A Comment -- General Comments From an Expert (A Commentary)
COMMENT
Global corporate tax. Ultimately, governments will have to extract more taxes from global companies. Covid relief has had an impact on governments. Taxes must go up. There will be push back, but this will happen. Many industrial companies have higher taxes already but it is the tax havens that will push back.
Larry Berman CFA, CMT, CTAUnknown
COMMENT
Gold. The inflation debate is raging and there are lots of factors to consider. Yellen said that Biden should go ahead with spending plan even if it sets off inflation. She wants higher rates as well, which will be important for markets.
Larry Berman CFA, CMT, CTAUnknown
COMMENT
Agricultural ETFs. Are people going to be permanently eating more staples or is the increased demand more transitory. The world is not eating more soy and wheat. There is a degree of speculation and labour struggles to produce output. Trend is spiky and would not look as a long term investment. Okay for traders but not for longer term.
Larry Berman CFA, CMT, CTAUnknown
COMMENT
Gold. Real yield is important to consider when looking at gold. When real yield is negative like right now, it is bullish for gold. The correlation is to real yield and not nominal yield. Inflation expectation is increasing faster than nominal yield. Bitcoin is also pulling some of the money that would have gone into gold.
COMMENT
Educational Segment. The Feds want more inflation and also Yellen wants higher interest rates. The current inflation expectation is transitory supply shortages. Core inflation is about wages and wage pressure. We will see in years and decades that labour's share of income will have to keep going up. This will affect corporate profit margins. Volatility is related to inflation expectations and higher multiples. Corporate incomes has been hitting record highs. Government will need to issue debt and it will be interesting to see how the markets accepts this. Large inflation is not a good thing.
Larry Berman CFA, CMT, CTAUnknown
N/A
Market. There are a couple of problems right now. When people are thinking about risk, there is a lot of noise out there right now. And then there is financial engineering. Companies are not using GAAP earnings. This sent the multiples through the roof. S&P earnings are amongst they highest they have been. Companies are comparing Q1 earnings to a year ago when earnings were disastrous. There will be a jump in earnings surprises.
David DriscollUnknown
COMMENT
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The discourse around debt seems to have receded. Inflation is one way the debt situation can be resolved. Making drastic changes to asset allocation is probably not the right thing t o do right now. A diversified portfolio is most likely a good defense for this concern. Unlock Premium - Try 5i Free
Stockchase InsightsUnknown
COMMENT
Market outlook. The market is at record highs but not every stock is at record highs. Also, earnings are at record highs. You must screen and look for value. Canadian banking industry is doing well and thinks it is not yet over priced. Dividends will also be going up.
David BaskinUnknown
COMMENT
US Tech. Owners and believers of the FAANG stocks. The notion of winner takes all in tech is something he believes in. Revenue and profit growth of big tech is from stealing market shares from competitors and other sectors. These companies have enormous wealth and tech capabilities. They are dominating the world in a way we have never seen. Disruptors may arise from Asia or other companies we have not heard of. However, we should not bet again big tech.
David BaskinUnknown
COMMENT
Bank loss provisions. Banks make provisions for loan losses and then makes revisions based on actual loan losses. You can look into the financials to see the actual loan losses. However, provisions are forward looking and actual loan losses is backwards looking.
David BaskinUnknown
COMMENT
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The forward PE for the S&P 500 is 21. Based on averages of historical PE, the range is 15x to 17x. However, 5i believes the range should be somewhere between 18x to 19x. This does not mean that the benchmark should trade down to a long-term average though. Unlock Premium - Try 5i Free
Stockchase InsightsUnknown
COMMENT
The Reddit/meme trade and Wall Street investing Things have fundamentally changed. Shorters aren't targeting retail investors, but rather flawed companies that maybe shouldn't exist. Without short-sellers pointing things out--if people had listened to them years ago, maybe the Great Recession wouldn't have happened and been a disaster. He truly believes that big hedge funds are hiring people to stoke these Reddit chat rooms to stoke these rallies (like AMC this week). He can't judge whether that's right or wrong.
COMMENT
The weekly US jobless report disappointed today The Fed is doing everything right and the markets look great. but he doesn't know how long it will last. In the past 7-8 years, there are a couple down days, the market forgets why it went down, then we're off to the races. The market fails to recognize that age inflation is here and isn't going away. When the market figures that out, the US 10-year yield will be much higher.
COMMENT
The Reddit/meme short-sellers (i.e. AMC this week) soaring 83%. Short-sellers aren't going after retail investors, but bad companies. Price can be truth in that a company can issue shares at a higher price, but it doesn't change a company's business. Cinemark, for example, isn't going through a share price surge like AMC. Investing with an incentive to track momentum is what professional investors do, but this is not a case of Us. vs Them, David vs. Goliath, retail investors vs. Wall Street.
COMMENT
The US weekly jobless report disappointed today The VIX plunged 9% today, the dollar is down again, gold rallied, and megacap tech ourtperformed as the US 10-year fell. Today is a case of the market heading into the weekend seemingly with having no cares in the world with the Fed on the sidelines, and this worries him.
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