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The Canadian story is that our economy is running a bit slow. That's to be expected with the impact of tariffs and the trade war that's developing. Our economy is fragile, and interest rates have been high. It's all weighed on GDP.
Sets the stage for additional interest rate cuts as the BOC assesses the economy and what's best for it going forward.
He's preparing for an "anything can happen" environment. A medium- to long-term trade war is definitely in the cards as a possibility. A number of nations might agree to the US terms just to protect their economies. There will be some that will hold out.
It's a coin toss here, and there's no doubt that it'll affect the global economy. GDP numbers in the US came in a little bit light. It may be largely because companies and individuals imported a lot more than they produced in Q1, just to get ahead of tariffs. There's been a lot of disruption out there.
His firm has definitely gotten defensive. July 1 will be another big day for Trump to unveil what he's going to do with the counter-tariff measures.
No, not due to the Canadian election. The fact that it's done is probably a good thing for Canada, the economy, and international investment in Canada. All the drama that preceded and surrounded the election created great uncertainty, and markets just don't like uncertainty.
This minority government might be a good thing, perhaps some of the Conservative agenda items will get through. So all in, we got a decent result and added some stability to Canada that we desperately needed.
He invests in Telus bonds instead of the shares. Credit is very good, still investment-grade. Marketable assets. No issue with default in any of the big 3 telcos.
For the equity side: not a lot of growth, price competition, CRTC always making new rules. Big dividend is enticing, but not for him.
Likes the company and what they're doing. National presence. He sold because US counterparts were struggling, and he feared those struggles would bleed into the Canadian market. A big pending IPO in the US could take some of the lustre out of this name. CEO fears seasonal trends may not develop as usual this year.
At these levels, definitely hold. Might be a 2026 story. Be patient.
Disclaimer: He's pretty close with the CEO.
He likes the big integrated names, but doesn't own any oil producers now. His team deemed that group as having first-derivative vulnerability to tariffs on volumes and profitability. Premium brand in the space. He's waiting out some of the volatility on the price of oil before getting back in. Nice dividend.
Likely that interest rates are coming down. BOC overnight lending rate is 2.75% right now and headed lower. Short-duration bonds are just going to yield less and less, and you can't enhance that yield without taking on more risk. More risk involves either extending bond duration or buying lower credit quality (and that's a big risk with markets the way they are today). Yield spreads widen when we get volatility. When a low-quality bond starts to yield more, that means its price goes down.
So he likes the short-duration aspect of this ETF. He's used it himself for cash management. You won't make the kind of returns you made in the past. To get a higher yield, you may want to diversify into preferred shares or some very high-quality equities.
Lots of capex to fix issues with refining assets. Sold last September when sentiment soured on price of oil. Investor sentiment muted even when company reached deleveraging targets. Nothing materially wrong with it, whole industry has rolled over. Sharp management, committed to investors.
When he's ready to get back into energy, he'd buy this at a much smaller weight and buy some SU as well.
26% of net operating income is from MG, so being impacted by tariffs. He calls this a second-derivative target of tariffs. Shares are trading as though MG is going to move its operations to the US, but he doesn't think it's equipped to do so.
The price has dropped off materially. Big drop at start of April was related to tariffs, price has moved up since then. Office is a very tough space right now with effects of Covid. He's stayed clear of anything related to office. Preferred shares should be relatively stable and insulated from the volatility we see in equities. But looks as though this name has been caught up in all the headlines.
