The rising Tiger

RYAN  By Guest Blogger Ryan Lewenza

Last week my colleague Doug outlined how China is going through transformative change like mass urbanization and rising consumerism, which is helping to reshape their economy from a largely agrarian society to an industrial powerhouse. He also mentioned my nonexistent Porsche, but that’s a topic for another day. This week I expand on the China topic, focusing on China’s economic outlook and investment implications.

Anyone who has basic knowledge of China’s economy and has not lived under a rock for the last decade knows that China’s GDP statistics are about as reliable as Kathleen Wynne’s strategies on addressing Ontario’s soaring hydro costs. Even China’s Premier Li Keqiang doesn’t believe in their GDP statistics as he was once quoted as saying the GDP figures are “man-made” and “for reference only”. These comments were made at a private dinner and came from a leaked memo via WikiLeaks.

So with this understanding one must look at alternative economic indicators in trying to assess China’s economic trajectory. For that I focus on three key economic indicators which are less susceptible to government manipulation. They include: 1) the Caixin Manufacturing PMI; 2) electricity consumption; and 3) freight traffic volume.

The Caixin PMI is an independent survey of 420 different manufacturing companies in China and it currently sits at 51.2 which is above the important 50 level indicating expansion in the manufacturing sector and is near its highest level since 2014. With manufacturing representing 40% of China’s economy, an improving manufacturing PMI suggests stronger economic activity from the world’s second largest economy.

China’s Manufacturing Sector Is Rebounding

Source: Bloomberg, Turner Investments

Similarly, China is experiencing a significant uptick in electricity consumption and freight traffic, further evidence of economic acceleration. On a Y/Y basis electricity consumption is up 17% and freight traffic volume is up 15%. Following a slowdown in early 2016, China’s economy is clearly on an upswing which bodes well for the global economy.

China’s Electricity Consumption is Up 17% Y/Y

Source: Bloomberg, Turner Investments
China’s Freight Traffic is Up 15% Y/Y

Source: Bloomberg, Turner Investments

Moving from the economy to China’s stock market, there are a few important bullish supports for Chinese equities. First, Chinese stocks are attractively valued when compared to global equity markets. For example, currently the MSCI China Index trades at 15x earnings versus the MSCI US Index at 22x, resulting in a P/E discount of 7 points. Now Chinese stocks should trade at a lower multiple compared to the US given the strong rule of law in the US, more mature financial markets, lower corruption, and the plethora of great US companies like Apple, Google, and Tesla to name a few. Despite this we see Chinese stocks as attractively valued which is one bullish argument for having some exposure.

The second support for Chinese stocks is the bullish technical trends for the region. Currently the Shanghai Index is trading in a solid uptrend and above its rising 50- and 200-day moving averages.

So with an accelerating economy, strong technical trends, and attractive valuations this is generally a good investment combination, and why we recommend our clients have some exposure to the region.

Chinese Stocks Trade At a Discount to US

Source: Bloomberg, Turner Investments

Now it’s not all roses for China’s economy and their equity markets. Corruption and poor environmental conditions continue to dog the region but our biggest concern remains China’s high and rising corporate debt load. China has been on a spending binge over the last decade as they modernize their cities by investing in critical infrastructure projects like roads, airports, and railways. Many of the projects were sound and necessary to bring China’s economy into the 21st century, however, some of the infrastructure projects are likely to prove excessive and fail to deliver much economic value. Case in point is China’s “ghost cities” which are dozens of newly built cities housing 1 million+ people that remain largely vacant. They were built in anticipation of people moving from rural communities to cities, however it is very likely that they overbuilt resulting in the high vacancy rates and likely future bad loans. I believe that some developers and banks may end up going under as a result of these questionable projects and that this could have economic consequences down the road.

Despite this longer-term risk, we still view China as a good area to invest in which we access through broad-based emerging markets ETFs. Currently we hold a 4% weight to emerging markets in client portfolios with the potential to increase the weight further. For this we would like to see a weaker US dollar (emerging markets have a high negative correlation to the US dollar) and continued improving technical trends.

With the huge gains made in developed markets like the US since the financial crisis, we believe investors should increasingly look to the emerging markets. In my view, the rising tiger that is China still has many years of strong economic growth ahead, which investors should look to capitalize on.

Ryan Lewenza, CFA,CMT is a Partner and Portfolio Manager with Turner Investments, and a Senior Vice President, Private Client Group, of Raymond James Ltd.

134 comments ↓

#1 For those about to flop... on 04.14.17 at 8:07 pm

Hey Crowdie ,I took your advice and went and checked out Clint Eastwood’s old haunt.
Had a nice lunch there with Mrs Flop and I tried to put it on the Turner tab,but was declined.

Also this is the first time I have been in the States since my blog buddy Boom’s passing and so I toasted his life with a lager from Wisconsin.

You want the proof….You can’t handle the proof…

M42BC
M64WI

https://imgur.com/a/NuGBY

#2 Setting the Record Straight on 04.14.17 at 8:13 pm

Some individual stock suggestions please and thank you.
Any thoughts on Alibaba?

#3 HAM R Us on 04.14.17 at 8:15 pm

Buy XCH and ZCH. You need both ETFs to cover Chinese economy. For I Trade accounts, XCH is commission free. They look good for long term investors.

#4 Dr. Bob on 04.14.17 at 8:16 pm

I enjoy reading your comments Ryan. I hope that you can fill in for Garth more often………(no offense to you Garth).

#5 mike from mtl on 04.14.17 at 8:17 pm

No issue with EM or China in particular.

Unlike us who’s GDP is based off flipping houses to each other and digging up wood and rocks. China gets these and sends us the finished goods back, enriching them and the US interests.

Also most of their tech companies are ACTUAL tech companies. Not like the vastly overvalued friendface, amazonia, jitter and crap/snap.

#6 jay on 04.14.17 at 8:19 pm

When the first missile hits N. Korea ,will that be a good time to buy?

#7 Stone on 04.14.17 at 8:25 pm

So what kind of car do you drive, Ryan?

#8 mark on 04.14.17 at 8:27 pm

A 4%weighting is clearly not much of a endorsement for the 2nd largest economy is it?

You would think the 2nd largest economy would have at least 20% ?

#9 David Prokop on 04.14.17 at 8:39 pm

People inside Beijing politburo don’t know what’s going on in China and here we have China bull Ryan who seem to know more about China than the top brass that is running that country.

Many successful investors like Jim Chanos or Kyle Bass are adamant that China is a bug in search of a window. Since 2007 China created some $24T of credit, which is more than the value of the entire US banking system. That’s a lot of money that went into ghosts cities and other useless projects that will never be paid back. This massive credit growth made a lot of people enormously rich, but there is price to be paid, maybe even sooner then Ryan thinks…

#10 Shawn on 04.14.17 at 8:46 pm

Hey Ryan,

Thanks for the insightful post. For your clients are you holding Canadian domiciled ETFS (ie XEC, VEE) or ETFs purchased with American currency (ie VWO, IEMG)? I understand that the foreign withholding tax is lower with American domiciled emerging market ETFs but considering the recommendation of holding about 5% emerging markets in your portfolio would the currency conversion be worth the savings in MER? Once again keep up the great posts and if I can borrow your ‘non-existant’ Porsche for a hot date tonight I’d be in your debt.

#11 Barb on 04.14.17 at 8:46 pm

Ghost cities in China.
Not unlike areas of Vancouver.

#12 Eddie Y fellow loser lounge member. on 04.14.17 at 8:47 pm

I just had a few shots of Jack with Smokey.

Ryan not trying to up stage you on your accurate but boaring post, but this is big.

Smokey lost his mind. Says Fagathronian aliens are after him. Said It in his his stupid book.

Says he’s been busy trying to save the human race from an all out nuke war, no time to post at the moment.. He said Trump was always a globalist and he knew it and documented in the last chapter..

Says Shlong something rules the world and he has to be stopped.

I asked him about why hes not posting on GreaterFool.

He said. Nothing.

That’s my report.

#13 Mark on 04.14.17 at 8:55 pm

Sure would be nice to see China, Canada, and the emerging markets starting to perform better. If you look at the ETFs (VWO, EWC, etc.) for these countries, normalized to the USD$, they haven’t gone anywhere in over 10 years. Yet dividend yields and earnings continue to grow, and earnings retention has been very strong.

Kudos, of course, to those who predicted that the US economy and US dollar would get a bit of strength over the past few years (for reasons that continue to mystify me), but at some point, the trend has to come to an end given the absolutely abysmal performance of the US economy and the increasingly unstable political and social situation.

given the strong rule of law in the US

Hahahaha… If anything, US stocks should trade at a discount because of the dysfunction of the US legal system and government generally.

#14 Tony on 04.14.17 at 8:58 pm

The Chinese are desperately trying to get their money out of their native China for 3 reasons.

1) The devaluation of the yuan
2) Trump will sink their entire economy for good with tariffs. China will thus go the way of Japan.
3) Air pollution making their city barely livable

#15 TurnerNation on 04.14.17 at 9:11 pm

Where’s Emmazaun – forcing the guests bloggers pen on a stat holday? ;-)

– Dollarama today: 5 items for $6 all-in. Score.
We all are Chinadian?

– ROFTLOL dept. 1 mill for a sht post war bung in TO:
Where else in the world would this shack be so vaulted?
Nowhere.

http://www.realtor.stfi.re/propertydetails.aspx?ref=E3759688&boardid=82&sf=xerkzyn#aa

#16 AR on 04.14.17 at 9:29 pm

Ryan, have you been to China? The ghost cities do not number in the dozens. There are hundreds. That may not end well.

Why are the 3 stats you quote any more reliable than the GDP numbers? Are they externally generated?

And finally, will any of this matter if Trump continues his testosterone laden, narcissistic approach to governance?

#17 S.Bby on 04.14.17 at 9:41 pm

If China’s economic numbers appear to be mostly a complete fabrication so why would anyone want to invest in that kind of environment? Would someone be more comfortable investing in a Enron type scenario because it’s the same thing. It’s all based on fraud and corruption.

#18 crowdedelevatorfartz on 04.14.17 at 10:12 pm

@#1 Flopper
Awesome. The Hogs Breath Inn brings back some memories of Laguna Seca Super Bike Race debauchery. But thats another story.
When I walked into the Hogs Breath it was JAMMED with tourists trying to look like they werent actually hoping to meet Clint and murmuring in faux small talk.
He wasnt there.
So I said to a snooty manager, “Where’s CLINT?”
Everyone stopped talking………
” MR Eastwood is in Canada on a fishing trip” came the snooty reply.
Half the bar asked for their bill and walked.
We got drunk and bought some T-Shirts.
A week later I’m back at work in Vancouver and a coworker friend who was on a week long fishing vacation at an exclusive resort in Northern BC walks in and sez, ” YOU will NEVER guess who I saw last week while fishing!”
“Clint Eastwood” , was my feigned bored reply.
Coulda pushed him over with a feather

#19 mike from mtl on 04.14.17 at 10:23 pm

If China’s economic numbers appear to be mostly a complete fabrication so why would anyone want to invest in that kind of environment?
/////////////////////////////////////////////////

And the US is any different? EU – a few good ones with a bunch of loser countries or shall I say members? Latin america is as corrupt as they come. India and surrounding states are equally corrupt with a very healthy underground cash real economy. Hint, to get ANYthing done in that part of the world required US$ cash in hand.

ME = oil.

#20 HAM R Us on 04.14.17 at 10:24 pm

Fools like Jim Chanos who shorted China when its GDP was like $1 trillion all the way to the current $11 trillion! People like Jim Chanos cannot be a good investor because they are too ideologically bent! They cannot/will not change when things change.

#21 mike from mtl on 04.14.17 at 10:28 pm

Continued.

So called ‘First world’ would like to think we are somehow beyond corruption, however I can suggest look harder. It’s still there just less upfront and sophisticated. But still there nonetheless.

Show up in those developing lands with cash in hand and everything suddenly becomes totally possible.

#22 TurnerNation on 04.14.17 at 11:18 pm

How to starve the Beast: you cannot come at it head on. No you must cut off its food supply.

Prediction: Home Crapital corp will go under taking legions down.

#23 HAM R Us on 04.14.17 at 11:18 pm

Another fool is Gordon Chang who wrote “The Coming Collapse of China” in 2001. Nowadays He still goes on American TVs to claim the imminent melt down of China whenever the Shanghai stock exchange drops down 1%. As late as last month, he proclaims that “China Is Going to Go Into Free Fall”. What a moron!!!

In the meantime, China has become the 2nd biggest economy! Let me provide some eye openers to those of you who have never stepped outside of Vancouver or Toronto or who only know China makes Dollarama stuff:

1. China has the biggest and longest high speed train network. I can bet you 99% of Canadian who has never even seen such a fast thing, let alone taken a trip with it.

2. China is the biggest auto market. Bigger than 27 EU countries combined! Bigger than north american combined.

3. Ask what the Chinese market means to these leading West companies: Apple, GM, Volkswagen, Starbuck, Airbus, Boeing…

To many to list here.

Why do not people in Canada/West wake up to the this new world?

Sometimes I suspect people like Gordon Chang is a Chinese government plant who purposely tries to dumb down the Americans so that China can rise without being targeted!

Gordon Chang should be tried as treason by the West collectively!

#24 Ghost Cities on 04.14.17 at 11:50 pm

It used to be that Chinese citizens/investors bought up newly built condos in these ghost cities as “investments” . They have more recently smartened-up, they are now seeking investment propertys in mature international cities like Sydney and Vancouver etc. They are particularly interested in cities with good universities.

#25 traderJim on 04.15.17 at 12:27 am

A country of 1 billion plus people going changing from decades of communism to a weird mixed economy with lots of centralized control is definitely one of the most important events of our time, but it is going to be a rocky road and looks like a house of cards to me.

Maybe their second, more market oriented attempt will work out better. I’ll probably be dead by then so I will stick to North American investments, thanks.

#26 Ponzius Pilatus on 04.15.17 at 12:31 am

Keep on advising your Chinese clients to buy Chinese stocks.
Where the hell is Smocking Man?
He’s gotta come back and “Make this blog great again”.

Canadian financial advisors are not allowed to service clients in China, due to regulatory restrictions. — Garth

#27 Nonplused on 04.15.17 at 12:58 am

I wish there were some ghost cities in Canada. I’d just move in to an abandoned apartment building and live for free.

I have a pair of skis made in China (K2’s). I wonder what the people who made them thought they were for. Maybe they show them Warren Miller films and they think they are primarily for jumping off cliffs to one’s demise.

#28 steerage steward on 04.15.17 at 2:21 am

No doubt China is a highly productive economy, however their opaque and arbitrary security markets should give western inverters pause.

#29 k on 04.15.17 at 2:26 am

Hey Eddie #12 comment.
Love ya….but you come across better when you know how to spell…….Boaring ? Is that pigs snarfling in the underbrush or did you mean uninteresting ? It is just a credibility thing. Just sayin’

#30 HCG on 04.15.17 at 3:04 am

Re #22

Their mortgage business is in shambles but one of the big banks (excluding BMO) will pick up their healthy deposit accounts. They’re the only thing that’s keeping them afloat now.

#31 ironically on 04.15.17 at 8:20 am

A 4%weighting is clearly not much of a endorsement for the 2nd largest economy is it?

You would think the 2nd largest economy would have at least 20% ?

…………….

most Canadians’s weighting of Cdn equities significantly outweights Canada’s contribution to world GDP- which is approx 4%.

#32 Harvey Lipshitz on 04.15.17 at 8:32 am

All Government Statistics are a total Fraud. Unemployment Rate anyone ?

#33 Victor V on 04.15.17 at 8:43 am

https://www.thestar.com/business/real_estate/2017/04/14/buyers-sellers-brace-for-an-unprecedented-spring-real-estate-season-in-toronto-region.html

“People are buying 100 per cent on debt. They are refinancing their homes. They don’t care if they are cash-flow negative. People just think they’re going to make money. Everybody wants another property. I’m talking friends, aunts,” he says.

#34 ALFRED E. NEUMAN on 04.15.17 at 8:46 am

A) An excellent post Ryan, and B) an excellent post strategy.

Re A: with you so on top of things, I worry less about trying to understand all things “investment”.

Re B: don’t expect much assault activity from the blog-snipers to-day .. this one is way over their heads.

They’ve likely read it thrice trying to find an attack angle and are left just shaking their heads: “Charts?
China? What the hell’s Ryan sayin’?”

#35 Victor V on 04.15.17 at 9:04 am

https://www.wired.com/2017/04/antonio-faccilongo-atomic-rooms

BEIJING IS CROWDED and expensive, with more than 21 million residents competing for housing that continues to skyrocket. That’s why an estimated one million people choose to live underground in cheap, concrete bunkers built to withstand a nuclear blast.

Italian photographer Antonio Faccilongo documented Beijing’s subterranean community in Atomic Rooms. The images show ordinary people trying to make it in the big city while living 50 feet underground. “They’re following their dreams, but the first step is moving into the atomic shelter,” says Faccilongo.

#36 Exilled on 04.15.17 at 9:22 am

Mr Ryan:

Wait and see, when the oceans start rising. What those Ghost city’s will be doing!

The ghost citys are inland! Away from the coast. See what the Chinese are thinking 50 years ahead.

#37 Fred on 04.15.17 at 9:28 am

thnaks for the post. As usual very informative. Interesting use of different metrics to assess current China growth. Not sure why the country cares little of transparency?

i like to use both passive and active products. Passive index investing as a core, active for sectors/regional. Active has shown to have significant increase in returns vs passive in the latter- ex., small caps, emerging markets.

RBC EM equity fund D comfortably beats VEE in nearly every important metric . And for those who only care about returns;

5 yr ave;
VEE- 6.66
RBC- 10.03

(RBC also has a emerging markets dividend fund for those looking for greater yield)

#38 westcdn on 04.15.17 at 9:36 am

China, yes the biggest Asian tiger with prospects better than Canada given our propensity to self-indulge and try to live on someone else’s dime (I always speak averages). The Chinese people have a long history of being exploited by their powers to be and they remember. I like a rule of law for all and prefer the Canadian legal system over the Chinese one, Cdn warts and all. I consider a Chinese investment more as a currency bet given the higher level of corruption. IMO, the potential rewards of a China ETF are worth the risk but the chances of me investing are low.

I would use gold as a hedge if my objectives included currency speculation. Personally, I favor a Canadian company with significant Chinese sales such as WEF.

I liked the quiet guy in the elevator and kick ass gal.
https://www.bing.com/videos/search?q=transformers+age+of+extinction+clips+chinese+guy+in+elevator&&view=detail&mid=CB0519D4B82743BBB195CB0519D4B82743BBB195&rvsmid=CB0519D4B82743BBB195CB0519D4B82743BBB195&fsscr=0&FORM=VDMCNL

#39 original dave on 04.15.17 at 9:51 am

nobody seems to be talking about the beat down Canadian subprime companies took last week.

Friday: home cap down 8.6%. Equitable down 8.3%. Genworth down 6%

houston….

#40 NoName on 04.15.17 at 9:55 am

Someone mentioned robots in china other day, robots managed to do number here in NA on a labour and employment, but in china because cheap and big labour pull it will be years maybe decade or decades before they start feeling same pain, me thinks…

http://bit.ly/2pj9vLK

—–

and this, schooling 2.0

“Authorities will strengthen educational campaigns targeting different ages within the group to champion patriotism and socialism with Chinese characteristics, making the “Chinese dream” a common goal for them, according to the plan.”

http://bit.ly/2oBJGZO

#41 Exilled on 04.15.17 at 10:08 am

Mr Ryan:

Lets throw this out there! Trump and Xi had a little meeting in Florida. North Korea was on the agenda!! Lets see if Trump gave up Tiawan and the Nine Lines also the Phillipines. In exchange for the Chinese taking care of ” Little Kim” ( not sure how to spell his name ). This would be a very good deal for the POTUS. He could save his 5TH and 6TH fleets from extinction. And his country. Because nobody win a nuclear war!

#42 Exilled on 04.15.17 at 10:09 am

P.S. China has 100 Million Man Army. Armed to the teeth!

#43 Exilled on 04.15.17 at 10:11 am

Epochtimes .Chinese News

#44 crowdedelevatorfartz on 04.15.17 at 10:22 am

@#34 Exiled
“Wait and see, when the oceans start rising. What those Ghost city’s will be doing!
The ghost citys are inland! Away from the coast. See what the Chinese are thinking 50 years ahead.
*******************************************
Nah, nobodys that prescient, especially a communist beaurocracy full of corrupt officialdom.
More than likely the land 200kms away was cheap and there were hardly any rube farmers to bamboozle out of their property.
It wont be rising oceans that cause mass exodus, more like desertification.
And while Trumpocalypse2017 may beg to differ…….it wont be a low level nuke war that kills hundreds of millions ….Cigarettes baby!
Chinese . The most prolific cancer tube boggers on the planet. The ultimate sneak attack.
Speaking of lung cancer……Hows the air pollution in the Peoples Republic? Can you still cut it with a knife ?

Invest in air masks…..

#45 Koshy Alex on 04.15.17 at 10:38 am

“Following a slowdown in early 2016, China’s economy is clearly on an upswing which bodes well for the global economy.”

http://www.reuters.com/article/china-economy-loans-idUSZZN3EZR00

China’s banks extended a record 12.65 trillion yuan of loans in 2016 as the government encouraged credit-fueled stimulus to meet its economic growth target.

I really hope this upswing is sustainable, if not we will have serious problems in the future for the so called global economy.

#46 crowdedelevatorfartz on 04.15.17 at 10:56 am

@#23 Hammer U

Ahhh yesss.
The stupid Gwailo will never realize the juggernaut bearing down upon them.
China the great, the powerful, it manifest destiny to rule the world
Well.
While China has spent trillions $ on the largest infrastructure upgrade in the history of mankind their people remain subjugated, their country polluted, inequality growing…
Thousands of protests all over China rattling the cages of a nervous communist beaurocracy that fears the inevitable meltdown. Hence kneejerk attempts at cracking down on corruption with show trials. Even when there are rumors of Dear Leader Xi’s own “dabblings” in the money pot…….
What will be the instigator for a new revolution?
An incompetant, corrupt judge following orders and releasing the obviously guilty child( known as Little Emperors) of a rich govt official?
One too many outbreaks of poisoning due to corrupt health inspectors allowing yet another questionable company to sell its dubious products ( white paint sold as baby formula killing and maiming hundreds was my pick as a new low in chinese communist entrepreneurialism….)
Another overworked factory employee jumping off the roof at lunchbreak? (Yep. Who knew….Smart Phones kill)
Subjugated minorities from the Chinese hinterlands tossing homemade bombs or randomly stabbing people in big city crowds?
Or the govt mandated population control aka The former “One child” policy that has created a generational timebomb that is only now becoming frighteningly apparent. (Far too many people wearing Depends…far too few to help change them).
Trying to keep a lid on the boiling anger that pervades all levels of China’s society at the corruption, the lack of free speech, the lack of basic democratic rights, the huge inequalities between the rich and the poor,…….its a powder keg and one of these days…..its gonna blow and all the bullit trains and big city laser light shows wont stop it.
Im very happy to be living right here in Gwailo central aka Canada
A sociologist once said that when a society reaches a point where everyone has a telephone the secret police cant control free speech because you would need half the population watching the other half.

China the great, the powerful, its manifest destiny to ultimately rule the world.
Careful what you wish for because the Americans have been practicing at it for a few decades and for all their efforts….they are now a target and despised world wide.
As Napoleon once said, ” When China awakes , the world will listen”. I dont think he meant its own internal civil war/revolution but I believe he was absolutely right…

P.S. Hows the air pollution? Getting worse?

#47 Eco Capitalist on 04.15.17 at 11:00 am

Ryan, you mentioned concern about Chinese borrowing, but who are they borrowing from? Are they sourcing capital internationally or would it be strictly an internal issue?

#48 Smudgekin on 04.15.17 at 11:17 am

I’ve never felt threatened by the Chinese or China. So I don’t know why there’s all this demonizing.

China’s biggest threat is internal. Being a one party system they don’t want a radical tyrant like Mao or Trump.

#49 AGuyInVancouver on 04.15.17 at 11:42 am

#9 David Prokop – Well at we know at least some of that credit has made it’s way into Canadian real estate:
http://www.cbc.ca/news/canada/british-columbia/chinese-real-estate-investor-to-repay-millions-1.3998380
And that just one we know of, due to them thinking they could get away with a scam. How many other thousands are out there?

As Garth points out China throws up a whole bunch of barriers to trade in services (and manufacturing). This is why JT’s goal of “free” trade with them is a fool’s errand.

#50 Paul on 04.15.17 at 11:56 am

48 Smudgekin on 04.15.17 at 11:17 am

I’ve never felt threatened by the Chinese or China. So I don’t know why there’s all this demonizing.

China’s biggest threat is internal. Being a one party system they don’t want a radical tyrant like Mao or Trump.
—————————————————————–
Hate to break it to you but Trump was ELECTED!

#51 Danger Dan on 04.15.17 at 12:00 pm

Last week I was skeptical but this week the charts have me thinking. Manufacturing is undoubtedly on the rise again, and doing business with the Chinese is typically a pleasant experience, but I still want no part in financing communism and that’s hard to avoid when the government is known for unilaterally nationalizing private enterprises by any means.

#52 jas on 04.15.17 at 12:20 pm

#20 Ham R Us
I agree some people like Jim Chanos are permanent bears.
It is better to ignore them

#53 crowdedelevatorfartz on 04.15.17 at 12:29 pm

@#48 Smudgekin
“I’ve never felt threatened by the Chinese or China. So I don’t know why there’s all this demonizing…..”
********************************************

“demonizing”?
Apparently uncomfortable truths are now considered “demonizing”?
Wow.
What ARE universities teaching malleble young minds these days?
Do you also show up to Jason Peterson lectures with an airhorn?
Nothing like shouting down an opposing viewpoint or better yet , labeling it racist/sexist/paternalist/demonizing.

I was merely responding to the arrogant braggaddoccio from #23 HamR Us.
He’s allowed to brag about China and I’m not allowed to point out painfully obvious short comings in the “Great Chinese Maul” that is stripping the seas of food and polluting the planet faster than any nation has in the history of mankind.
But when the last flower is plucked from the ground they “win” because they have more bullit trains?
Yeesh.

OK. Lets talk Facts
Why has China pumped billions into its military? Is someone about to invade?
Why is China constantly attempting to hack into US or Canadian govt sites, private companies, or personal websites?
Why does China outlaw religion?

Not demonizing….FACT
Ever heard of the South China Sea?
Thats where the next major clash of Titans will occur all because China is now demanding its “place in the sun”.

Fact. Nothing like illegally building an airstrip on a submerged coral reef in the Spratly Islands or the appropriately named Mischief Reef, then plopping a flag on it and claiming “historical soveriegnty rights”and demanding all other nations recognize their claim.
This in an area that handles 40% of the WORLDS shipping…..
Whats next to claim ? Hawaii? Australia? The Pacific ?Canada? I mean lets face it.
The original settlers of North America were nomadic tribes walking from asia 10’s of thousands of years ago.. Forget all the land claims by First Nations…China was here first!
Lets pay them billions and hand over the keys…….
I’m sure in about 50 years we’d be living in a polluted “utopia” just like them

China is no paragon of virtue and neither is the West. But make no mistake, if the Chinese govt could crush our way of life they would do it in a heart beat and lose no sleep over it. And if the tables were turned, I’m sure we’d do the same.
It isnt just the USA that uses nationalistic “jingoism” to pump up its population to march merrily off to war………
Nothing like a war to get peoples minds off their problems at home.

And if what I’ve said is considered “demonizing”…… So be it.

#54 mike from mtl on 04.15.17 at 12:38 pm

EEM or even ACWX is a good ETF to get into.

///////////////////////////////////////////////////

Why? it’s down almost 10% over the last five years… EM tends to be negatively correlated with US$ There’s no advantage in US$

Yes I realise in CA$ it is still actually devalued as well however the forex costs are for what? unless you measure your portfolio in US$?

#55 TurnerNation on 04.15.17 at 12:58 pm

“The Emerging Bull” – the headline I see today on Investors Business Daily weekend edition (print copy – I like holding dead bleached trees in my hand).

But you heard it (here) first.

http://www.investors.com/news/emerging-markets-outperform-us-stocks-despite-trump-trade-threats/

#56 jess on 04.15.17 at 1:13 pm

China Capital Flight 2.0: Lose A Lawsuit On Purpose
Feb 16, 2016 2:02 pm HKT
American lawyer Dan Harris says at least one Chinese company is attempting a new way to beat Beijing’s tightening regime of capital controls: by faking a breach-of-contract lawsuit with an offshore entity which the Chinese company intends to “lose.”
https://blogs.wsj.com/chinarealtime/2016/02/16/china-capital-flight-2-0-lose-a-lawsuit-on-purpose/

chinese beige book
CBB’s on-the-ground data also contradicts
Still No China Rebalancing

http://www.chinabeigebook.com/what-is-the-china-beige-book-2/

http://www.theepochtimes.com/n3/2236942-still-no-china-rebalancing/

#57 A Reply to #50 Paul on 04.15.17 at 1:48 pm

Hate to break it to you, Paul, but you can be elected and still be a tyrant. A tyrant is any person in a position of power who exercises power oppressively or despotically. In Trump’s case, that definition seems to fit (or fill) the bill, at least to my mind.

#58 stephen H on 04.15.17 at 1:58 pm

# 53 crowdedelevatorfartz
“OK. Lets talk Facts
Why has China pumped billions into its military? Is someone about to invade?”
——–
“China is no paragon of virtue and neither is the West. But make no mistake, if the Chinese govt could crush our way of life they would do it in a heart beat and lose no sleep over it. And if the tables were turned, I’m sure we’d do the same.”
———————————————————–
I think you just answered your own question as to why countries spend on military. Even Canada spends $20 billion a year on military. Who is about to invade?

Also, your comment as to why is China constantly attempting to hack into US or Canadian govt sites, private companies, or personal websites?

Have you heard of Edward Snowden? Are we being hypocritical here?

Not defending anyone’s practice, just pointing out that a more balanced view is warranted.

#59 akashic records on 04.15.17 at 2:16 pm

North America is in a very good position: it has natural resources, sufficient size internal market.

North America should bring back industries to operate locally, but based on the highest level of automation, instead of aiming to achieve employment goals.

China’s biggest disadvantage in the age of automation is the large population. Even the largest pool of cheap labor (which was behind the recent Asian growth) can’t be as efficient as the advanced automation.

Advanced automation can prosper better in lower population regions, as higher wages provide better incentives to automation. At the same time, the less amount of people need automation to support is the better.

Advanced automation can also break the current economic paradigm, that is based on growth. Economic success is now tied to growth in production, growth in available human labor, etc.

The “growth-based” economy leads to ideologies that markets needs to be expanded, declining workforce needs to be replaced by immigration, etc. All these economic and political ideologies are fundamentally inefficient social engineering solutions, leading to clashing human interests, culminating in wars.

Advanced automation would allow to focus on sustained economy, where the measure of efficiency is not growth, but the opposite, how small amount of resources can provide the required economic output.

Advanced automation would also put an end to rapid growth of population, as large families would no longer have economic benefit, just the opposite. We can see that in the developed countries, where political and industry leaders are in panic mode due to the shrinking labor force, trying to stimulate population growth with ad hoc immigration policies – instead of pushing to more advanced automation, to eliminate the need for human labor.

Tomorrow’s best economies will be countries with relatively small population density, the highest automation, that can create the most value added products from the local natural resources, to supply the needs of the local population – without depleting the natural resources, keeping nature intact and in balance.

Globalization will occur as a network of self-sustaining, highly automated, self-sustaining local economies, instead of shipping resources across the world to process them with the cheapest labor, then shipping them back across the world for the highest paying consumers. This model will look like a sign of insanity.

#60 Savings Linked to Economic Growth on 04.15.17 at 2:46 pm

“But the United States … is [a culture] in which the common view is that people should spend their money. Countries in east Asia — for example, Singapore and China — have harnessed different cultural understandings of how one should behave toward consumption and saving. Indeed both of these countries have made very high levels of saving a major vehicle in achieving spectacular economic growth … [S]aving policy can also be one of the keys to a nation’s economic growth.”
— George Akerlof and Robert Shiller, 2009

“Growth remains high but is gradually moderating as the population ages and the economy rebalances from investment to consumption, from external to internal demand and from manufacturing to services. Orderly rebalancing requires addressing corporate overleveraging, overcapacity in real estate and heavy
industries, and debt-financed over-investment in
asset markets.
— OECD Economic Survey of China, March 2017

http://www.oecd.org/eco/surveys/china-2017-OECD-economic-survey-overview.pdf

#61 Tony on 04.15.17 at 2:47 pm

Re: #54 mike from mtl on 04.15.17 at 12:38 pm

Avoid EEM the expense ratio is far too high.

#62 paulo on 04.15.17 at 3:11 pm

#22 #29
no doubt Hcc/ Heb will be Canadas country wide
The smart money has already hit the exit,the sheeple stamped to follow shortly im thinking
Funny how the sky can fall in a few short weeks!

#63 Entrepreneur on 04.15.17 at 4:04 pm

We certainly have to look at the graphs, the picture of China, plus form an opinion outside the box. Sorry, but I live and stand by morals.

#64 Dan on 04.15.17 at 4:19 pm

Well, I can see here some clever comments like when the first missile hit should i buy? So how about vice versa, some nukes on canucks heads, no?

#65 crowdedelevatorfartz on 04.15.17 at 4:32 pm

@#58 Stephen H
“Not defending anyone’s practice, just pointing out that a more balanced view is warranted.”
*******************************************

Ok.
Move to China and try and have this conversation with me over the internet………………..

Democracy may be flawed but until someone comes up with something better……
I’ll take it over Communism every day of the week.

#66 WUL on 04.15.17 at 4:42 pm

#49 AGuyInVancouver

Here is the very short BC Supreme Court decision. Curiously, it just appeared on the Court’s website this week. The defendant/judgment debtor did not attend either the arbitration in China, or the proceedings at the Palais de Justice on Howe St. Good choice. Would you? No fun being spirited onto an after hours flight. Gone underground I would wager.

http://www.courts.gov.bc.ca/jdb-txt/sc/17/05/2017BCSC0596.htm

#67 Ryan Lewenza on 04.15.17 at 4:43 pm

Stone “So what kind of car do you drive, Ryan?”

It’s big, red and has the logo TTC on it. I actually take the TTC streetcar into work each day. It’s inexpensive and allows me to read the paper in the morning. Not bad if you don’t mind someone coughing on you or the occasional drunk screaming in the back. – Ryan L

#68 WUL on 04.15.17 at 4:48 pm

Sorry, meant Hornby. Maybe the beleaguered borrower missed the Chambers proceeding due to my directions.

#69 Ryan Lewenza on 04.15.17 at 4:54 pm

Mark “A 4% weighting is clearly not much of a endorsement for the 2nd largest economy is it? You would think the 2nd largest economy would have at least 20%?”

Despite China being the second largest economy its financial markets are still in their infancy with many companies still being state owned. China only represents 3.5% of the MSCI All Country World Index. Also China (and EM) are much more volatile than developed markets which is not what our clients are looking for. As discussed we may look to add to our EM exposure possibly taking it up to 8-10%, but we would likely never go above 10%. At Turner Investments we focus on risk as much as we do on returns. – Ryan L

#70 John in Mtl on 04.15.17 at 5:10 pm

@ #59 akashic records on 04.15.17 at 2:16 pm

One big problem needs to be solved first: tbe current model of work = wages = buying all that is required for living.

#71 Ryan Lewenza on 04.15.17 at 5:11 pm

Shawn “Thanks for the insightful post. For your clients are you holding Canadian domiciled ETFS (ie XEC, VEE) or ETFs purchased with American currency (ie VWO, IEMG)?”

We use a mix of VEE and VWO. We do it this way since we currently want to maintain a 20% exposure to US dollar but have more than 20% exposure to international markets. – Ryan L

#72 Ryan Lewenza on 04.15.17 at 5:26 pm

AR “Why are the 3 stats you quote any more reliable than the GDP numbers? Are they externally generated?”

The PMI is externally generated and therefore is hard to manipulate. The electricity data comes from the National Energy Administration which is an arm of the government so you could argue it might be manipulated. Given this I put most weight on the PMI. – Ryan L

#73 Ronaldo on 04.15.17 at 5:32 pm

#39 No Name

Speaking of China and robots, the following is an example of robots taking over manual type jobs.

http://www.scmp.com/news/china/society/article/2086662/chinese-firm-cuts-costs-hiring-army-robots-sort-out-200000

If they keep this up, how will they expect to fill those empty cities like this one.

http://www.npr.org/sections/parallels/2015/10/15/446297838/chinas-white-elephants-ghost-cities-lonely-airports-desolate-factories

I suspect that the reason they are empty is that the idea of “Build it and they will come” backfired on them since those people who came from the farms and worked in the factories would not have been able to afford to live there anyway.

#74 mike from mtl on 04.15.17 at 5:39 pm

#61 Tony on 04.15.17 at 2:47 pm
Re: #54 mike from mtl on 04.15.17 at 12:38 pm

Avoid EEM the expense ratio is far too high.
//////////////////////////////////////////////////

Err right yes the MER is much higher on EEM than VEE, which I own. Which was my point towards mr. technical, why pay the premium in US$, higher MER and actually lower returns (in US$). Why do this?

VEE, ZEM Great hedge against poloz peso at very least. XEM has a even higher MER so probably not a great choice for long term.

#75 WUL on 04.15.17 at 6:05 pm

Ryan:

Kudos to your public transit use. Same here for me in Fort McMurray. Low carbon footprint. The air up here on the Eco-moral high ground is fresh.

#76 Contrarian Coyote on 04.15.17 at 6:10 pm

I wonder if anyone in ‘world-class’ Toronto has seen this:

http://www.zerohedge.com/news/2017-04-15/london-housing-market-suffering-worst-collapse-financial-crisis

Choice quote:

While buyers – especially those relying on mortgages – remain largely locked out of the market because of high prices, nervousness about Brexit and the U.K. outlook, price downside according to realtors may be “limited because of the continued shortage in the supply of property to buy, with estate agents’ listings reportedly at a record low.”

Which is odd because a cursory check reveals not only that there is a glut of high end properties, many of which have been on the market as long as a year, but that despite huge discounts as high as 40%, nothing is moving, and just this one listing service has no less than 124 pages of properties – at 15 properties per page – with price declines in Kensington and Chelsea alone, up from “only” 53 pages when we last looked at the same website back in December.

#77 traderJim on 04.15.17 at 6:19 pm

I just woke up from my nap, is it WW3 yet? Did I miss anything?

#78 Ryan Lewenza on 04.15.17 at 6:20 pm

Eco Capitalist “Ryan, you mentioned concern about Chinese borrowing, but who are they borrowing from? Are they sourcing capital internationally or would it be strictly an internal issue?”

They are borrowing from internal banks and investors. Since the banks are largely state owned the government directs the banks to lend to developers and provincial governments to fund these massive projects and cities. If these projects turn our to be failures then the developers will go under and the banks will have to write off the bad loans. If its widespread and systemic the banks will be at risk with the government having to rescue them. This was similar to Fannie Mae and Freddie Mac in US. This is worst case scenario and the good thing is official government debt is low for China so they could easily bailout some banks if needed. – Ryan L

#79 smallcapteve on 04.15.17 at 6:58 pm

Hi Ryan,

What is your take on the debt situation in China?

Kyle Bass has been claiming China will need to do restructuring of many of its banks and undergo a large devaluation of its currency.

#80 Victor V on 04.15.17 at 7:01 pm

Sold! Toronto townhouse sells for $1 million over asking

http://www.blogto.com/city/2017/04/sold-toronto-townhouse-sells-1-million-over-asking/

#81 Victor V on 04.15.17 at 7:22 pm

Globe editorial: Pop Canada’s housing bubble, before it pops the economy

http://www.theglobeandmail.com//opinion/editorials/globe-editorial-pop-canadas-housing-bubble-before-it-pops-the-economy/article34709215/?click=sf_globefb

#82 asking a question on 04.15.17 at 7:28 pm

Ryan, I’d love to hear your views from a TECHNICAL viewpoint on physical gold. Thanks.

#83 NoName on 04.15.17 at 7:35 pm

#73 Ronaldo on 04.15.17 at 5:32 pm

boo hoo cities…
There was a video that watched on a youtube some time it is about gut that lives in ch in a and he explains construction gov grants and number of floors, as he explains and shows same thing on a smaller scale house if i remember well “neill houses” so basically boils down to every year when grant is available they would weld new rebar on already protruding rebar add another floor, and stop when money runs out… i have hard time finding that video but ill look more later.

robots are expensive, people are dime a dozen…
https://youtu.be/pLwVycO7V-k?t=12m14s

#84 crowdedelevatorfartz on 04.15.17 at 8:18 pm

@#77 trader jim
“I just woke up from my nap, is it WW3 yet?”
********************************************

Only if you tell your wife to hurry up with that goddamn beer……..

#85 crowdedelevatorfartz on 04.15.17 at 8:23 pm

@#82 asking a question
“Ryan, I’d love to hear your views from a TECHNICAL viewpoint on physical gold…..”
*******************************************
Hmmmmm.
Specifically ( or should I say technically?) How much and WHERE do you plan on physically inserting all that bullion?
A hint….. Ever seen the movie Papillon with Dustin Hoffman?

#86 Ronaldo on 04.15.17 at 8:49 pm

#83 NoName

Yep, a dime a dozen is right. Here is proof.

https://www.youtube.com/watch?v=wQ6D4h31xIk

I don’t see these jobs coming back to the U.S. anytime soon.

#87 SWL1976 on 04.15.17 at 8:55 pm

#58 stephen H

#53 crowdedelevatorfartz

Have you heard of Edward Snowden? Are we being hypocritical here?

Not defending anyone’s practice, just pointing out that a more balanced view is warranted.

———-

Balanced view with fart man???

Good luck with that

Today’s blog pic says it all in more way than one

#88 Andrew Woburn on 04.15.17 at 9:21 pm

Another Chinese dudes tax.

China’s Property Tax Struggles to Get Off the Ground

“About 25% to 30% of China’s gross domestic product (GDP) is linked to final demand from the property and construction sectors, Moody’s Investors Service estimated in a report last month.

“This creates the potential for developments in the property market to have large macroeconomic effects,” Michael Taylor, a chief credit officer for Asia Pacific at Moody’s, wrote in the report.

China’s financial sector would also be affected by any turbulence in the housing market. Almost half of last year’s new bank lending went to real estate, mostly through mortgages, and outstanding bank loans to developers and homebuyers stood at 26.68 trillion yuan ($3.87 trillion) at the end of 2016, up 27% from a year earlier and accounting for a quarter of the total, central bank data show.”

Maybe they could compare notes with Poloz.

http://www.caixinglobal.com/2017-04-13/101078147.html?

#89 Smoking Man on 04.15.17 at 9:23 pm

Just checking in to see if the embargo is still in effect.

#90 jess on 04.15.17 at 9:35 pm

chinese MMF
http://www.rba.gov.au/publications/bulletin/2017/mar/9.html

#91 Andrew Woburn on 04.15.17 at 9:44 pm

Somewhere around 1990 I met a guy who was working on counting cows in China though a Canadian satellite company. The Beijing mandarins doubted the number of cows reported to them by the provincial authorities and wanted a back check.

My friend explained that cow counts started with local authorities and passed on through a chain of officials to Beijing. At each level the count was bumped up to look better. He explained he expected to find that the end number would be too high by around 30% or more. Nobody was getting a cow bonus. It was just the way things were done.

It appears that telling the Emperor what he wants to hear has a long and honourable tradition in China and hasn’t changed under the new imperium.

#92 Trumpocalypse2017 on 04.15.17 at 9:48 pm

North Korea just fired one blank, perfectly timed for Pence’s visit.

They are not holding back.

The chance of a nuclear detonation now before month end is 99%.

The chance of global war involving nukes is now 70%

Real estate? Make sure it’s got a basement, preferably two levels.

#93 Marius on 04.15.17 at 9:50 pm

There are 25,000 empty homes in the city of Vancouver. Report the ones in your neighborhood.

https://lonelyhomes.ca/

#94 NS Guy on 04.15.17 at 9:56 pm

So all the smart Chinese billionaires are doing everything in their power to move their money OUT of China and into Canada.

But Canadian investors are supposed to send a portion of our hard-earned cash by investing in Chinese industry?

#95 Andrew Woburn on 04.15.17 at 9:59 pm

Many people seem very concerned about corruption in China. But is it corruption if everybody does it?

In Canada corruption is an outlier, an unexpected event and is perceived as criminal, immoral and economically disruptive. In China it appears to be expected and priced into the system. Perhaps it is not surprising that a country which has not had a rule of law tradition has a different take on getting a piece of the action and burying it in the garden while you can.

I am not supporting or condoning Chinese corruption because at the very least, it distorts the economy and discourages foreign investment. However if the system works for them and they are not clamouring for change, is it smart or effective for us to say we will not do business or invest in their economy because they are “corrupt”.

#96 Smoking Man on 04.15.17 at 10:11 pm

Just checking in to see if the embargo is still in effect.

Smokey stop drinking you lunatic, think of your family.(. Your not band .-Garth.

#97 Andrew Woburn on 04.15.17 at 10:20 pm

Don’t tell Wynne.

The New City Poised to Pierce Beijing’s Property Bubble

http://www.sixthtone.com/news/how-xiongan-will-burst-beijings-property-bubble

#98 Smoking Man on 04.15.17 at 10:20 pm

Just checking in to see if the embargo is still in effect.

Smokey stop drinking you lunatic, think of your family.(. Your not band .-Garth.

#99 Smoking Man on 04.15.17 at 10:21 pm

Just checking in to see if the embargo is still in effect.

Smokey stop drinking you lunatic, think of your family.(. Your not band .-Garth.

#100 ** Smoking Man ** on 04.15.17 at 10:22 pm

Just checking in to see if the embargo is still in effect.

Smokey stop drinking you lunatic, think of your family.(. Your not band .-Garth.

#101 Nemesis on 04.15.17 at 10:22 pm

#TheEssentialSinophile’sGuideTo…

#StrategicCapability…

https://youtu.be/rTdOnDSPZ_Q

#TacticalImplementation…

https://youtu.be/iG3dPnD1SGo

#TimelessBonusInsights… #CourtesyOfWilliamGoldman…

https://youtu.be/rMz7JBRbmNo?t=2m39s

#102 Popeye the Sailor Man on 04.15.17 at 10:26 pm

#67 Ryan Lewenza on 04.15.17 at 4:43 pm

Just remember there is always a crazy one on the bus! If you look around and can’t find them guess who it is?

#103 Andrew Woburn on 04.15.17 at 10:31 pm

Don’t tell Wynne.

The New City Poised to Pierce Beijing’s Property Bubble

http://www.sixthtone.com/news/how-xiongan-will-burst-beijings-property-bubble

#104 Andrew Woburn on 04.15.17 at 10:32 pm

What would Mao say?

Chinese Men Find Beauty Under the Knife

http://www.sixthtone.com/news/chinese-men-find-beauty-under-knife

#105 I'm stupid on 04.15.17 at 10:48 pm

They are borrowing from internal banks and investors. Since the banks are largely state owned the government directs the banks to lend to developers and provincial governments to fund these massive projects and cities. If these projects turn our to be failures then the developers will go under and the banks will have to write off the bad loans. If its widespread and systemic the banks will be at risk with the government having to rescue them. This was similar to Fannie Mae and Freddie Mac in US. This is worst case scenario and the good thing is official government debt is low for China so they could easily bailout some banks if needed. – Ryan L

I know of a Chinese developer that stole hundreds of millions from China. He was building one of those ghost cities but decided it was more profitable to run with the money. I’m not suggesting it’s the norm but it does happen. He’s building homes in the gta now, one of the few people that will pay with cash to get a deal. The problem is that it’s too difficult to do the volume of work he needs done entirely in cash. I personally won’t risk it, but I know some contractors that have taken $2million and $5million in cash.

#106 traderJim on 04.15.17 at 11:05 pm

#92 Marius

“There are 25,000 empty homes in the city of Vancouver. Report the ones in your neighborhood.”

There’s a reason everyone hates a snitch.

This is just one example of the hell you end up with as government intervenes in markets.

“The road to hell is paved with good intentions”

Neighbours spying on neighbours and begging the taxman to bring other people down.

Just like that socialist paradise, Cuba, where folks are counting the days until they are able to do away with the neighbourhood snitch.

#107 traderJim on 04.15.17 at 11:13 pm

#84 Fartz

Not married.

Good thing or I’d have died in a “war” years ago.

Now I made it this far just to get incinerated in the next 2 weeks as the Trumpocalypse unleashes Trumpageddon.

Impressive how Trump has even managed to put his brand on the end of the world.

#108 traderJim on 04.15.17 at 11:37 pm

Seriously though, the failed NK missile launch seems just too perfect doesn’t it?

I know the commies can’t build a decent bicycle, but after Kim J U built it up to be some huge event, you’d think they would make sure it worked.

I’m thinking maybe, just maybe, the Chinese, shamed by Trump in a series of ingenious tweets, finally stepped to the plate and did the job.

I had to laugh at Kim complaining about Trump’s ‘agressive tweets’ hahahaha. The Donald has invented a new weapon.

People who still think his tweets are silly or ineffective just don’t get it (and probably never will).

Expect a tweet soon where Trump playfully neither confirms nor denies any involvement in the launch failure.

Meanwhile China is piling the pressure on Korea to behave like never before.

No matter what you think of Trump (and some of his core supporters are abandoning him as they see he is not as ideological they thought), you will have to admit (now or later) that he is changing the way things work in a dramatic way.

We live in interesting times.

#109 traderJim on 04.15.17 at 11:48 pm

Oh well now look at this:

https://www.defense.gov/News/News-Releases/News-Release-View/Article/1153281/statement-by-secretary-of-defense-jim-mattis-on-north-korea-missile-test/

Ok it wasn’t a playful tweet, which I would have preferred, but you have to admit….

#110 For those about to flop... on 04.16.17 at 1:26 am

Pink Snow falling in Pebble Beach.

Not really ,but check out the latest offering from my buddies at how much…

M42BC

Visualization of the U.S. States that Depend on Foreign Trade the Most.

https://howmuch.net

#111 Henry on 04.16.17 at 4:45 am

Happy Easter blog dogs. Christ is risen.
Yes it’s ok to say that:)

#112 Ryan Lewenza on 04.16.17 at 8:17 am

asking a question “Ryan, I’d love to hear your views from a TECHNICAL viewpoint on physical gold. Thanks.”

Gold’s technical profile is neutral at best. It’s been trading in a range of roughly 1,100 to 1,350 over the last few years. Longer term (since 2011) it’s trading in well defined downtrend. To reverse the current negative trend gold will need to break above its downtrend which comes in around 1,300. Then it would need to take out next resistance of 1,367 (July 2016 high) and make a higher high. With the escalating tensions in Middle East and in North Korea gold has been trading better. However, it will need to break above 1,300 then 1,367 for us to get more bullish on the precious metal. – Ryan L

#113 Ryan Lewenza on 04.16.17 at 8:28 am

smallcapteve “Hi Ryan, What is your take on the debt situation in China?”

Yes Kyle Bass has been very negative on China for a while and so far his big trade has not worked. I agree with Kyle that China has put on a lot of debt in recent years which as I covered will one day have to be dealt with and could have some negative consequences. However where I differ with Kyle is that I don’t think the problem is as bad as he makes it out to be and if it is then the government can come in and backstop these bad debts. China has a very low debt to gdp ratio. If the government needs to bailout some bad banks as a result of some bad loans then they could easily issue government debt and bail out the banks. – Ryan L

#114 crossbordershopper on 04.16.17 at 8:59 am

DELETED (Racist)

#115 NoName on 04.16.17 at 9:18 am

I watched this some time ago last week.
DIY IpHONE

https://www.youtube.com/watch?v=leFuF-zoVzA

#116 GFD on 04.16.17 at 9:56 am

Canadians, lets embrace 33% home price increases. New breed of home buyers are on the loose. https://youtu.be/kcqHRsZJjcs

#117 Trumpocalypse2017 on 04.16.17 at 10:20 am

“THERMO-NUCLEAR WAR MAY BREAK OUT ANY MOMENT ON THE PENINSULA”

As reported again just minutes ago on CNN, direct from North Korea.

Use your daylight hours today wisely.

Prepare.

Take nothing for granted.

The path of escalation that could involve China or Russia or both is complex.

But it will be traveled at lightning speed.

#118 Ronaldo on 04.16.17 at 10:34 am

#27 Nonplused on 04.15.17 at 12:58 am

I wish there were some ghost cities in Canada. I’d just move in to an abandoned apartment building and live for free.

https://www.youtube.com/watch?v=AVv8RoY_f14
—————————————————————-

Not a city but it may work for you. Or maybe this one:

https://www.youtube.com/watch?v=gRwJQXCyE38

#119 NoName on 04.16.17 at 11:16 am

#118 Trumpocalypse2017 on 04.16.17 at 10:20 am

n k, stand no chance, might throw sucker punch, but that is as far it will go, after that is game over. scariest thing they have in their arsenal is 5000T of chemical weapons, everything else is antiquated, that is a reason why kju is focused on distance delivery systems.
if it come to fight cruisers drones, apachis and thunderbolts, will finish it and it send clear msg. to maoists for not controlling their barki ng pudle.
as this moment noone have better trained army than us.

https://www.youtube.com/watch?v=YS8YP7mtNss

#CanWeJustNotLiveInPeaceAndTranquility

#120 NoName on 04.16.17 at 11:21 am

@ ronaldo

you want to something abandoned and uber realy cool

http://gizmodo.com/these-are-the-sad-remains-of-the-soviet-space-shuttle-p-1710827956

#121 A Reply to #116 NoName on 04.16.17 at 11:38 am

That was the coolest video I ever saw! Thanks for sharing.

#122 traderJim on 04.16.17 at 11:52 am

#118 TrumpocalypseNow

Or maybe this is a more reliable source for news: http://www.bbc.com/news/world-asia-39614428

I see from that article (by the fascist right wing BBC I’ll admit) that NK has missiles that will reach Vancouver.

Nuking Vancouver may not help the real estate supply problem but it could potentially help the demand side of the equation, so there’s that.

#123 WUL on 04.16.17 at 12:04 pm

I’d like to linger here and learn more about China and military strategy as it relates to today’s outbreak of WWIII. However, I have to go tour Syncrude’s oil sands mine and plant guided by my landlord/roomie heavy equipment operator. Any points of particular interest you’d like to hear back on?

Garth:

A topic I am interested in but not an imminent issue. I know you advise on investments but you also delve into tax strategies, wealth and estate preservation and the like.

What might you say on the tax consequences of death of an RRSP holder and the means available to keep the nosy Exchequer out of your business. I have done some research and it seems that if the owner of the RRSP is married or has a partner, about the only thing that can be done is to name that person as beneficiary.

Thoughts? Thanks.

Correct. Only a spouse or financially-dependent child (or disabled grandchild) may receive RRSP funds rolled-over without tax by virtue of being a beneficiary. — Garth

#124 millmech on 04.16.17 at 12:24 pm

#113 Ryan Lewenza,
Tell him to buy now, lol , a friend of mine bought huge into bullion in 2011 at $1600/ounce, still waiting after six years to break even.
It has paid him nothing and by the time he breaks even(if he ever does) he could have easily doubled his initial investment twice over.
Do not forget about the precious metal investor in Chilliwack who had his $750,000 in silver removed from his possession by threat of another metal “lead”, when thieves dressed as police robbed him at gunpoint.

#125 Ponzius Pilatus on 04.16.17 at 1:36 pm

#107 traderJim on 04.15.17 at 11:05 pm
#92 Marius

“There are 25,000 empty homes in the city of Vancouver. Report the ones in your neighborhood.”

There’s a reason everyone hates a snitch.

This is just one example of the hell you end up with as government intervenes in markets.

“The road to hell is paved with good intentions”

Neighbours spying on neighbours and begging the taxman to bring other people down.

Just like that socialist paradise, Cuba, where folks are counting the days until they are able to do away with the neighbourhood snitch.
——————–
If the house is empty, is there a neighbor?

#126 Smoking Man on 04.16.17 at 2:59 pm

Got say Equidor was amazing. Anyone miss me?

4 chapters complete, gave up on the old typewriter. New book title is.

On the oneway road to death, shit happens.

Fiction but based on my biography.

Next adventure St Maarten.

#127 AGuyInVancouver on 04.16.17 at 3:55 pm

#126 Ponzius Pilatus said “If the house is empty, is there a neighbor?”

Exactly. I’m all for snitch lines if it means some offshore squatter is forced to pay up or free up scarce real estate.

#128 Deplorable communications on 04.16.17 at 4:15 pm

#127 Smoking Man on 04.16.17 at 2:59 pm

Got say Equidor was amazing. Anyone miss me?

4 chapters complete, gave up on the old typewriter. New book title is.

On the oneway road to death, shit happens.

Fiction but based on my biography.

Next adventure St Maarten.
..
Ecuador… lmao… there is a deep groove in the road from schlong branch to seneca..

Wasn’t the first book autobiographical? after all chap one was titled “talking dick head” …welcome back

#129 Trumpocalypse2017 on 04.16.17 at 4:29 pm

CNN – “High Alert – North Korea Coming to a Head”

– “All options on the table”

http://www.cnn.com/2017/04/16/politics/hr-mcmaster-north-korea/index.html

KJU now getting desperate to deploy nukes.

Expect big news by tonight.

#130 traderJim on 04.16.17 at 5:15 pm

#128 Vancouver Guy says: ‘scarce real estate’

Canada has 10 million square kilometers.

If you gave every person in the world 2 sq feet of space they could all stand on a plot the size of 1/3 of tiny PEI.

There is no shortage of RE anywhere, you’re drinking realtor kool-aid.

What there is is an excess of liquidity.

Snitch lines will do nothing to solve the real problem but will turn a lot of people into scumbag snitches.

#131 traderJim on 04.16.17 at 5:24 pm

#127 Welcome back Smoking Man!

Equidor sucks. Try Peroo or Columbya next time.

I know Whiny James missed you too, he kept reminding us.

#132 Tony on 04.16.17 at 7:26 pm

Re: #113 Ryan Lewenza on 04.16.17 at 8:17 am

It’s been just over a week since the FED and bankers monkey-hammered silver two days in a row. It seems since 2011 instead of stocks falling off a cliff and gold and silver going through the roof somehow the opposite happened. A gentle push from the FED and bankers accomplished this. When they say don’t fight the FED just look for alternate investments.

#133 Connor D. on 04.17.17 at 9:27 am

So the North Koreans are the brainwashed ones? That’s funny.

#134 WW3 is coming on 04.17.17 at 12:52 pm

#47 Smoking Man on 04.16.17 at 9:47 pm
I sold my presious boat yesterday. Tears in my eyes as it pulled away. They were tears of joy.
The day before a dude offered my 20k for it, we shock hands I had a deal. I bought the boat for 17k 4 years ago when cad vs usd was at par.
So knowing how shit works and the buyer might get cold feet I keeped showing it.
A dad in his 30s texted me. What name do you want on the bank draft. Told him mine.
He showes up in his shit pick up truck. On board 3 boys. 12y old 10yr old and a 5yr old.
The kids got on the boat and played boat pilot.
He hands me a draft for 18k.
How could I not say no. Those kids will have the time of there life on it.
Family memories. They guy that offered me 20k Was rich and privlaged thinking he saved 2k from current market value.
I had the boat for 4 years and made a 500 dollar profit while making little kids happy as shit.
Where is my Nobel Pease Prize….
It’s not always about the money.
____________________________________________
#56 Smoking Man on 04.16.17 at 10:12 pm

Shong Branch is going on the market tomorrow.
Two reasons.
The up coming T2 Dr tax. And the fact that I just got a gig in Manhattan pulling in 1350 usd a day. 10 hour day. On contract for a Swiss bank.
I know before the fat lady sings. There is another 400k in it for me.
There is no future here for me. I love my hobbie as vba wizard. And T2 has opened the flood gates to temporary foreigh workers. The big banks that I’ve worked for will make out like animals.
I’m buying more shares but I won’t be a whore and reduce my rate.
It’s the logical thing to do.
________________________________________
Jesus Smoking man can’t you tell us anything other than bullshit. Firstly its all about the money! That is why you are taking your imaginary gig in New York for $1350 USD per day. What happened to the bank gig in Boston? Ecuador, how could you be there a week ago when you are posting from Seneca NY. As Eddie Y fellow loser lounge member told us the other day your nuked. I thought we were done with your brand of lying and deception. I am not quite sure what your game is but get some help you talk too much buddy.