The terrible, horrible, no-good, very bad market days

DOUG  By Guest Blogger Doug Rowat

I was staring at this deadly looking item at the Bata Shoe Museum in Toronto last month:

Shoe of Death?

Source: Doug Rowat

Oddly, it got me thinking about markets and investor behaviour—such parallels sometimes occur in the strangest places. While this shoe looks like a horrible torture device, its actual purpose is not at all frightening (I’ll explain at the end of my post).

Equity markets are similar. Things that initially appear scary, in the end, usually turn out to be harmless. Also at the Bata Shoe Museum was an exhibit featuring Great Depression–era footwear, which included the following newspaper headline:

Headline that greeted investors after the Oct 24, 1929 stock market crash

Source: Doug Rowat

Though almost 100 years old, the above headline is not that dissimilar from those that appear today following really ugly days on the market. Now, of course, we’re gazing at our smartphones and laptops instead of newspapers, but the frightening messages haven’t changed:

Headline that greeted investors last month

Source: Various media

So, singular periods such as the Great Depression aside, when the market has a terrible day, what should you do? First, recognize that scary headlines are designed to create viewership and sell advertising but aren’t at all predictive. Secondly, once your fear subsides, consider adding to your portfolio and buying on weakness. Below I highlight the 15 worst single-day declines for the S&P 500 over the past 50 years. In almost every instance, the market was higher a year later. The takeaway? Move towards your fear, not away from it:

The worst S&P 500 single-day returns over the past 50 years

Source: Bloomberg, Turner Investments

And, in case you think the above examples were skewed by the 2008–09 financial crisis, below are the 15 worst single-day declines that have occurred since the financial crisis. Again, moving towards your fear was equally beneficial:

The worst S&P 500 single-day returns over the past 10 years

Source: Bloomberg, Turner Investments

So, the next time North American markets have a terrible day (there were several just last month) and the alarmist headlines inevitably appear, don’t curl up into a ball and cry yourself to sleep. Control your fear, take advantage of the weakness and invest.

Finally, that menacing looking shoe above? It was a clog used by 19th century French farmers to shell chestnuts.

Terrifying.

Doug Rowat, FCSI® is Portfolio Manager with Turner Investments and Senior Vice President, Private Client Group, Raymond James Ltd.

 

68 comments ↓

#1 Flop... on 06.15.19 at 3:44 pm

Robax, you go to shoe museums in your spare time?

Fair enough.

I’ll try not to put the boots in…

M44BC

#2 Ronaldo on 06.15.19 at 3:47 pm

I wonder how many people took advantage of the best entry point for the markets in the past decade on Dec. 24/18. TSX up 18.7% since then. Not many I suspect. Too busy out last minute shopping for bargains when the best ones were on the TSX not at The Bay.

#3 Chimingin on 06.15.19 at 4:09 pm

Thanks Doug! I find your posts insightful and interesting.

#4 Simon on 06.15.19 at 4:35 pm

Buy low, sell high. Very insightful.

#5 tccontrarian on 06.15.19 at 4:37 pm

“Secondly, once your fear subsides, consider adding to your portfolio and buying on weakness.”

/ / / / /

Hmmm….

Simpler to just say – adopt a ‘contrarian’ approach. It’s simple but not easy.

tcc

#6 Shawn Allen on 06.15.19 at 4:40 pm

What Gets Sold, Also Gets Bought

#2 Ronaldo on 06.15.19 at 3:47 pm

I wonder how many people took advantage of the best entry point for the markets in the past decade on Dec. 24/18. TSX up 18.7% since then.

************************************
Good question. And certainly a good point that December 24th 2018 was a great buying opportunity.

Look at the volume that day. It was Christmas eve Monday, half day trading 171 million shares. A low volume day. But look the previous trading day the Friday December 21 when the market ended only 1% higher than on Monday the 24th. There was a massive 614 million shares traded. About twice the normal volume.

On the TSX every share sold is also bought. (IPOs and secondary offering direct from companies are not included in the volume.) A tiny fraction of the volume would have been corporate buy backs. But the vast majority was one investor buying from another.

As it was a down day in a down week it is true enough that it was sellers rushing to sell that drove the market. But they could ONLY sell if buyers stepped up to the plate. And step up, they did, albeit only after being sufficiently enticed by the lower prices.

The point is that a lot of investors were indeed buying at the lows. I have no idea the mix between retail investors and institutional. But it is a fact that there was heavy buying as well as precisely equal heavy selling.

Of course it would be extremely rare for any investor to have gone all in that day. Most investors have existing portfolios and limited cash and most can’t add a huge amount on any given down day.

That stocks were cheap on December 21 and 24 may have been clear. But if so, they also looked cheap for several weeks prior. The bottom was not known until after the fact.

#7 Drill Baby Drill on 06.15.19 at 4:42 pm

Those shoes could be used to manually aerate your lawn

#8 akashic record on 06.15.19 at 4:43 pm

Terrifying.

Only for chestnuts.

#9 Brian Ripley on 06.15.19 at 4:44 pm

Late Stage Deleveraging grinds on:

“At the end of the business cycle there are three forces at work:
1) Rising interest rates sap demand and raise the cost of capital.
2) At the same time, according to capital theory, future returns decline due to over capacity.
3) While demand is decreasing and there’s a glut of supply, the herding nature of market participants create euphoric sentiment that drives expectations (and market prices) well past likely outcomes.
This process is what forms a market top” said Alex Barrow Co-Founder of Macro Ops.

And from StatsCan June, 23, 2019:

“Mortgage interest payments (+4.0%) have outpaced mortgage principal payments (-0.4%) as a result of higher interest costs, continuing a trend since the second quarter of 2018. Household credit market debt as a proportion of household disposable income remained at 177.6% in the first quarter, as debt and income grew at similar rates. In other words, there was $1.78 in credit market debt for every dollar of household disposable income.”

Someone’s non-purchase is another’s non-income. If so, expect a slowdown… well it’s already happening. Net worth is shrinking in Canada. See my chart:
http://www.chpc.biz/history-readings/late-stage-deleveraging
…mashed up from StatsCan.

#10 Yanniel on 06.15.19 at 4:49 pm

“consider adding to your portfolio and buying on weakness.”

Say you did so in the Japanese market. How would the returns after one year look like?

#11 Yep on 06.15.19 at 4:57 pm

#2 Ronaldo – The last time I even looked at my portfolio was on December 18, 2018. I have something this Monday to do, and noticed one stock went up by $10.00 per share because might sell some then.

#12 Barb on 06.15.19 at 5:07 pm

Shoes are an aeration device?
(for a very very small golf green?)

#13 Still learning on 06.15.19 at 5:21 pm

Great post today Doug. Actually it’s good advice for life in general.

#14 jess on 06.15.19 at 5:34 pm

https://www.cnn.com/2019/06/15/politics/us-ramping-up-cyberattacks-russia/index.html

#15 Feel the orangeness on 06.15.19 at 5:40 pm

Elect
me or it goes up in flames!! https://twitter.com/realDonaldTrump/status/1139891393252474880?s=19

#16 Doug Rowat on 06.15.19 at 5:50 pm

#1 Flop… on 06.15.19 at 3:44 pm

Robax, you go to shoe museums in your spare time?

Fair enough.

I’ll try not to put the boots in…

M44BC

Platform shoes with goldfish beats dinosaur bones any day of the week.

–Doug

#17 Doug Rowat on 06.15.19 at 5:57 pm

#2 Ronaldo on 06.15.19 at 3:47 pm

I wonder how many people took advantage of the best entry point for the markets in the past decade on Dec. 24/18. TSX up 18.7% since then. Not many I suspect. Too busy out last minute shopping for bargains when the best ones were on the TSX not at The Bay.

Technically, HBC on the TSX was the best deal. But who knew?

–Doug

#18 akashic record on 06.15.19 at 6:43 pm

Supposedly the world is facing a 500 trillion retirement shortfall by 2050.

US leads the way, China following close and India is the third.

This shoe might become globally fashionable again.

#19 Flop... on 06.15.19 at 6:56 pm

#16 Doug Rowat on 06.15.19 at 5:50 pm
#1 Flop… on 06.15.19 at 3:44 pm

Robax, you go to shoe museums in your spare time?

Fair enough.

I’ll try not to put the boots in…

M44BC

Platform shoes with goldfish beats dinosaur bones any day of the week.

–Doug

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

Hey Robax, that was my level 1 joke.

I’ve had enough brews to move onto level 2

I wondered where they got to.

I haven’t seen them shoes since my wedding night…

M44BC

#20 Damifino on 06.15.19 at 7:10 pm

Peter Mansbridge once interviewed Stephen Harper on the CBC during the depths of the Global Financial Crisis. Harper suggested there might now be some great buying opportunities.

Mansbridge was taken aback. He asked Harper if he was sure he wanted to send that message to the public.

Politically, it was a dumb thing for Harper to say despite it being a perfectly correct assessment of the situation.

Needless to say, most people did not jump into equities. Instead, they wanted to surround the Prime Minister’s Office with torches and pitchforks.

#21 yvrguy on 06.15.19 at 7:12 pm

Hey Doug,

If you don’t have cash sitting around, but have 5% cash as part of your portfolio in a money market ETF… Do you move some of that 5% into equities… And then back out at rebalance time?

#22 Leichendiener on 06.15.19 at 7:20 pm

Yes, suck it up and buy into weakness. Go forward into withering fire!

#23 Flop... on 06.15.19 at 7:54 pm

In the years 2000-2002 there was a massive stock market collapse.

What do I know about it?

Not much.

I was backpacking the world and was high on drugs and listened to a lot of Trance Music.

I have since grown up and I’m finally listening to Doctors advice.

I now listen to less Trance Music…

M44BC

https://m.youtube.com/watch?v=52rnzFWtXp4

#24 Y m of 3 on 06.15.19 at 7:54 pm

…even in Australia.

It’s surprised me how much pleasure I get from reading to my kids. Happy father’s day Doug!

#25 =-jwk=- on 06.15.19 at 7:56 pm

Catching up…

They think money falls from the sky and they have no idea a Venezuela type country they will get and will not be able to turn back.
For any future posters think you are making me angry, I am 85 years old, I’m not going to be here for long

For your entire adult life, money HAS fallen from the sky. And now the mills have to pay it back, long after you are gone…

@#28That formula basically hard-stops Justin’s aspirations as the next real estate taxation Czar. Cause, well, the Constitution (which Justin probably hasn’t read) does not permit the Federal government to mess around with residential real estate.

It is basically sacred.

Great, CMHC, a federal institution that has to take much of the blame for skyrocketing prices, should be folded immediately then.
Oh, well, you see, that’s different…

@#29
#8 Ian on 06.14.19 at 3:56 pm
In the U.S., the IRS provides for an exclusion of up to $250,000 for single, and $500,000 for married filing joint on any capital gain
from the sale of a residence. Any gain that is above the threshold limit would be subject to taxes, regardless of whether the property is
U.S.-situs or foreign.
—————————–
You support tax deductible mortgage interest then too?

USA style? Yes.

@#30
I posted this question yesterday with no response, I ‘ll try again.
Does anyone implore the long term strategy of Buy to Rent and Rent to Live strategy.

This is called aribtrage. I have done it. Instead of putting 150k down on a 900k ‘starter home’ in GTA in we paid cash for two 3bed/2bath ~1400 sf SFH in the US. The rent from those two ($1500USD gross) covered the cost of renting the exact same house ($1600CDN) in GTA. We lived there for 3 years like that, essentially rent free. We then sold the two rentals, moved to and bought a house in Ottawa…but due to the rise in property values in USA, wound up using the sale money to buy two much nicer homes (gross $3000USD) with small mortgages on them. The two new houses have much high tenant quality – in fact both still have their original tenant for 3 yrs+.

Fast Forward to today: The problem is Toronto rents have also soared, along with US property values. The days of getting $1 in rent per $1000 in house are gone. Today, those two houses we paid 150k USD would be about 250 USD but still rent for ~ 1600? The two we bought are up to $400k, yet only genreate 3k/month.
not a great investment today. And the house we lived in rented for $2000 when we left, and it now up for rent again for $2300.

So, it can work, it used to work, but it isn’t easy money by any means.

@#44 bobby
I work with a lot of these millennials. I call them the ” I’m entitled to crowd, the skateboarders”. They feel that everything must be handed to them rather than having to work for it. Whereas we moved around to secure opportunities, took risks, gave up some luxuries and sought better paying jobs, they expect the jobs and opportunities to come to them

You don’t work with millenials. You are just parroting stuff you read on old white guy right wing websites. *I* work with millenials, In fact I frequently hire them over middle aged/pre-boomers (ie people like you) because they are curious, creative hard working staff who don’t make judgement about other generations , even when those said generations haven’t seemed to have learned the ‘if you don’t have something nice to say, don’t say anything at all’ rule….

#26 Joe on 06.15.19 at 8:33 pm

“Be fearful when others are greedy and greedy when others are fearful.” warren buffet

#27 Juve101 on 06.15.19 at 8:33 pm

Thanks for the uplifting post Doug… Garth has been depressing the hell out of us this past week :)

I heard that. – Garth

#28 BC Renovator on 06.15.19 at 9:59 pm

Always like your Blog Posts Ryan. Funny how this comes after Garth’s Doom and Gloom week of posts.
Can you guys do a post regarding Gold/Silver? A lot of respected Economists are calling $50 Silver and saying Gold is at a bottom. I’m no Gold bug, but hey, after this past weeks Blogs of Doom and Gloom sure makes me think about buying some.. Thx

#29 Bytor the Snow Dog on 06.15.19 at 10:04 pm

Doug this post is so boring I’m falling asle…….

zzzzzz……

#30 acdel on 06.15.19 at 10:14 pm

Ok smartass (Doug), good one, got a chuckle out of it, but, you do bring some sound advice, thanks.

#31 Al on 06.15.19 at 10:18 pm

“Terrifying.

Only for chestnuts.”

Correction, for ALL nuts.

#32 NoName on 06.15.19 at 11:28 pm

Even commies ripoff arcage game unit design and decals looks like central planning committee was making exclusive design desitions…

https://arcadeblogger.com/2019/06/15/the-museum-of-soviet-arcade-games/

#33 Ronaldo on 06.16.19 at 12:16 am

#28 BC Renovator on 06.15.19 at 9:59 pm
Always like your Blog Posts Ryan. Funny how this comes after Garth’s Doom and Gloom week of posts.
Can you guys do a post regarding Gold/Silver? A lot of respected Economists are calling $50 Silver and saying Gold is at a bottom. I’m no Gold bug, but hey, after this past weeks Blogs of Doom and Gloom sure makes me think about buying some.. Thx
—————————————————————
Silver is a much better buy. At least in USD’s if that’s what you deal in. $14.94 u.s. and $20.00 Cad. Ratio to gold is the highest I have seen in the last 10 years 1/90.
In Cad, silver is at the same level as it was in spring of 08 when it peaked at around $21.00 when our dollar was at par with the USD. I have maintained for several years now that $20.00 Cad is the bottom for this metal given cost of production and the scarcity and the fact that is mostly uneconomical to recycle as the amounts used in electronics is very miniscule. There is not a lot of above ground stock available at any time unlike gold where every ounce ever produced is still in existance. Personally I prefer silver in coin form such as the American Silver Eagle or the Canadian Maple Leaf which can be purchased from several w ell known dealers such as Kitco. I own a precious metals ETF which I picked up for around $20.00 last September which pays close to a 5% dividend and now trading at around $25.00. The etf is HEP and is mostly gold producers and streaming companies. This etf first launched in May of 2011 at the time that silver and gold hit their tops so it has been badly beaten down. I consider this a good long term hold considering you are getting paid to own it. I suspect that we will see it come down a bit from where its at right now but with the talk of interest rates coming down again that is generally good news for gold.

#34 Lizard Man on 06.16.19 at 12:57 am

Goofball socialists like Keynes thought pinning inflation to 2% annually would eliminate the business cycle and produce revenue for social good. Of course he was laughed out if the room . Economists first question was, ” what happens after 50 years when inflation has doubled consumer costs”. Keynes didn’t have an answer and his theory died for decades….not to rebirthed until post war bureaucrats saw that big raises for organized unions could be puked up at every election. Thus, politics was born. if

Brutal socialism didn’t last in Russia or China because when human beings are involved it’s quickly realized that instinct is stronger than theory. Adam Smith got it right…animal spirits will prevail. All to do with the limbic system, the lizard brain, striving to survive. Altruism doesn’t count for much when the shit hits the fan. And why socialists are always the greatest thieves…because they steal from the poorest among us.

You’ll do fine if you rely on Smith rather than Keynes. The sky is not falling. Calamity and Huge Frauds come and go….war…climate hysteria. As an investor you should listen to the lizard.

#35 Guitarzan on 06.16.19 at 1:05 am

#2 Ronaldo on 06.15.19 at 3:47 pm

What you meant to say… The best deal was on Bay Street, not at the Bay store!

Reality is that Black XMas was difficult to pinpoint… Many did not see it coming. Fewer saw the rebound. So the moral of the story is… Steady as she goes.

Market timers only predict correctly in the rear view mirror. If someone learns the secret, let me know. I haven’t figured it out in 35 years!

#36 JackInABox on 06.16.19 at 1:10 am

#20 Damifino

Peter who?

#37 Yanniel on 06.16.19 at 1:22 am

““consider adding to your portfolio and buying on weakness.”

Say you did so in the Japanese market. How would the returns after one year look like?”

So?

#38 Spectacle on 06.16.19 at 1:27 am

27 Juve101 on 06.15.19 at 8:33 pm
Thanks for the uplifting post Doug… Garth has been depressing the hell out of us this past week :)

I heard that. – Garth

————— 0 ——————-

Whoah! I’m sleeping with the lights on after that one!

Ps: still love every museum been to, great historical resources.

#39 Kreditanstalt on 06.16.19 at 3:47 am

And what if the “market” just perniciously, gradually slides slightly lower, lower a little, constantly over three or four years…?

Hope you dip buyers have deep pockets.

#40 Smoking Man on 06.16.19 at 3:56 am

My son on dad day.

https://youtu.be/R3iX0SUQpPg

#41 Jacques Pepin on 06.16.19 at 4:21 am

DELETED

#42 Gregg in Victoria on 06.16.19 at 5:22 am

Scary headline – should we buy??

Trump warns of epic stock market crash if he’s not re-elected

https://nationalpost.com/news/world/trump-warns-of-epic-stock-market-crash-if-hes-not-re-elected

#43 Howard on 06.16.19 at 6:04 am

#138 Sail Away on 06.15.19 at 1:49 pm

Chronically underpaid Mills? Oh, the whining. Nobody is owed a job or certain salary- someone is worth more when, and only when, they produce that value. If their salary is not enough, then they need to increase their value to the world. Claiming it’s somebody else’s fault and trying to take their wealth is a childish bully tactic.

——————————————-

Well if not chronically underpaid, what would you call it? Wages stagnant for 40 years (inflation adjusted), skyrocketing cost of living. Most of the wage stagnation falling on young workers. I’m glad your business is different but is not reflective of the overall stats.

But coming back to the Boomers’ healthcare – who pays for this? Mills can’t afford to. Why not tax some of the Boomers’ unearned wealth? Or do we just add more to the deficit pile for the Mills and Gen-Z to pay off eventually?

#44 NoName on 06.16.19 at 7:33 am

Now that great depression of last century is mentioned, outside few pices of depression ear glassware and few youtube movies/documentaries i dident sea or read much about. But i do remember j p morgan chase was mention somwhere in there, he was buying if i remember well…

https://www.youtube.com/watch?v=vlxUMcZ4AdI

#45 The Great Gordonski on 06.16.19 at 8:22 am

DELETED

#46 Doug Rowat on 06.16.19 at 9:34 am

#39 Kreditanstalt on 06.16.19 at 3:47 am

And what if the “market” just perniciously, gradually slides slightly lower, lower a little, constantly over three or four years…?

Possible, but a historically rare occurrence. And the S&P 500 ultimately always recovers. If you don’t have the investment time horizon to wait out temporary weak patches then don’t invest in capital markets.

–Doug

#47 The Great Gordonski on 06.16.19 at 9:40 am

Like I told you….so long ago..

https://www.independent.co.uk/voices/letters/hong-kong-china-extradition-bill-protests-a8960371.html

China is a powder keg. It ain’t 1934 and no one is going on another long March with Comrade Xie. Walk around Beijing, people being shoved around by soldiers, having thier pockets turned out. It’s a Maoist nightmare, where justice comes out if the barrel if a gun. Give the people half a chance and they’ll tear the Communist Membership apart like hungry jackals.

Go long USA, fool to believe the Chinese BS that Xie is a nice guy globalist out to save the world. Obviously Chretien is a goofy Alzeimers patient, and the best the Liberals could front up since the elevation of King Puddle Pants.

Donald Trump saw right through the limp weasel foreign policy of Obama, and the limp wristed Trudeau. He’s got Xie set up for a pint. Go President Trump. If the US market isn’t up 60% in 24 months I’d be very surprised.

#48 Coastal Zapper on 06.16.19 at 9:55 am

I had heard a long time ago that it was common place for the market to drop before Xmas because brokers sold to put money in the bank to buy presents.

Any truth to that?

#49 crowdedelevatorfartz on 06.16.19 at 10:43 am

@#40 Smoking man
“My son on dad day.”
+++++
Father’s day.
A politically incorrect target if there ever was one.
I’m amazed the PC Pink Shirt Police haven’t harassed (bullied?) Trudeau into renaming “Fathers Day” into “Parenting Day” or some such non gender, inoffensive term,and obliterated/censored all references to the masculine reference “Father” from govt Calenders, govt bulletins, govt publications.
I guess the bureaucrats are busy on other areas of gender eradication…
Perhaps next year after he wins re-election the Ministry of Truth will issue it’s mandate for the “gender name purge”.

#50 crowdedelevatorfartz on 06.16.19 at 10:47 am

Comedian Steve Martin explaining the Bata “Cruel Shoes”

https://www.youtube.com/watch?v=6bhrBdgYTV8

#51 Ronaldo on 06.16.19 at 11:15 am

#35 Guitarzan on 06.16.19 at 1:05 am
#2 Ronaldo on 06.15.19 at 3:47 pm

What you meant to say… The best deal was on Bay Street, not at the Bay store!

Reality is that Black XMas was difficult to pinpoint… Many did not see it coming. Fewer saw the rebound. So the moral of the story is… Steady as she goes.

Market timers only predict correctly in the rear view mirror. If someone learns the secret, let me know. I haven’t figured it out in 35 years!
—————————————————————
Intuition. In the past 18 years from the last trading day of the year to end of April the following year, markets have been up 15 of the 18 years and even for 2 years with only 1 year down by less than by 3.5% (2018). It’s generally a pretty safe bet to buy after tax loss selling season. This last one just happened to be a bit more obvious with the market down 17% from July. As Shawn said in his post for every seller there was a buyer so many other buyers saw this opportunity as well. Am I able to tell when this market is going to crash? Certainly not, and I am not about to sell any of my holdings in fear of such an event but I will make adjustments when I feel the need to and I will take advantage of buying opportunities as they arise. When will the next opportunity come. I have no idea.

#52 Ronaldo on 06.16.19 at 11:19 am

Correction to my post:

Should have read, “the last trading day before Xmas” not “last trading day of the year”.

#53 crowdedelevatorfartz on 06.16.19 at 11:23 am

Speaking of shoes

https://www.citynews1130.com/video/2019/06/15/sarah-jessica-parker-opens-shoe-store-in-edmonton/

If the reports of recessionary Alberta are true, Sarah Jessica Parker might have second thoughts about opening a shop.
The shops at the West Edmonton Mall are about as busy as a morgue.
Apparently if it wasnt for the carnival rides and tourist junkets…. crickets…..

#54 Doug in Londinium on 06.16.19 at 12:00 pm

I’ve lost count of how many times I’ve said it before, and will say it again. Invest like an engine with a governor. When the speed drops, the centrifugal flyweights drop down, which pulls on the linkage to open the throttle. The more open throttle allows more fuel/air mixture to be drawn into the cylinders on the intake stroke. That greater amount of fuel/air mixture, when ignited pushed the pistons down with more brute force during the power stroke. That greater force is transferred to the crankshaft, and results in more output of torque and mechanical power. Similarly, like the governor, if stocks drop in value you should buy more while they are on sale. Ridiculously simple, isn’t it?

#55 Shawn Allen on 06.16.19 at 12:44 pm

West Edmonton Mall?

#53 crowdedelevatorfartz on 06.16.19 at 11:23 am:

If the reports of recessionary Alberta are true, Sarah Jessica Parker might have second thoughts about opening a shop.

The shops at the West Edmonton Mall are about as busy as a morgue.
***********************************
You are at least partly right about Alberta recession indicators. Alberta has a great economic dashboard report. It has 12 indicators declining and 20 in the green and growing. A year ago the indicators were more positive. There has been some back-sliding in Alberta’s emergence from the energy recession.

https://economicdashboard.alberta.ca/

But I have reported here before that West Edmonton Mall remains remarkably busy. Even with unemployment higher than traditional, 93% of those in the labour force are working. A lot of people still have a lot of money (or okay credit, but it’s all the same to a retailer).

Go into Lulu Lemon in West Edmonton Mall. They are very busy selling their expensive wares.

No doubt some stores are doing poorly. But in my experience West Edmonton Mall is quite busy. Far from a morgue, it is more like an Irish Wake.

#56 Renter's Revenge! on 06.16.19 at 12:47 pm

#39 Kreditanstalt on 06.16.19 at 3:47 am
And what if the “market” just perniciously, gradually slides slightly lower, lower a little, constantly over three or four years…?

=========

You mean like preferreds?

#57 crowdedelevatorfartz on 06.16.19 at 12:49 pm

@#137 Marco
“Milenials should coldly wait, Time is on their side.”

+++++

Well.
If you excel at sitting around waiting…..why do anything else…..

Just curious.
After you’ve sucked the financial “juice” from the Boomer’s bones who will you turn your outrage towards next?
GenX you’ve been warned…..

#58 Shawn Allen on 06.16.19 at 12:52 pm

Competition and Monopoly

53 crowdedelevatorfartz on 06.16.19 at 11:23 am
Speaking of shoes

https://www.citynews1130.com/video/2019/06/15/sarah-jessica-parker-opens-shoe-store-in-edmonton/

************************
Selling shoes is a tough business. It’s competitive especially at the lower end. At the higher end there are opportunities to sell based on brand name and to not compete on price (which is death unless you have the lowest costs).

But consider that you can be 100% guaranteed that Sarah Jessika Parker’s new store will accept both Visa and Mastercard.

Those cards will scoop 2% whatever. Sarah has basically no choice to accept those two cards. Customers demand it.

So, Visa and MasterCard are basically two separate monopolies as far as almost every retailer is concerned.

And their fees are basically unregulated. This explains why both have been exceptional investments. The stocks are expensive. But to date their extraordinary profits driven by their monopoly positions have made them good investments.

#59 Gravy Train on 06.16.19 at 1:03 pm

#47 The Great Gordonski on 06.16.19 at 9:40 am
“[…] If the US market isn’t up 60% in 24 months I’d be very surprised.” What a letdown! We all expected you to make a bet, such as: you’ll swallow a bug. :P

#60 crowdedelevatorfartz on 06.16.19 at 1:08 pm

@Dolce Vita
As much as I understand where your “Italia Forza” jingoistic pride comes from.

Will Italy be the next Greece?
Public Debt at 132% second only to bankrupt Greece.
2020 is shaping up to be even worse with a predicted +3% deficit on the books which will violate the EU Rules of fiscal responsibility.
The result?
EU Fines?
Or
Italian Interest rate hikes…….
Long term 10 year Italian bonds are now 2% higher…..
Time to dump the EU and go back to the Lira?
Mamma Mia!

#61 Remembrancer on 06.16.19 at 1:20 pm

#49 crowdedelevatorfartz on 06.16.19 at 10:43 am

Nope not a thing… Crowing about fake issues only helps drown out discussion on the real ones…

https://www.statcan.gc.ca/eng/dai/smr08/2017/smr08_218_2017

https://twitter.com/liberal_party/status/114023216403
1762432

https://twitter.com/parti_liberal/status/1140232037133107200

https://twitter.com/JustinTrudeau/status/1140242569198223360

https://twitter.com/JustinTrudeau/status/1140242491146473472

#62 But when ... on 06.16.19 at 1:29 pm

#54 Doug in Londinium on 06.16.19 at 12:00 pm

I’ve lost count of how many times I’ve said it before, and will say it again. Invest like an engine with a governor. When the speed drops, the centrifugal flyweights drop down, which pulls on the linkage to open the throttle. The more open throttle allows more fuel/air mixture to be drawn into the cylinders on the intake stroke. That greater amount of fuel/air mixture, when ignited pushed the pistons down with more brute force during the power stroke. That greater force is transferred to the crankshaft, and results in more output of torque and mechanical power. Similarly, like the governor, if stocks drop in value you should buy more while they are on sale. Ridiculously simple, isn’t it?

the engine does go for a shyte the governor applies more fuel and all hell breaks loose …

#63 crowdedelevatorfartz on 06.16.19 at 3:06 pm

@#61 Rememberancing

Facts ? Facts?
“Because its 2016….”

https://www.youtube.com/watch?v=ItsGW1Nlm3c

How about if we meet halfway….

Happy Father Figure Day

#64 TurnerNation on 06.16.19 at 3:24 pm

Sympathy post for the new guy. If only I’d invested in the TSX Virtue Signaling index! At record highs, though dangerously close to hitting Peak Virtue. We can hope.
A new high reached.
https://www.cbc.ca/news/canada/saskatoon/two-spirit-people-marginalized-1.5172812

#65 Tony on 06.16.19 at 3:43 pm

I only see two days on that list. I threw the others out the window since the U.S. stock market has been virtually 100 percent rigged since 1994. The last 10 years have been what can only be termed a three ring circus sideshow.

#66 Tony on 06.16.19 at 3:46 pm

Re: #62 But when … on 06.16.19 at 1:29 pm

That’s why America is cutting interest rates to get every last sucker or bag holder who isn’t in the market into the market for 2021 when the elites unload everything.

#67 The Great Gordonski on 06.16.19 at 11:07 pm

#59 Gravy. Hah, Ive got the pedal to the metal every day and eating a few bugs comes with the territory.

#66 Tony. But, when the “elites” have dumped everything do you think they’ll reinvest in GICs? Hakuma Matata Amigo. When the next crash comes there’ll be plenty of elites rushing to get in. Don’t be influenced by the communist leaning media. Lots of us so called elites have millions and more on the table come rain or shine. It’s not about the daily bounce or political spit of alt left douchebags. Haven’t you noticed that the leftists all drive the nicest SUVs during a recession?

The fundamentals are really good, many many companies still trading below Buffets line, 8 P/E with yields rising on profits and buybacks. The Trump Hate Media and Globalist looms want people to be scared, to engineer a crash through perception. It sure as hell isnt going to happen on fundamentals. The globalists are panicking, expect the climate to get worse, the lies more intense going into 2020 when it’ll look like the whole world needs to impeach Trump, all crazy talk. This is a generational but time, regardless of what the CBC is puking up.

#68 Doug in Londinium on 06.18.19 at 11:04 pm

@But when …, post #62:
The governor applies more fuel to compensate for a drop in speed, is that what you call going for shyte?