GTA Capital Markets & Investment Research Services

05/01/2022

Census signals it's time for Canadian investors to act their age

The decade bull market supported by low inflation and ultra accommodative monetary policy has come to a dramatic pause, if not end.

There is a substantial decline in workplace pension plans over the past 50 years.

This structural shift has led many Canadians to take matters into their own hands by investing for their retirement through registered retirement savings plans (RRSP) and tax free savings accounts (TFSA), which has opened to door for casino-type trading platforms to push speculative investments like cryptocurrencies.

There’s nothing wrong with speculative investing if you’re younger or have extra ‘play money’ on hand, but the risk of losing everything and starting over in your fifties would be devastating.

Seek professional help.

Census signals it's time for Canadian investors to act their age The decade bull market supported by low inflation and ultra accommodative monetary policy...

04/24/2022

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The International Monetary Fund’s significant downward revision to its 2022 World Economic Outlook, just one quarter into the calendar year, has generated headlines and hand-wringing around the world.

Three major secular developments are to blame for the tepid outlook:

the changing nature of globalization;

the prolonged reliance on artificial growth boosters; and

the long-term failure to invest in the sources of sustained growth.

These developments coincide with a period of low productivity growth in many countries, which is a function of past and persistent failures to invest in the drivers of genuine growth, including physical infrastructure and human capital.



https://www.zerohedge.com/markets/el-erian-warns-global-growth-engines-are-sputtering

04/24/2022

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"The Biggest Story No-One Is Talking About": Why Albert Edwards Expects "Something In The Market Is About To Snap"

Extreme monetary policy divergence between the FED and Japan, China and virtually every emerging market Central bank.

"The end one of the two central banks will capitulate first, and that will most likely be the BOJ as it has far less firepower - both monetary and verbal - than the Fed. One can watch this in real time as US Treasury yields soar higher, while the 10y JGB yield keeps knocking at that 0.25% YCC door "and the louder it knocks, the more rapidly the yen plunges." The yen will snap, or the BOJ's defense of the upper YCC barrier will fail (or both)."

"Japan, that paragon of MMT crackpots everywhere, suddenly finds itself trapped in a lose-lose dilemma: intervene in the bond market and spark a furious, potentially destabilizing and uncontrolled plunge in the yen which would also lead to galloping (if not worse) inflation, which could collapse what little faith remains in the BOJ, or do nothing and contain the slump in the yen while risking far higher yields which in a country where the debt is orders of magnitude greater than GDP, could also spell fiscal and monetary doom."

"When Australia ended YCC yields snapped higher – much higher!" A similar interest rate move in Japan, still the world's second largest economy, and one can kiss all remaining central bank credibility goodbye."



https://www.zerohedge.com/markets/el-erian-warns-global-growth-engines-are-sputtering

04/23/2022

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Higher Producer Prices are funneling through the CPI.

The CPI figure came in at 8.5% year-over-year, in line with expectations and at a 40-year high, while core CPI (excluding food and energy), came in at 6.5%, slightly below forecasts of 6.6%.

Meanwhile, PPI, which measures prices paid by domestic producers, came in at 11.2% year-over-year, the highest on record.

Historically, inflation moves from peak to bottom over a period of 24 to 36 months. So we may not return to 2.0% core inflation for some time.

04/23/2022

Central banks are on the move globally

This week we heard from major global central banks, most of which are on a similar inflation-fighting agenda as the Federal Reserve.

The Bank of Canada (BoC) this week raised rates by 0.50% and committed to ending its balance-sheet purchases by the end of the month, which will shrink the balance sheet over time.

We see the BoC potentially raising rates by another 0.50% in its June meeting as well and moving rates steadily higher towards 3.0% in the next few quarters.

the Federal Reserve is likely to raise rates by 0.50% and announce a balance-sheet reduction program at a pace of $95 billion per month.



https://www.edwardjones.ca/ca-en/market-news-insights/stock-market-news/stock-market-weekly-update