down debt is desirable. So one could argue that?s a sound policy.?

John Mousseau is managing director of Kotok?s Cumberland Advisors. He said that even if paying down debt is always a good plan, it makes sense that some individual municipalities take umbrage with LePage?s across-the-board bond freeze.

?All politics are local, and local people want to make local decisions,? he said. ?There?s a rationale to [LePage?s stance], but what?s good for Kennebunkport may not be good for Lewiston.?

One municipality that?s not hurting, at least this month, is Grand Lake Stream. The annual finance summit at Leen?s Lodge is a boon for the small town.

One guide on retainer for the finance gurus was Mark Gray of Bangor. He estimated that Kotok?s yearly excursion brings in about $200,000 between lodge fees, food, excursions and guide pay.

?This is a big deal, dollars-and-cents wise,? he said. ?It?s a big shot in the arm to the local economy.?

Charles Driza, owner of Leen?s Lodge, said Camp Kotok is the most important event of his year, from a business standpoint.

?It sort of stretches our capacity. David literally fills every bed we?ve got,? Driza said.

?It?s a big buzz around here,? said Deb Cochran, an employee at Pine Tree Store, a trading post a few miles from the lodge. ?It brings attention to Grand Lake Stream. If you?re not a fisherman, we?re kind of out of the way. So it?s some good attention.?

According to a local guide, Charles ?Kim? Vose, Kotok is all too happy to help. He recalled a conversation he had with Kotok last year that stuck with him.

?Last year, I asked David why he comes back here every year,? he said. ?He told me, ?Because you guys treat us like [expletive]. You make us gut fish, we get eaten by bugs, and you never, ever ask us how much money we make.??

Kotok said that even though the event gets more attention every year, it still feels like a vacation.

?They keep liking it,? he said of his comrades. ?They come back every year.?

Follow Mario Moretto on Twitter at @riocarmine.

Source: http://bangordailynews.com/2012/08/03/politics/top-finance-gurus-make-annual-pilgrimage-to-grand-lake-stream-joined-by-lepage/

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