Looney Hour Event - Investor Series
As a regular listener, I was excited when they had an event in town!
- On Real Estate: they are bearish on rents and condos due to rise of purpose built rental apartments (9% increase in rental supply across Canada which is unprecedented). However they are bullish on single family homes in Ontario due to lack of supply being built (not in bullish for houses in BC or QC)
- Bonds: Concerns about bonds, potential for large losses (up to 40%) due to a rapid rise in interest rates (as a result of geopolitical conflict, trade war tensions) The rising crude oil/ diesel prices will likely increase inflation by making essentials such as plastics, fuel, food and fertilizer more expensive. Globally countries have rising government debt with spending projected to further increase due to more military spending in the face of geopolitical conflict.
- In the post financial crisis 2009, central bankers kept interest rates low, relied on quantative easing, yet government spending and debt continues to climb. This delayed the bond crisis, yet financial institutions still promote the standard 40% bond, 60% stocks balanced portfolio, despite that reflecting a different financial landscape, notedly decades of declining interest rates that lead to higher bond yields, this trend is not projected to continue in the current macro environment.
- Discussion of economic weakness in France and Germany. Germany has been experiencing prolonged job losses due to restructuring it's economy, abandoning nuclear lower, reduced investment in oil and gas in favor of solar and wind, making the EU especially vulnerable to Russia in the face of war/aggression.
- Forecasted opportunities: Everyday people can invest in commodities: barrels of crude oil, copper, critical minerals, wheat, soy, canola, agricultural products, fertilizer, gold
- Canada is positioned to do well in this age of economic uncertainty due to its abundance of natural resources, critical minerals. After over 15 years of not investing in resources/ mining of critical minerals. Canada's low productivity is due to a lack of investment by corporations in machinery, equipment and R&D. There are some encouraging signs that Canada is reversing/ correcting these mistakes.
