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

Portfolio construction -- put strong dividend payers in TFSA? Broadly speaking, TFSAs often get the riskiest assets with the hope of striking it big and getting a big tax freebie. That's not his approach. He thinks math works out over the long term. If you're under 60, you have lots of time for stocks to compound in your TFSA. He'd rather get 7% for 30 years than 17% for 3 years. So he thinks the dividend heavy-hitters are great investments for a TFSA.

Volatility in oil. Price has been a conundrum. The green revolution is coming, but we need fossil fuels for another 20 years. There's been under-drilling. Price is exacerbated by this horrible war. Canadian oil patch is a cheap as it's ever been at 2-4x. If the price of oil stays here, these companies are still very attractive.

Insulating your portfolio in these markets. He's been tilting toward the value trade for about a year, taking things off the growth area. Hugging dividends, oil, value, and materials. Raised a bit more cash. Fed might be more aggressive, and you want dry powder. Be more opportunistic. When you have oversold conditions in really good assets like tech, go back in for a better entry point or even just for a trade. He did this last week with NASDAQ stocks and SHOP. Names like AMZN and GOOG have been very buyable down here. If we have a flattening yield curve or concerns about global growth, investors might warm up to the growth trade again.

Why did Canadian banks fall out of bed this morning? You can't read too much into a couple hours of trading. They've been a good roll for a long time, so not as cheap as they were. Great earnings. BMO's issuance yesterday had something to do with its drop. Bond yields are down, so the concern is inflation is too high and the Fed will raise faster. Yield curve is nervous. Banks like higher, short-term yields. US banks have really had a hard time the last couple of months.

Banks and benefit of rising interest rates. He owns a lot of banks. At this point, they're getting a bit rich, though there's still room to go. But he doesn't like piling in on the 7th inning. They're a good long-term hold, but a bit too pricey now for a new position.

Cheapest Canadian bank? BMO is the cheapest, then CM. Whole banking sector has a few more innings to go. Great place to be over time.

Q4-2021 saw GDP growth of 7%. Q1-2022 is projected at 1.3%. This means the economy is slowing down and a lot of interest rate moves happened in that time period. So, this sets us up well for the market to continue to rise. He's fully invested, and he was not scared by the slump.

The healthcare sector. Question was about Abbvie. Healthcare is a great place to be--it's defensive and they have pricing power, demand for treatments and drugs. Companies also have patent protection. Barriers to entry are high.

U.S. investors are growing more bullish He's bullish near-term and targets the S&P at 4,550. He's a buyer. Monday saw a momentum trade that set up for low rish and high reward, and it closed above the 200-day moving average. The S&P at 4,460 close is a stop level. Today's session (stocks slightly down this morning) is a resilient day. He's happy to take it. This rally accompanies spiking oil prices and rising treasury yields. The technical set-up looks good. He's long S&P futures and maintaining his portfolio holdings. A more aggressive Fed is more credible. In the past three weeks, company fundamentals haven't changed, but investor sentiment has reversed to be more positive. History points to a second half of 2022 and Q1 2023 will be strong.

Has oil topped out? We saw a parabolic move in oil after the US stated its position on Russian oil. He expects crude oil to become rangebound, with the bottom end around $85-90, but below the parabolic highs of $130, even if the Russian war ends. This range will benefit oil companies which will buy back shares and protect dividends.

The market has retraced 50% from bearish lows. History says the market is now all clear. Maybe. He didn't panic when markets moved down, nor say the market would scream to the upside. Upward moves in the 10-year-yield are far more measured now and less frantic than before, and this is more comfortable for the market. He's been neither strong bull or bear, just sticking with his tech stock. Remember that the Fed has raised rates only 0.25%, but bonds have risen from 1.5% to 2.37%. The bond market has done the heavy lifting, so the Fed hasn't bumped rates by 0.5%, and this is good. Consumer demand remains very high and consumers can weather high gas prices. Nike's latest blow-out numbers show this.

Bullish or bearish? Historically, the third year of a bull market offers fewer possible outcomes. She doesn't expect a blockbuster year like 2021. The economy is slowing down, but that doesn't mean a recession. Watch the 3- and 10-year spreads. Be positioned for the second half of 2022 which looks better.

So much about the market depends on progress in the Ukraine war and no one can predict what will happen. Will Putin escalate or will there be a settlement? Inflation is the other major market driver, some of which is linked to the Russian war, namely grain and oil. Inflation won't magical go away if the war is settled, but prices will relax some. So far in 2022 non-profitable companies have been severely punished, like Peloton, Door Dash and Shopify.

The cost of shipping containers The cost of shipping containers have skyrocketed because of supply shortages. He doesn't know when this will be solved, but the volatility in shipping rates is wild now. The current shipping price is headed to drop. Do not chase these profits, because they won't last.