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Analysis and Opinions about A Commentary
Signal
Opinion
Expert
COMMENT
COMMENT
April 5, 2021
Jobs are coming back. Unemployment numbers in Canada are coming this week. There are a lot of positives that the market is celebrating. However, who is going to pay for all this stimulus? Right now, markets are okay and it should continue for the next 4-6 weeks. Valuations are problematic but some times the market doesn't care. Vaccine efficacy is positive.
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Jobs are coming back. Unemployment numbers in Canada are coming this week. There are a lot of positives that the market is celebrating. However, who is going to pay for all this stimulus? Right now, markets are okay and it should continue for the next 4-6 weeks. Valuations are problematic but some times the market doesn't care. Vaccine efficacy is positive.
COMMENT
COMMENT
April 5, 2021
Tax hikes and corporate tax hikes are coming. Funding gap is more than $2 trillion. This will suck a lot of money out of the capital markets. Liquidity is also a factor.
Show full opinionHide full opinionTax hikes and corporate tax hikes are coming. Funding gap is more than $2 trillion. This will suck a lot of money out of the capital markets. Liquidity is also a factor.
COMMENT
COMMENT
April 5, 2021
Crypto. Wouldn't recommend for the average investor. However, if you are going to invest, invest in the TFSA so you don't have to pay taxes on it. Good for speculative plays.
Show full opinionHide full opinionCrypto. Wouldn't recommend for the average investor. However, if you are going to invest, invest in the TFSA so you don't have to pay taxes on it. Good for speculative plays.
COMMENT
COMMENT
April 5, 2021
Bond ETF. Bond funds have interest rate sensitivity risk, duration risk. It is different from doing a laddered strategy yourself. The world is so sensitive to interest rates so bonds will be a bad investment for a while. A traditional 60-40 balanced portfolios will see stress. It will be a problem for the next couple decades. Central banks will probably continue to monetize the debt.
Show full opinionHide full opinionBond ETF. Bond funds have interest rate sensitivity risk, duration risk. It is different from doing a laddered strategy yourself. The world is so sensitive to interest rates so bonds will be a bad investment for a while. A traditional 60-40 balanced portfolios will see stress. It will be a problem for the next couple decades. Central banks will probably continue to monetize the debt.
COMMENT
COMMENT
April 5, 2021
Educational Segment. Earnings season is starting next week. Markets will be focusing on the earnings. S&P is now up to $174/share. With the S&P over $4000, the multiple we pay for the earnings is getting pretty high. The multiple of the market should be 16.5x, which is fair value. If we use a multiple of 20x, you get a $200/share number. Before covid, for 2021, we were expecting $200. Now 2022 expectations are at $200. The earnings are discounted into the future. The markets are expensive here. May will be interesting and we could see selling into strength.
Show full opinionHide full opinionEducational Segment. Earnings season is starting next week. Markets will be focusing on the earnings. S&P is now up to $174/share. With the S&P over $4000, the multiple we pay for the earnings is getting pretty high. The multiple of the market should be 16.5x, which is fair value. If we use a multiple of 20x, you get a $200/share number. Before covid, for 2021, we were expecting $200. Now 2022 expectations are at $200. The earnings are discounted into the future. The markets are expensive here. May will be interesting and we could see selling into strength.
COMMENT
COMMENT
April 5, 2021
Buy everything except the stay at home stocks, which is what happened today. We just saw blow-out jobs numbers. If everyone is vaccinated, we may return to record-low, pre-Covid employment levels, unless inflation spikes. These record highs have come at the expense of the stay at homes, which may see a comeback. But he thinks a slowdown won't happen. Meanwhile, he sees an uptick in index funds, which help lift FAANGs which are part of them. It's strange to see low-wage inflation now.
Show full opinionHide full opinionBuy everything except the stay at home stocks, which is what happened today. We just saw blow-out jobs numbers. If everyone is vaccinated, we may return to record-low, pre-Covid employment levels, unless inflation spikes. These record highs have come at the expense of the stay at homes, which may see a comeback. But he thinks a slowdown won't happen. Meanwhile, he sees an uptick in index funds, which help lift FAANGs which are part of them. It's strange to see low-wage inflation now.
COMMENT
COMMENT
April 5, 2021
The new investors who fuelled the Reddit short squeeze seem to be bowing out. One reason is that some of their stocks got crashed. Meanwhile, professional money managers have moved onto reopening plays and increasingly more back into big tech stocks. Those young, new investors still holding those Reddit stocks are waiting for them to bounce back to former lofty levels, but he doubts they will. The lesson: an investors needs to diversify into financials, retails or the rails. Boring stocks, but you need them.
Show full opinionHide full opinionThe new investors who fuelled the Reddit short squeeze seem to be bowing out. One reason is that some of their stocks got crashed. Meanwhile, professional money managers have moved onto reopening plays and increasingly more back into big tech stocks. Those young, new investors still holding those Reddit stocks are waiting for them to bounce back to former lofty levels, but he doubts they will. The lesson: an investors needs to diversify into financials, retails or the rails. Boring stocks, but you need them.
COMMENT
COMMENT
April 5, 2021
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The government is providing liquidity to the system through QE. More access to capital should mean banks are more willing to lend. However, savings rates have increased dramatically while spending and investments have not occurred at the pace that was expected. Unlock Premium - Try 5i Free
Billy Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The government is providing liquidity to the system through QE. More access to capital should mean banks are more willing to lend. However, savings rates have increased dramatically while spending and investments have not occurred at the pace that was expected. Unlock Premium - Try 5i Free
COMMENT
COMMENT
April 1, 2021
Too much euphoria in the market? Not sure it's euphoria. Aren't markets supposed to go up? 2019 and 2020 were spectacular years. And people are thinking the good news we expected in 2021, actually took place in 2020. Markets don't go up every single year. Even in times of good economies and fundamentals, the stock market will do whatever it likes.
Show full opinionHide full opinionToo much euphoria in the market? Not sure it's euphoria. Aren't markets supposed to go up? 2019 and 2020 were spectacular years. And people are thinking the good news we expected in 2021, actually took place in 2020. Markets don't go up every single year. Even in times of good economies and fundamentals, the stock market will do whatever it likes.
COMMENT
COMMENT
April 1, 2021
Just a sugar high with governments propping up the economy and low interest rates? Go back to January 2020, the outlook was really good. This is what governments do to protect the economy, people and business. Hopefully it's onwards and upwards from here.
Show full opinionHide full opinionJust a sugar high with governments propping up the economy and low interest rates? Go back to January 2020, the outlook was really good. This is what governments do to protect the economy, people and business. Hopefully it's onwards and upwards from here.
COMMENT
COMMENT
April 1, 2021
Interested in energy? No. He doesn't want oil to go negative or stay low. But we have to start preparing for a post-carbon world, and we have to get there sooner rather than later. You don't want oil to drive economies for the next 30 years. He'd rather own companies that can set prices for customers, rather than betting whether the price of oil will go up or down.
Show full opinionHide full opinionInterested in energy? No. He doesn't want oil to go negative or stay low. But we have to start preparing for a post-carbon world, and we have to get there sooner rather than later. You don't want oil to drive economies for the next 30 years. He'd rather own companies that can set prices for customers, rather than betting whether the price of oil will go up or down.
COMMENT
COMMENT
April 1, 2021
Outlook for rails as coal is phased out. CP rail still moves a fair bit of thermal coal, which is decreasing. CNR gets more of its revenue from metallurgical coal, which is increasing. Both provide only a small portion of revenues. They also move chemicals, lumber, autos. If you're betting on worldwide economic recovery for many years, as he is, you have to own the railroads. He's a bit nervous about the acquisition of KCS, but if that goes through, could be terrific. Incredible performers over the long term, and no reason this will stop. He owns CNR, but would have no problem holding CP. Keep holding.
Outlook for rails as coal is phased out. CP rail still moves a fair bit of thermal coal, which is decreasing. CNR gets more of its revenue from metallurgical coal, which is increasing. Both provide only a small portion of revenues. They also move chemicals, lumber, autos. If you're betting on worldwide economic recovery for many years, as he is, you have to own the railroads. He's a bit nervous about the acquisition of KCS, but if that goes through, could be terrific. Incredible performers over the long term, and no reason this will stop. He owns CNR, but would have no problem holding CP. Keep holding.
COMMENT
COMMENT
April 1, 2021
Canadian or US banks, lifecos, car makers, or FANGs? Thinks of best business first, and then country second. His clients own National Bank, TD, RY, and JPM. Best banks with the best management teams. Jaime Dimon at JPM is the very best. In Canada, his favourite is always National, with smart acquisitions and growing in wealth management. All Canadian banks are under-levered. You have to be there.
Canadian or US banks, lifecos, car makers, or FANGs? Thinks of best business first, and then country second. His clients own National Bank, TD, RY, and JPM. Best banks with the best management teams. Jaime Dimon at JPM is the very best. In Canada, his favourite is always National, with smart acquisitions and growing in wealth management. All Canadian banks are under-levered. You have to be there.
COMMENT
COMMENT
April 1, 2021
Interested in lifecos? Not as much. It's a harder business to figure out. Though as interest rates go up, it is beneficial for the lifecos.
Show full opinionHide full opinionInterested in lifecos? Not as much. It's a harder business to figure out. Though as interest rates go up, it is beneficial for the lifecos.
COMMENT
COMMENT
April 1, 2021
Pipelines. Not that interested. Scarcity argument is a strong one for putting value on pipelines. They were cheap in 2020, but not now. Also face concern about rising interest rates.
Show full opinionHide full opinionPipelines. Not that interested. Scarcity argument is a strong one for putting value on pipelines. They were cheap in 2020, but not now. Also face concern about rising interest rates.
