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

Educational Segment. Seasonality matters some times and other times not at all. In the US, there is the presidential cycle that creates this pattern of spending. Right now, the Santa Claus rally is at its most powerful. In the first year of the presidential cycle, the pattern changes. January and February does not bode well in terms of returns. There will be a good opportunity in Q1 to put money to work.

Market. The market is focusing longer term, i.e. the vaccine, vs. the short term and regional lock-downs. Short term we could get some increased volatility but longer term it looks good. The market could be sensitive to any potential bad news like more potential lock-downs. The market is also discounting that the republicans maintain control of the senate and if the democrats get control of the senate, it could be bad for the markets. She has been out of the energy producers for a few years now. She sticks with the infrastructure names in energy.

Pipelines vs. Insurance. She has exposure to both. The pipelines are yielding in excess of 7% and they are safe dividends. She would lean towards pipelines due to this, but she owns insurance as well.

What would it take for her to reinvest in energy producers. It is driven by crude prices. You would have to have visibility of where prices are going to go. OPEC agreed to cut back production along with western producers. A lot of countries need $50 oil to balance their budget and would not be willing to cut back production. Hopefully Canada's take-away capacity increases in the future. She sees better opportunities than energy producers.

The markets don't care about the vaccine anymore, based on today's mixed close. The vaccine is baked in. Rather, investors are focused on the record number of Covid cases in America, 300,000 today alone. The outbreak is front and center....Judge the strength of the global commodity according to the commodity stocks. OXY-N Petroleum, for example, plunged 8% today after rocketing up since end-October. Exxon has had a big run, but was down 3.61% today.

It's gratifying to see what he thought would happen, happen. Given the strong rebound in demand, especially China and India, as well as the vaccine, it is promising. The world we enter into post-covid is tighter than before covid. It is quite bullish.

The fear of peak demand has brought about peak supply. Looking to 2021, all the signs point to demand recovering and the recovery will be faster than anticipated. US shale is also in decline. OPEC capacity will have little spare capacity. The oil price could go back to pre-covid levels.

Today was a tumultuous session driven by over-exhuberance (vaccine approvals) and fear (Covid cases). It comes down to short-term holdings--you own some stocks to own, others you rent like a hotel room by the hour. Don't overstay your welcome. If we see stimulus next week, markets will roar back. Markets have a new hope: FDA approval of the Pfizer vaccine which would happen any moment this weekend.

The IPO craze of 1999-2000 wiped out a generation of investors, and it could happen now. The recent IPOs (i.e. Doordash, Airbnb, Snowflake) boil down to MANIA. On Jan. 15, 1999, Marketwatch.doc debuted at $17, then after a long attempt to open (like Airbnb yesterday), the stock soared to $97.50, up 474%. Absurd but Wall Street liked it. Then in late 1998 (Nov.) theGlobe.com IPO'd 605% set a pattern among tech stocks. From then, the public wanted a piece of the easy money. Now, this week, Doordash and Airbnb IPO'd and soared as well (as well as Snowflake). The solution is to provide more stock on the fly during an IPO to meet additional demand when the public makes waves of market orders. This will create a more orderly market, which certainly didn't happen this week. If that doesn't happen, we'll see too many buyers and not enough shares. It's not healthy that a stock soars +100% above its IPO price. The pre-existing shareholders in a few months will sell their shares and these IPO investors will get crushed. This happened in 1999. However, the investment bankers setting up IPOs refuse to do this and are setting up investors and the stock market for failure. After all, people are making money. Who doesn't want free money? Insane. In 1999, there were more IPOs, but weaker companies, many of which went under and buried their investors.

Are we moving out of the valley of despondency over Covid-19? We've already done that. The market's decided it's clear sailing. Indexes reached record highs this week. He has no doubt that world GDPs will roar back in the second half of 2021, and so the indexes make sense. But he's worried there's too much enthusiasm, especially with the IPOs of DoorDash and Airbnb, which have never really been profitable. It gives him little shivers, reminding him a bit of 2000.

Controversy over the DoorDash and Airbnb IPOs. When people are enthusiastic, they find ways to look past the negatives. DoorDash is systematically bankrupting restaurants. No one knows how much demand will slip away once the pandemic ends. A prime example of people looking only on the bright side.

Gold. He's never been a gold bug. He doesn't understand the dynamics that move the price up and down. It's slipped about 10% since its highs. There are other ways to play a weakening US dollar: EM, non-US stock, developed Europe, or the TSX.

REITs. RioCan just cut distribution. Largest mall operator in Canada, and many aren't paying rent. Question is will people and tenants come back. It's on the wrong side of the trend. Steer clear. He owns CAP, apartment buildings are terrific assets. Also owns Crombie (grocery) and Granite (industrial) REITs.