A Comment -- General Comments From an Expert (A Commentary)

Yes. That will be the second wave of Trumpism 2.0. First he wants to take care of tariffs, then give people a big tax break (even though they'll be paying more in tax through tariffs). The next phase is to reduce regulatory burdens on companies. 

He hears that the M&A pipeline is full, especially on the higher end. Lots of deals being either done or contemplated.

In the last few days during all these tariffs, there's been a sudden, aggressive surge in treasury yields. That's probably a key reason why Trump shifted policy on tariffs today. The 10-year yield jumped from 4% last week to 4.3% which is a very big move. That is not supposed to happen when the stock market is stressed. We don't want these rates shooting up. Bad. The spike has been counter-intuitive due to selling treasuries. Keep an eye on this. This quirk should fizzle out though, especially with this 90-day tariff pause.

Garner feels that gold is very overvalued, not this bad since summer 2011 during the debt crisis. But gold plunged 45% from its euphoric high. If that happened now, gold would fall to $1,650/ounce. Historically, gold falls in and out of periods of correlation with other assets, namely stocks. When gold breaks out, then falls below support, this is a bull trap. Recently, we saw a euphoric peak above $3,000. A breakdown below $2,900 opens a trap door downwards. A gold rally has never survived an RSI reading above 70 without a correction. And this has happened 3 times over the past decade. She expects gold to fall.

We're seeing emotional, knee-jerk reactions, "I need to get in. I need to get out." People should step back and look at their asset mix, what and why they're holding. If you're more than 5 years from retirement you're fine being all in stocks, can withstand volatility, which allows to take advantage of swings like this. If not, can't withstand it, you should hold some fixed income to give you safety. Being concentrated only in Canada, making up only 3% of global stocks, doesn't make sense. Diversify. We've seen 20% drops like now in 2018 and 2020 and 2022--the average intra-year drawdown over the last 75 years is 14%. Drawdowns are normal in markets, though this time it's self-inflicted (through tariffs). Before, dips allowed investors to get right away, but this time it depends on one person: Trump. Will this be V-shaped, or will it be prolonged, which will likely lead to a recession.

There's always something a bit unique, as no two situations are exactly the same. The last time we went through a shocker was during Covid in March 2020, and the market fell over 30%. The message he sent to clients then was whenever you look back at times like these, you always say that you should've bought great companies when they were on sale. That's eternally the message.

Warren Buffett says buy when there's blood in the streets. If you buy great quality (and this is the moment to buy great quality because it's cheap again), you'll be well served when you look back at your portfolio 5 years from now.

An "all or none" approach is probably the wrong thing to do, as it just leads to paralysis. If someone had, say, $50k to invest, just be disciplined and put in $10k (or whatever's comfortable) a month and start buying today. If you wait until calm returns and things improve, you'll have missed the first 25% move.

Buy the world's best companies. Anything from Canadian bank stocks to any of the great technology companies. They've all been hammered, and this is your opportunity. Dividend yields are higher because you're paying less for these stocks. Great management teams will figure out how to navigate these situations.

It's always a mistake to sell when the world is panicking. Don't forget Warren Buffett's advice to buy when people are panicked and sell when everything looks rosy. These quality companies were great 10 years ago, and they'll be great 10 years from now. If you can buy them on sale, why wouldn't you? Investors should be loving these times.

You have to buy the sector when it looks awful and prices are low. He has minimal exposure, owning just one stock in the space. When things are weak, you really appreciate having a low-cost producer.

Shortage of housing in Canada. But in Toronto, for example, so many condos are coming on that prices are softening and even rents are softening. The only REIT he owns is CAR.UN.

Office buildings are going through an evolution, and we don't know how it's going to end. Not cheap enough to make a bet on the office space. Malls are certainly going through a worse evolution, being replaced with condos and apartments. The steady area has always been apartments.

Nobody likes these tariffs and bear market. He thinks that before Thursday when Congress steps away from its session, news from Congress or the White House a better path forward. Fingers crossed. If there's no resolution and Congress recesses, more volatility will happen. But volatility offers opportunity through lower prices, like Nvidia dipping below $90. It popped over $100 on rumours that the tariffs were on hold. You can nibble on names that are on sale now. He's cautious. Corrections always happen, so always have some dry powder. If you're worried by this sell-off, you don't have the right portfolio for your long-term goals.

Needs more details, but it sounds like the caller is hedging long exposure to his underlying bank stocks by owning put spreads (great). Depending on where the put strikes are, take your profit on the long end and expose your naked put to add to the position. Look at the price of volatility in the short run vs. what you will pay to roll those out to the back months. Needs more time to explain more. Don't sell calls here, not when the market is down.

The government interest rate is 2.75%, and it's looking 60/40 for a rate cut. To do better than this, buy a dividend stock. It is what it is. There is no super-safe strategy without risk. Doesn't exist.

The Pro-Eyes S&P Opportunity Index is sharply up, therefore issuing caution. But during the flash-crash of spring 2020 and other corrections, the index flashed opportunity. So, be prepared to add to your favourite names on crazy days. However, we could see a couple quarters of choppiness. What this index doesn't say is how long choppiness will last. We are oversold enough for a trading rally. Secondly, the Tactical Risk Monitor shows that we are set up for a bounce and rally, but we need a headline from the White House or Congress saying they will handle tariffs better. The rumour this morning saw markets briefly rip. Likely, the bounce will be moderate, with resistance at 5,500 on the S&P, over the next month at least. Technically, the market is very oversold. The S&P trough in 2022 to the high recently: the tariff sell-off in recent days slashed those gains in half, back to the high of 2021. Now, we have good support and a good time to buy, BUT this situation may not hold for sure. Next support is 4,500 then low-4000s. We're not free and clear yet, but this is a tradable rally now. 

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