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

Markets. Ignore the tweet noise. Earnings are fabulous, slowdown in manufacturing, crazy negative interest rates globally except for Canada.

Interest rates in Canada. BOC reluctant to cut rates. But if the US keeps cutting, Canada will have to as well. If things don't improve globally, we can expect cuts at home. We aren't falling off a cliff globally. You can still make money in equities in uncertain times if you just hold tight. TSX is at all-time highs.

Uncertain times. There will always be uncertainty. He can't say if current uncertainty is "more uncertain" than previous times. If you're going to be in the market, this is what happens. Ignore the noise, focus on quality assets, and stay invested.

How to make 3% and sleep at night. Tax consequences, what's your health situation, how much do you need to live on, age, short and long term horizons? All go into designing a portfolio. Bottom line is there's no such thing as a safe return. There are fees, taxes, inflation. Strangely, dividends are giving you more than bonds. So equities in good quality dividend players, ETFs, and some fixed income could last you for the long term. Just don't chase yield or gold.

Market Outlook He believes his most memorable call will be what he thinks today about gold stocks. He is very bullish. The mathematics behind his calls includes the analysis of nation states. He wants to know the precise point at which the GDP starts to fall under the rising debt. He believes this occurs when debt exceeds $3.50 per $1 of GDP. Japan, the US and the Eurozone are at those levels now. Negative interest rate curves is telling us that the rules of the game are changing -- value is disappearing. You better get yourself invested in something that is not disappearing -- GOLD. Central Bankers are using modern monetary theory -- it does not matter how much debt you use, just as long as there are buyers of the debt. The problem comes when debt grows too high you see another situation of 2008 -- and the market collapses.

A 10 year review Since being on the show over 10 years she likes to stress that investors remember that you are investing in companies. Well run companies, at a reasonable price, can be held for many years and you can do well. You don't need to be a trader to do well.

Silver She does not own any silver or gold companies. The gold-silver ratio is near historic highs, making silver a better value relatively speaking.

We didn't get guidance from the Bank of Canada today. Will we see more easing from them? They're not in a hurry to cut, like America, and they don't need to. Meanwhile, the US Fed is a lock to cut rates this month, probably 25 basis points, then another 25 before the year ends. After that, he doesn't know. The market is pricing in 3-4 cuts in the next 12 months. A high dividend stock alone is like cotton candy--not nutritious. You need to look at many metrics, including new management, long-term outlook, etc.

No, the US and China won't strike a trade deal, but, yes, a truce of some sort. Investors are coming back in September, back to work. Everything today was working against the market. As long as trade uncertainty hangs over us, expect the fall to remain choppy. But overall, the market should be good until 2020. We're in the middle of Fed easing and rate cuts, which he expects to happen once or even twice by the end of the year. That'll keep the consumer and manufacturers alive. So, no recession soon, though it will happen down the line. The scary thing for him the growing amount of debt, not a recession. The street believes the Bank of Canada will do nothing tomorrow with interest rates. The economy is still strong and unemployment is still low. Like the US, our overnight rate is higher than the entire yield curve--and this can't sustain.

The market has performed well so far this year, despite volatile geopolitics. Fed interest rate cuts have fuelled the rebound in stocks, and consumer spending has helped. That said, a there's a growing chance of a recession in 2020. The US Fed and European Central Bank will continue to trim interest rates for the rest of this year. The US consumer remains strong, so any sudden decline or spending or confidence will mean a recession. Brexit and the Hong Kong demonstrations may add to volatility this fall. Expect volatility for the rest of the year. He's betting defensive by holding REITs and utilities for their dividends, and healthcare and tech for growth.

The energy market is broken: oil is up 24% year to date, but oil stocks are down 20-40%. Nobody cares. But in Canada, oil makes up 11% of our direct economy. There's a buyer's strike in the small/mid-cap space, a lack of fund flows. And yet, these oil companies are generating free cash flow yields of 20-40%. They could pay down debt or pay a 20-30% dividend or (recommended) both. The profitability of these companies is high. OIl companies should buyback shares. There's isn't selling pressure, but there aren't buyers. Many names are down 70-80% in one year, horrible. Oil investors have been bruised and remember it. There's a disconnect between investors and stock fundamentals. Stocks are trading at a discount to their liquidation value; the combined market cap and net debt is now trading at a 70% discounted value to that cash flow stream. It's like getting $6 billion for free in a company. To change this sentiment will be serious share buybacks and, when production growth rates of oil in the States massively decelerated--sentiment will change overnight.

Why does shale production keep increasing and when will it stop? U.S. shale will continue to grow for 4-6 years, he guesess, but what's important is the growth rate slowing to the point where DEMAND growth for oil exceeds the growth rate for US shale. US shale has grown because (say recent studies) companies are simply drilling their best rocks. Now, such companies are exhausting their inventory as investors want some of their invested money back through buybacks and shares. The year-over-year growth rate in shale is collapsing; he predicts below 1 million barrels/day rate by the end of 2019.

Why aren't we seeing more M&A? There's no perceived difference between quality and junk stocks, so they're all trading at a similar valuation. Also, in Canada there's board entrenchment--why would a CEO, who owns a ton of his company's stock that has plunged in value, want to fire himself by merging with another company? If he could, he'd raise private equity and buy a company like CPG-T, but the interest isn't there...But all it takes is one company to go private to trigger others.

Hasn’t been a quite summer. There’s a disconnect in the market. Fundamental data looks good, but there is negative sentiment and fear. He’s afraid that there might be a self-fulfilling prophecy.