When the Cruises Are Coming Back

In this episode of Industry Focus: Wildcard, Emily Flippen chats with Dan Kline about the state of the cruise industry. They look at the regulatory environment and demand for cruises, measures the cruise lines have taken to ensure passenger safety, and how they are attracting passengers. They also talk about the unique financials of a cruise business versus other businesses when it comes to bankruptcies. Dan shares his plans for a cruise he has planned for the near future and much more.

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This video was recorded on September 30, 2020.

Emily Flippen: Welcome to Industry Focus. It's Wednesday, September 30th, and I'm your host Emily Flippen. For today's Wildcard episode, I'm joined by Motley Fool contributor Dan Kline.

We're going to be taking a look at the cruise industry, and more importantly, we're going to be answering a question, a question that I know all of our listeners must be dying to hear the answer to, I'm kind of joking, [laughs] but the question is, Dan has a cruise booked for January, will it happen, and will Dan be on it? [laughs] That's what we're going to try to figure out for the next 30 minutes or so. Dan, how are you?

Dan Kline: I'm good. And those are two very separate questions. Because the cruise could happen, but I'm only going to be on it if it's actually safe to be on it. And that is kind of a promise to Tom Gardner. That may not mean a vaccine, but it may depend on how much testing they can do exactly. You know, are they going to test me every day onboard, are they going to test the crew every day? It is a three-day trip that only stops in the Bahamas, so it could end up at a private island, it could be pretty easy to control that type of environment by limiting what you can do when you get off, when you're not at the private island. So, there's a possibility, but we're going to get into the nitty-gritty as we go through this half hour here.

Flippen: So, I don't know if anybody listening has been doing the same thing that I've been doing since the pandemic began. But on a near daily basis, I've been doing two things, one is checking Zillow constantly, looking at house listings. [laughs] I'm in, by no means, a position where I'm going to be buying a house or a condo or whatever it is any time soon, but I look as if I am, just because it's been kind of a cathartic experience [laughs] for me during the pandemic.

But an additional thing that I've been checking that's maybe more realistic far off into the future is checking the prices on cruises. I've been looking at these cruises, just living vicariously through the experiences that maybe I could have at some point in the future. But I'm just constantly shocked by the prices and how cheap these cruises seem to get. We'll talk about that, but Dan, to start off, what is the state of the cruise industry right now? Because when I look at these prices, I can't imagine it's good.

Kline: So, it actually changed today. And it's a little bit technical. So, before today there was a no sail order from the CDC, basically forbidding any ships based in the U.S. from sailing, ships that take over 250 passengers, until the end of September. But the cruise industry itself, through their trade association, actually had banned all cruising through the end of October. Now, the CDC has extended its no sail order through the end of October, but they wanted to do it into February, and basically the government stepped in and said "no."

Now, I think February is a little extreme, but I also think we should take it month-by-month. October 31st may be too soon. We may not have rapid testing; we may not have all the different things they've planned to do. And we'll talk about how they're going to sail safely. I think they have to demonstrate that before they sail. But I do think it is actually correct to ban it for another month out and then look at it a few weeks before that and then have a very slow return, if it's safe.

So, really nothing has changed today, though my guess is, it's probably going to impact negatively on the market in the short term, but of course, we don't care about the short term here.

Flippen: It's interesting, because while I appreciate when organizations like the CDC provide guidance in the cases of public safety and public health issues, cruises being one of them, it provides a level of certainty for the industry that you simply don't have otherwise. When I think about the barriers the cruise industry is facing, I don't tend to think regulations are a big one. In my mind, even if there was no sail order, how many people are actually interested in getting on a cruise right now? Is there just truly pent-up demand [laughs] for these cruises, does a no sail order even mean anything for an industry that can't attract guests?

Kline: So, I do think there's demand, I do think if you know it's going to be a half-full cruise and most of the same experience, but you'll have to wear a mask in public places and a few things are different, I do think locals, just like we've gone to Disney World under safe conditions, we'll probably go. So, do I expect there's going to be, you know, 80 cruise ships operating in November or December? No. Do I think the ship behind me, the Navigator of the Seas, which does three- and four-day itineraries, largely either for locals or people who are visiting Miami for another reason, I do think they'll be able to sell those. That said, the prices are very low.

But let's look at what the industry has done, because this isn't just, hey, we got some masks and some hand sanitizer, please come on our ship. Royal Caribbean and Norwegian partnered on what they call the Healthy Sail Panel. Basically, they hired a whole bunch of experts and it's led by Mike Leavitt. He was the former U.S. Secretary of Health and Human Services. So, that's a big-ticket guy. Like, they didn't just get me or a mascot to do it. This is a serious panel. And they also have Dr. Scott Gottlieb, who is the former Commissioner of the FDA. So, again, heavy-hitters.

And they submitted their recommendations to the CDC. This is a +65-page report that contains 74 best practices to protect public health and safety. It's a lot of things. It's testing, it's the use of face masks, enhanced sanitation, changing the air filtration. Obviously, you know they're going to change things like buffets. Buffets in the last days of cruising were no longer you walking up and getting it; it was people handing things to you. It wouldn't shock me if some of the buffets, where you sit down and fill out a little card and people go get stuff for you, that's actually how Texas de Brazil is working right now with the buffet part of their business. So, this is really comprehensive -- where you're going to have to take a test a few days before, you have to take a test in the terminal, the crew is going to be tested.

And then what happens if there's a positive, how are they going to quarantine you, how are they going to get you home? Well, that's easy. I live in Florida. They're going to make sure I get to my car and go quarantine. But what if it's Emily who lives in Virginia and has to get back on a plane, are they going to drive you home, are they going to charter a jet? All of those things are addressed by the industry. And that's also to make sure that I get sick, maybe I alluded to all testing or something went wrong, there is an outbreak on the ship, we don't all get stuck on the ship for six months, because that's not fun. That's not a vacation anymore, that's a prison. So, they're working really hard.

And again, just like I've talked about how I felt like Disney was the safest place in Central Florida, I actually feel that cruises are going to be no more dangerous than going to the mall, and the mall is not doing particularly anything other than halfheartedly enforcing masks and a little bit of social distancing. So, I actually think the industry, with some prodding, has been doing things very correctly. And the fact that they pushed back the date to October 31st before the government did, I think that's a good sign, because, look, the cruise industry doesn't want you to go on a cruise and get sick because then you're not going to go on a cruise again. So, that's really, really important.

Flippen: That's exactly what I was going to say, I think, in my mind, what separates the cruise experience versus Disney, versus a mall, versus even a movie theater is the fact that you're stuck with people in a closed environment for a number of days, up to weeks, just with each other. So, it allows an outbreak to spread more easily among a group of people as opposed to one person who is infected and maybe doesn't realize and spreading it at a mall, which slowly disperses across the community, not [laughs] arguing that that's any less bad, but it's a little bit harder to trace. So, when you think about what is the biggest threat for the cruise industry right now, I can't help but believing that sailing too early would be the biggest threat. Because all it takes for them is to launch a single cruise that has an outbreak on it for the government to come back in for their own organizations or other companies to come and say, look, we're not sailing anymore. All it takes is one incident.

Kline: Absolutely. Disney has plausible deniability. If I go to Disney and infect a bunch of people and they all fly home and get sick, maybe it was the plane, maybe it was the hotel, maybe it was the restaurant they eat in off property, maybe they had it before they got there. On a three-day cruise that's probably true as well. When you get to a seven-day cruise, if someone is sick, they could get sick, they could impact other people and not know it; how they're going to handle that is really important, because the cruise industry has an unfair reputation. If you think of the tens of thousands of cruises that happen every year and the relatively just a handful that have outbreaks of whatever illness it is, if that happens, it gets magnified in the news, it becomes very much like the Chipotle food health situation where, yep, only 135 people got sick and none of them died and none of them got that sick, they just basically had tummy aches, but of course that rocked Chipotle for over a year. That's what the cruise industry has always been susceptible to, and that's what is susceptible here.

So, look, I've talked about this with you many times, Emily, there's public pressure on a cruise to do all the things we're all supposed to do anyway. People glare at you if you don't wash your hands because they don't know that you were in the handicap stall that had a sink in there and you already washed your hands. So, you just wash your hands again. Like, if you see another person, you wash your hands again. Cruises have always had signs on the door, use a paper towel to open the door. Now, you're in tight quarters, there are ways to abate that. Some of the newer ships can make a profit at 25% capacity; I don't believe that, the industry has said that, that might be true at max pricing, that is not true at the discount pricing. And I pointed out, I booked a cruise for January. There's no free offers for January, because they don't know what cruising is going to look like. I booked a cruise and it cost me almost nothing. Now, I get insider pricing, I get casino pricing, so it was definitely a good deal. That said, I looked, hey, what if there's a vaccine and a friend wanted to come with me. It was less than $500 for something that would normally be $900 to $1,200. So, that's a problem for the industry right now.

I've joked about this, but they need video of people on a ship waving and having fun, not, like, wearing masks and looking sad. [laughs] You know, they need me with a drink in my hand. I have a good time at the piano bar or whatever it is. And they're going to be very, very careful. But this is an industry that's lost billions and billions of dollars because you can't just close your cruise ships and send your crew home. It's taken an enormous amount of expense just to get the crew home. There are still tens of thousands of people that aren't home, that are stuck on ships because countries won't take them back.

There's a lot of expense to just keeping your ship clean and seaworthy and doing all the things you need to do. They're not used to having all their ships in port at the same time, so there are some ships that are just, like, wandering around, because they have to. So, there's a massive amount of expense here. And starting this industry back up, this isn't flipping a light switch, it's not easy at all.

Flippen: So, let's operate under the assumption here for a second that the cruise that you have booked, which I believe is a three-day cruise in January, is moving forward and you're interested in going on it. And that's a lot of assumptions there, but let's just pretend that that is the case right now. You mentioned that there's a lot of recommendations and guidelines in this report that cruise lines have put together. Walk me through what that experience would look like for you as a cruise line customer.

Kline: So, some of this is supposition, because they didn't actually spell out in the public-facing part, but the assumption is I'll have to take a test two or three days out, come back with a positive test from a doctor. Then I'll likely have to go to the port in a socially distanced way and take a test while in port, likely a quick test. If that test comes back positive, they might give me a better test, a test that takes half-an-hour to come back, a test that maybe takes an hour, who knows.

Then when I'm onboard, there will of course be increased sanitation; there is actually hand sanitizer in a lot of places on the ship anyway. There will be social distancing, you'll be wearing a mask onboard, they've literally improved the air filtration. They will probably, at first, only be booking balcony rooms, so everyone has outside airflow. My guess is, if they're cruising in January, it's going to be half capacity. Things like the theater shows might run three times a night, instead of twice, so they could limit the crowds. They might add sittings to the dining room, so they could spread people out. Right now, if you're a party of two, you can get a table for two; that used to not be the case. They used to sit everybody at, like, tables for 10. They will probably reconfigure dining rooms so you're only sitting with groups you choose to be with. I'll probably be by myself, [laughs] so that's not a problem.

Things like, you know, I'm a big fan of the piano bar and the pub where they play guitar. Well, they're going to have to space out tables differently. There will be distancing, but it is difficult -- that's easy with a quarter capacity or half capacity cruise, because those venues -- the piano bar might be crowded, but it's never incredibly crowded.

If you have half as many people, that'll be easy, the bigger challenge is when they move to full capacity. And the cruise ship behind me, the one that I'm taking that three-day trip on, which I've been on that trip like, I don't know, a dozen times. That's the Navigator of the Seas. And I don't know the exact capacity. But at full booking it's maybe like 3,000 people, but at max booking it's like 3,800 people. You know, that's if it's school vacation, families of four are in one room, you're going to look at like 1,000 people would be my guess on the first couple of weeks' worth of trips. And probably stopping in Nassau and only allowing controlled excursions. Meaning, like, you can go in a group onto a bus to an island where you can go swimming and hang out. You're probably not going to be able to walk around the country freely the way you are now; that's just a guess.

And then, of course, on the private island, they can control everything because that is a company-owned island. There's going to be more cleaning, but there will also be less cleaning. You'll probably won't have a room steward in and out of your room twice a day. Usually they come in the morning and then they come at night. They leave a little folded animal towel on your -- some of that's not going to happen, they're going to make every step to minimize contact and sort of do all the things you're doing in same states like the one you live in, not states like I live in where apparently restaurants and bars can be as packed as they want. And that may be coloring my opinion, that if Florida is willing to let people pack a restaurant or a nightclub, why on earth wouldn't they let an industry that's [laughs] trying hard to do it the right way? So, it's going to look very different.

And it's the same thing I say about Disney. If this is your family vacation and it's not something you do regularly, I wouldn't do it, it's not going to be the full experience. Unless you're getting a great, great price, I wouldn't do it. But for someone like me, who is getting free most of the time, and does this all the time, it'll still be fun even in the limited circumstances, and I'll know what I'm missing out on, but I also know I'll get to do it again at some point.

So, this is now a really good time to book your Summer of 2021 cruises, because the prices are excellent and they're looking to say, we have really good bookings, which is something we can talk about in a minute if you like.

Flippen: So, before we talk about that, you mentioned a lot of practices that these cruise lines are going to do to try to reinvigorate trust from consumers that getting on a cruise is safe. It all sounded [laughs] very expensive. And we have news out today, you talked about Disney, we have news out today that Disney, even with their resorts open internationally and even with the resorts here in the United States, many of which operating, but operating at a smaller capacity, they're still laying off tens of thousands of workers, because it's just so hard for them to make money and operate a full staff when they have such; A. higher overhead, but B. lower revenue from limited capacity.

With all of the steps that cruise lines are taking to make the experience better while still only operating, you mentioned, at like, best half capacity, there's no way cruise lines are going to be making money off of this right?

Kline: So, Disney laid off 28,000 people, about two-thirds of the more part-timers. That's very unfortunate, but it makes sense. Nobody is taking a vacation to Disney World right now, at least not at the level they used to. So, the hotels are largely empty. The park on the weekend is at half capacity and it's full, I'll report back to you later, because I'm going to Animal Kingdom on Saturday. But during the week, they're not. Even though they could be half capacity, they're not reaching that capacity. And Disney is also being more careful than the state is requiring. They can actually open at full capacity, they're not doing that because they want to at least have the perception of safety, and I would say, the reality of safety. They're putting money into that. But there's just more people that were furloughed then they possibly needed. And ideally, a year from now, when, you know, people have booked their vacation, maybe it's a year from Christmas, you know, when Disney is really booming again, I expect that many of those jobs will come back.

The problem the cruise industry has is it's a global workforce. So, one, it's somewhat difficult to get its workers back, some of them had to take jobs and aren't necessarily going to be eager to come back. That being said, there are going to be many fewer people who work for cruise lines for quite a while. So, some superfluous things are going to go away. I have a friend, a gentleman named Ross Ledbetter. When they stopped, he was the piano bar entertainer on the Navigator of the Seas, before that, when I first met him, he was the piano player who played in the elevator. So, you'd get in the elevator and there's just a guy playing piano and it's fun. My guess is, there's no piano elevator player when they reopen. And I know that sounds silly, but that's a $4,000 to $6,000 a month expense.

Now, having less people cleaning rooms, because they're only touching your room once a day, that's not as big a savings, but there's going to be tightening all across the board. I think all your entertainment will stay, because they're going to need people to spread out. I think they're not going to have less bars open, because they're going to need people to be in different places, but there are going to be things you don't see, like, there's fewer people who are in that waiter pool, because they don't need as many people. They might do things, like, rotate which specialty restaurant is open each night, though they may not, because they may want to spread out the seating. So, it's going to be really tricky.

They've let go a lot of marketing people; they've cut a lot of spending where they can. You're going to see the big new ships that weren't already close to being finished, those are going to be delayed a year or two. But once you start building a cruise ship, you pretty much have to finish building a cruise ship, you can't call up and be like, hey, that half-built cruise ship, I cancel my order. Like, maybe see if someone wants an ark, [laughs] you know.

It is a tough situation for the industry, we're going to talk a little bit later about whether this is investable. No matter what the answer to that is in your head, remember that this is not going to be fun for years in terms of an investment. That there is a lot of borrowing, there's a lot of debt. There are a lot of negatives here, even though I'm actually feeling pretty confident about the industry right now.

Flippen: So, let's talk about some of the companies in this industry, or really the industry as a whole. Obviously, there are the three major cruise lines operating here in the United States. You have Norwegian, Carnival and Royal Caribbean, all significantly impacted as a result of the pandemic. And we'll talk a little bit about what we think for their financial future. But for our listeners who maybe haven't heard the episode that we know we've taped previously about cruises, tell us what's unique about the financials of a cruise business versus other businesses when it comes to bankruptcies? Because there are some very, very big differences [laughs] in the assets of the cruise line industry that have some impact for its ability to raise debt versus others.

Kline: So, this might be the thing I've said most on Industry Focus or on Fool Live at different times, is that, there could be bankruptcies here. Because that's a strategic tool to get out of debt, to renegotiate some of your deals, to get out of certain contracts and obligations. That being said, the people lending money to cruise lines don't want to come and repossess cruise ships. What are they going to do with them? They don't know how to run them, they don't have a captain, they don't have any of the things necessary. The best people to be running cruise lines are cruise lines.

Now, if we were in a normal economy and, say, Norwegian was faltering, but Royal and Carnival were doing well, well, there might be pressure to sell off ships or routes or births, but nobody is doing well right now, nobody is in the market looking for cruise ships. There's a small cruise line here in West Palm Beach that does little two-day trips, and they have two old carnival ships that could probably be upgraded. They are not looking to upgrade their ships; they are desperate to be doing any business. So, that, as an investor, is something to be wary of. It's also important to know that -- and this is not entirely true, because there are some high-end cruises that this doesn't apply to, but in general, when you look at Royal, you look at Norwegian, you look at Carnival, about half of their revenue comes from you booking a ticket, another half of their revenue comes from the stuff you do onboard. Hey, I'm going to buy a drinks package, I'm going to eat at a specialty restaurant. I booked an excursion through the company, I'm going to go, I don't know, backpacking in the Bahamas, so that's really, really important. And the fewer people you have onboard, the less money they're making from that. And the fewer people you have onboard, and the more likely you're not going to pay for an enhanced room.

So, normally what, say, Royal does is they give me a free interior or even a free balcony, in rare cases. And then they send you something called Royal Up, how much would you pay if it's available for the next class, here's the minimum. Do you want a suite, the minimum extra bid is $300? Do you want an expanded room that's physically bigger, the minimum bid is $100? I've done it when I've traveled with my son and I've occasionally gotten it. But all those things make extra money. How many people go play Bingo and buy a card, make extra money? You know, who takes the cupcake making class? Not everything costs extra. There's lots of free stuff to do on cruises. You don't pay for the waterslides, you don't pay for the shows, you don't pay for the entertainment. That said, right now everything is very compromised by the fact that the ticket prices are going to be lower, how much people spend onboard is going to be less; even if they spend more per person, which doesn't seem that likely, it's a really, really tough economic picture and that could lead to a bankruptcy.

I tend to think "No," I actually think once they start cruising, both Carnival and Royal Caribbean borrowed money at between 10.5% and 11.5%. Emily, that's like the guy in the corner breaking your leg for money. Like, that is not a great rate. I actually think once they're operating for a few months and they could show they've returned to profitability, I actually think they're going to be able to refinance at more normal rates. And that really, really changes the bankruptcy picture for the company, because right now I feel like they could just go, you know what, people who want 11% money now that we're operating, fine, we'll declare bankruptcy and we could sort it out that way. I think they're going to have an ability; they're not going to get 1% like they would have gotten previous to the pandemic, but I think they're going to be able to get some more reasonable loan terms once they're showing they can put up an operational profit.

And let's remember, I'm most familiar with Royal and Carnival, they were really profitable companies. That said, there's a huge capital investment, people are looking for new cruise ships every year, they want those private islands to get better, they want terminal experience to be improved. But I do think, if they can get passengers on by early next year and start that process of building back up, they probably won't file for bankruptcy because it will look really bad. People aren't going to book a cruise on a company in Chapter 11, because your money becomes very uncertain. I have friends that took the cashback rather than 125% in credit even though they still want to go on the cruise, because they're worried about what happens to their money if there's a bankruptcy. Those are real concerns and I actually think that makes a Chapter 11 a last resort tactic and we're not there yet.

If they're not cruising in March, we're probably there. If we're slowly ramping up to speed through the Winter, which is the slower season anyway, I think the industry will probably be fine, but I'm not sure I would invest based on those thoughts. [laughs]

Flippen: Yes. That was going to be my next question. It feels like we're painting two separate, yet interconnected pictures here. One is, you're looking at an industry, the cruise line industry that, at least [laughs] when there's not a global pandemic happening, is a really stable industry, it has strong, steady demand, generates a ton of free cash flow and has some protections against it from things like bankruptcy, just as a result of its business and the assets, the cruise ships, that it owns.

On the other hand, as you're talking [laughs] and you're explaining all the different things that go, and for these cruise lines to even get to the point where they can have anybody on board, that to me just screams, oh, it's going to be a painful and a long process to get these ships operating at the capacity that they were pre-pandemic. So, when you're looking at this space and you're trying to balance the positives and the negatives here, do you think now is the time to come in and potentially buy shares of cruise lines that you maybe liked pre-pandemic, whether it be Norwegian, Royal, or Caribbean?

Kline: So, think of this the way you do some of the stocks in your cannabis portfolio. That you fully understand that it's going to take a really long time, and that there is a risk of going to zero. That being said, when I have a week, I will probably buy a little bit of Royal Caribbean and a little bit of Carnival, no more than 2% of my portfolio total. Some of that is being a fan. I understand my buying stock doesn't actually help the company, but some of mine is just having stake in the game in an industry I really like. And I think that's OK. I know ...

Flippen: Very Buffett of you.

Kline: Yeah, I know that's a gambler's mentality. But it's a very tiny percentage. Because I do think 10 years from now, we could be looking at these stocks being dramatically higher, 5X and 6X higher, but it's going to take over a year, if they start January 1st, it's going to take over a year until their full schedule is back on board. There are ports that are simply not going to be open. I've talked with you that I've been offered Alaska cruises, which is something I'm never offered for free. And those are more than a year out, because those ports aren't open. Some of the countries that cruise ships stop in aren't going to want cruise ships to stop there for six to eight months. There are some countries that are simply going to say, we don't like Americans, no matter how much you test. And that's fair [laughs] based on what's going on here, that's not crazy. So, this isn't an industry.

Disney could tomorrow open up at full capacity, open all its hotels and lower prices accordingly to fill the parks. If they really wanted to do that, they could do that. Even if the cruise industry wanted to do that, they can't do that. It's slow-going. Right now, there's only limited places they could go. I think it's very possible that that January cruise I have booked becomes a day at sea and then a stop at the private island with no stop, you know, in another country, because Nassau won't want Americans to stop there, even on a very limited basis.

So, I am not telling you to invest, I do think it is a safe-ish investment if you're willing to look at a 5- to 10-year horizon, that these businesses could get back to where they are. But remember, they're going to have to spend a lot of money on debt, they're going to have to be very inexpensive until a lot of people said, wow! What a great experience. And they run the risk of people booking a cheap cruise but not being happy due to the limitations. It's something I've seen at Disney. People are at Disney, there's no line to get on most of the rides. And you hear people, when they take their masks off, they're sitting and they're eating something, oh, this stinks, I have to wear a mask all day. And it's like, well, you just walked onto Avatar, that's usually a two-hour wait. Like, there are real pluses here.

I do think there is a risk that some people won't do this. And look, the cruise industry needs younger people, and they've done a really good job, especially with these short three- and four-day cruises, making it like a bachelorette party destination, making it feel like a Vegas type of thing. Might be awhile before they can get that back, so this is going to be really, really rocky. That being said, Fools, happy to go on a cruise with you. I've got cruises booked in May, June, July, and August. [laughs]

Flippen: [laughs] And we hope that you will be on all of them. But the cruise that I am most curious about is the three-day cruise you have booked in January. And I know yesterday I asked you the desert island question, I'm going to do the same thing here, except for not with stocks. I'm going to make you answer me, you know, you mentioned there's a lot of a gambler's mentality when you talk about cruises, let's take that mentality to the next step here. If you are a betting person and you have to bet on whether or not that cruise that you have booked for January goes forward, which side do you fall on? And if it does go forward, if you think it does go forward, if you had to bet, do you think you will be on it or not?

Kline: So, I would say, 90%, the cruise happens. I would say, 25%, I'm on it. And I'm only likely to be on it if it is a very low capacity and it's very under the gun in terms of public pressure and what they're looking at. If it was just me, I would have no issues with that. It's my wife and son, so it is possible that I go on it. And if hotel prices are still low here when I get back, I quarantine myself for a week and take a test every day, if that type of thing is possible, I might be willing to do that, because, you know, if I am gone Friday through Monday, and then I spend the Monday through Saturday in a hotel. My son is 16, my wife can live without me for a week. If it's that kind of safe, I'm likely to do it. Now, if there's a vaccine at that point and some of the people, the vulnerable people on the ship have had that vaccine, that might tilt it. But this isn't a decision I'll make alone, because I would always be like, hey, I'm going, you know, like, [laughs] you know, I like fun probably more than I should.

That being said, it's one that it'll involve everyone I'm likely to be in physical contact with, which isn't that many people right now, but I don't feel like taking a cruise is any more dangerous than what I'm doing in October, which is driving to a casino and spending a couple of days in a half-filled casino where the procedures are very good as well.

So, there's risks with everything, you have to know your risk. So, I think it's going to happen, because I don't think this current government is going to stop it. And I think the industry is going to be as safe as they can. But I'll be on it if they're doing all the right things; and I expect, in January, they will be doing all the right things. I don't know if in March they'll still be doing [laughs] all the right things if we don't have a vaccine. But I do think the first ones that go will be very, very scrutinized, and that feels like a much safer place to be.

Flippen: Well, I'll tell you one thing, I will be an extremely bitter camper if your cruise happens in January and you're on it, mostly because, for anybody who's listening to me already know this, I am in the process of studying for level two at the CFA exams, and we don't even know if in December we're going to have the opportunity to have the exams, which require a room full of, you know, hundreds to potentially over 1,000 people in one room. It's truly, kind of, crazy times we're living in. And I think if I had to take the over/under on that cruise happening, I think I would take the under.

If we can't get these professional exams done in December, then there's no way we're taking cruises in January. But, hey, maybe I'm wrong on both fronts. [laughs]

Kline: Here's the thing. I hope you're wrong if it's safe, I don't hope you're wrong if it isn't. And I am taking a cruise, I think, in May out of New York, so maybe you'll come along, there's a -- [laughs] you know, maybe you and your boyfriend, I know some of the Fool writers are joining me. Hopefully, next Summer, the world will be normal. January, I did it as a lark, if I cancel, I get my money back; if they cancel, I get 125% back. So, I'll book in February, which is a little more expensive, or I'll book in March. None of the free offers kick in till May. I suspect that will change. As they start opening, there'll be some last-minute offers, because it's going to be diehards like me who are the first people willing to do this.

Flippen: [laughs] Well, Dan, I'll tell you one thing. I'm not sure about being down for the cruise in January, but I'm there for May. In my mind I have no doubt that the industry will be back up and running by Summer. But, heck! You know, someone's going to pull this podcast up in May and be like, look how wrong you were. I hope that's not the case, but in the world we're living in anything is possible.

Kline: Yeah, Emily, I'll point out that when this all began in March, I booked on October 17th that same three-day cruise, I booked it on October 17th, I think it was the day, or maybe it was a four-day, because my birthday is the 16th, and I'm like, oh, by October, of course, we'll be back. And I was definitely wrong about that. So, I could absolutely be wrong about this. But I can't make the comment I'm going to make, it gets too political, so I'm not going to make it.

Flippen: [laughs] Well, on that note, Dan, thank you for coming on and giving us your insights and your own anecdotal experiences with cruises. As always, it's appreciated.

Kline: Thank you for having me, and hopefully I will see you, like, January 20th, and we could talk about this again. [laughs]

Flippen: [laughs] That sounds great. Listeners, that does it for this episode of Industry Focus. If you have any questions or just want to reach out, you can always shoot us an email at [email protected], or tweet at us @MFIndustryFocus.

As always, people on the program may own companies discussed on the show, and The Motley Fool may have formal recommendations for or against any stocks mentioned, so don't buy or sell anything based solely on what you hear.

Thanks to Tim Sparks for his work behind the screen today. For Dan Kline, I'm Emily Flippen, thanks for listening and Fool on!