ALWAYS CONSULT YOUR INVESTMENT PROFESSIONAL BEFORE MAKING ANY INVESTMENT DECISION
September 21, 2020 | Danielle on CBC Weekend Business Panel
U.S. bans WeChat and TikTok. MEC sold to US firm, Trudeau to deliver throne speech. Here is a direct video link.
September 18, 2020 | Oil Demand Disappoints Bulls
Oil offers further proof that, at the zero-rate bound, monetary policy is pushing on a string, unable to increase consumption. In reports released last week, both the International Energy Agency (IEA) and the Organization of the Petroleum Exporting Countries (OPEC) cut their global demand outlook by 9.5 million barrels a day from 2019 levels, driven […]
September 17, 2020 | Dollar and Treasuries Call Federal Reserve Bluff
Yesterday the US Fed offered its next iteration of low policy rates for longer, and longer, and longer with a promise that it would not hike for (at least) another three years in its effort to manufacture price inflation above 2%. The truth is, as we’ve already seen in places like Japan and Europe, keeping […]
September 16, 2020 | Rosenberg: We Have Yet to See COVID’s Real Impact
Many lucid thoughts in this segment… David Rosenberg, chief economist at Rosenberg Research, speaks with Financial Post’s Larysa Harapyn about GDP forecasts and what we should expect from the Canadian economy, especially if there are more outbreaks of COVID-19. Here is a direct video link.
September 14, 2020 | Downtown: Not Business as Usual
Six months into the pandemic, the 30-kilometre underground pedestrian network and labyrinth of restaurants, retailers, and offices in downtown Toronto remain empty as thousands of Bay Streeters work from home and hundreds of small businesses falter. See Toronto PATH remains eerily empty six months into a pandemic The author offers a summary in this video report. […]
September 11, 2020 | Demand for Greenbacks Intensifies
As the US dollar Index (DXY) hangs in this morning above 93, other commodities like precious metals, oil, natural gas and equities are losing ground once more. While most people understand that the world is highly indebted today, many miss that the largest share of that debt is denominated in US dollars. As international trade […]
September 10, 2020 | NB Chief Strategist: ‘Negative Economic Surprises’ on Deck
It is rare for a chief market strategist for a major bank to discuss downside risks in Canada so plainly. This segment was recorded during yesterday’s market bounce. Most stocks, especially in Canada, remain well below their February highs, however, the rebound since March made back some losses and has afforded another opportunity to reduce […]
September 9, 2020 | All Eyes on the Dollar Teeter Totter
In August, I pointed out that the US dollar index (DXY) was looking oversold and that a bounce in the 92 range could signal the next retest for risk assets on the other end of the dollar teeter-totter. Here was my partner Cory Venable’s big picture chart of the dollar index from 1995 to August 7. […]
September 8, 2020 | The Truth About Obscenely Priced ‘Investments’
While the largest tech companies have leapt in price, aggregate earnings for NASDAQ 100 companies have fallen 30% year to date. Before last week’s modest sell-off, the largest five–Apple, Microsoft, Amazon, Facebook and Google (Alphabet)–accounted for a record 23% of the entire S&P 500 index, the highest concentration of the top five on record, even […]
September 4, 2020 | ‘This Time Is Different’
The number of U.S. permanent job losses (inverted scale below in green) versus the S&P 500 price (in grey) since 1994, throws some cold water on S&P 500 bulls today. And more broadly, so does this look at global equity prices as a ratio of sales for the companies in the basket (below since 1980), […]
September 3, 2020 | Shilling: Expecting Recession Throughout 2021
As we covered in our client letter for August on Monday, central banks can pump money into financial intermediaries and buy some securities to increase cash in the system but they cannot force lending nor productive investment through the economy. This is why M2 Money Supply (movement and multiplier effect of capital through the economy) […]
August 31, 2020 | Cost-Cutting is a Necessity with Many Legs
The COVD-19 shock is unfolding in phases. The first was the global shutdown and market collapse into the end of the first quarter. The second was a bounce in economic data and asset prices into the summer as central banks and governments unleashed monetary and fiscal support and businesses reopened. The third, now unfolding, is […]
August 28, 2020 | ReThinx Update: Rapid Total Energy Transformation Underway
We’re on the cusp of the most profound disruption of the energy sectors in over a century. We’re not facing a slow energy transition, we’re facing a rapid and total energy transformation and it’s already begun. The disruption is inevitable (for economic reasons), existing coal, gas, nuclear and other assets are stranded. No new investments […]
August 27, 2020 | DiMartino Booth on a ‘Generation of Painful Liquidations’
Thinking people know that present financial conditions are a train wreck in motion and controlling our own behaviour is the most valuable risk management available. An excellent essay from former Fed-insider, now independent analyst, Danielle DiMartino Booth, is a helpful fact check in a mad time, see Monetary Policy Gone Wild. A Lost Generation of US […]
August 26, 2020 | Roach: America’s Coming Double Dip
Economist Stephen Roach’s latest piece in Project Syndicate is worth reading, see America’s coming double-dip. The fallout will not be contained in America. Here’s a taste: The daunting history of the US business cycle warns against complacency. Double dips – defined simply as a decline in quarterly real GDP following a temporary rebound – have occurred […]
August 24, 2020 | Danielle on CBC News Business Panel
Our weekend business panel discusses this week’s shakeup of Parliament, with Chrystia Freeland being sworn in as Canada’s new finance minister after the resignation of Bill Morneau. Plus, Canadian home prices rose in July, but not by much. And, despite the global pandemic, the S&P 500 reached record highs this week. Here is a direct video […]
August 20, 2020 | Reality Check: Making Back Losses is Not The Same as Making Gains
Investment sales folks and Perma bulls who lost heavily in the first quarter are celebrating the rapid bounce back in market prices since March. Many cashed out with losses near the lows but have panicked and bought back higher in recent weeks. Others who held through the heart-pounding drop are relieved at the rebound, but […]
August 19, 2020 | Lacy Hunt: Monetary Inflation is Transitory and Ultimately Growth-Depressing
Piling on more debt today, just to keep the economy afloat, will lead to decades of slow growth and potential disinflation. The Fed is not able to sustainably lift growth or inflation. Hoisington Management economist Lacy Hunt’s recent Bloomberg interview is worth the read at this link. Here’s a taste: When the Fed initiated QE1, QE2 […]
August 18, 2020 | Government-Boosted Economy Approaches Next Hard Return
America’s largest retailer Walmart reported today that it ended its latest quarter July 31st with revenues 5.6% higher than a year earlier as consumers spent government support funds: “Stimulus was definitely impactful to the consumer in the second quarter, and we’re watching what’s going on in Washington, and how we’re going to progress with a new […]
August 17, 2020 | Canada’s Housing Bubble Most Ominous in The G7
Canadian real estate prices have increased by 88% since 2005–nearly triple the pace of any G7 country (red line below since 1975). The next closest is Germany (in yellow), with an increase of 32.3% over the same period. Historical precedents are daunting for Canada. After bubbling into a 2005 peak, US real estate prices (in […]
August 15, 2020 | Rethinking Office Space
The COVID-19 pandemic is changing the way we perceive and manage workspaces. Plexiglass dividers and floor decals might not be permanent, but the pandemic will bring lasting change to offices. Experts from the architecture and real-estate industries share how they are getting back to work and what offices will look like in the future. Here […]
August 14, 2020 | Global Recession: China, Commodities and Global Impacts
The slowdown in global economic activity has been accelerated by COVID-19 but was ongoing well before it as debt weight and aged populations continue to curb consumption. This has implications for all countries but particularly those with less household wealth who have built their economies on the presumption of ever-expanding consumer debt and leaping demand […]
August 13, 2020 | Bankruptcy Boom Unfolding
Canadian law firms are expanding their corporate restructuring partners to prepare for a wave of insolvencies as COVID-19 relief measures dry up and lenders start to lose patience with struggling businesses, as reported by the Globe: “Firms are acutely aware of the need to have a strong team entering this next phase of COVID.” This recent Bloomberg […]
August 12, 2020 | Dollar Dominoes as the Global Economic Bounce Stalls
As recently discussed in US dollar down, but is it out? and US dollar stalks risk markets everywhere a falling dollar has been the wind at the back of the risk rally since March. Its next move will impact everything. Economist Daniel Lacalle discusses in this clip. The U.S. Dollar. Collapse or Oversold? Global Recovery Stalls. Here is a direct video […]
August 11, 2020 | Financially Destructive Policies Ripe For Review
As the worst pandemic in a century forces the world to look for new ideas to expand the multiplier effect and more efficiently share resources through a depressed global economy, policies that have helped extreme wealth pool in a few at the expense of the rest are up for much-deserved review. Today’s historically low corporate […]