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

Are CDRs a good option for AMZN or AAPL? Sure. These stocks are so big and so liquid that it would work well for them. The sponsors of the CDRs would be very careful to use big, liquid names where the volume will be enough that you don't get an arbitrage situation where the CDR price is different than the underlying stock, because you don't want that.

Aerospace stocks. Not a sector he pays a lot of attention to. But we know that the big companies are being tapped to manufacture more because so much is ending up in Ukraine. US is running out of artillery shells, for example, because they're all being shipped overseas. Defense industry stocks might be an interesting place to look.

BOC 50 bps rate hike. Perhaps a little higher than people were expecting. Might be a signal that they're done, as we're already seeing many signs of slowing starting to take effect after one of the most aggressive rate hike cycles in memory.

Fed decision next week. They've already done enough, way too much. They might do one or two more. We're already seeing signs of pullback. Money supply has moderated greatly since the massive Covid stimulus. The PMI for both manufacturing and services is now below 50, which represents a contraction. CPI has peaked, and core CPI has probably peaked and is coming off summer highs. He hopes the heavy lifting is already done.

Possible recession? The million dollar question as to whether we'll get a hard or soft landing. Personal savings rates are now well below the 3% level, which is below historical averages. Now consumers are burdened with higher prices across the board, and that will affect us as we go through next year. It will be a faster contraction than many people are expecting.

Layoffs in tech sector. Not concerning, normal process for business models. They're uncertain about the future, even though they're seeing pretty good prospects as we head into 2023. So they're just making some defensive moves.

Is TSLA's CEO distracted by TWTR? 100%. There are only 24 hours in a day.

Autonomous cars. Everyone's trying to get in. Long, long, long term, we will have driverless cars, but how much a company wants to spend on the initiative is another question. TSLA and all the others are spending a lot.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Potential Red Flag For Next Investment: Short interest. We do not like to give most short sellers, especially the short-and-distort crew of funds that attack Canadian companies with ugly and often incorrect reports (as happened with Saputo Inc. this week). But you should at least know the short position on a company, and the reason behind any large short interest. At the very least, learning why there is a short position will make you aware of some of the risks in your investment, and prevent you from buying with only your rose-coloured-everything-is-fine glasses on. Some of the most-shorted stocks this week (in terms of days to cover) are Algoma Central Corp. (91 days), Wildbrain Ltd. (78 days) and Frontera Energy Corp. (62 days). A high short position can mean potential future buying, and it can mean a possible short squeeze. But it also means some (mostly smart) investors are taking a big bet against your company. You should at least find out why.

Message to bank CEOs: Be constructive. Don't scare markets into selling. The economy is in good shape and the recession won't be that bad. Sure, there are plenty of economic problems, but this isn't a financial apocalypse.

We may have had a the Santa rally already starting in mid-October and we milked that already, unfortunately. Today, American CEOs are correct: we will see a recession in 2023. We haven't seen evidence of one yet, though. The pullback in recent days reflects the market realize a recession is coming. For 2023, play in the bond space to pick up yield, the first time in a while. De-risk portfolios and look at government bonds.

Believes interest rates will remain higher for longer (bond market has it wrong). Expecting a 50 basis point raise in December, and another 50 basis point in January 2023. Recent US jobs report point to further interest rate increases. Apple moving supply chain away from China is part of global restructuring. "Just in time" inventory being re-thought with fragility of global relations.

Educational Segment. Believes "soft landing" narrative is not true, and that economy is heading towards a recession. Short term rates higher than long term rates indicator that recession is imminent. Every time the yield curve inverts (interest rates go up), earnings go down and recession occurs. Expecting higher interest rates for longer to fight inflation and good jobs report. Earnings growth is not happening, so is a time to be cautious for investors.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. How Capital Gains and Capital Loss Tax Works. Canadian investors that own financial assets outside of a registered account (TFSA, RRSP, RESP, etc), are required to pay income tax on any capital gains that they realize within a tax year. Capital gains are defined as the increase in value above one’s cost basis for an investment that has been realized upon sale. When Canadian investors sell equities that have increased in value above their cost basis in an unregistered account, they must pay income tax on this increase in value. One caveat is that if an investor also sells an asset that has decreased below their cost basis, this realized capital loss can be used to offset any capital gains, and thus decrease one’s income taxes. One technique that many investors use is selling an asset that has decreased in value to realize that capital loss and repurchase the stock 30 days later (to avoid the wash sale rule).

The Fed wants to tame inflation so that you products and services are affordable, but unemployment remains very low. There are not enough people in the workforce for various reasons. Some don't want to return to work because they made so much money during the pandemic (partly by spending less on stuff). Also, wages stayed higher longer than they should, and there's a mismatch between job openings and job seekers like specialized engineers. Companies must realize they need to cutback staff now that the halcyon days are over. The companies created during the pandemic hired a lot of people and even the money-losing businesses are still operating (for now). He predicts mass layoffs in the new year. The FED will eventually win the war against inflation--be patient.