Off to speak at the CFA Institute Asset Allocation for Private Clients conference in Atlanta, Georgia. My topic: “When to hold 'em and when to fold 'em: Investment policy that real life people can stick.”
That is, so long as the snow storm here today doesn't cancel my flight Monday. Glad we finally got our leaves raked last week. Merry Christmas!
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Yes snow good foot here north of the GTA. Couldn't help but think buyers might remember that we use natural gas and oil for winter heating…. not just cars/trucks.
Barron's came out with a buy on oil and gold this weekend, have you any comments you could share.
SQ, at this point we do not have a buy on our metrics. BTW we also don't put much weight on pattern recognition for TA.(Just to answer your question last week.) We find pattern recognition can be highly subjective so not that helpful in our work.
Since Alberta introduced the gas and oil royalty tax, drilling has increased in Alberta by 1%, in Sask, 47%. This capital shift has created employment, wealth, and prosperity for Sask.
Under Obama, 48% of Amercians will not pay any income taxes, an increase from 38%. Obama wants to tax the wealthy and give this money to those who do not work.
The captains of industry who have ingenuity, business skills, and risk their captial should be admired, rewarded and encouraged. Not discouraged. The country will benefit with increased jobs, wealth, and prosperity.
Just how many will move their factories, offices, business to Mexico or Asia because of the increased tax load in America, as happened in Alberta.
Obama will only lengthen Amercia's current economic contraction. He is a charismatic, and everyone of his campaign speeches gave Americans hope. Now it is reality. Unless he takes a step or two to the right, he will not last 4 years. Jimbo
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I'm having difficiulty making sense of your conclusions. Less people paying income tax should be a good thing. And those who do not work don't pay income tax anyway so how are they being given money? And what does Obama have to do with Saskatchewan and Alberta?
It's probably easier to suit your investment to the climate anyway, rather than try and adjust the climate to your investments.- LKH
Danielle–Would it be possible to post the pertinent points from your talk on the blog–it would be valuable to us. Thanks.
Economically speaking Obama will do what McCain would have done. There are few options.
Here is a nightmare scenario that would dwarf any economic hardship we can imagine.
As Obama begins to reign in the military, Russia construes this as a capitulation and attempts to regain its European sphere of influence, especially, but not only, the Baltic states with their large Russian populations. The Franco-German axis does not risk a confrontation with Russia on behalf of these newest members of the EU and NATO. The East European nations, threatened from the East and abandoned from the West, have no choice but to try and create some new political/military union to resist the mounting threat. (It has happened in the past.) This is interpreted by Russia as a provocation, providing it with an excuse to act… Somehow consequences of the financial crisis pale in comparison.
All this sounds a little far out, but just in case General Dynamics (GD) looks pretty good:)
M
In this free country of ours we are able to express our ideas, theory and thesis. It is not only encouraged, but welcome, and available for all to read. Not quite sure what you are trying to say, but I think the message is that GD is a good buy.
GD, I have looked at it before, it looks like a compelling buy, however it does not meet all the criteria of Benjamin Graham. Falls short on Price to Book, Current Ratio, and Interest Coverage. As Warren Buffet has said ” successful investing is not owning stocks in a number of good companies but in a few exceptional companies”.
Hope you do well with GD, you probably will.
I am currently intrigued with this blog and Parkisms. “Let the market find a bottom without you”, “Buy and hope is not a good strategy”, “There is no such thing as decoupling”, “Buy and Hold does not work all the time”. I am truly sorry if I have slightly misquouted Ms. Park. I apologize. No disrespect is intended, only respect.
Berkshire Hathaway has experienced a large loss in this current bear market. Warren would have been far better off to divest in late 2006. Now wondering if intelligent investing is part, Benjamin Graham, part Warren Buffet, part Philip Fisher, part Danielle Park. Jimbo
Alberta is just an example that demonstrates that high taxation will push capital and accompaning jobs to the lower taxation jurisdiction. Today, Alberta rejigged it tax royalty with Syncrude to keep production and jobs within Alberta.
Non working people are not given money but benefit through social programs, food stamps, subsidized housing, work fare, etc. Truly necessary in any country, however if the wealthy are required to pay more and more and more of the tax burden they will move to a lower taxed jurisdiction. How many will move I do not know. Currently you are taxed at 40%, most things being equal will you not move to another country were you are only taxed 30%,20%,10%, 0%? Jimbo
Just theorizing a bit, seeing as Obamania is sweeping the world with anyone scarcely bothering to consider what the cost of “change” could be. I certainly hope B.O.’s oratory skills will be matched by his administrational capability. If not, we’re in a whole new investment universe.
Obama is a lefty, not quite Taliban Jack Layton but leaning that way. He is in bed with labour unions. Pushing equality of income, like Cuba, N, Korea, Venenzuala. Everything is the property of the people. Who on earth will want to invest there, live there? America became the greatest country in the world through pursuit of freedom and pursuit of success. There is no freedom in Cuba, in N. Korea, in Venenzuala. China is turning to capitalism. America, under Obama is moving to socialism. America will not stand by and watch their country being destroyed. He will change, or he will be booted out. Obama is a pouf!
Franco-German axis.? That is heavy dude. Where do you get your stuff? Yoooooo hooooooo, Danielle, where are you, we need you.
I agree with the last comment. Please keep the political rhetoric off this blog and put it somewhere else. I like this blog because it simplifies investing, not because I want to read about all the other crap. Sorry, couldn't find a better word. Get my point?
Just filling time between Danielles' next post. Tim Horton's coffee shop banter. If your are Canadian you know what I mean. The morning cofffee shop gang have all the answers to solve the world's problems.
Apologies to everyone and anyone who may have been offended by my comments. It was not my intention to be controversial. I certainly did not invent the axis term. It has been used in the media to describe EU in recognition of the two most powerful economies of the region and I do not think it derogatory. (My ancestry is part German.) Consider my reflections as ramblings of an old man whose investment strategy has largely been based on world’s to-date geopolitical situation which seems to be shifting rather quickly. Happy investing to all.
M
Hey M. Absolutley now reason to apologize at all. Actually welcome new thoughts, new ideas. This is Canada,. If you give us reason to think, thank you. Please continue to post. The more infrormation, the more thoughts for us to ponder, the better. Not derogatory in the least. If you are conveying an old man's thoughts I truly would like to be informed.
It seems you are more intelligent than the layman, and initially diffficult to decipher. However if you could write for us to understand that would be greatly appreciated. Always intereted in what the intelligent mind has to convey.
Keep posting. Jimbo
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Yes, Mr. M, please keep posting!! We need your life experience!
Dear Ms. Park,
I was hoping you could comment on which direction interest rates on fixed income assets (GICs and bonds) will head in the near and distant future here in Canada. Do GIC and bond rates ever differ at all in terms of what direction their interest rates go in – if they do, under what circumstances do they do so? I'm fortunate enough to have cash as I followed your advice as others have – thank you again! I have read about the deflation which is occurring now and was wondering if I should lock some of my cash in for longer periods of time (3-5 yrs) if interest rates were to go lower from here – I have no idea where they are headed…
Thanks
Hi Danielle,
Not sure if you responded to this persons request. If you did I missed it.
This is a subject that is of great interest to we retired people who cannot afford to take market risk in this environment. I, and I am sure others, would appreciate your views on bonds, GIC's and interest rates.
Thanks for all you do,
BillB
PS. Currently reading JKG's Crash of 29 and read the history of financial euphoria a couple of weeks ago. Along with the insight JKG provides he has a wonderful sense of humour.
I am not sure where rates are headed in the next 1 to 2 years. In the present they are headed down in Canada over the next few months. Hoever, I have heard that Cdn banks are offering extra sweetners to attract deposits such as 4% GIC rates, which are some 1.25% above their breakeven rate. In other words they are paying more than going rates in order to build up their cash on deposit. Longer term I am concerned that rates will be trending higher over the next few years after the deflationary impact of recent asset losses are absorbed. My thinking is that there is a deficit of savings in the western world, which means cash deposits will be scarce and sought after by many institutions. Also we were in a falling rate cycle from the 1980's to 2003, I think we are due for the secular uptick in rates over the next perhaps 10 to 15 years. But that is just my guess…