Friday, 23 December 2016
Monday, 19 December 2016
Monday 19December2016 - The CLOCK
THE
CLOCK
A
man died and went
to Heaven.
As
he stood in front
of the Pearly Gates, he saw a huge wall of clocks behind him.
He
asked, “What are
all those clocks for?”
St.
Peter answered,
“Those are Lie-Clocks. Everyone who has ever been on earth has a
Lie-Clock.
Every
time you lie, the
hands on your clock move.”
“Oh”,
said the man.
“Whose clock is that?”
“That’s
Mother Teresa’s”,
replied St. Peter. “The hands have never moved, indicating that she never
told a lie.”
“Incredible”,
said the man.
“And whose clock is that one?”
St Peter responded,
“That’s Abraham Lincoln’s clock. The hands have moved twice, telling us that
Abraham told only two lies in his entire life.”
“Where’s
Donald Trump and
Hillary Clinton's clocks?” asked the man.
St.
Peter replied,
“We’re using them as ceiling fans.”
Saturday, 22 October 2016
Monday, 17 October 2016
Tuesday, 13 September 2016
Friday, 9 September 2016
Wednesday, 7 September 2016
Thursday, 25 August 2016
Sunday, 14 August 2016
Sunday 14August2016 - Today's Thoughts Re Infrastructure!
When one mentions infrastructure at the country, province, state or local level we often just think of just the physical infrastructure networks in our daily lives. These are the usual references to roads, public transportation, energy distribution systems, sewers, water systems, etc. These are the Hard Infrastructure systems.
As well there are Soft Infrastructure systems that benefit our highly developed economies that we often do not recognise or give full credit to as performing a key function to the well being and support of our advanced western economies.
In Canada we recognise that education, the rule of law, and especially health care and many others are essential infrastructure services that support the basic structural needs of all of our citizens to lead and contribute to out society as a whole.
When talking with our neighbours to the south, I find it very difficult to understand their reluctance to understand that the inclusion of the soft infrastructure of healthcare is beneficial to the long term advancement and support and well being of their citizens.
When one mentions infrastructure at the country, province, state or local level we often just think of just the physical infrastructure networks in our daily lives. These are the usual references to roads, public transportation, energy distribution systems, sewers, water systems, etc. These are the Hard Infrastructure systems.
As well there are Soft Infrastructure systems that benefit our highly developed economies that we often do not recognise or give full credit to as performing a key function to the well being and support of our advanced western economies.
In Canada we recognise that education, the rule of law, and especially health care and many others are essential infrastructure services that support the basic structural needs of all of our citizens to lead and contribute to out society as a whole.
When talking with our neighbours to the south, I find it very difficult to understand their reluctance to understand that the inclusion of the soft infrastructure of healthcare is beneficial to the long term advancement and support and well being of their citizens.
Friday, 12 August 2016
Friday 12August2016 - Chart of the Day!
Chart from Danielle Park's web site.
As one chases yield in over priced dividend paying stocks, it is mindful to keep this big picture of the equity markets as represented by the SP500 proxy SKY in ones decision making and not get carried away.
Central bank policies of zero interest rates and printing money (QE) have certainly upset the prudent investment of savings and retirement accounts for individuals, private pension plans and insurance companies.
Chart from Danielle Park's web site.
As one chases yield in over priced dividend paying stocks, it is mindful to keep this big picture of the equity markets as represented by the SP500 proxy SKY in ones decision making and not get carried away.
Central bank policies of zero interest rates and printing money (QE) have certainly upset the prudent investment of savings and retirement accounts for individuals, private pension plans and insurance companies.
Thursday, 14 July 2016
Sunday, 10 July 2016
Sunday - 10July2016 - A Trump Tragedy!
Donald Trump was visiting a primary school in Orlando and visited a
grade four class. They were in the middle of a discussion related to words and
their meanings.
The teacher asked Mr Trump if he would like to lead the discussion on the word 'tragedy.' So our illustrious Republican candidate asked the class for an example of a 'tragedy'.
One little boy stood up and offered: "If my best friend, who lives on a farm, is playing in the field and a tractor runs him over and kills him, that would be a tragedy."
"No," said Trump, "that would be an accident."
A little girl raised her hand: "If a school bus carrying 50 children drove off a cliff, killing everyone, that would be a tragedy."
"I'm afraid not," explained Trump. "That's what we would call great loss."
The room went silent. No other child volunteered. Trump searched the room.
"Isn't there someone here who can give me an example of a tragedy?"
Finally at the back of the room, Little Johnny raised his hand. The teacher held her breath.
In a quiet voice he said: "If the plane carrying you was struck by a 'friendly fire' missile and blown to smithereens that would be a tragedy."
"Fantastic!" exclaimed Trump, "That's right. And can you tell me why that would be a tragedy?"
"Well," says Johnny, "It has to be a tragedy, because it sure as hell wouldn't be a great loss... and you can bet your sweet ass it wouldn't be an accident either!"
The teacher left the room..
The teacher asked Mr Trump if he would like to lead the discussion on the word 'tragedy.' So our illustrious Republican candidate asked the class for an example of a 'tragedy'.
One little boy stood up and offered: "If my best friend, who lives on a farm, is playing in the field and a tractor runs him over and kills him, that would be a tragedy."
"No," said Trump, "that would be an accident."
A little girl raised her hand: "If a school bus carrying 50 children drove off a cliff, killing everyone, that would be a tragedy."
"I'm afraid not," explained Trump. "That's what we would call great loss."
The room went silent. No other child volunteered. Trump searched the room.
"Isn't there someone here who can give me an example of a tragedy?"
Finally at the back of the room, Little Johnny raised his hand. The teacher held her breath.
In a quiet voice he said: "If the plane carrying you was struck by a 'friendly fire' missile and blown to smithereens that would be a tragedy."
"Fantastic!" exclaimed Trump, "That's right. And can you tell me why that would be a tragedy?"
"Well," says Johnny, "It has to be a tragedy, because it sure as hell wouldn't be a great loss... and you can bet your sweet ass it wouldn't be an accident either!"
The teacher left the room..
Monday, 27 June 2016
Saturday, 25 June 2016
Friday, 24 June 2016
Friday 24June2016 - Defining Money!
Money has
different names!!!
In temple or church, it's called donation.
In school, it's fee.
In marriage, it's called dowry.
In divorce, alimony.
When you owe someone, it's debt.
When you pay the government, it's tax.
In court, it's fines.
Civil servant retirees, it's pension.
Employer to workers, it's salary.
Master to subordinates, it's wages.
To children, it's allowance.
When you borrow from bank, it's loan.
When you offer after a good service. it's tips.
To kidnappers, it's ransom.
Illegally received in the name of service, it's bribe.
The question is, "when a husband gives to his wife,what do we call it???"
ANSWER:
Money given to your wife is called DUTY, and every man has to do his
duty because wives are not DUTY FREE.
In temple or church, it's called donation.
In school, it's fee.
In marriage, it's called dowry.
In divorce, alimony.
When you owe someone, it's debt.
When you pay the government, it's tax.
In court, it's fines.
Civil servant retirees, it's pension.
Employer to workers, it's salary.
Master to subordinates, it's wages.
To children, it's allowance.
When you borrow from bank, it's loan.
When you offer after a good service. it's tips.
To kidnappers, it's ransom.
Illegally received in the name of service, it's bribe.
The question is, "when a husband gives to his wife,what do we call it???"
ANSWER:
Money given to your wife is called DUTY, and every man has to do his
duty because wives are not DUTY FREE.
Saturday, 18 June 2016
Wednesday, 15 June 2016
Wednesday 15June2016 - My Saturday Night Rant!
Posted a few days late.
Posted a few days late.
My Saturday Night Rant
Central banks in major economic regions Japan, Europe and USA have engineered the groundwork for the next worldwide financial crisis with their zero/negative rate interest policies.
One area affected with multiyear quantitative easing (printing billions of dollars of money from nothing) and zero/negative interest rate policies are creating huge investment management problems for individuals and pension plans and their fixed income planning models based on receiving a normal 4-6% annual return.
The attached chart shows how absurd central bank policies have become. Now with trillions of dollars of bonds worldwide yielding nothing. Actually the holders of bonds pay to own them in their portfolios.
My wife is already adjusting to the effects of these Central Bank zero interest policies with adjustments to her defined benefits pension income. Current changes are centered around increased premium deductions for health care coverage along with reduced coverage limits.
Japan Central Bankers thought they could reduce interest rate based income to zero and below and it would encourage their population to spend more and generate economic growth.
WRONG. Their ageing population has responded by spending less and hording their savings to make them last longer in the absence of not receiving any interest income on their fixed income investments.
Saturday, 14 May 2016
Wednesday, 11 May 2016
Friday, 6 May 2016
Tuesday, 3 May 2016
Monday, 11 April 2016
Wednesday, 6 April 2016
Thursday, 3 March 2016
Thursday 03March2016 - Bubbles Bursting!!
Watch out Vancouver Real Estate!
Markets crash far, far, far faster than they rise, especially when the final rise is parabolic.
http://www.cnbc.com/2016/03/03/i-see-bubbles-bursting-everywhere-top-academic.html
Watch out Vancouver Real Estate!
Markets crash far, far, far faster than they rise, especially when the final rise is parabolic.
http://www.cnbc.com/2016/03/03/i-see-bubbles-bursting-everywhere-top-academic.html
Sunday, 28 February 2016
Saturday, 27 February 2016
Wednesday, 17 February 2016
Friday, 5 February 2016
Tuesday, 2 February 2016
Tuesday 02February2016 - Bonds and Stocks Diverging!
Clips from Danielle Park's excellent blog.
High yield prices began to plunge in late 2006 as the subprime bomb blew. Stocks joined the descent late 2007 to early 2009. By the bottom, high yield bonds had lost an average of 38% and the S&P 500 55%. Both then rallied two years, before slumping afresh with global revenues in mid 2011, and rallying into 2013 on QE ‘liquidity’. That was then.
Since 2013, high yield bonds have been diving (down some 18% so far) even as the S&P 500 managed to limp higher into mid-2015 on ‘FANG’ fumes (Facebook, Amazon, Netflix and Google).
High yield bonds broke below their 2011 support line last fall (horizontal green band above) and so far continue to drop as 2016 brings rising defaults and write-downs.
Click image to enlarge.
Clips from Danielle Park's excellent blog.
High yield prices began to plunge in late 2006 as the subprime bomb blew. Stocks joined the descent late 2007 to early 2009. By the bottom, high yield bonds had lost an average of 38% and the S&P 500 55%. Both then rallied two years, before slumping afresh with global revenues in mid 2011, and rallying into 2013 on QE ‘liquidity’. That was then.
Since 2013, high yield bonds have been diving (down some 18% so far) even as the S&P 500 managed to limp higher into mid-2015 on ‘FANG’ fumes (Facebook, Amazon, Netflix and Google).
High yield bonds broke below their 2011 support line last fall (horizontal green band above) and so far continue to drop as 2016 brings rising defaults and write-downs.
Click image to enlarge.
Monday, 1 February 2016
Saturday, 30 January 2016
Saturday 30January2016 - When Will Reality Kick in?
Clips from Danielle Park's blog.
Clips from Danielle Park's blog.
Sales and profit trends reveal hideous S&P 500
An aging and indebted world spending less, and a soaring greenback, have taken both boots to multinational sales and earnings trends since 2011. While stock prices always recognize such realities eventually, this cycle central banks have managed to inspire an unusually long period of willful blindness among participants.
Down just 11% since last July, the S&P 500 has levitated in a world of HFT dreaming even as other global markets have increasingly hit the skids. Far from getting off easy however, the S&P 500 now has the distinction of being one of the most precariously perched markets in the world today. This chart of sales growth (in blue) versus the price of the S&P (in black) since 2000 paints the picture well.
Down just 11% since last July, the S&P 500 has levitated in a world of HFT dreaming even as other global markets have increasingly hit the skids. Far from getting off easy however, the S&P 500 now has the distinction of being one of the most precariously perched markets in the world today. This chart of sales growth (in blue) versus the price of the S&P (in black) since 2000 paints the picture well.
Sunday, 17 January 2016
Sunday 17January2016 - The Crumbling Financial Edge!
From Mauldin's weekly newsletter.
George Friedman comments on Italy's failing banks. Will an Italian bank holiday be the event that kicks off the next world financial crisis?
Friedman: Italian Debt Crumbles
Now let’s turn to geopolitical concerns for a moment. All my readers have had a chance to look at George Friedman’s 2016 forecast. New readers can access a summary for free here and find a link to the full version. I can’t tell you how thrilled I am that George has partnered with Mauldin Economics. He brings so much to our table with his insights. Rather than go over what you have hopefully already read (and if you haven’t, you should), let me highlight one position he has clarified further since he wrote that forecast.
In a note entitled “The Precarious State of Italian Banks,” George and his team gave us an update on the serious financial problems facing Italy. You can find good news, but the bad news overwhelms the good. Nonperforming loans have now reached $216 billion, which is about 17% of Italian GDP. We have already seen some Italian banks fail rather spectacularly, and we are going to see that number increase. There is never just one cockroach. And while depositors are covered up to €100,000, that doesn’t do much good for businesses and wealthier households.
Italian bank debt is now very suspect. As it happens, Italians, rather than depositing their money in the bank at very little or no interest, buy bank bonds to get at least some return. In the recent spate of bank closings, 130,000 shareholders lost €790 million. The four small banks that failed represented just 1% of total Italian bank deposits. The total amount of bank debt held by Italian households is €237.5 billion. That’s billion with a B. Think of it as high-yield debt on steroids – except that it is generally very low-yield.
It’s not clear whether the Italian insurance deposit scheme has the money to cover even a fraction of the bigger potential losses. The ratio of assets to deposits covered is about 250 to 1. Now, the US FDIC’s required ratio is about 100 to 1, but US banks don’t have nonperforming loans of 17.9%, either.
There’s a lot more to this story than my brief summary can detail, but the point is that the problems in Europe don’t stop with the immigration crisis. The credit crisis of a few years ago has not gone away. Italy’s debt-to-GDP is growing every year, and it was already at a critical level five years ago – before the ECB took rates into negative territory and bought massive quantities of Italian bonds. They can continue to do that, but can they buy Italian deposits and defaulted bank debt? That’s rather doubtful. This is a story we will be watching closely as it unfolds this year.
From Mauldin's weekly newsletter.
George Friedman comments on Italy's failing banks. Will an Italian bank holiday be the event that kicks off the next world financial crisis?
Friedman: Italian Debt Crumbles
Now let’s turn to geopolitical concerns for a moment. All my readers have had a chance to look at George Friedman’s 2016 forecast. New readers can access a summary for free here and find a link to the full version. I can’t tell you how thrilled I am that George has partnered with Mauldin Economics. He brings so much to our table with his insights. Rather than go over what you have hopefully already read (and if you haven’t, you should), let me highlight one position he has clarified further since he wrote that forecast.
In a note entitled “The Precarious State of Italian Banks,” George and his team gave us an update on the serious financial problems facing Italy. You can find good news, but the bad news overwhelms the good. Nonperforming loans have now reached $216 billion, which is about 17% of Italian GDP. We have already seen some Italian banks fail rather spectacularly, and we are going to see that number increase. There is never just one cockroach. And while depositors are covered up to €100,000, that doesn’t do much good for businesses and wealthier households.
Italian bank debt is now very suspect. As it happens, Italians, rather than depositing their money in the bank at very little or no interest, buy bank bonds to get at least some return. In the recent spate of bank closings, 130,000 shareholders lost €790 million. The four small banks that failed represented just 1% of total Italian bank deposits. The total amount of bank debt held by Italian households is €237.5 billion. That’s billion with a B. Think of it as high-yield debt on steroids – except that it is generally very low-yield.
It’s not clear whether the Italian insurance deposit scheme has the money to cover even a fraction of the bigger potential losses. The ratio of assets to deposits covered is about 250 to 1. Now, the US FDIC’s required ratio is about 100 to 1, but US banks don’t have nonperforming loans of 17.9%, either.
There’s a lot more to this story than my brief summary can detail, but the point is that the problems in Europe don’t stop with the immigration crisis. The credit crisis of a few years ago has not gone away. Italy’s debt-to-GDP is growing every year, and it was already at a critical level five years ago – before the ECB took rates into negative territory and bought massive quantities of Italian bonds. They can continue to do that, but can they buy Italian deposits and defaulted bank debt? That’s rather doubtful. This is a story we will be watching closely as it unfolds this year.
Saturday, 16 January 2016
Thursday, 14 January 2016
Thursday 14January2016 - Alberta Bitumen Oil Below $10
Clip from Danielle Park's blog.
Clip from Danielle Park's blog.
Canadian oil under $10, how low can it go?
Hitting a low of $8.35 a barrel yesterday (down from $80 2 years ago), Canadian oil producers are losing money at current prices. Yet so far, they are continuing to pump at record levels nonetheless. The spending to extract bitumen is front-loaded and so sunk costs encourage producers to increase output as prices fall. Today highly indebted and desperate for cash flow, most don’t see a choice. See: Crude at $10 already a reality
Monday, 11 January 2016
Monday 11January2016 - Canadian Dollar and Stock Market Outlook!
From Danielle Park’s blog. Monday 11January2016
Click image to enlarge.
From Danielle Park’s blog. Monday 11January2016
Posted on January 11, 2016 by Danielle
Park
Canadian dollar index (FXC) broke below .70/U$ this
am as West Texas Crude broke below $32 and copper below $2.00. Canada
can’t catch a break these days.
The TSX is officially into bear market territory,
now down more than 20% from the cycle peak in September 2014 and falling…
Closing below 12,700 (dotted line below) last week, the next key test is the
11,000 area (brown bar below) which was the dot.com peak in September 2000, as
well as support that held through the QE-led exuberance of late 2009 to late
2012.
If the 11,000 support area fails once more, we will
be watching for a test of the 2009 uptrend (yellow bar) in the 10,000
area. Ultimately, history suggests that if the present downturn is to be
the third and final cyclical bear to end the secular bear that began for stocks
from extreme over-valuations in 2000, then a retest of the March 2009 lows
(green bar) in the 8,000 level is in the cards for the TSX composite.
The Canadian dollar (red below) typically leads the
Canadian stock market (TSX in blue since 1999), and it’s already below the 2009
low as shown here.
At Venable Park, we have long suspected
that at least one more test of the 2009 lows was probable before this secular
bear could end. Time will tell if that thesis was correct. One
thing for sure, few financial managers have told their clients or investors
that this is a probability.
Click image to enlarge.
Friday, 8 January 2016
Friday 08January2016 - Gold Big Picture View!
Charts from January EWI Financial Forecast Issue.
With anticipated current seasonal strength in gold bullion price we should have a good rally in gold stocks. Chart waves (A), (B) and (C) to complete wave B (circle). Sell your gold stocks at wave B (circle) and bullion here. The next wave for gold bullion and gold stocks in down to even lower lows.
Charts from January EWI Financial Forecast Issue.
With anticipated current seasonal strength in gold bullion price we should have a good rally in gold stocks. Chart waves (A), (B) and (C) to complete wave B (circle). Sell your gold stocks at wave B (circle) and bullion here. The next wave for gold bullion and gold stocks in down to even lower lows.
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