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

Working from home has increased demand on data and telecom systems. Demand on networks has increased dramatically and not stopping any time soon. Looking out 3-4 years, we'll probably double amount of data created in all of history. Data centres, cloud computing, cell tower storage will all increase to keep up with consumption demand and bandwidth.

With equities at historically high multiples, is it hard to find value? Yes. Multiples climbed dramatically in 2020. So he wants to focus on earnings growth and dividend growth. A good place to be if there are any hiccups in the recovery, but also to gain leverage to an accelerating economy.

What about the Biden plan for infrastructure? The new stimulus package will have trouble passing. Biden has touted infrastructure spending a lot. We'll have to see how much progress is made in infrastructure. In the US, building infrastructure doesn't depend on federal intervention, as states can enter into public-private deals, and many have already done so.

A company that might benefit from EV and installing charging stations? There is ChargePoint, but you're paying 10x sales. Charging stations will be monetized eventually and very competitive. He prefers to go through the renewable energy developers, as they have estabished track records, are cashflow positive, and without astronomical valuations.

Is the Reddit episode behind us? He hasn't wasted a lot of effort on that circus sideshow. It's almost an idealogical crusade, rather than about the money. They're playing Russian roulette, but one spin away from the lights going out. Hopefully it's over, and now everyone can go back to focusing on fundamentals and macroeconomics.

Encouraging signs in the macroeconomic landscape? Not everything is sunshine and roses, as employment numbers are not that great. But personal incomes are holding up quite well. Retail sales are holding up pretty well. Ongoing, tremendous strength in housing. Economic variables are validating their expectations for a robust economic recovery in 2021. Should spill over into corporate earnings.

Favourite stock in renewable energy? They don't own any of the pure plays. Try Northland Power, wind and solar outside Canada. TransAlta Renewables is another. The whole space has the sun shining on them, with both Trudeau's carbon taxes and now the Biden administration. A lot of money flows into the sector, with government policy behind it. Also ESG is really quite a juggernaut.

Canadian big 6 banks. Hard-pressed to go too far wrong owning any of the big 6 banks. 4-5% dividend yields, which grow at high single digits most years. Credit losses are behind them. Net interest margins still under pressure, but banks earn their way through whatever the economy throws at them.

David vs. Goliath as retail investors take on big hedge funds. But you're sticking it to the man buying GameStop. Rather, you buy stocks to make money. GameStock is an ailing business. Robinhood has already delivered the revolution with its app to promote investing. Guide for new investors: choose stocks that will rise higher; don't demolish the fat cats but read annual reports; stocks do crazy things because investors have emotions and are unpredictable; the government won't ride to the rescue (they're busy with the pandemic and running the country); buyer beware when you buy any stock (there are no guarantees); don't borrow money to buy stocks, because margins enlarge losses; and keep a sound head and do the homework.

The Reddit short squeeze: with markets you always see new things. Unpredictable. After a week, the element of surprise is gone, but it's possible this could happen later to other stocks though the effect will be weaker. People who bought may be in a losing position now. Wider markets could be choppy this month, given investor sentiment being overblow in January. Now, that sentiment is peeling back. Also, February tends to be seasonally weaker. So, he's raised some cash and is putting it to work on down days.

Market. He is worried things are looking toppy and we are in a bubble of some sort. After stocks go public, the stock goes way up before the money is even spent. When you look back to 2001, not all stocks got hit. A lot of the rest of the area other than Nortel was not hit that hard. There are pockets of the market where you will be okay. He is optimistic that the vaccines will come into greater use and the pandemic will come under control. The trajectory for stocks over the next few years will be higher. There are going to be corrections along the way, but you have to stay invested in stocks.

Silver. It is still trading at a discount to gold, relatively. There is still industrial applications. He would hang on even though we had a big move up. He would take silver over gold at this point.

Rising margin debt. Every major market peak we have had, there is an element of speculation. You can't time these things however. You are seeing the froth and the leverage coming through margin accounts. It speaks to the expansion of credit margins and the quality of the value is entirely speculative. The rally we are seeing is not on fundamentals.

Silver. There was a natural opportunity in the short for GME and other stocks like this. However for silver, the market is massive so the dynamics are very different. Redditors will have a difficult time pushing this higher probably.