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

Educational Segment. The Corona Virus. People have no idea how this I going to play out. Unlike SARS, we are at market highs. Corona is way bigger than the market thinks.

Market. For the past few years it has been buy the dips on these kinds of reactions. The market is expensive so you will never be able to catch the bottom. The market was looking for an excuse to blow off some steam. You might want to nibble a bit but it is probably not over yet. The volatility will probably persist. He would be careful of companies with too much dependence on China. Defensive names, telecom, renewable energy, and utilities could be bought on dips but it is on a case by case basis.

Each correction is different, depending on how deep it goes and for how long. In the past month, sure we've hit highs but below that things are murky. The TSX held up better because of our big financial component. He doesn't see the TSX correcting that much. Gold went up, but the US dollar failed to and is starting to roll over. Oil recently bottomed and today it sold off, but its outlook is looking better. Gold has spiked and went up today, though there wasn't a rush to the US dollar. After gold's spiky move of late, he expects it to come back a little. He expects another wide market sell-off Tuesday. Doesn't expect more QE, because the market fundamentals remain strong. The US treasury yield hit $1.37 today which is the floor, the September 2019 low. Based on past bottoms, the yield should rise from here.

What indicators do you use for technical analysis? One isn't enough. Actually, some of the best traders use just one indicator like the 200-day moving average. He likes the RSI vs. the index, a simple--is my stock rising against the index? He also likes the Williams %R (https://www.investopedia.com/terms/w/williamsr.asp). If one indicator works, then that's fine.

He wasn't concerned about the coronavirus, but now he's seeing more stress in the global supply chain. Everything's being produced in China and it's being cut out. There will be some supply chain issues that will arise. It will be good for gold since it will be a slow-down.

Gold and precious metals is a good place to be in this uncertainty. The safety trade makes a lot of sense. He bearish on the economy but it is nice to see gold rising higher. Gold is the ultimate safe haven for him.

He's lost trust in the fed since 2008. At some point, you have to stop printing more money. Ultimate utility of debt will run out and you will have to dip into reserve. He's bullish on gold. He has positions in place and now he is looking at other areas like blockchain that is fascinating. We just crossed the billion threshold for Ethereum based apps.

The value of the blockchain will grow with the coin. It is a ledger. Blockchain is the solution. Gold and blockchain can coexist together. There's a lack of understanding of what money and currency is and its differences.

Market. The market is a little bit frothy right now so you expect a little bit of a pause. Then the Corona virus is taking a bit back. We are responding to the FED and the Corona virus. If the economy falters a little bit, the FED will come into the market and try to support it. Morgan Stanley is taking over E-Trade in a multibillion dollar deal in an all stock deal. This is not an opportunity to get in. Is there really going to be that much synergy? And we are at a market top. They are paying a lot for it. The fund he works with is fully invested. We are a couple of months away from where the market seasonally moves into a more unfavourable period. He thinks you need to be a little more defensive now. L-T is perhaps a little too defensive. It is too early for that one. Gold is just finishing its seasonal period of strength. The Corona virus is an unknown. There is a lot of optimism about its being contained at present. There is a greater risk that this is different than SARS.

Impact of coronavirus? Pickup in the economy in the second half of the year will probably be delayed.

How long can the Fed fix every single problem? Market is complacent, and the Fed is accommodative. Not a lot of liquidity out there, and the easy place to be is the market.

Both stocks and gold are hitting all-time highs. Which is right? There are still value stocks out there trading at 10-18x earnings, with good businesses, good earnings growth, and increasing dividends.

Are people looking for yield in dividend plays? Yes, but there are lots of good companies with lower yields, but increasing them at more than 10%. Tries to mix his portfolio of stocks yielding 3-4-5%, with companies that are growing their dividends faster.

What are you expecting from the banks? It'll be slow, with an increase in credit loss provisions. Reasonable quarter, with stock prices down. He has a fairly significant position in both Canadian and US banks.