What to do when idiots run the world?

When you combine Trudeau’s Selfie politics with Morneau’s silver spoon trust fund mentality, you get ongoing budget deficits, careless spending on wasted programs and social agenda’s with no economic merit. Couple that with Trump’s war on everybody, and our lack of true leadership, and voila. Stock market downturns, investors pulling out of Canadian projects and infighting between provinces for political gain without consideration for economic fallout.

So what’s a person to do? Well if you’ve invested using time-tested fundamentals you weather the storm. When deploying new capital, go for fixed income instruments that have low volatility and meager returns. Now is not the time to bet the Farm.

Stay Calm and Build your Cash reserves.

Rick Barbosa

 

BBT Financial Update 10 days ahead of Barclays Analyst

Our clients enjoyed a 10 day window to buy up depressed stocks from our client update on May 12th. See the Barclays post below:

BUZZ-Barclays upgrades 5 Canadian banks on valuation, outlook

23 May 2017 – Reuters

BUZZ-Barclays upgrades 5 Canadian banks on valuation, outlook** Barclays raised its outlook on 5 Canadian banks due to low valuations following Q1 results

** Analyst John Aiken writes depressed valuation also attributable to housing market worries arising from non-bank lender Home Capital Group’s rapid decline in deposit accounts
** Cites upcoming switch to 2018 valuation year as painting rosier earnings growth outlook
** Among ‘big 6,’ raises Bank of Montreal to equal weight from under weight, PT to $98 from $95
** Lifts Bank of Nova Scotia to overweight from equal weight, PT to $84 from $78
** Upgrades National Bank of Canada to overweight from equal weight, PT unchanged at $59
** Boosts TD Bank Group to equal weight from under weight, PT to $69 from $64
** Also raises regional bank Laurentian to equal weight from under weight, though trims PT to $58 from $59
** In last 12 months, banks have outperformed the broader Canadian equities market, with the Thomson Reuters Canada Banks Index up 14.9 pct vs. the TSX Composite (up 11.1 pct)

Even with the BMO earnings today,  we see a buying opportunity.

Our Call 05/24/17
We predict that enough republicans will vote for impeachment before US Thanksgiving, leading to further depressed values for banks in the US. Canadian Banks should see continued strength as safe havens. Oil will bounce higher despite incremental supply. Overall infrastructure spending will boost oil demand over the next 2 years so hold on or add to your energy stocks.

Rick Barbosa

 

Playing by the Rules

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Whatever your Politics, you cannot argue with the recent market uptick and how it’s been impacted by pre-emptive policy choices of the new U.S Administration. In my recent posts you will have read that Free Trade and Trade Agreements in general only work if the playing field is level. The playing field is not level, and Large Multi-Nationals like it that way. We have systematically exported our manufacturing expertise to nations that are not democratic and do not see raising the standard of living as a priority. Product quality, safety, pollution and labour practices have all suffered as a result of non-level playing fields.

North American companies can compete with any company in the world on a level playing field. Our access to talent and innovation, capital, and natural resources is beyond compare. The standard of living we all share in the developed world was the result of investments made by both private and public sources, for the long-term prosperity of our companies and countries.

The current administration is disrupting the status quo. By refocusing and rebuilding North American industries we are saying that it’s time we focus on ourselves and our standard of living. The message is simple and effective. We must put our country, its industries and it’s people first or we risk our very way of life.

Play fair or don’t play at all.

Regards,

Rick  Barbosa