Stock pickers & nose pickers

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DOUG  By Guest Blogger Doug Rowat
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The investment strategists at JP Morgan like their symmetry.

They released their first research report on stock concentration risk in 2004. Wrote another in 2014 and then planned to write another in 2024. In other words, each report was to be released an exact decade apart.

Then 2020 happened.

The year-like-no-other prompted JP Morgan to move up their timeline and they recently released their latest update—roughly four years ahead of schedule. But this release has a symmetry of its own as it now captures a perfect 40 years of market data.

I’ve highlighted the results of JP Morgan’s previous 2014 stock-concentration research before, and as a reminder, the results weren’t pretty. Examining the universe of Russell 3000 companies since 1980, JP Morgan found that roughly 40% of all stocks suffered a catastrophic loss. What defines a catastrophic loss you ask? A catastrophic loss equates to a permanent 70%+ decline from the stock’s peak value. So these losses are not only ugly, but there’s also no recovery.

Think Trump Hotels & Casino Resorts, Blockbuster or Bear Stearns.

Now, if you had to guess, would you say that the 40% catastrophic-loss figure has improved or worsened with the addition of six more years of data? Right. It’s worse. In fact, it’s significantly worse across virtually all sectors:

The odds of any given stock blowing up were always high, but the odds have worsened

Source: JP Morgan, Turner Investments. Based on Russell3000 Index data. A catastrophic loss is a permanent decline of 70% or more.

So why would you invest in equities at all given this high probability of catastrophic failure? Because a small number of ‘mega-winners’ actually carry the day for the broader Russell 3000 Index and result in its overall positive gains (roughly 15% annualized returns over the past decade, for example).

Gains being powered disproportionately by a small number of stocks is, in fact, true for most major indices. In the case of the Russell 3000, these mega-winners only comprise about 10% of the Index. In fact, the MEDIAN stock in the Russell 3000 has actually recorded a NEGATIVE return over the long term and JP Morgan further highlights that “around 2/3 of the time, a concentrated position in a single stock would have underperformed a diversified position in the Russell 3000 Index.” So, unless you own a broad-based equity ETF, your odds of owning a sufficient number of these mega-winners to keep pace with or outperform the Index are low.

Yet investors always believe that they can pick the best-performing stocks and often fail to recognize the need to diversify. Recall the research of Brad Barber and Terrance Odean. Mr. Barber and Mr. Odean were researchers at the University of California who conducted a landmark study of investor behaviour during the 1990s. They looked at the holdings and trading activity of roughly 78,000 households at a large US discount brokerage over a multi-year period.

One of the more remarkable revelations of their study was that the mean household only held 4.3 stocks. That’s it. If you combine this lack of diversification with the catastrophic-loss probabilities outlined by JP Morgan then the investing danger becomes obvious.

But all of this, I should point out, is an argument against concentration risk not an argument against equity-market exposure itself. There are the naïve, under-diversified stock-pickers who believe they’ll magically avoid the catastrophic losses, but then there are those at the opposite end of the spectrum who believe that equity markets should be avoided entirely. Fear of higher interest rates or the US Federal Reserve tapering its asset purchases being just the latest excuses to avoid equities.

When we last worried about the Fed tapering its asset purchases, back in May 2013, the market concern lasted about a minute. The S&P 500 sat at the 1,650 level then. Now it’s at more than 4,250, almost a three-fold advance. And the last time we had a Fed tightening cycle—nine interest rate hikes from late 2015 to mid-2019—the S&P 500 advanced 57% on a total-return basis.

And in case you’ve forgotten, equity markets have survived much worse than higher interest rates and an easing of Fed stimulus. There was a time when the worst global pandemic in a century swept across the world killing millions, shuttered the world’s largest economy to the extent that its Q2 GDP actually dropped 33% on an annualized basis, its worst plunge in about 75 years, and resulted, of course, in the onset of the fastest bear market in the S&P 500’s history.

And yet the S&P 500 still advanced more than 18% for the year…which is to say, last year.

Tell me again about your excuses for not investing in equities this time around?

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

 

79 comments ↓

#1 RowatNation aka Prince Polo on 06.26.21 at 8:56 am

Back in August 2020, the talking heads on CNBC were yammering on about growth v. value.

I thought, this is riDONK! Why not just own both and not fret about it? [specific tickers pre-redacted to protect the foolish].

Let’r rrrrrrrrrrrrrrrrrrrrrrrrrrrip!

#2 KLNR on 06.26.21 at 9:04 am

@#74 Out Of Work CEO, Will Travel on 06.25.21 at 7:40 pm
Most readers of this high brow blog will have no knowledge or framework to connect to this place “WAWA” on Lake Superior…also those people have no recollection of the “Friendly Giant”on CBC back in the late 60’s. The 60’s in Canada was great as you could hitch hike across the country and most of us who are familiar with the whole country would be stuck in a line in Northern Ontario trying to get a lift out of WAWA. There were cheap (free really) hostels all along the trans-Canada. PEI was so kind to me at the hostel where the Premier showed up and we had a PowWow. Canada back then so cool. So cheap. We were busy trying to make friends not tearing down towns or amping up the negatives. A great place Canada back then. It’s gone. Maybe Mexico.

come on man, turn that frown upside down.
Like any country, we’re not without issues but Canada is still great. I wouldn’t want to be anywhere else.

#3 Zen Investor on 06.26.21 at 9:23 am

I’ve had 2 TSX – 100% write offs in 20++ years. TS.b and PGF. Both bought on speculation but solid potential. Losses written off are also called….tax planning. GLTA.

#4 Love_The_Cottage on 06.26.21 at 9:24 am

Can’t wait for the replies along the lines of:
“sure, other people shouldn’t pick individual stocks, but I’m a nameless person on the internet and I can because…”

#5 Millennial 1%er on 06.26.21 at 9:57 am

The only stocks I pick are the ones provided to me as compensation as per my employment contract.

I sell as soon as I get liquidity and turn it into 80/20 ETFs.

Thinking is for chumps

#6 just a dude on 06.26.21 at 10:09 am

Fantastic post, Doug – thank you.

My painful losses on individual stock holdings back in ‘08 convinced me once and for all that I was not smart enough (nor visionary enough) to successfully pick stocks that wouldn’t possibly send me to the poorhouse in the future. Broad sector and geographic diversification in my portfolio since then has allowed me to sleep reasonably well.

Thank you, Garth and Ryan for helping me stay the course since then with your collective voice of reason and objectivity.

#7 Flop… on 06.26.21 at 10:40 am

I read crappy papers in the U.K, of course I’m not going to try and stock pick…

M47BC

—————————————————

‘What a waste!’ Canada’s largest house – a 65,000 sq ft behemoth complete with two pools, a boat garage, waterfall and LIGHTHOUSE – sits decaying and unfinished after forestry mogul owner was forced to abandon it during financial crash

* “Canada’s largest house is a 65,000-square foot mansion that’s abandoned and decaying on the shores of Lake Temiskaming in Northern Ontario

* It features a waterfall, small golf course, two swimming pools, indoor boat garage, squash court and an observation lighthouse

* The Peter Grant Mansion, named after and built by the forestry mogul of the same name, was last listed in 2010 as costing $25million

* Much of its interior was finished, although its walls have now been vandalized, and many of the building’s windows are broken  

* It is unclear who the current owners are, but little has been done aside from the installation of security cameras.”

https://www.dailymail.co.uk/news/article-9722987/Canadas-largest-house-abandoned-65-000-sq-ft-mansion-boat-garage-lighthouse-more.html

#8 BoomerMan on 06.26.21 at 11:27 am

Buy and hold equities through thick and thin. Hmmm. Good advice if you bought the US market in 2010. Bad advice if you bought the Japanese market in 1989. Bad advice if you bought the US market in 1929 that took 29 years to break even. You are a 35 year old in 2021 and can safely wait until you are 64 to get your non inflation adjusted dollars back. Hmmm. It would be folly to jump in at current market over valuations.

#9 Ian on 06.26.21 at 11:32 am

Thanks for the Blockbuster Video memories. Spent alot of nights as a teenager strolling those aisles for a rental, lol.

#10 My Body My Choice on 06.26.21 at 11:49 am

“Stock pickers and nose pickers …”

and guilt grifters.

I’m a poet and don’t even know it. I just hope I don’t blow it.

#11 Stone on 06.26.21 at 11:55 am

Stock pickers & nose pickers

———

That’s a good blog title. Was that a little jab for all those who like digging for gold? Lol.

Definitely agree with todays blog post. Broad based ETF B&D all the way. It pays. 14.71% ytd. I enjoy when the B&D is aroused and erect…which is pretty much all the time. Fantastic!!!

#12 Keen Reader on 06.26.21 at 12:00 pm

The real question is how much would have markets advanced without the massive QE? “Survival of equity markets” may look nice in the rear-view mirror, but hard to ignore current risk levels. A major correction could derail the best plans. Pretty challenging times now for investors, with valuations at ATHs and conflicting expert views on inflation vs deflation. Keeping a eye on both opportunities and the exits certainly isn’t easy…

My excuses for not investing “more” in equities is that I’m satisfied with YTD gains so far. Markets could go flat for two years and it’d still be ok for me, provided inflation also remained low. Unfortunately that’s not the case, forcing continued exposure to significant risk. I reduced equities and bumped up cash and gold a few weeks ago, losing out a bit on recent gains, but have no SA-like world-domination goals. Only time will tell whether being prudent or bullish is appropriate at this juncture, though it certainly isn’t binary…

#13 Joe on 06.26.21 at 12:06 pm

Uh buddy the reason the market didn’t crash during 2020 was cuz of free money printing. That’s why it survived. It didn’t survive naturally.

#14 Doug Rowat on 06.26.21 at 12:20 pm

#8 BoomerMan on 06.26.21 at 11:27 am

Buy and hold equities through thick and thin. Hmmm. Good advice if you bought the US market in 2010. Bad advice if you bought the Japanese market in 1989. Bad advice if you bought the US market in 1929 that took 29 years to break even. You are a 35 year old in 2021 and can safely wait until you are 64 to get your non inflation adjusted dollars back. Hmmm. It would be folly to jump in at current market over valuations.

—-

Still scarred by the ‘29 crash, eh?

You want a historically very, very reliable investment to also be 100% risk free? Quite an expectation. Best not drive in your car today, fly on an airplane or even leave the house if that’s your view of risk.

But then how would you get to your local speakeasy?

—Doug

#15 Upenuff on 06.26.21 at 12:28 pm

Thanks again Doug for your teachings (writings). I spent too many years getting beaned by the ball instead of hitting homeruns trying to pick stocks on my own….now I leave it to the professionals and sleep way better. Slow and steady will save your ass.

Upenuff

#16 GrumpPanda on 06.26.21 at 12:35 pm

Re: Out of Work CEO. I miss Rusty and Jerome. We had only CBC until ’74 or ’75. Then CTV came. My Dad said that’s when the arguments started. We bought a 12″ black and white TV for the kitchen where I was banished on Saturday nights for HNIC.
With the Internet now everyone has the freedom of choice to stay in their own echo chamber. No need to ever watch Canadian news. Satellite families are no longer people with a big dish.
For all we gain I fear we are losing something more valuable. A sense that we have something in common.

And yes I’ve been to Wawa.

#17 NSNG on 06.26.21 at 12:44 pm

Your column left out the nose pickers part. You’re disappointing many people.

#18 IHCTD9 on 06.26.21 at 12:47 pm

#2 KLNR on 06.26.21 at 9:04 am
@#74 Out Of Work CEO, Will Travel on 06.25.21 at 7:40 pm
Most readers of this high brow blog will have no knowledge or framework to connect to this place “WAWA” on Lake Superior…also those people have no recollection of the “Friendly Giant”on CBC back in the late 60’s. The 60’s in Canada was great as you could hitch hike across the country and most of us who are familiar with the whole country would be stuck in a line in Northern Ontario trying to get a lift out of WAWA. There were cheap (free really) hostels all along the trans-Canada. PEI was so kind to me at the hostel where the Premier showed up and we had a PowWow. Canada back then so cool. So cheap. We were busy trying to make friends not tearing down towns or amping up the negatives. A great place Canada back then. It’s gone. Maybe Mexico.

come on man, turn that frown upside down.
Like any country, we’re not without issues but Canada is still great. I wouldn’t want to be anywhere else.
———-

Some of Canada’s issues are world topping today. We are definitely not on track to improve either…

Wawa is famous for the big goose, I grew up about 5 hours north-west of there. The trans Canada is a beautiful drive over Superior.

I remember the friendly giant, and “paddle to the sea”.

#19 Leechy Fruit on 06.26.21 at 12:49 pm

#13 Joe on 06.26.21 at 12:06 pm

Uh buddy the reason the market didn’t crash during 2020 was cuz of free money printing. That’s why it survived. It didn’t survive naturally.

__

Still, it survived. Didn’t it?

#20 Doug Rowat on 06.26.21 at 12:53 pm

#13 Joe on 06.26.21 at 12:06 pm
Uh buddy the reason the market didn’t crash during 2020 was cuz of free money printing. That’s why it survived. It didn’t survive naturally.

—-

So true. Hopefully you completely sheltered yourself last year and avoided all those ugly, unnatural double-digit equity gains.

—Doug

#21 Ponzius Pilatus on 06.26.21 at 1:04 pm

#14 Doug Rowat on 06.26.21 at 12:20 pm
#8 BoomerMan on 06.26.21 at 11:27 am

Buy and hold equities through thick and thin. Hmmm. Good advice if you bought the US market in 2010. Bad advice if you bought the Japanese market in 1989. Bad advice if you bought the US market in 1929 that took 29 years to break even. You are a 35 year old in 2021 and can safely wait until you are 64 to get your non inflation adjusted dollars back. Hmmm. It would be folly to jump in at current market over valuations.

—-

Still scarred by the ‘29 crash, eh?

You want a historically very, very reliable investment to also be 100% risk free? Quite an expectation. Best not drive in your car today, fly on an airplane or even leave the house if that’s your view of risk.

But then how would you get to your local speakeasy?

—Doug
———————
My family lost everything in the German crash in 1929.
Well, not quite everything, they could stil use the paper money for wallpaper.
But they were very young and would recover, but the message as a young kid was always to stay away from the stock market.
And funny,even to this day somewhere deep in my sub conscience there is a voice that warns me when I’m about to get too “adventurous”.
About “Speakeasies”.
Sadly too many are closing.
Newcomers, either don’t drink, or drink at home.

#22 TurnerNation on 06.26.21 at 1:06 pm

#26 George S on 06.25.21 at 3:04 pm
“There are only 8 (eight) more years to reduce our emissions by about 45% of current levels”

uhh yeah did you not notice the year + of lockdowns and house arrest? The travel shut-down? Tourism banned in Kanada – cruise ships sent away. Bubbles and Virtual Berlin Walls? Did you think it all was for your health? Nope into 2030 we are under global control. Over travel/movement, mainly.
Very tight timelines, we are being sold on a winter shut down. Get ready for triple Karbon taxes too. Travel, soon food will be for the rich. Of course the solution will be more communism/UBI. Maybe the new E-Currency pre-loaded onto a benifits card


–Seen elsewhere- I said this early last year that “Distancing” is the greatest social and economic weapon ever:
“Destroy the middle class.One important goal of repeated lockdowns, distancing and sanitation measures, is to wipe out the middle class, the self-employed and SMEs. There’s no medical science to support any of the measures.”


— Which I way I stand by the prediction that Indoor dining in Ontariowe likely will NOT open this year.

.Why Ontario’s not hopping to Step 3 of reopening despite hitting vaccination targets. (cbc.ca)

#23 Dolce Vita on 06.26.21 at 1:07 pm

Good advice.

ETFs primarily for me, 90% in $ terms. 10% kill the boredom of ETF stocks but even then big, liquid, throw off healthy dividends, blue chip, etc.

Doug, I still liked your histogram chart from a while ago showing for decades the Market up 70% of the time.

All that is needed is patience and perseverance.

———————-

Garth:

I’m telling you, you might get your 32M Cdns 70% 2 doses vaxd by the August long weekend.

Re-ran the numbers from yesterday and the new date is:

August 7

6 day vax average = 477,520 as of yesterday. You know, they could cancel the Aug long weekend and have it the weekend after.

——–

Gov Canada delivering on vax forecasts, finally*. Week of June 21-27 (as of yesterday):

Forecast = 5.2M
Received = 8M
+2.8M

2 more days to go.

*Since Apr 24 to June 20 Gov Canada Forecast vs. Received shortfall in doses:

-2M

That shortfall made up for this week. Nicely done Gov Canada and Minister Anand.

Mind you, thanks should primarily go to the EU and in part to the USA, as of late, for the doses.

Anand just buys and distributes them. She couldn’t forecast her way out of a wet paper bag up until this week.

#24 Doug Rowat on 06.26.21 at 1:10 pm

#17 NSNG on 06.26.21 at 12:44 pm
Your column left out the nose pickers part. You’re disappointing many people.

—-

Nose pickers are the investors sitting on the sidelines ‘picking their nose’. Happy to disappoint anyone looking for the literal.

—Doug

#25 Dolce Vita on 06.26.21 at 1:24 pm

Off topic.

In under 2 hrs Italia takes on Österreich in Euro 2020.

If Euro 2020 were a downhill ski competition I’d be worried. It’s not. It’s the beautiful game. We play it better (without skis).

Of course that doesn’t stop Lederhosen Österreich from quasi-trash talking Italia before the game:

https://kurier.at/sport/fussball/oesterreichs-gegner-nur-immobile-ragt-aus-italiens-kollektiv/401425602

The game will be played in Wembley. English referee, Brits bitching about Draghi wanting the finals moved to Rome because of Delta infested England, etc.

As usual, the Brits will cheer for Italia as I cheer for them.

—————

Just another drawing to an end Pandemic day on Planet Earth.

#26 Michael in-north-york on 06.26.21 at 1:31 pm

Just do core-and-explore. Keep 40% in bonds, 50% in stock indices, and invest 10% in individual stocks if you like doing so. But never put more than 3% in a single stock.

Even if the returns on your 10% individual picks trail the returns on your 50% stock-index portion, you will be doing well overall. And having fun, too.

#27 G on 06.26.21 at 1:41 pm

Article. So might be interested.

How the Financial Industry Can Apply AI Responsibly
https://spectrum.ieee.org/the-institute/ieee-products-services/how-the-financial-industry-can-apply-ai-responsibly

#28 WTF on 06.26.21 at 1:44 pm

#101 Mean Guy on 06.25.21 at 10:30 pm
“I really hope you guys don’t portray yourselves as having even a basic grasp of finances. Somebody might take you seriously you know. People could get hurt.”
Let’s do some quick calculations on known facts: 2 bedroom condo in Toronto, 1,000 sq feet. Cost about $1M. Property tax about $6,000 annually. Maintenance, is standard at about 70 cents /sq ft, so $700/month.

Total costs: $1,200 per month.

Utilities are generally paid by tenants now, for obvious reasons.

Actual rental cost of $1M condo of (less than) 1,000 sq ft: $2,950 a month, parking not included: https://rentals.ca/toronto?beds=2&types=condo&active-listing-id=326142

He’s only off by 145%. No biggie.
—————————————————————- I understand the commentary was about ownership costs vs rent, But.

I’ll review a real life current example for FULL context.

Just signed a lease for 2 bed bath 11oo sq ft, view, Apartment assessed at 1.8 million. (the one beside it is for sale now) Rent $ 3200. Insurance/utilities $200 per. Total $3400 per month. Landlord gets 38k per annum.

Assume its paid for. Lost opportunity on 1.8 million invested with return at 6% = $ 108k – 38.4 k =69,600 shortfall (add income/ prop taxes) . Don’t forget “special assessments”

Wouldn’t work in your 1 mil/$2900 example either, shortfall of 26k.

“basic grasp “indeed

#29 catnogood on 06.26.21 at 1:51 pm

Nobody knows nuthin’.

#30 G on 06.26.21 at 1:53 pm

Are you paying attention yet? Bill C10 and now this Bill. What are “they” wanting to hide/control from the masses hearing I wonder???

Trudeau government’s move to ‘protect Canadians against hate speech & hate crimes’ is road to hell for freedom of expression
https://www.rt.com/op-ed/527682-trudeau-hate-speech-freedom/

#31 Quintilian on 06.26.21 at 1:55 pm

It’s hard work. You have to do overcome inertia and at the same time, don’t be a fool and rush in.
But if you want good nutritious meals, at the fraction of the cost of going out, you have to do it yourself.
Don’t buy the packaged miracles by the experts.
I take the same approach to investing.
It works.

KIP IT SIMPLE

#32 Stock picker on 06.26.21 at 2:08 pm

If most stocks in an ETF are dogs then why not just buy all the good ones individually and get a better return.

#33 GreaterPoodle on 06.26.21 at 2:31 pm

In fact, the MEDIAN stock in the Russell 3000 has actually recorded a NEGATIVE return over the long term and JP Morgan further highlights that “around 2/3 of the time, a concentrated position in a single stock would have underperformed a diversified position in the Russell 3000 Index.”

Listen, I agree with your message in general that the hoi polloi should check their brains at the door and buy indexes, but I don’t think that JP Morgan’s strawman is evidence that no investor can beat a given index stock picking. Of course a bonehead picking one stock is likely going to lose, but there’s also nothing particularly magical about the stocks chosen for an index. What advantages does an index have? Low cost and low turnover…that’s it. That’s not rocket science.

How about diversification? It’s overrated. The indexes are all way too diversified. Meaning that using the Russell index as an example of why individual stock picking is bad is logically flawed. An investor buying the Russell index is doomed to suffer performance anchors by carrying all those loser stocks, which JP Morgan is essentially admitting. They (and you) are arguing for eating the whole oyster, shell and all.

So, unless you own a broad-based equity ETF, your odds of owning a sufficient number of these mega-winners to keep pace with or outperform the Index are low.

You don’t have to own any mega-winners. You just have to avoid the losers.

#34 SoggyShorts on 06.26.21 at 2:43 pm

#101 Mean Guy on 06.25.21 at 10:30 pm
Soggy says he isn’t really paying rent at all, because the rent he is paying (lol) is coming out of his investment account.
*******************
It’s pretty basic in this scenario we had 2 options since you bragged about a paid-off house:

Option A)
Have a $1,000,000 paid-off house. Only pay property taxes, utilities and maintenance.

Option B)
Have a $1,000,000 portfolio. Pay only rent and utilities.

If the portfolio kicks off more in gains/dividends than the rent, then Option B is living just as rent-free as the homeowner.

Yes, the homeowner in some markets can also gain appreciation in their house, but not always(remember, 80% of Canadians do not live in the GTA/GVA), and certainly not always greater gains than the 1m portfolio.

#35 IHCTD9 on 06.26.21 at 3:08 pm

#21 Ponzius Pilatus on 06.26.21 at 1:04 pm

About “Speakeasies”.
Sadly too many are closing.
Newcomers, either don’t drink, or drink at home.
————

Newcomers have nothing to do with it. The 13k pop. old stock blue collar town I work in had no less than 8 bars back in the 80’s, almost half of them being peeler joints.

Today? One. One single little bar with nary a line up to get in. Closed at 11:00pm. Today we have 7 Pizza joints instead, several open all night, just about all of them are take out only, and deliver.

It’s the Internet, followed by an aging demographic.

#36 Doug Rowat on 06.26.21 at 3:23 pm

#33 GreaterPoodle on 06.26.21 at 2:31 pm

I don’t think that JP Morgan’s strawman is evidence that no investor can beat a given index stock.

—-

I never said that and neither did JP Morgan. But it’s evidence that the vast majority won’t.

Separate SPIVA research, which I highlighted in my last post, further confirms this.

And saying that you’ll outperform by avoiding the loser stocks is like saying you won’t get wet if you dodge the raindrops.

—Doug

#37 the Jaguar on 06.26.21 at 3:23 pm

Breaking News. The Jaguar now fully vaccinated, celebrated with a small shopping spree at Simon’s Department Store, and still managed to walk the few kilometers home with a six pack of Negro Modelo and her favourite Pino Grigio tucked under the arm that took the 2nd Pfizer shot. In + 27 heat. Those Viking genes just never let me down. Going to be a scorcher all week out here in the wild west.

Noted the patio garden renovation that has been underway at Premier Kenney’s southern headquarters is nearing completion. Should be ready to roll come July 12th, which is always the day and location the Premier’s Stampede Breakfast is held. Pancake, anyone?

In May, Alberta had the highest per capita cases of Covid in both Canada and the USA. We are now five days away from freedom. Full re-opening, with just a few restrictions such as masks on public transit, seniors homes, etc. The scene at the Telus Convention Centre this morning was inspiring. Like a military operation.

Following the Spanish-American War of 1898 the Independence Movement slogan “Cuba Libre” became a cocktail. Could it be time for an “Alberta Libre” recipe? Here’s to a ‘Free Alberta’….(clink!) In case of emergency, just whip up a “Presidente”. I already gave ya’ll that recipe.

Now back to stocks, bonds, asset allocation, and the markets…..

#38 ogdoad on 06.26.21 at 3:33 pm

‘They looked at the holdings and trading activity of roughly 78,000 households at a large US discount brokerage over a multi-year period’.

Yes sir! And now the fun begins. bzw. IoT data machine.

That’s one study. I could recommend just a few others. :)

Hope ur using it FOR the peeps!? But, at first glance, you are!

Happy Saturday!

Og

#39 G on 06.26.21 at 3:52 pm

DELETED

#40 SoggyShorts on 06.26.21 at 4:04 pm

#32 Stock picker on 06.26.21 at 2:08 pm
If most stocks in an ETF are dogs then why not just buy all the good ones individually and get a better return.
**************
That’s a joke right? Like “if most of the lottery numbers are losers, why not just pick the winners?”

#41 SoggyShorts on 06.26.21 at 4:05 pm

#33 GreaterPoodle on 06.26.21 at 2:31 pmYou don’t have to own any mega-winners. You just have to avoid the losers.
*****************
Is that true?
This blog has shown multiple times that when timing the market if you miss all of the worst days and all of the best days your returns will suck.

Judging by today’s post it seems like even if you missed the ~100 worst companies, if you also missed the ~100 best you’d also have crappy returns.

#42 TurnerNation on 06.26.21 at 4:19 pm

Call it a New Green Deal or Global Reset or what have you but they are taking us back to the stone ages with bike lanes and rickshaws and candles:
– Germany:

https://ruhrkultour.de/netzbetreiber-50hertz-warnt-vor-energie-engpaessen/?
“The warnings of the network operators and the Federal Court of Auditors against a blackout are not taken seriously enough by the Federal Government. “We also need long-term controllable power plants to ensure security of supply in Germany,” says Stefan Kapferer, head of the transmission system operator 50Hertz. “A reliable and inexpensive supply of electricity to private households and the economy is increasingly questionable,” warned the Federal Court of Auditors at the end of March.”

–Even the Pope is behind this rollout.

https://cruxnow.com/vatican/2021/05/vatican-launches-seven-year-laudato-si-action-plan/
““For a long time now, this house that hosts us suffers as a result of wounds that we cause by our predatory attitude, which makes us feel that we are masters of the planet and its resources, and authorizes us to make irresponsible use of the goods God has given us,” the pope said, arguing that this attitude has caused an “ecological crisis without precedent.”

———–
Oh you think CV control system will be going away?
Expect Wintertime lockdowns due to oh I don’t know a ‘Sigma SuperPlus Max XL’ variant.

.NZ announces immediate pause to trans-Tasman travel (abc.net.au)

.Portugal’s Lisbon rolls out new COVID curbs as cases surge (aljazeera.com)

.Chile announces new border closure due to the arrival of the Delta Covid-19 variant (cuencahighlife.com)

#43 Ned Flanders on 06.26.21 at 4:27 pm

Why do my neighbours insist on playing Russian Roulette by purchasing penny stocks in IT and bio tech firms? Companies with huge quarterly losses and some without any income.

Rhetorical question. People want to hit a home run with their stock picks. It’s not good enough to make 15% annually … it has to be 300% today.

I know, I know … get smarter neighbors!

#44 Concerned Citizen on 06.26.21 at 4:29 pm

“Tell me again about your excuses for not investing in equities this time around?”

My excuse – stocks haven’t been more expensive since 2000 at the height of the Dot Com Bubble. And you know as well as I that the only reason the S&P 500 is up over 30% from pre-COVID highs is because of all the money printing and negative real rates. If for any reason that policy ends – such as if inflation gets so high that even the money printers can’t ignore it any longer – then we risk a hugely painful reversion to the mean as interest rates rise. Stocks do well over the long term, but there have been many long periods of zero or negative returns in stock market history, and we haven’t had one of those periods in going on 12 years now.

I’m not totally of stocks, but I am being extremely cautious in my exposure. There is very little value out there – especially in the U.S. large cap.

#45 kommykim on 06.26.21 at 5:28 pm

RE: #32 Stock picker on 06.26.21 at 2:08 pm
If most stocks in an ETF are dogs then why not just buy all the good ones individually and get a better return.

=======================================

Because 80% fund managers, who do this for a living, get it wrong at any one time. What makes the part time, Googling, YouTube & BNN watching amateur investor think they can beat the odds? At least the fund manager is smart enough to play with someone else’s money. I guess as long as people are still dumb enough to buy lottery tickets (Tax on the stupid) there’ll be retail stock pickers…

#46 McSteve on 06.26.21 at 5:32 pm

Dougie – Are you in the inflation of deflation camp….say 2 – 5 years out? I’ve heard compelling reasons for both (Money printing, low interest rates, sovereign debt, technology, demographics). All arguments seem equally compelling. I’d say deflation would have been the order of the decade, except with all the government interference and debt it wasn’t allowed to happen. Hard to play the game when the rules keep changing.

#47 Daveyboy on 06.26.21 at 5:48 pm

Wife works for Nike. Made a killing this week. Selling them asap . Being diverse is the best!

#48 Steerage on 06.26.21 at 5:54 pm

Looks like garth lit them early…..i love the smell …. in the morning…. victory

#49 Nonplused on 06.26.21 at 5:55 pm

#13 Joe on 06.26.21 at 12:06 pm

“Uh buddy the reason the market didn’t crash during 2020 was cuz of free money printing. That’s why it survived. It didn’t survive naturally.”

Does it really matter why? You have to play all the cards that land on the table.

I saw a soccer clip where the striker clearly tripped on his own feet in the goalie area and was awarded a penalty kick by the ref. The defender was at least a foot away. What do you think the striker did? Your choices are:

a) argue he shouldn’t have a penalty kick
b) intentionally miss the net
c) score and celebrate

#50 TrueLies on 06.26.21 at 6:15 pm

Tell me again about your excuses for not investing in equities this time around?

– – – – – – – – – – – – – – – -**********- – – – – – – – – – – – – – – –

There are ‘excuses’ and then there are ‘reasons’.

For me, risk/reward unfavourable right now and ‘smart-money’ have been selling in record numbers, historically speaking.

At the same time, more $$ came into the markets in the last 6 months than the previous 12 years – combined!

Isn’t this Greaterfool after all? I believe the concept holds for all types of markets, not only housing.

My 2-cents…

TL

#51 Mean Guy on 06.26.21 at 6:25 pm

#28 WTF.

WTF indeed.

I thought the guy who brought up “opportunity cost” would at least understand the concept.

Big fail buddy.

You assume the $1.8 m would have earned a for (6% iirc) but then you fail to include the gains in the value of the condo. Prett basic. Another good example of people thinking they are competent to do any kind of financial analysis and failing to grasp an extremely basic factor.

Not to mention it was completely irrelevant to the point being discussed, a sad attempts at obfuscation.

Then he falls to “special assessments”. Oh boy. Ok lets count the number of special assessments in all of Canada for the last decade and compare to the number of stocks that had catastrophic results.

Just give it up already, the proof is in the pudding: homeowners have done far better than 95% of renters mainly due to leverage and tax free gains. Just get over it already.

#52 Ponzius Pilatus on 06.26.21 at 6:32 pm

Dolce,
I had low expectations from the Austrians.
But I think they aquitted themselves well.
They dominated the second half, and had a dissalowed goal.
What really bothers me is that the Italiens still seem to be competing for the ” Best Actor” Oscar, rather than for the European Soccer Championship.
Well, may the best team win.

#53 oops on 06.26.21 at 7:29 pm

@Kommykim

Dood/ette…Vizzini dies…just sayin’

#54 mark on 06.26.21 at 7:42 pm

Investing becomes a lot easier when you let go of your ego and are no longer fooled by randomness.

If you’ve ever dealt with the average investor you’ll know they overstate their returns, understate their costs and rarely understand the implications of tax.

They’re more than happy to tell you about their big winner, while sweeping 17 other losers under the rug. Then they’ll tell you the index is a bad deal because it holds a lot of losers!

#55 Nonplused on 06.26.21 at 7:58 pm

#51 Mean Guy on 06.26.21 at 6:25 pm

“Just give it up already, the proof is in the pudding: homeowners have done far better than 95% of renters mainly due to leverage and tax free gains. Just get over it already.”

I don’t think Garth ever said nobody should own a home. I believe the advice is “if you want a home and can afford it, buy one” and the “rule of 90”. What he advises people not to do is put all your eggs in one basket or make yourself a slave to home ownership.

#56 Wrk.dover on 06.26.21 at 8:03 pm

I think when the next 1929 scenario does unfold, currency is going to be dragged down to worthless along with the assets, thanks to the derivative camp and dog knows what sordid else going on in the tall towers.

So one might as well go all in on B&D with all their excess funds, just in case they do indeed keep that crash can kicked ever farther down the road, beyond our natural deaths.

My investing funding though, is after having secured every last other thing a person could need to sustain life well, happily ever after, on a couple of high four figure annual incomes, should that need arise. I fully invested sustainable/tangible first. Paper second.
______________________________

As for the demise of drinking establishments though, blame that entirely on the driving home after drinking laws, nothing else.

#57 Juve101 on 06.26.21 at 8:23 pm

#29 catnogood on 06.26.21 at 1:51 pm
Nobody knows nuthin’.

That about sums it up.

#58 Nonplused on 06.26.21 at 8:51 pm

#109 crowdedelevatorfartz on 06.26.21 at 12:45 am
@#67 Nonplused
“I am sure the fire bans will be on soon. I am surprised they aren’t already.”

++++

Total agreement.
Unfortunately after 1.5 years of Covid on again /off again bans….
EVERYONE is about to lose their shite.
I went downtown van today on the Skytrain for a dental appt.
99% of the passengers were following mask protocol.
Security guards everywhere.
The few people that werent were the homeless beggars and the insane babbling to themselves.
Its a Full Moon.

I expect this Summer to be a gong show if the heat wave/ Forest Gump started fires shuts down the parks and forests for camping.
The govt on all levels are walking on eggshells after the entire population has been locked down for a YEAR and a HALF…..
Everyone is seething, angry and ready to explode.

“Prime Minister Apologist” best not kick the Covid can too hard.

————————————–

You are probably right, but I hope that is not what they are doing. If they are not implementing fire bans because they want things to feel “normal” during the worst drought in 20 years, we are in for a long, smoky summer. Maybe they are just holding off for July 1st so people can shoot off their fireworks and the bans will come July 2nd. Still a dangerous strategy if you ask me.

Some years ago I reacted to the fire bans by buying a propane fire bowl. Those are usually permitted because they aren’t any more dangerous than a propane grill. All the ambiance of a fire without chopping wood or getting smoke in your eyes, and 60,000 btu which is more than enough during a fire ban (temperatures are usually high). They use a fierce amount of propane though, if you run it on low you might get 3-4 evenings out of a 20 lb bottle. But have you seen what packaged firewood costs these days? I was at Co-Op yesterday and a pettily bag of sticks that wouldn’t burn for 2 hours was $14. So unless you bring your own firewood you cut yourself, which you can’t do if you are crossing a boarder, it is now cheaper to use propane than wood. Gone are the days when a decent package of wood that would last all evening cost $7.

Well, if my brother’s former girlfriend was with us $7 was never enough. Her idea was put all the wood on at once. Why not? She wasn’t paying for it, or going to get it. “Keep the flames within the pit? Phthhbityphth.
Lesson learned: Dating a younger woman comes with hidden costs. Lots of them. And fire hazards.

The cost of prepackaged firewood is getting so high that I have seen people resorting to prepackaged charcoal.

#59 willworkforpickles on 06.26.21 at 8:58 pm

Look at the Fed…they are the mother of all invention here in keeping the truth out of sight painting a distorted picture in its place as if they would rather the masses believed to the contrary that all of the stock market’s gains through history came during dis-inflationary periods, not inflationary ones.
This is why the Fed lies like a rug about inflation. They do so to keep the bubble rising.
The Fed desperately needs to keep its debt-driven smoke and mirrors show of recovery going forward up and running between the ditches and has no choice but to go with an invented and controlled low CPI (consumer price index) inflation rate in order to make US treasury bonds look basically appealing to current and future (foreign) holders of national debt.
If the higher 12% inflation rate were reported on an honest CPI scale, the inflation adjusted yield on US 10 year bonds would be negative 10%…so who’d be buying then?
The smoke and mirrors horror show to come will eventually come to town by way of historically normalized interest rates and not maybe…it will with real inflation skyrocketing higher.
The house of cards CPI manipulated lie the Fed hides behind (doublespeak) will be exposed.
What the CPI omits as part of the overall inflation numbers equation is about to be exposed to the world.

You know if real yields on the US 10-year were honestly reported at -10%, gold would be shooting to the moon right now… gold rises fastest the faster real yields go negative…the Fed maintains and stays on their desperate course to suppress gold as the rising price of it is like a submission of their own all out failure…(the Fed will fail)
I said it before and will say it again…the Fed sweats bullets actually and really living with the prospect of perpetual looming failure.

#60 Ponzius Pilatus on 06.26.21 at 9:00 pm

#56 Wrk.dover on 06.26.21 at 8:03 pm
As for the demise of drinking establishments though, blame that entirely on the driving home after drinking laws, nothing else.
————–
On second thought, I think it’s BOSTON PIZZA.

#61 Nonplused on 06.26.21 at 9:04 pm

#56 Wrk.dover on 06.26.21 at 8:03 pm

“As for the demise of drinking establishments though, blame that entirely on the driving home after drinking laws, nothing else.”

One of friends is a retired police officer. In his experience, people who were below the 0.08 limit did not have more accidents than people who were well below or at zero, which is probably why the criminal limit is set at 0.08. Above that, the statistics showed that things got progressively worse. Someone above 0.16 was unlikely to get home without an accident. So a well set law.

Then the provinces saw a money grab. Fines but no criminal charges above 0.05! Big fines! Impound your car with fees! Even though you have not broken any criminal laws! It did have a detrimental effect on the hospitality industry and I am sure the fines never made up for the lost tax revenue from the establishments. Wing night became “Doesn’t anyone want to come to wing night?”

Oh well it kept all those honest people off the road. No indication it did anything to curb people from driving over 0.08 though, those folks were already reckless criminals who didn’t care. Sort of like how gun laws keep the honest people honest, but don’t affect the gangs.

#62 Mean Guy on 06.26.21 at 9:38 pm

#55 Nonplused

Who mentioned Garth?

I was answering Soggy who insists renters have done better than homeowners in the last 5, 10, 15 or 20 years, CEF who insists rent is less than property tax and maintenance fees, and WTF who brings up a whole different subject (opportunity costs) which he brilliantly uses to destroy my analysis by cleverly assuming a 6% return on a stock/bond portfolio and zero returns on housing.

With assumptions like that, one might think the writers are blinded by emotion and can’t think clearly.

Pretty sure the name calling will start up again, I think that means they surrender.

#63 baloney Sandwitch on 06.26.21 at 9:40 pm

I agree, most people will struggle to explain the difference between a balance sheet and a bathroom scale. Index funds are the best managed by a fee only financial planner.

#64 Russ on 06.26.21 at 10:57 pm

Nonplused on 06.26.21 at 9:04 pm

#56 Wrk.dover on 06.26.21 at 8:03 pm

“As for the demise of drinking establishments though, blame that entirely on the driving home after drinking laws, nothing else.”

Oh well it kept all those honest people off the road. No indication it did anything to curb people from driving over 0.08 though, those folks were already reckless criminals who didn’t care. Sort of like how gun laws keep the honest people honest, but don’t affect the gangs.
===========================

You got that right .

The B.C. NDP took all the fun out of an impaired drive.

The drive was a Sunday tradition when the bars were closed to keep the religious fathers happy. Thank Dog for Expo ’86!

We would be on the lookout for a softball tournament or something like that , ’cause they had a ‘special license’ for the hospitality tent (beer garden).

Otherwise it was a box behind the seat.

Cheers, Russ

#65 Ustabe on 06.27.21 at 12:09 am

Then the provinces saw a money grab. Fines but no criminal charges above 0.05! Big fines! Impound your car with fees!

BC jumped all over that. Now picture this:

Young kid just getting his life back on track, working minimum wage a bit out of town, sharing a basement suite. Gets popped for .06 on his way home after watching a hockey game at a friends. Fines, car impound fees and a driving ban for however long. Room mates don’t feel like carrying him on the rent again, job fires him for not showing up and he has just enough money to do either pay his fines of bail his car out if he does it right now. So he is jobless and homeless with limited prospects for .06

Second scenarion: High school principal gets popped for same .06. Next day phones one of her teachers that lives nearby and arranges for a ride back and forth to work/home. Leaves a note for her husband to go bail out the car and writes a cheque for her fines. And she is collecting a paycheque as if nothing happened with the exception of it costing a few dollars that she could well afford.

We have allowed our governments to place what should be judicial decisions in the hands of those whose job is to enforce the laws. We let that sort of thing happen at our peril.

#66 Sail Away on 06.27.21 at 12:43 am

#54 mark on 06.26.21 at 7:42 pm

[Stock pickers are] more than happy to tell you about their big winner, while sweeping 17 other losers under the rug. Then they’ll tell you the index is a bad deal because it holds a lot of losers!

———

Oh, index is the proper choice for the majority of one’s portfolio, and the only thing emotionally reactives should be allowed to purchase under penalty of corporal punishment.

But for those of us made of sterner stuff, it’s hard to beat the exhilaration of locking in a gain worth more than a year’s salary before breakfast.

#67 Doug Rowat on 06.27.21 at 1:20 am

#45 kommykim on 06.26.21 at 5:28 pm
RE: #32 Stock picker on 06.26.21 at 2:08 pm
If most stocks in an ETF are dogs then why not just buy all the good ones individually and get a better return.

=======================================

Because 80% fund managers, who do this for a living, get it wrong at any one time.

—-

88% last year.

—Doug

#68 Diamond Dog on 06.27.21 at 5:20 am

I’ll bite Doug. Buy low, sell high. The market is?

https://www.multpl.com/shiller-pe

According to Shiller PE, the second highest valued S/P in market history next to what no one in their right mind would deny, the market dot.com bubble of 2000. We aren’t far off here.

https://www.multpl.com/s-p-500-price-to-sales

Price to sales tells the same story. I wish this chart predated 2000 to get a full comparison, but I’d wager S/P share value to sales is higher than 2000 at the moment, not lower.

This btw, is in keeping with an argument money managers make for continued investment which is that as earnings improve, P/E’s will go down which is true but lets look at that for a moment. The U.S. economy is, what, a little less than 10% of what it was before the pandemic hit? To make up for this loss in volume, prices have risen to keep profits up. We all know recognize this as inflation. The macro economic problem is, when incomes can’t keep pace with inflation, what happens? It’s a rhetorical question.

To which, money managers counter, housing valuations have swelled homeowner equity. Markets have done the same with 401-K’s. Incomes have been swelled not so much by what people do (because it couldn’t come from there), but by what people own. The problem is, its a dual edged sword. Asset inflation doesn’t last forever to wit, they are more sensitive to rates than anything, but also to their own value. As values go up, so does risk and it never changes.

So, if interest rates go up what happens? Valuations fall and money starts to flee the market place. Thus, investors believe rates won’t go up because its an economy killer if the Fed raises rates which they won’t do because it will kill the economy, the #1 reason why rates have stayed in the basement for the last 13 years.

Oh, the Fed wants to to give itself room to lower rates if we have an economic shock to the system like, say, a pandemic but can they? Most believe they can’t, plus the Fed lends itself its own money so there’s that. Just like Japan, the Fed can be it’s own bank and rely on money velocity to keep it’s currency buoyant. On top of this, the Fed has been buying MBS’s like never before, keeping rates ultra low to juice asset inflation and boost incomes on what people own (real estate, stocks) and the BoC has been doing it here too. Few are expecting things to change because, basically, it can’t. Or so, with recency bias and logic, we are led to believe and unless the economy actually gets producing again or North America goes through a currency crisis, it’s not bad logic but that doesn’t mean it will last. At the end of the day, production matters. Income from what we don’t own, that matters too.

So, lets say rates don’t go up for the next 10 years or until the U.S. becomes the 2nd largest world economy or the 3rd and so on. It doesn’t change the fact that the present economy as we know it is relying on less production than before and relying more on inflation, partly driven by the thirst for profit and partly driven by less competition than there was before so I’ll say it again. If incomes can’t meet the rise in inflation or the rise of the cost of living, what happens?

What I’m trying to say is, the entire north American market is relying on housing and equity valuations to ride itself through this patch but we running out of runway. Real estate can’t have double digit returns forever. The markets can’t do it either. At some point, this government engineered worm will turn and when it does, expect a crash.

https://www.multpl.com/s-p-500-price-to-book

What does Price to book tell us compared to the “undeniable 2000 bubble”? Price to book value tells a long game on equity and we are 9% off from the historic zenith peak of 2000 (which, btw, was coming off highly productive 90’s. There was more to get excited about in 2000 than there is now). There’s a message in that.

https://www.multpl.com/s-p-500-historical-prices

Money managers will point to a chart like the one above and tell us that historically throughout the last 150 years, the trend is up. What they don’t spend much time on is, if your money was invested from the peak of 2000 to 2013, your money in the S/P laid an egg. From 1968 to 1983, same thing. See adjusted for inflation below:

https://www.multpl.com/inflation-adjusted-s-p-500

My point is? Macro economics does matter. It doesn’t mean the market place isn’t full of opportunity when the market crashes, or there wasn’t money to be made during these periods. Just in the last 20 years, we had golden opportunities to go all in at the bottom of the dot.com bust, the 911 bottom, the GFC bottom, the commodity bottom of 2016 and the pandemic bottom. Anyone who had cash on the sidelines and invested on any past bottom, did well. Anyone who didn’t take profit at or near market peaks, not so much . How do you have cash if you, as an investor, don’t take profit?

All I’m saying is, buy low sell high. And the market is? It’s high. Lets not live in a land of pretend, the market is high. Can it go higher? Sure it can. But I look at these charts like this one and what do I see? I don’t see us investing in a present bottom. I see a damn close to top, not a scenario for all in investing and walk away for a few years without a care or worry and I see risk, lots of it. Risk always comes when valuations rise relative to historic norms, like when a market is high like this.

Already long post, but I can’t help but think back to investors who felt frustrations of “missing out” back in 98′ or 99′ because they didn’t hit the peak. Did these same investors feel frustrated watching the dot.com bubble pop? Or the market melt of 911? Or the GFC? Commodity crashes? The pandemic? Cancer in their family? I can think of a 1001 reasons why cash on the sidelines is not a bad thing.

The market place has been a great place to be for the last 13 years. Is there anyone with a straight face that can say the market place will continue to rise from here for 13 more? Some wise souls said as much 13 years ago at the bottom of the GFC. You won’t find these same souls saying that now.

#69 Bezengy on 06.27.21 at 7:11 am

I’ve had plenty of losers, and as a DIY investor have no one to blame but myself. I do think however, many of my mistakes could have been avoided if I had belonged to a group of say four or five investors. That way I would have been slapped down with any stupid ideas I came up with on the spur of the moment, or have had someone challenge my biases, and who would argue four heads are not better than one. I’d also bet having a advisor that doesn’t belong to some sort of collaborative team of advisers would be prone to making mistakes similar to mine. I do like the model Garth and company seem to have. Team effort with emphasis of avoiding losses. Mistakes can be costly, this I know from experience.

#70 Steve French on 06.27.21 at 7:32 am

Raising a cold beer in Australia to the memory of old Smoking Man tonight.

Still can’t believe he left all us blog dogs.

Cheers to you mate.

“Good night, sweet prince, And flights of angels sing thee to thy rest.” – Hamlet

#71 Ordinary Blog Dog on 06.27.21 at 8:28 am

Good points Doug. I’ll call Rusty – and we will get in and diversify. Is there an ETF for the high-flying equities?

#72 Doug Rowat on 06.27.21 at 9:36 am

#68 Diamond Dog on 06.27.21 at 5:20 am

Already long post…

—-

That part’s correct.

—Doug

#73 Sail Away on 06.27.21 at 9:49 am

#69 Bezengy on 06.27.21 at 7:11 am

I’ve had plenty of losers, and as a DIY investor have no one to blame but myself. I do think however, many of my mistakes could have been avoided if I had belonged to a group of say four or five investors. That way I would have been slapped down with any stupid ideas I came up with on the spur of the moment, or have had someone challenge my biases, and who would argue four heads are not better than one.

———-

Decision by acclamation can be awful decision.

Maybe it could work if they are professionals who don’t view the market as a lottery ticket. Otherwise the confirmation bias can be even worse.

I have many friends in financials each sort of with their own niche. Bonds, arbitrage, futures, etc. We tell each other when we see opportunity but wouldn’t dream of debating the point. Dig in yourself and either take a position or not, but respect their competence.

#74 crowdedelevatorfartz on 06.27.21 at 10:19 am

@#35 IHCTD(

“Today? One. One single little bar with nary a line up to get in. Closed at 11:00pm. Today we have 7 Pizza joints instead, several open all night, just about all of them are take out only, and deliver.

It’s the Internet, followed by an aging demographic.”

+++

100% correct.
If I may add one other observation to the demise of pubs…
Boomers drank like fish out of water.
Mills and Gen Z …not so much….. they seem to prefer the smokeables
Drinking…One other thing we Boomers did to excess
:)

#75 jess on 06.27.21 at 10:37 am

What the Supreme Court Ruling Means for Fannie, Freddie, and FHFA
defeat for investors who lost their claim to $124 billion. – dismissed claims made by Fannie and Freddie’s private shareholders who wanted the two firms to be privatized after the government took control of the two companies during the 2007-2008 financial crisis

https://www.investopedia.com/fhfa-fannie-mae-and-freddie-mac-5190021

#76 crowdedelevatorfartz on 06.27.21 at 10:40 am

@Mean Guy
“Then he falls to “special assessments”. Oh boy. Ok lets count the number of special assessments in all of Canada for the last decade and compare to the number of stocks that had catastrophic results.”

+++

You have heard the term “Leaky Condo” yes?
I personally know of 5 different condo projects currently undergoing “recladding”
( It involves building scaffolding around the ENRIE building and shink wrapping the eyesore, pulling ALL the outside walls off, removing mouldy drywall and rebuilding. Usually takes 1.5 – years”).
Typical assessment $250k

A friend was moaning the other day that the entire complex he has lived in for 10 years is now 30 years old and they are getting quotes for every unit to share the cost.
I have other business acquaintances that have sold when they noticed cracks in the hall floor tiles and wall drywall that indicated there were major issues with the building settling that havent been assessed yet.
Elevators that need upgrading every 20 year usually go for between $250k-$500k PER ELEVATOR depending upon the buildings’ height.
Awesome.
Then there is the older buildings 30 years plus that start having copper plumbing leaks.
I personally oversaw the replacement of an office buildings copper riser and booster pump system about 20 years ago.
It took 7 months and cost close to 435k…
We havent taked about windows, Window cleaners swingstages, or God help you, entire electrical upgrades
( we noticed about 25 years ago that large manufacturers of Panels, controls, switchgear, etc, were buying up the smaller guys and then closing their factories… I personally had to source out a highrise firepump control panel that blew up due to a water leak.
The building was 25+ years old and the panel was no longer made. A new custom built fire pump controller panel?
6 months wait and $175 k OR I found one through the internet that had been salvaged from a demoe’d highrise office tower in downtown Calgary….$25k used and I had to get it recertified for insurance …another 10k.

So a $25k “special assessment” per unit isnt out of the realm of possibility for any buiilding 10 years old or older..

Time for coffee.

#77 crowdedelevatorfartz on 06.27.21 at 10:46 am

@#61 Nonplused
“Oh well it kept all those honest people off the road. No indication it did anything to curb people from driving over 0.08 though, those folks were already reckless criminals who didn’t care. Sort of like how gun laws keep the honest people honest, but don’t affect the gangs.”

+++

Touche.
Another govt cash grab to nab honest people while the criminals wreak havoc and are out on bail the same afternoon.

#78 Diamond Dog on 06.27.21 at 2:19 pm

72 Doug Rowat on 06.27.21 at 9:36 am

Time tells all Doug.

#79 Mean Guy on 06.27.21 at 2:41 pm

CEF Wow, at least 5 condos, probably 1,000 people affected.

Now let me tell you about the guy I know who lost over $1M in Nortel, I don’t think he was the only one to lose money on that stock, or on Enron, BlackBerry, Global Crossing, oh so many mining frauds.

Let’s quantify the losses and the number of people affected ok?