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

Advantage of DIY Investor: Tune out the noise. Professionals are constantly exposed to a barrage of investment information. The signal to noise ratio from the firehose of daily news is vanishingly small, while the cognitive toll is high. They are compelled to pay attention to short-term volatility which triggers the most destructive behavioural errors. DIY investors, on the other hand, have the luxury of tuning out the noise, developing a sound long-term strategy, setting it in motion, and checking our portfolios only when appropriate—perhaps every six to twelve months. 

He remains bullish, but isn't putting much stock into today's rally. The real test will come with inflation and employment data in the coming two weeks.

We won't return to 3,200 (his former target), but there will be rallies as well as more volatility. He has few regrets of what he has sold. We're in a bear market rally.

Would advise investors to keep equity portfolios well balanced given underlying strength of economy. 
A 60/40 portfolio with fixed income/equities will do investors well.
High interest products are paying nice returns for defensive names. 
High quality dividend stock are offering great opportunities. 
Opportunity can be found in low priced tech stocks. 

Advantage of DIY Investor: Choose investments based on appropriateness rather than compensation. Because the vast majority of financial advisors in Canada are compensated based on the investments they select for their clients, rather than by their clients directly, what is best for the investor is frequently at odds with what is best for the advisor. Put yourself in their shoes: as an advisor, would you suggest the broad-based mutual fund that will kick back a generous fee into your account, or the index fund that will pay you nothing but accomplish the same goal for the client and save them tens of thousands of dollars? The incentives of paid professionals can never be truly aligned with the investor. 
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Hard to tell on a quarterly basis. As a general rule, they're in very good shape. Even though loan losses have continued to rise, that's a good thing because they can take them back into earnings when things aren't as bad as forecast. Lots of capital to increase dividends or buy back shares, not trading at extreme levels on book value. In his dividend portfolio, he owns TD, RY, CM, and BNS. These are great businesses over the long term. A lot of the quarters had one-off costs. Great things to buy and hold long term. They continue to make money.

Weird economic background. Coming out of Covid, we had lots of fiscal stimulus, and now part of that's falling off. Then we had massive monetary policy decreasing rates, and there's a long lag in that effect, which we haven't felt yet. Consumers have had lots of savings, and unemployment is not very high. They're not in as bad a shape as people think. Remember, we came out of a very difficult 2 years, and now people are making up for that. You're seeing inflation numbers really high on the services side, as people just want to live their lives again, and this number is what the Fed's trying to bring down. US consumers with mostly fixed mortgages aren't as sensitive to higher mortgage rates as they were in 2008 when most had adjustable-rate mortgages.

Canadian consumers appear to be in a much more difficult situation.

Hasn't really come to fruition yet, and that will be important for a lot of the telecom companies. If you're in an elevator or underground parking, you still can't get your phone to work. Once 5G gets to a critical level, all these companies will do much better. 

Problem with all these companies is that they increased costs because of Covid to an unreasonable level. They had to upgrade so quickly, and they just don't need those people anymore. Now there's a normalization of the economy and businesses, and so they have to get rid of people. All the layoffs have been tech-related.

Question is whether we've had a jackrabbit start, or is it a dead cat? Stocks that were off the hardest in 2022 have rebounded the most early this year, largely because you had the exaggerated effect of tax-loss selling in December. 

People say maybe central banks aren't going to raise rates so much and it's not going to be quite so bad, and they bid up the fallen stocks again. Where to from here? The determining factor is going to be interest rates. People are saying that the banks may not raise by so much, they've done enough, but let's do the math. The Fed funds rate is around 5%, inflation is around 7%. He's not sure how 2% below inflation is restrictive monetary policy. How is 1 year of raising rates going to undo 25 years, since the long-term capital crisis of 1998, of flooding the market with capital. 

Everyone's talking as though recession is what matters to markets. What matters to markets is corporate earnings. Interesting period here, when it's the first time in 30 years that companies have had the ability to raise prices and have those price increases stick.

Banks are off anywhere between 15-30%. Better to have shares of the bank than to have money on deposit with the bank, even with GIC rates where they are. He thinks interest rates are going higher. Bank earnings have been weaker than expected. Bank earnings are easily manipulated. Invest with the one that you bank with. It will at least be emotionally satisfying, as your bank charges will be covered by dividends, which will increase regardless.