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

Message to bank CEOs: Be constructive. Don't scare markets into selling. The economy is in good shape and the recession won't be that bad. Sure, there are plenty of economic problems, but this isn't a financial apocalypse.

We may have had a the Santa rally already starting in mid-October and we milked that already, unfortunately. Today, American CEOs are correct: we will see a recession in 2023. We haven't seen evidence of one yet, though. The pullback in recent days reflects the market realize a recession is coming. For 2023, play in the bond space to pick up yield, the first time in a while. De-risk portfolios and look at government bonds.

Believes interest rates will remain higher for longer (bond market has it wrong). Expecting a 50 basis point raise in December, and another 50 basis point in January 2023. Recent US jobs report point to further interest rate increases. Apple moving supply chain away from China is part of global restructuring. "Just in time" inventory being re-thought with fragility of global relations.

Educational Segment. Believes "soft landing" narrative is not true, and that economy is heading towards a recession. Short term rates higher than long term rates indicator that recession is imminent. Every time the yield curve inverts (interest rates go up), earnings go down and recession occurs. Expecting higher interest rates for longer to fight inflation and good jobs report. Earnings growth is not happening, so is a time to be cautious for investors.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. How Capital Gains and Capital Loss Tax Works. Canadian investors that own financial assets outside of a registered account (TFSA, RRSP, RESP, etc), are required to pay income tax on any capital gains that they realize within a tax year. Capital gains are defined as the increase in value above one’s cost basis for an investment that has been realized upon sale. When Canadian investors sell equities that have increased in value above their cost basis in an unregistered account, they must pay income tax on this increase in value. One caveat is that if an investor also sells an asset that has decreased below their cost basis, this realized capital loss can be used to offset any capital gains, and thus decrease one’s income taxes. One technique that many investors use is selling an asset that has decreased in value to realize that capital loss and repurchase the stock 30 days later (to avoid the wash sale rule).

The Fed wants to tame inflation so that you products and services are affordable, but unemployment remains very low. There are not enough people in the workforce for various reasons. Some don't want to return to work because they made so much money during the pandemic (partly by spending less on stuff). Also, wages stayed higher longer than they should, and there's a mismatch between job openings and job seekers like specialized engineers. Companies must realize they need to cutback staff now that the halcyon days are over. The companies created during the pandemic hired a lot of people and even the money-losing businesses are still operating (for now). He predicts mass layoffs in the new year. The FED will eventually win the war against inflation--be patient.

It is difficult to time the market and predict market movements and the economy so stay invested. We are starting to see inflation come down gradually but be prudent, diversified and defensive. They invest in recession resistant businesses and nine out of ten of their companies have been generating record profits. He remains optimistic that the North American economy is coming from a strong place so is looking for a soft landing.

Today's better than expected employment numbers are pressuring markets. He remains realistic, bearish. Given Powell's remarks this week, no, that isn't the end of the Fed's tightening. Bulls are stupidly insane. Forget using last year's valuation on a stock as a benchmark for this year's valuation.

Today's better than expected employment numbers are pressuring markets. She's not bearish or bullish. Retail sales says didn't really grow. Wage growth continues, but is slowing. The S&P is trading at 18x 2023 levels that she thinks will come down. On the up side, we're past peak inflation and the worst of the Fed tightening. The tone is changing, but there's a cap to how high we go.

Today's better than expected employment numbers are pressuring markets. If this were July, stocks would keep falling and close 3-4% down, but is isn't happening. Why? Seasonality but more importantly fundamentals. This means, there's a growing chance of a soft landing. Creating more jobs last month is an indicator of that, of a healthy economy. Next Friday, we'll get the inflation figure for November. Note that the Cleveland Fed has been lowering its inflation forecasts.

Today's better than expected employment numbers are pressuring markets. Maybe a recession next year will be shallower than feared. Let's if inflation numbers in the next two weeks bear a trend, a positive one. Seasonality, too, all these factors could give the market some lift into the end of the year.

Very optimistic on the state of the global financial economy right now. Expecting the start of another 4 year bull cycle in the markets. Believes seasonal interest in Silver (Dec-Feb) will result in higher prices. Commercial hedgers are long on Silver right now. Short & intermediate trends are up on Silver as well.

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research. Investing Mistakes: Too Much Focus on Macro Issues. This year has been a challenge for stock pickers because companies do not matter now. It is all about inflation, interest rates and geopolitical events. There are debt-free companies with high margins and growth rates in the 70-per-cent range, yet their stocks are half, or less, of what they were seven months ago. Everyone worries about the macro picture, and no one cares about the companies. But guess what? You own part of a company when you buy its stock. You don’t own gross domestic product. You don’t own inflation. You don’t own interest rates. You own a company. Many companies will continue to grow and thrive despite the bad economic headlines. Don’t forget what you actually own.

What's changed in the last 3 years? A whirlwind. The seeds of change were already there 3 years ago with Covid 19 cases and border disputes. The war in Ukraine has weighed heavily on 2022. The ETF market has been keeping pace. The US ETF market is about 20x as large as the Canadian one, and that's why he and others believe that the Canadian ETF market has more runway for growth.

Stagflation. A global risk. Canada is something of a refuge, given our more inflation-resistant markets with oil and raw materials being our chief exports. The giant stock runup through the pandemic was focused on technology names, and Canada has a bit of that, but not as big a footprint as you'll find in major US indices like the S&P 500.