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

Benefits of a Bond ETF. It is a basic liquidity ETF. GICs are locked up. Short term bond ETFs can be bought and sold any time. He prefers to look further afield for yield opportunities outside of North America.

He does sector rotation at this firm. Investors have raced into income in all sectors this year. You would do better in LEMB-Q. Utilities are a crowded trade.

The problem with the global economy is self-inflicted, namely the US-China trade war which has hurt the rest of the world with capex dropping around the world. It's impacted manufacturing, as in Germany (now in recession), but less so in the US and UK. The bigger issue was that interest rates have not normalized, but keep declining.... Peleton's IPO was today; there's nowhere to put money given low rates so they put it in stocks, so companies like Peleton can IPO. Also, investors don't know if we're headed to a recession, and the Fed suffers some confusion too--they're not sure how far to push down rates and how fast or slowly.

India's economy The issue with India, like all EM, is you need a very long-term view. It's one of the fastest-growing economies in the world with much potential. But India lacks China's infrastructure. Modi is going a good job growing GDP. India's tech is a tailwind. Expect volatility, so you need a strong stomach.

Market Outlook He expects the global economies will begin to slow down. Europe posted the weakest PMI it has seen in almost a decade. With interest rates so low, equities have been the place where investors have taken their money. Trade tensions with China are being reflected with the Chinese economy slowing as well now. Both sides have backed themselves into a corner -- it is unlikely a solution will be created before 2020, he thinks. He gives credit to President Trump for stepping up against China taking intellectual theft. He thinks the US Fed did not actually need to cut rates as this takes away the ability to do so later. The stock market will come under pressure when the Fed sends signals it will no longer drop rates.

REITs & utilities instead of bonds? If you are doing it for income and don't worry about volatility then REITs and utilities are a good way to go -- they have more tax efficiency and better yields. If capital preservation is more important, then holding bonds makes sense.

He owns a lot of cannabis stocks. Volatility is endemic; we've seen 8 uptrends/downtrends to date. He's been on offence and defence this year. He holds more cash than usual now though he's been deploying during recent volatility. He looks at the topdown and the bottom-up, especially in cannabis where there are many junior companies. To predict a recession, he looks at the inverted yield curve and other metrics.

The US market is news-event driven, namely the tariff war. It's hard to make a fundamental analysis. If the trade war goes down a dark path, we cut hit negative GDP growth. But he thinks Congress and Trump himself will prevent this. That said, the trade war is definitely a negative. Meanwhile, negative interest rates are messing up the capital--and especially bond--market. There's only so much the US Fed can do.

Are rate-reset preferred shares good for an RRSP? They always talk about preferreds as fixed-income, but they are not. With rates going down, these investments are down 20-25% this year. This badly hurts savers and seniors who need the income. Compare that to a bond which pays 2% typically. He stresses that these are not bonds. He will look at preferreds where they are really, really cheap, not now. There's no tax advantage putting these into an RRSP.

Convertible debentures pay well and offer little downside. They should be talked about more, much better than preferred shares. Problem is in Canada they are not liquid. Large institutional investors can't buy it; just retail. But he likes and own several of them.

Big news today was the impeachment announcement. The markets used to trade on earnings and seasonality... Nike reported after hours and beat in a big way, confounding China trade fears. The US Fed's 25-point cut was measured and smart. Germany just reported disastrous PMI numbers, and today America released weak consumer confidence numbers, so there is a slowdown. That said, consumers are still spending. He won't predict a recession. However, October is one of the most volatile months and the TSX is flirting with all-time highs. Be ready for big drops to swoop in. Beyond that, he sees good growth.

Market. There are weak economic numbers in Germany. You had BREXIT, Chinese trade, general slowing of world exports, rising interest rates and an inverted yield curves, and now we are seeing more and more of that showing up in real economic data. With Germany being so export driven you are seeing the lowest numbers in a decade in terms of German output. None of what the European central bank has done in terms of QE, and negative interest rates, nothing is going to solve or fix these economic cycles. Trump started a global trade war and contracted the global economy but it won't fix any of that. We need resolution of the trade issue to get through this. As long as Trump is running this we will not see any resolution to all this.

Gone to Cash, what is the timing on when to get back in. No one knows. Bond yields are so low it is hard to move to them as a safe heaven. Don't try to be in and out of markets because they are volatile. Sit down with a financial planner to plan out your financial plan within your time-horizon.