Market. The US economy had a good second quarter. In Europa and Chine things are slowing little. One of the main things that the Fed has to face is the yield curve flattening quickly. He believes the bond markets figure things out fairly quickly. The yield curve is saying that there is slower growth and low inflation. This doesn’t mean you can’t do well in stocks. You have to be very careful when interest rates are being raised. Particularly in light of coming out of QE. Earnings have been coming very strong. 

Market. Stock piles are nearing record low levels. Lack of available inventory within OPEC and lack of investment in OPEC and non OPEC countries. Inability to meaningfully grow production after 2019. USA has a pipeline bottleneck until 2020. With continued demand growth, we see inventory continuing to drop. See inventories approaching all time lows by the end of next year. Demand will only decelerate in today’s economy at $120 oil.
40% underperformance by Canadian energy stocks relative to index. A lot are trading at 4X multiples instead of normal 7.5 to 8X. He sees a minimum of 50% upside and if he is correct at $80 oil, he sees 100% upside in Canadian energy stocks.

Frac Sand Stocks. He got out of this sector last year.  Perennial concern of too much new supply in Texas.  Beginning of 2017, quality was questionable, but found they could use a lower quality sand.  Storyline changed dramatically and he is no longer in this sector.

Market. Shift in politics moving to the right. We are seeing some barriers. Green economy has grown tremendously and moved toward the mainstream. Interesting to watch Trump with coal, and Doug Ford moving backwards on green energy projects. This is a short-term slowdown. Long-term, tremendous investment opportunities.

Big companies moving to clean energy. Car industry is going full steam ahead. Every major car company is moving on hybrid vehicles, and this is a major change. Easy to get caught up in short-term political cycles. Right now, he’s looking for opportunities that are a little undervalued. Long term, no question that this is the direction the economy’s going. Not a question of if the economy will change, but how quickly it will. Tread carefully for now, over next election cycle. Emerging markets like China and India are investing in green energy. Bit of a lost opportunity for Canada. We had been at the forefront, but now we’re taking three steps backward.

Can wind power be a profitable part of your portfolio? Absolutely. Renewable energy is a play on long-term contracts. Costs are coming down dramatically. Though in Ontario, there won’t be any new contracts. Tremendous opportunity, becoming competitive with traditional systems. Look to improving energy storage to capture wind when it blows at off-peak times.