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

Yielding oil companies such as CNQ-T (Owns), WCP-T, VET-T. CNQ-T is cheap and trades under 5 times cash flow and has great assets. He has been buying it. VET-T is a great company and has maintained their dividend over a dozen years. WCP-T is smaller but an excellent company and trading at a cheap valuation.

Best North American Pipelines. ENB-T and Pembina are the best. You want to see dividend growth. PPL-T is good also.

US stocks hitting record highs. Pushing to new record highs. Weaker economic data fuelling investor optimism because of more dovish Fed rates. From technical perspective, it's a bit frothy. US economic expansion is the longest ever, and will continue. No signs of recession in next 12 months. But good idea to push toward more defensive stocks.

A trader's market? Yes, but potential downside risks. Still have US-China trade issue. It will be resolved before US elections next year. Market doesn't want new tariffs. Also have to watch for slowing, aging global economy. Markets continue to push higher, but have to be cautious. Approach equities more selectively going forward.

For Fed QE, 25 or 50 basis points? Thinks consensus is 25 points later this month. Look at the FANG index, compared to the S&P which has outperformed by 20%. Don't have too much in tech.

Price of gold? Broken above an important technical ceiling, so there's more upside. Holds 3-4% gold as a hedge against what else is happening in the other riskier assets in the portfolio.

Today's record high was a "melt-up." If it continues to go, then this melt-up will be driven by FOMO, rather than stock fundamentals. Likely, we'll see more interest rates cuts in the US of 25 basis points--but we don't need this. There's a ton of investment money out there already, so we don't need that cut. Potentially, trade tensions will ease. Nothing happened at the G20, really. The new NAFTA signing faces a 50/50 chance to complete, given the political turmoil in the States. He expects the China-US trade agreement might happen next year, yet maybe not. Trump has long been playing the trade card with his base, based on trade deficits--which aren't as bad as Trump is leading people to believe. Manufacturing has left the U.S., but the US economy is NOT manufacturing, but high-end service. He's dumbing down issues to play to his base.

Convert ETF bond funds to rate reset preferred shares? They reset the dividend at some point on the yield curve, maybe 1% above the 5-year rate on Canada bonds. The benefit is that if interest rates go up, they will raise their yields which will stabilize their price. They are being impacted by those resetting their rates today as interest rates decline. That's negative. Preferred are better than bonds only if the preferreds are good quality; preferreds pay a better yield and offer a tax advantage.

I'm 90 and love banks, but what happens to the money I invest in those banks. Should I stop investing? You buy a bank GIC that pays under 3% annually for 5 years or you can buy a bank stock that pays a higher yield, offers tax advantages and rises in share price. Which is better? Keep investing.

I'm concerned when funds keep issuing shares over time. Is there a risk of too many shares in a regular stock and the chance of a rollback? No. They are issuing more shares, likely for institutional investors. So they would buy more of the underlying product to support the ETF.

Market Outlook He likes to buy on the contrarian side, when things look really out of favour and sell when everyone gets excited. He needs to be patient sometimes, but he is also willing to cut losses. He will hold for years, especially if he receives dividends to wait. He thinks investors are not patient enough and that leaves them vulnerable to noise in the market. Active funds have been found to have poorer results than passive funds and the fees can kill you over time.

OPEC will extend cuts. OPEC did what they had to do. They can't increase production or else prices fall. If they decrease, then US shale is around for a lot longer. They are caught in a vicious cycle. Slower economic growth hurts oil, too. Christine Lagarde will head the ECB, just announced. She's intelligent and can run the ECB, but she's a lawyer, not an economist. Will she understand the details? Then, again, Powell is a lawyer too and seems to be doing well. Likely, she will keep rates low and maybe do a round of QE though several nations, especially Germany, want higher rates. Overall, lower rates will help stocks.

He looks for under-the-radar stocks that show (the potential for) outsized growth. One sector he follows is cannabis, which has pulled back a lot since April and suspects it is nearing the bottom, so he's starting to buy again.

Oil sector Canadian oil and gas have been in a very tough space for the past three years. If you own these stocks, don't sell them. Sentiment is depressed, so when that sentiment revives, these stocks will probably move up fast and suddenly.

What do you see out there? Little flourish right at the end of today, which was encouraging. Most gains in the first half came at end of first quarter. In the S&P, we're reaching a top again that we saw last year. We're either going to break out with the volume, or fall 5-10%. He'll be watching the markets carefully next week.