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

Japan? Japan is the King of negative rates. It has been tough for banks there. You probably want to stay away from regions with negative interest rates in general. If you want global exposure, you may want to hold US banks who have expanded globally.

White House has discussed de-listing Chinese companies We all want this situation to get better. Let's hope they do not de-list companies and worsen things.

Impact of negative interest rates? A lack of alternatives is driving investors right now. Equities are still the place to be. We need to see earnings growth again to bring focus to the market. CEOs are getting concerned about changes in business decisions -- delays in capital expenditures, for example. US Consumers are still in a good spot and so is labour. As long as the US consumer is doing well, remain in equities.

Global investing? He is a big fan of investing outside of North America -- especially into EU infrastructure. On the trade front, the Chinese-US tensions will be resolved. He expects the US to resume its dominance eventually. China is doing a good job on R&D, but it will never be the world financial centre.

Negative Rates. ECB Chief economist has said there's plenty more rooms for them to buy more bonds. However, who else who buy bonds with a negative yield? Along with Japan, one third of developed world bonds have negative yield.

He thinks bond interest rate in the U.S. could go lower. If the economy is badly effected by Tump's impeachment or trade war, you could see rates cut. He doesn't think they will go to 0% but could see it quite low.

It's not a big surprise that there is further escalation of trade war talks seeing as it's gone on for so long. China's economy is slowing because they're export oriented, so it would be in their own interest to strike a deal. However, they have to do it without losing face. It's a question of striking a balance.

If there is a shut down of the US government, you could see the USMCA could get lost in the transition. However, there are plans to push it through regardless.

Market. This year has been a very strange year. Typically when you have a year when stock markets are up, investors chase those returns. Investors have raced into bonds of all stripes. Memories of more mature investors move back to 2008 with a kind of investor PTSD. The outlook is one of stabilizing growth – easing monetary policies and a very different set of circumstance. This is the first time that lowering of interest rates has come without any strong evidence of an economic recession. They are being pre-emptive with rate cuts.

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.