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

Banks. We are in the longest bull market in history. We are long in the tooth. Invest a little at a time going forward, investing more if the market goes down. He thinks there is a negative overhang on the Canadian banks from housing. He suggests keeping adding as markets go down.

Mexico and the U.S. strike an early trade deal: Typical Trump--he solved a problem he created by crapping on NAFTA. But nothing was signed today; they agreed on things. The whole process was divisive, alienating Canada from the talks. The market continues to give Trump these passes. He's reviving businesses that died 40 years ago. The warning signs are going up anyway. Economies have been strong, but stock markets look forward--and there are cracks. For example, why is copper rolling over, if things are so good? Turkey and Venezuela are falling apart. Even Japan and Europe are seeing sloppier numbers. Tax cuts have poured a little fuel on the U.S. market fire, but the cost will be the huge deficits to pay later. The U.S. is drinking the Kool-Aid. ETF flows are really keeping the market going, and when they stop, the market will tank. Overshoot on the upside, then overshoot on the downside. The question is when exactly it happens.

American financials have been flat since March, but tax cuts are putting money in the pockets are American consumers. Why? He agrees. It's surprising. BoA has the best valuation upside. The U.S. financials are telling us something negative about the rest of the market. The 10-year US treasury hasn't broken above 3%. That said, valuations are cheap.

Silver: The US dollar will face downward pressure and silver will decrease with it. Buy it then.

Market. The average bull market usually lasts 14 or 15 years. Some thought this bull market began when the lows were hit in 2009. He believes this new bull market didn’t start until 2013 until the old high was taken out, the breakout point. So there could be another 5 years or more left in this bull run. Today we are testing the January highs of this year. Right now, it is just a correction until a major low is taken out. He does not have a bearish case, just a case for pause. He expects to see a summer correction which becomes a buying opportunity.

Technical Analysis indicators. Start with trend, higher highs and higher lows. Once that is established, then start using indicators. To confirm trend, always use 200 day moving average, if you are a midterm trader. Then would use a longer term momentum indicator, telling us the velocity of a stock. Then would use money flow. This tells whether money is flowing in or out of a stock.

Seasonal Technical Analysis. Seasonal references are available on his blog (Valuetrend.ca) that references websites that provide this information. You have to look at charts through a logarithmic scale that would address both the percentage gain and dollar figure.

S&P 500 and NASDAQ hitting record highs. Earnings have been very strong. Two-year swap spreads give corporations tremendous access to capital. Tech has been leading the way. VIX is at 25, which usually signals risk is away from the market, notwithstanding trade wars and benign nature of the yield curve.

The VIX. The VIX was at 60-70 back in the day. The big driver is technology. Consumer staples are doing well, drug companies turning around. VIX signals market’s ripe for M&A activity, especially drug companies and tech.

How far can this bull market go? VIX level signals risk is gone. Presidential unrest could bring risk back in, and give you another buying opportunity. Looking at a company’s fundamentals, if you think that revenues and earnings can grow, market shenanigans beget buying opportunities.

Interest in the cannabis sector by Constellation and Diageo. The space has been the go-to sector in Canada for a lot of international companies. The valuation can be justified by having a big company behind it. For a beverage company, in the wake of declining beer sales, they need to bet on another asset class.

Market. If the US president would be impeached what reaction would we see? Markets do not like uncertainty so if that scenario played out the markets would be uncertain as to who would get in next, etc. The market has had time to digest Trump's approach. The world would not end but there would be meaningful volatility of 5-15% of he was impeached. This is now the longest bull market in history so people are trying to guess when it will end. Going to the sidelines has shown to be risky over the last few years. There is nothing out of the ordinary or a reason to hit the panic button. He gets concerned from a geopolitical perspective that the market is incorrectly balancing the bad with the good. This could lead to a meaningful pull back. You need to look at what you own and decided if you can live with it if we get into a bad market.

Combining TFSA and other Accounts in Retirement. If your RIFF owns all equities, you may have to sell at a lost to create liquidity. You could look at the TFSA and non-registered as one account generally, however.

Can the caller retire yet? Look at the income the portfolio is generating and see if it is enough to live on. If you are making up the income by selling equity then in a bad market you are selling that much more and increasing the erosion of your portfolio.

Get rid of the 10 Mutual funds in caller's account because of high fees? Don't gamble with this. Don't hold too many funds because there will be overlap in their holdings. Hold 3 or 4 funds at the most. He suggested caller interview advisors about fees.