Market Outlook He is optimistic about the Canadian market. If you look at last year's 10% TSX drop, historically the subsequent market goes up 12% -- good 90% of the time, he says. Canada is very washed out in the energy and financial sectors. Multiples on banks have come down a lot, which should bode well for them. He does not think we are headed to a recession, relative to earnings growth. If we can see some stability, we can see some catch up on values. Small caps got hurt hard last year and he thinks that means a healthy rebound in this space.

Volatility from 2018 will continue this year as the cycle matures. He doesn't think a slowdown is imminent, but it will happen. We've seen a nice rally since Dec. 24 and investors are coming back. Geopolitical concers are also easing. US labour and manufacturing numbers meanwhile have been good. The US economy is still firm. Maybe we won't see new highs, at least not until China-US resolve their trade war, and he's confident it'll happen. He's overweight the US and underweight Canada now, and zero in Europe, with some in Asia, which is getting cheap (maybe add there). Canadian banks and insurers will do okay in 2019. He doesn't see a massive slowdown. He doubts the US Fed will hike beyond once this year; they'll remain calm. Key here is US-China resolving their trade war.