Sell your Stocks and Hoard Cash-Vaccine Passports Destroying Society Right Before Our Eyes

Please feel free to read my last two posts to measure my accuracy and research. In Europe, the Middle East and now in North America these control mechanisms are being rolled out as mandatory for employment and enjoyment of life, all to keep you safe. If you believe that and that the experts know what they are doing, this is the wrong site for you. My job is to ensure my clients and those that want to listen are prepared for what’s to come. These mandates will lead to the following, much of which is starting to unfold now:

  • Less services, including education, health and public safety
  • More disease with increasing side effects and less healthy lifestyle options
  • Increased inflation and food and material shortages with less and less people working
  • More unemployment and fewer options for employment (10-15% of effected staff fired, leaving)
  • More violence as desperation sets in
  • Increased division in society and resentment toward others

If you have heeded my warnings and advice you are doing better than most. Now with mandates on there way we need to sell 50% of our equities and keep as much cash on hand as possible.

There is no use arguing with those who are not informed as that time as come and gone. Now we need to think of ourselves and family and batten down the hatches.

Take care of yourselves.

Rick

 

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Banking in Ireland leaves its customers behind the rest of the world

Last year after making the decision to move to Galway Ireland we set out to find office space and a bank to enable our operations to function. As consultants and accountants, we have been exposed to or used some of the latest technology and best practices from a variety of industries across the Globe. The Canadian Banking system is dominated by a few large players, just like in Ireland. However, we were surprised to find that their was a huge technology gap between the two markets. We looked at 3 players (Bank of Ireland, AIB and Ulster Bank) and found that they were all using basic platforms that resembled functionality and technology from the 90’s. Why was tech proud Ireland so behind?

Here are some of the features we are used to working with and think should be employed by Irish Banks. Have a peak and tell us which one would be most useful to you or your business with a poll at the end.

1.Mobile Check deposit-Deposit a check via your mobile phone

2. Receive and send money using only your email, and no Banking details.

3. Add a Bill or Payee by simply scanning it into your banking app? This uses the same technology as check deposit above.

4. Current Credit Score and Credit Score simulator which reflects how your situation may change based on your plans.

So there you have it. Our top 4 tech choices we wish Irish banks employed. There are loads more features we’d like to see but these were the most useful to regular customers. Let us know which one you value the most? Hopefully someone somewhere important will see this and start the ball rolling.

Thank you for Reading

 

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Pivoting in a Crisis

Its not raining, it’s a torrential downpour of biblical proportions. The worst part is that you could not have modelled or planned for these events. So now that we’ve dealt with what we can’t control time to focus on what we can.

Life offers us opportunities to grow as individuals, some choose to use these opportunities as lessons and learn from them, others do not.

Take this opportunity to Pivot on what you thought worked vs. what is actually working during this ultimate stress test.

  • Your Financial Situation
    • Which investments held up well, which didn’t? Transition to those stocks or instruments that held up well, buy more of what worked.
  • Your Income Stream (Job/Business)
    •  If you’ve been furloughed or laid off, has the drop in income affected your spending? Where can you adjust to meet your reduced income levels
    • Has your business been impacted by the shutdown, how can you adapt to the new reality?
    • What is the leanest your business can run without affecting service and losing customers?
  • Your Health
    • What can you do to stay active
    • What can you do to keep your sanity and keep boredom at bay
    • How can you avoid overworking while working from home
    • How can you maintain the “right amount” of contact with partners- too much vs. too little

In short, pivoting is the fancy word for adapting. However, choosing which approach is best suited for your situation is where the difference lies. Pivoting in the right direction takes research, trial and error and quick decision making when things don’t work.

Take back control however limited and steer your ship with the wind at your back.

Till next time.

Rick

 

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Key takeaways from Turmoil

I haven’t written much lately, and that’s been for a variety of reasons. The most important being that I had to ensure clients capital was sheltered from what seems like Tsunami’s of bad news. Not much changing to do, just some re-balancing into less risky investments and continuing to hold our oldies but goodies.

Some of my observations or takeaways over the last few months:

  1. Don’t panic, analyze
  2. Ensure you always have enough cash on hand in case of an emergency (worst case scenario)
  3. Make sure you have adequate Insurance on all hard assets, including your lives
  4. Believe in your ability and instincts
  5. Never rely on others to help you out financially
  6. Never assume someone in authority is smarter than you are
  7. Question what seems too good to be true
  8. You always get what your pay for.
  9. Consistency always pays off
  10. Take care of yourself and your health (mentally and physically)

Stay sharp, stay committed and stay focused

Rick

 

 

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Can you sit still?

Recently, we’ve increased our positions in a few key holdings including CIBC, Genworth Mortgage Insurance and Blackberry. Initially the returns were positive, lately, based on the news cycle or lack thereof, their values have decreased somewhat. Nothing materially has changed for either one of these holdings, including Blackberry, which made an unexpected profit even when you back out the Qualcomm payment.

Analysts are paid to overreact, we do not. These businesses are sound, make money, and will make more money.

Our Criteria for investing is simple:

  1. Good or Service is Vital (Need)
  2. High Barriers to entry (Financial moat)
  3. Good Management
  4. Strong Balance Sheet and Cash position

The true mark of an investor versus a trader is how long they can sit still when things are not going in their favour at the moment. If you panic and “limit your losses” you are a trader, if you believe in your analysis and see these swings as temporary, then you are an investor. Limiting your losses also means wiping out future returns.

Stay Calm and Carry on.

Rick Barbosa

 

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4 Pillars of Building Wealth

Believe it or not, the manner in which you can build your nest egg hasn’t changed since the dawn of the 20th century. The tools may have improved but these foundational pillars still exist.

  1. Discipline – Stay true to your purpose and never lose sight of your goal.
  2. Save – Learn how to keep and grow your money
  3. Research – The best results come from the most informed decisions.
  4. Plan – Anticipate life, surprises, retirement, and set out to meet these obligations.

Contact us to learn how to use these tools and start building your wealth.

Rick Barbosa

 

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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

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Has “Free Trade” really helped us?

In my humble opinion NO.

Here is what I used to base my answer on. When we lowered tariffs in North America it was meant to encourage a freer flow of goods between nations. Economists tell us that increasing trade creates wealth and was essential to grow economies on both sides of the border or for that sake internationally (TPP, CETA). Free or tariff reduced trade is only a recent trend so we must look at why we had tariffs in the first place.

Tariffs or “taxes” were meant to protect our local and mature markets that were the envy of the world. Our Markets (Canada/US) harbored a healthy working population with disposable income and a robust manufacturing sector. Unlike other parts of the world North America (Canada/US) had made investments for the betterment of it’s population that included:

  • Health and Safety
  • Organized Labor
  • Minimum wage
  • Social Security/Government pensions
  • Workplace or Self-Directed retirement plans
  • Workers Compensation
  • Employment standards Legislation
  • Environmental Protection

Anyway you cut it, these programs increased our cost of production, albeit while producing a higher standard of living. The Tariffs made cheaper goods that were made in countries or states that did not have any of these obligations competitive by increasing their landed cost. In most cases local was cheaper when you factored in tariffs. This drove investment in both countries by companies who wanted to serve these rich markets by making it cost effective to produce locally.

We were told that lowering tariffs would drive competition and innovation because we would be allowed access to their markets on an equal footing in exchange for access into our markets. That did not happen. Restricted or limited access is what we got.

Too often national or state interests fell outside of NAFTA like Health and Safety, minimum wage, and environmental standards. So what in essence happened is that for companies to survive the onslaught of cheaper goods they too had to go offshore to remain competitive. In fact the standard of living has not increased in Mexico, the U.S and Canada. All the wealth that has been created did not raise the standard of living in any developed country, instead it only boosted the multi-national corporations bottom lines. This came at the expense of blue-collar and lower level white collar workers.

I am a strong proponent of responsible capitalism and competition. It’s the best system period and one that drives growth and innovation. When Free Trade was introduced and as other European and Pacific agreements pop up we must ask ourselves one fundamental question:

Is the playing field really level on  both sides?

Rick Barbosa

Albert

 

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The cost of drinking the Kool-Aid

Kool-Aid

Now with tax season winding down, I finally have some time to reflect and write about recent events and provide my spin on these.

In any corporate environment we all know of those individuals who have attained their positions either by

  1. Selectively being drafted from upper management for their sympathetic views
  2. Taking shortcuts to achieve short-term results, neglecting long-term consequences

The first type of promotion is what’s known as Empire Building. This comes about when senior management wants individuals around them willing to “go along” with their direction and corporate outlook on how to best serve the interests of the company. Interests of the company in Empire Building more often than not will miraculously coincide with Senior Management’s own self interests. These interests can take the form of Bonus’, Stock Options, Board Positions, Fringe Benefits and Gold Plated Pensions. The least amount of resistance that they can have while attaining these interests the better.

The second type closely mirrors the first, but is distinguished only by the individualistic approach to the end result. WIIFM (what’s in it for me) Managers see employees and subordinates as tools and assets to employ in attaining the quickest, most cost effective, and most personally rewarding path to success. They often do not take into account longer term issues such as quality, impact on brand, societal impact and human cost of their decisions.

Many out there would see nothing wrong with either approach and tout that it is often necessary to employ these tactics to achieve the results the market expects. “Market Expectations” is another name for a Giant pitcher of Kool-Aid. Once we drink from the Kool-Aid pitcher as an organization we start to rationalize the decisions we make to make the market happy. Trouble is, this can’t and won’t last forever. What’s often left in the wake of pandering to the market and drinking the Kool-Aid, is broken trust, lost resources and damaged lives.

As owners and managers, we have a fiduciary and moral duty to think long-term on how to best achieve sustainable and realistic results that elevate our companies and staff as a whole. It’s not a 100-yard dash, it’s a marathon. Play to finish.

Some recent examples of “Kool-Aid” corporations:

Volkswagen takes $18 billion hit over emissions scandal Friday, April 22, 2016 02:03 PM EDT Toronto Sun

Mitsubishi Motors mileage scandal widens, U.S. regulator seeks information TOKYO 
— Reuters

General Motors will pay $900 million to settle criminal charges related to its flawed ignition switch that has been tied to at least 124 deaths. CNN Money

Till next time.

Rick Barbosa

 

 

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Making Friends with the Bear

Bear fight

Like everyone else who has non-fixed income investments, I have felt the pain this year like you. When you put your money at risk you should in fact be aware of “the risk” and have the stomach to ride it out. No one, and I mean no one gets a free ride. If you go to sleep in a deep sweat at night worried about losing 15% of your investment, then you should not be in the market. Every investor should know that a balanced fund should always include cash and fixed income portions to counter balance the risk of equities. Mutual Funds (not my choice) do this automatically as they spread both the gains and losses over a wide swath of instruments.

If you’ve ever looked at my “Rick’s Picks” you won’t see very much change, even during this volatile period. It’s important to keep your head above the noise and realize that external forces are driving this Bear Market not fundamentals. Some of the 2015 forces included:

  • Oil prices (even the Saudi’s can’t keep this up forever)
  • Demand from China (Market is maturing)
  • Low Growth (Mature markets and economies here to stay)
  • Interest Rates (artificially low)

So instead of fighting the Bear, learn from it, make friends with it, and use it to your advantage. How you say?

  1. Watch your portfolio and the 52 week low points as they come up and buy into your gems on the cheap.
  2. The stocks on your wish list that were out of reach are probably cheap now-Load up
  3.  Take advantage of DRIP plans to lower your acquisition costs and “buy low” automatically

Bottom line, keep your head on your shoulders, don’t follow the crowd, and continue to do your research based on the fundamentals.

 

Till next time…

Rick

 

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