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Doesn't really surprise him too much. Trudeau government is past its best before date for the most part. Pretty clear that we'll get a change in leadership with the election next year. Anyone with future leadership ambitions in the party is trying to distance themselves from Trudeau.

Clearly, from her statement, they weren't aligned on how tax dollars should be spent. "Gimmicks" was the right way to categorize the GST holiday and $250 giveaway; complete nonsense from anybody who has any fiscal responsibility whatsoever.

To be fair, governments had to spend a lot of money to pull the world out of the Covid downturn. No matter who was leading. Excess spending in the US probably accelerated inflation, as it did here in Canada. Similar events happened in Europe.

He's not so sure the opposition in every country wouldn't have done exactly the same thing. Nevertheless, people are voting for change. Trudeau government has been in power a long time, and it's time for a change. When a finance minister resigns, typically you'd expect negative impact on the CAD. A change in the Canadian government might actually be a positive for the CAD.

Not a fan of the bond market here and where yields are. But if you do need to rebalance, try this one. He likes it a lot, and it'll do you well for the next few years.

However, he'd suggest looking at the bonds in some of the ETFS and going out and actually buying the bonds. This way you avoid the management fee, and you can customize your outcomes better in terms of a laddered bond portfolio.

That's a very specific question about one investor and their financial circumstances, risk tolerance, etc.

If we're going into an environment of slower economic conditions, then ZWU is likely to do a bit better. This would be due to the Canadian banks pulling back. He loves them both, great exposures. A bit concerning if all a retiree's portfolio is in just those two vehicles; there's not much diversification either within or outside of Canada.

Consider adding ZPAY, which gives you some US exposure to big banks and tech, and with a lower risk profile.

Good way to add diversification for a retiree. Gives you some US exposure to big banks and tech, and with a lower risk profile.

He doesn't see a hard recession coming, though any recession in Canada will be harder than in the US. In a hard recession, Canadian banks can easily fall 20-30%. A lot of the rally in recent months has been the recognition of aggressive rate cuts by the Bank of Canada. A lot of that's already in the market, and you have more downside risk than upside potential in terms of the next year or two.

That doesn't make it a bad ETF, but the question is what are you going to put your money in to generate the same kind of yield? He'd suggest considering a tilt more toward ZWU. This would give you diversification, plus let you keep your high-dividend yield with tax-friendly exposure for Canadian taxpayers.

Very broad exposure to the Canadian market across all sectors, with a covered call. Very tax-efficient for Canadian taxable accounts, which is why he likes it a lot. For new money, likes it better at $16 than at $18.

Last summer, he was adding under $60. Recently trimming above $65. That's the approach he's thinking of for the next few years.

He likes natural gas as a transitionary vehicle as we move off carbon in the decades ahead. There's a lot of it around, so doesn't see this being a growth stock. Buy when weaker, sell when more expensive. That's how he's thinking about a lot of the energy stocks. See today's Educational Segment.

An ETF that has derivatives around it to generate extra income. These are gimmicks. They found a way to charge a management fee for you to buy a stock, just by adding an options strategy. For example, NVDY has underperformed the stock NVDA by 50%, yet charges a 1% MER. 

If you like the underlying stock, just buy that and forget about the yield.

An ETF that has derivatives around it to generate extra income. These are gimmicks. They found a way to charge a management fee for you to buy a stock, just by adding an options strategy. For example, NVDY has underperformed the stock NVDA by 50%, yet charges a 1% MER. 

If you like the underlying stock, just buy that and forget about the yield.

The ETF companies don't earn anything from the amount that trades. But the volume does speak to investor interest in an ETF. An ETF that doesn't trade a lot is probably not long for this world, as it won't be economically viable. Typically, any ETF should have at least $25M of capital after being live for a year or two.

Volume is one thing to look at, but not the only thing. Look at the assets it contains.

You have to understand what they're doing with the covered calls. Some of them write right at the money, some of them write out of the money, and some only 50% of the name. And on it goes.

Here's a rule of thumb:  if they completely overwrite the entire portfolio, you're going to get a higher yield, but lower upside traction. If you're bearish, that would be a better one to play. If bullish, you don't want it -- you want writing out of the money, less yield, but you get more upside capture.

You really have to look at the strategy and understand it. It's not whether one is better than another, it's about the market environment you're in. He has no problems switching ETFs within a registered account, as these aren't taxable events. But in a taxable account, if you're constantly switching, you're probably generating a lot of tax for no reason.

Outlook for 2025

The "fearless" forecast. It's fun, and everybody does them, but nobody really knows. 

The Fed is meeting this week. A couple of months ago in their Summary of Economic Projections, they thought US GDP would be 2% this year. It's 2.7%. They thought the unemployment rate would be 4.4%. It's 4.2%. Inflation was supposed to be 2.6%, and it's 2.9%. There's no reason they should cut rates this week, yet they are going to. His point is that forecasting's very hard.

A year ago, when we looked at the Wall Street consensus for earnings, $233 was the number. When we get to January and earnings for Q4, looks to be around $241-242. So they underestimated earnings  growth. But the median number for the S&P was expected to be 4850, with the most bullish strategists pegging it at 5200. Yet here we are today with it pushing on 6100. Even the most bullish bulls were not even close last year.

He was overly cautious last year. He figured the chances of a recession were really high. Usually when there's big consensus in one direction, something else is going to happen. He was right, but in the wrong direction. 

Let's turn to next year. Wall Street consensus for earnings at end of 2025 is $267. So a 12% increase from where we are today. Average S&P forecast for 2025 is around 6500. Bulls see the S&P ending at 6700-7100 next year. This year there's a lot more optimism, and the markets are significantly more expensive. Last year was expensive at 20x; this year is 25x and expectations are for it to maintain that premium.

Again, he thinks something different will happen in 2025. If you look at history over the past 100 years, no one really knows what's going to happen after back-to-back years of stellar performance. He suspects markets will be flat to down a little bit. Given Trump's policies, odds of a recession will be pushed way into the future.

For the bond market, bonds are broken. US treasuries are the benchmark of the world, and YTD they've returned 2%, pretty much a failure. Bonds have done a bit better in Canada with our structurally weak economy; but most of the gain has come in the last month. Don't expect that from Canada going forward. Cash will beat bonds in the next year or two.

On crude oil, he sees us being range-bound for a number of years. Everything has been positive for oil and gas, yet still can't hold above $100. If we go into a downturn/recession, can expect a dip below $60.

Gold had a breakout. He's expecting sideways consolidation for the next year or two, not acceleration above the top of the trend channel.

CAD -- above $1.40-1.42, long-term owners of USD should hedge that. You want to buy Canadian dollars on international markets, especially if we get a change in government next year. Canada is a buy.

That's a very specific question about one investor and their financial circumstances, risk tolerance, etc.

If we're going into an environment of slower economic conditions, then ZWU is likely to do a bit better. This would be due to the Canadian banks pulling back. He loves them both, great exposures. A bit concerning if all a retiree's portfolio is in just those two vehicles; there's not much diversification either within or outside of Canada.

Consider adding ZPAY, which gives you some US exposure to big banks and tech, and with a lower risk profile.

Today's resignation by the Finance Minister on the same day as the fiscal update is not timely. Today the Nasdaq is hitting new highs. We've had two straight years of strong returns, which is unusually. The TSX is up 20% this year, playing catch-up vs. the S&P's 25%. The market is discounting good news. The market expects Trump's presidency will see more M&A and investment. Consensus says that S&P companies will grow earnings in 2025 by 14% from 10% this year. Canada's weaker economy has seen interest rates fall much faster here (75 basis points), though cuts may be more measured in 2025. Now, the mortgage market is better. The banks just reported the positive effect of lower rates should be felt in latter-2015, which is good. The street expects the US Fed's Powell to cut, but watch for his comments and tone.