Song of Wyoming

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DOUG  By Guest Blogger Doug Rowat
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I thought that the Fed’s annual shindig in Jackson Hole, Wyoming would be a staid affair. Shows what I know.

Market futures were indicating little expected volatility around Jerome Powell’s speech at Summit’s end and my own thinking was straightforward: the Fed already had the market prepared for many more rate increases, its next meeting was less than a month away and recent inflation data was mildly encouraging, so why rock the boat?

Well, Jerome Powell last Friday not only rocked the boat, he also warned everyone in the boat to get their lifejackets on. As a result, the S&P 500 plunged more than 3% on the day with only five stocks managing to squeak out gains. Amongst Powell’s many non-market-friendly comments were that the Fed, through higher interest rates, was going to bring “pain” to households and businesses. Jerome Powell effectively played the role of Clubber Lang in Rocky III:

However, we always keep perspective. Three percent down-days for the S&P 500 are certainly uncomfortable, but they happen all the time. In fact, on average, about 4 or 5 times a year. So they’re unusual, but not rare occurrences. And it’s not worth behaving like a chicken with its head cut off when they do occur.

There’s also a certain irony to how Powell’s warning was interpreted. Doomers, including many who post here, were more than happy to uncritically accept the Fed’s now gloomier outlook. However, at the same time, these same Doomers rejected the Fed’s sanguine outlook last year when it said inflation was “transitory”. But the point is that the Fed can be, and often is, wrong. Which raises the larger question: are these pessimists interested in fair criticism of the Fed or are they just enamored with their own continuously pessimistic agenda? Powell’s speech thus put confirmation bias on full display.

However, let’s take a step back and simply look objectively at what happens historically with equity markets when the Fed raises rates.

Since the 1950s, there have been 12 periods when the Fed’s tightened. And these cycles have run the gamut. We’ve seen periods where the Fed has raised aggressively (1994-95), periods where the Fed has raised for long periods (a stretch during the 1960s saw interest rates move higher for 5 years) and periods where the Fed has raised frequently (the tightening cycle beginning in 2004 saw the Fed raise rates 17 times).

However, the one general consistency is that the S&P 500 has moved higher almost every time. In fact, positive market gains were recorded in 11 of these 12 cycles with an average annual return of 9.4%. Impressive, particularly when the conventional wisdom is that equity markets hate Fed tightening.

S&P 500 annualized total return during periods of Fed tightening

Source: Morningstar, Haver Analytics. Data to March 2022.

Each tightening cycle is unique, of course, but considered in their totality, throughout the breadth of history, the reason for the positive S&P 500 gains is straightforward: the Fed’s only raising rates to slow a strong economy, and when economies are strong, corporations generally do well. Indeed, even throughout this current tightening cycle, corporate earnings have continued to show year-over-year growth. Longer term, corporate earnings have a ridiculously high correlation to market direction.

So, is the past proof that the market will be able to adjust to higher interest rates this time and ultimately advance? No. However, even the Doomers would have to agree that history paints an encouraging picture.

I’m kidding. The Doomers won’t waver. Cue the comments section for proof of that.

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

 

138 comments ↓

#1 Dogman01 on 08.30.22 at 3:48 pm

Doomaggeddon!

Peace, Order and Good Government?

Answer C: None of the above

The Rage Index
https://www.pollara.com/wp-content/uploads/2022/08/Rageindex-Pollara_public_release.pdf

“Must just be a fringe minority of far-right racist misogynists with unacceptable views …”.

This is what decline looks and feels like:
– Billions funneled to foreign wars
– Massive debt at all levels of Government
– Inflation
– Establishment driven propaganda narratives
– Failing institutions , corruption and compromised integrity of those in power

Economic and Social Suicide encouraged and abetted by your insular out of touch Ruling Class.

Next up, censorship, disarm and dis-empower the population, greater police powers, broader “hate speech definitions” , ubiquitous surveillance.

As things fall apart they will double down on their failure, all ideologues do this.

#2 Doug t on 08.30.22 at 3:49 pm

It’s all rainbows and unicorns lol

#3 Doug t on 08.30.22 at 3:59 pm

#1 dogman01

Not gonna disagree with you

#4 Big Bucks on 08.30.22 at 4:00 pm

Have we ever had a period where interest rates were ultra low for so long?Now that they are normalizing and will stay normal for years that will knock markets for a long,long sideways movement.If the SP 500 is above 4000 by 2028 that will be a positive for investors.

#5 Faron on 08.30.22 at 4:09 pm

#120 Sail Away on 08.30.22 at 1:49 pm

All that said, I am happy to negotiate a truce wherein you won’t “have” to be “burdened” by being challenged with alternative points of view. Here’s what I am willing to move on:

I will offer a reduction in my SA rebuttals/commentary/name calling. I’ll admit, I enjoy @keubiko’s call-outs and adopt his style. He’s a killer analyst and good human.

I’ll keep SAGIs to myself for my own alpha.

I will constructively comment when you say things I agree with. It happens!

What can you offer? In addition to my earlier comment, my concerns would be the off-base personal attacks WRT mental health (of which you engaged again today) and quit slagging on the homeless and/or addicted unless you have data backing up your claims.

It’s no surprise that I get disagreement here. This is a forum composed of about 95% conservatives. I hold a liberal point of view. You constantly troll liberals and specifically opposition to points of view I have expressed and are surprised you get a response? Maybe bring your chatty chat to a Lib forum and see how that goes?

Finally, as always in every day life and surf, respect gets respect. If you mock this comment, I’m going to continue to grindingly criticize you and your view ls when I have the time to do so.

#6 jess on 08.30.22 at 4:12 pm

who are the housing providers?

“Creating a new, five-year rent-to-own stream under the Affordable Housing Innovation Fund is the third part of the plan. The government says it will help housing providers develop and test rent-to-own models and projects.”

#7 anon on 08.30.22 at 4:13 pm

There are people who want to be right and people who want to make money.

#8 under the radar on 08.30.22 at 4:15 pm

JP’s 8 minute talk eviscerated 1 trillion of wealth and still counting.

#9 Søren Angst on 08.30.22 at 4:23 pm

Watched that speech and read this very good historic account on Volcker right after it:

https://finance.yahoo.com/news/paul-volcker-jerome-powell-jackson-hole-morning-brief-103113768.html

which Garth (and now you Doug) echoed.

My impression was big deal, Powell’s just saying he’s not repeating the error that Volcker made by loosening up on rates (and having prolonged the misery) before the high inflation fight was won.

THEN I watched Mr. Market IMPLODE.

Could not believe it.

My theory is that there are too many immediate gratification people in Mr. Market that foolishly believe the US Fed was kidding (before Jackson Hole) AND do not understand how every day people are ravaged * by high inflation.

Friday and today they are still selling off and that’s a good thing. Get them out of Mr. Market and let history, that you WELL reprised Doug, prevail.

———————–

*
CRA Tax Brackets by Age Groups, 2018 tax year.
https://www.canada.ca/content/dam/cra-arc/prog-policy/stats/itstb-sipti/2018/tbl04-en.pdf

% of tax filers in a specific age group making $46,605 or less:

15 to 29 yrs = 84.5% (i.e., % of 15-29 yr olds that make ≤ $46,605)
30 to 39 yrs = 57.6%
Under 35 yrs = 77.1%
40 to 59 yrs = 52.7%
65 yrs & over = 76.1%

Readers of this Blog are a well healed group. The vast majority of Canadians are decidedly not.

Some here worry their Cdn RE nest egg(s) value will be harmed or their RE commissions or their Broker commissions etc. WHILST the vast majority of Canadians are JUST trying to keep their heads above water financially.

Self-absorbed thinking. High inflation must be brought to heel. It will take time.

Powell is correct.

#10 Squire on 08.30.22 at 4:24 pm

#1 Dogman01 on 08.30.22 at 3:48 pm
———————————————

Time tested practice of divide and conquer (rule).
Wikipedia – Divide and rule policy (Latin: divide et impera), or divide and conquer, in politics and sociology is gaining and maintaining power divisively. Historically, this strategy was used in many different ways by empires seeking to expand their territories. However, it has been hard to distinguish between the exploitation of pre-existing divisions by opponents, and the deliberate creation or strengthening of these divisions implied by “divide and rule”.

#11 SW on 08.30.22 at 4:24 pm

If our entire monetary system almost exclusively revolves measuring inflation then we really should be discussing (a) how inflation is measured and (b) know specifically what is causing it. So many competing theories and I believe the Fed does not really know as they have gotten it so wrong. Funny how Canadian CPI is lower than what it is in the US when the $USD has rallied so much. That’s because we mess more with numbers to keep it down.

The problem with the Fed is that they don’t know how markets work. How many times have they upset the apple cart then back on the mic days after to try and fix what they said? I think only the BOJ has actual traders working for them and traders are the people who know how markets work.

#12 Squire on 08.30.22 at 4:25 pm

….continued.

Sound familiar ?

Elements of this technique involve:

creating or encouraging divisions among the subjects to prevent alliances that could challenge the sovereign and distributing forces that they overpower the other.
aiding and promoting those who are willing to cooperate with the sovereign
fostering distrust and enmity between local rulers
encouraging meaningless expenditures that reduce the capability for political and military spending

#13 I have 3 young kids on 08.30.22 at 4:33 pm

Thanks for the post Doug. You guys help us make sense of what’s going on.

Anything to slow these crazy price increases.
My grocery bills are going nuts.
A lot of people I know are using these price increases as reason to delay or even cancel having kids.
My answer is you always find away but we are cutting back on the activities for kids and definitely for my wife and I

#14 Leichendiener on 08.30.22 at 4:34 pm

#1 Right on.

#15 Søren Angst on 08.30.22 at 4:34 pm

#11 SW

“The problem with the Fed is that they don’t know how markets work…I think…”

—————–

Think less.

#16 Whomstilltotrust on 08.30.22 at 4:34 pm

I do like the early 3 comments. They all nailed it. Who’s bread I eat, his song I sing. First man made Climate change, then Corona Virus and Monkey pocks. What’s next. Lenin is being quoted: The capitalists will sell us the rope with which we will hang them. Most main stream media are beholden to the politicians in power, so we are only being told what we are supposed to know. Panem et circenses (bread and games), that’s what eventually brought the old Rome down. Let’s hope history will not follow suit, the present chaos will subside and our world will still be restored to livable conditions.

#17 Shawn on 08.30.22 at 4:35 pm

Tax paid when multi-millionaire dies?

I like Linamar a lot. Founder frank Hasenfratz passed away earlier this year.

His estate owns 24% of Linamar shares worth almost exactly $1.0 billion dollars.

He started the company around 1965 and I would imagine the book value of those shares for tax purposes would be next to nothing unless something has been done in the past to crystallise the gain.

So I wonder, will the estate face several hundred million dollars in capital gains tax? I really hope so. But somehow I doubt it. People can hate taxes all they want. But I don’t think it is fair if a guy like Frank Hasenfratz can escape capital gains tax on death while most middle class people cannot. And yes, I know the corporation paid lots of taxes over the years and created jobs and all that. Still, I ask for equal treatment on death.

On the insider reporting system, the late Frank Hasenfratz is indicated to no longer be an insider. And the estate is not listed as an insider. Estates presumably get an exemption. The 2022 annual meeting circular was honest enough to note that the estate now controls the company.

We may never know if any substantial amount of capital gains income tax is due from the estate for 2022 or if any shares will need to be sold to cover any tax bill. I wonder if any analyst was rude enough to ask on the conference call?

#18 Boomer busted on 08.30.22 at 4:36 pm

#19 Theory of Everything on 08.27.22 at 1:19 pm
#8 Kootenay Dave

You ask a lot of questions Dave.

I am also 40 something.

I can only tell you how I see it.

There is a divide.

The pitchforks were going to come up.

Covid is the perfect fear/control mechanism to delay what many wealthy already felt was going to be a revolution. It has perhaps been delayed, but I think it is still in the forecast and in the upcoming act.

Notice how those in charge (Boomers) punished those at lowest risk (Young people).

Young people were punished in the most ridiculous ways possible. I realized it right away. The young are realizing it now. They won’t forget. Why shouldn’t they hold a grudge?

___________________

I think you have it all wrong, Doug. As described above, the problem stems from those poor young people who were punished, if not brutally tortured during COVID.

In fact, many were forced to make huge sacrifices by having to wear masks to protect the health of their parents and grandparents. Can you believe it? The audacity… I completely understand how they must feel … and all of that pent up anger that they harbor. Yes, my father fought in the Second World War to give us the freedoms that we enjoy today … but, like hey, that was before I was born so that doesn’t count. What has he done for me lately?

#19 Ben on 08.30.22 at 4:41 pm

Wanted to comment on the article but once I reached the end I noticed that Doug Rowat is so mighty that he trademarked his name.

If the stock market gives 7% returns wouldn’t Loblaws stock be to the moon with their price hikes and market influencing?

#20 T on 08.30.22 at 4:47 pm

Its not doomer.

$25 trillion was pumped in the system and the equities have been living off zero rates for 14 years.

That ended January 2022.

Everyone is just finally coming to the realization.

#21 Frank C on 08.30.22 at 4:47 pm

#13 I have 3 young kids
“My answer is you always find away but we are cutting back on the activities for kids and definitely for my wife and I”
*********************************************

I agree that there will always be a way to make it work if you really want children. Problem is not everyone is willing to cut back on activities and the creature comfort they are accustomed to for the sake of having kids. Then there are people who simply don’t enjoy kids and citing financial reasons is a more socially acceptable way to get nosy friends, relatives and coworkers off their backs.

#22 Brett in Calgary on 08.30.22 at 4:56 pm

It’s hardly ever “different this time”, but I am sure happy to have some inverse ETFs in action. Hell even the bullion has done better than bonds! It may not be different this time, but we have one heavily indebted world, with some crappy demographics to boot. Time will tell I guess.

#23 Caffeine Monkey on 08.30.22 at 5:06 pm

CNBC headline today: “Fed’s Williams pushes back on market expectations of a rate cut next year”

#24 Don Guillermo on 08.30.22 at 5:11 pm

#21 Frank C on 08.30.22 at 4:47 pm
#13 I have 3 young kids
“My answer is you always find away but we are cutting back on the activities for kids and definitely for my wife and I”
*********************************************

I agree that there will always be a way to make it work if you really want children. Problem is not everyone is willing to cut back on activities and the creature comfort they are accustomed to for the sake of having kids. Then there are people who simply don’t enjoy kids and citing financial reasons is a more socially acceptable way to get nosy friends, relatives and coworkers off their backs.
###########

Peer pressure is not a reason to have children. It’s OK to choose not to. The pressure on young women can be relentless.

#25 Flop… on 08.30.22 at 5:13 pm

I went to Jackson Hole on the way to Yellowstone National Park.

I wondered why they had the shindig there, and then it came to me.

One of the Fed staffers probably when discussing current affairs stated that we’re in a hole.

Epiphany uncovered.

That’s it, we need to book our next Federal Reserve get together at Jackson Hole…

M48BC

#26 PBrasseur on 08.30.22 at 5:14 pm

FED is tightening because of inflation, to curb demand.

But Strong demand does no equate a strong economy. A strong economy is an healthy productive economy, what we have now is demand based on massive money printing, stimulus and debt.

What does this means for stocks? Hell if I know! But that’s the last place to worry if you own quality assets.

But for the economy it’s obvious, when Ponzi scheme debt driven demand disappears productivity won’t be there to pickup the slack.

Simple really, we have been entertaining utopias and living beyond ours means for a long time. Now it appears it’s times for reality check and belt tightening. The rebalancing is just beginning.

This is much more than a bump on the road.

#27 1255 on 08.30.22 at 5:21 pm

There’s never been an unwinding of a $9 TRILLION balance sheet.

There’s nothing to compare it against in history.

#28 Cici on 08.30.22 at 5:22 pm

Doug, I think you missed a couple key elements. Powell had to react with a serious dose of gloom and doom because a) markets had started edging up again on sugar-high expectations for an upcoming pivot and b) fiscal policy like Biden’s student loan forgiveness announcement is also setting us up for more inflation.

As Garth always laments, “suck and blow.” Powell has one heck of a job to do in calming inflation while trying to engineer a soft landing, especially with the Biden team’s irresponsible desire to stoke inflation via fiscal stimulus in order to buy votes for the upcoming midterms.

Anyone else notice how STRESSED Powell has looked as of late, especially at the Jackson Hole shindig? He appears to be the only real leader on the Western stage who cares or who is at all concerned about the dangers that all this MMT excess could bring to the entire global economy.

The more the pumpers pump, the more he has to slam on the brakes. Classic suck and blow. And doing too much of either (pumping or braking) could cause MAJOR CALAMITY.

Time for the kids to let the adult run the show. Here’s to hoping Powell can bring this puppy down slowly, safely and consistently before it implodes.

#29 Faron on 08.30.22 at 5:23 pm

#25 Flop… on 08.30.22 at 5:13 pm

…we’re in a hole

A hole of Jackson’s no less.

#30 Flamethrower on 08.30.22 at 5:25 pm

#7 anon on 08.30.22 at 4:13 pm

There are people who want to be right and people who want to make money.

__________________

And still a coveted third category of those like myself who want both … and get both.

#31 Shawn on 08.30.22 at 5:27 pm

Alberta Economic Update Tomorrow

The projected surplus for the year that will end next March is going to be EPIC. Oil royalties through the roof! Some big income tax revenue too, even at 8%.

And that will be after some new spending likely to be announced tomorrow.

Good thing all ya all moved to Alberta like I been telling you to. Can you say Jason bucks?

#32 Søren Angst on 08.30.22 at 5:29 pm

#23 Caffeine Monkey

He is but 1 member of 12 that casts a vote at the US Fed for rate changes.

Scroll to “FOMC Federal Funds Rate History” table for past and up to date voting results vs. rate changes (Federal Open Market Committee):

https://en.wikipedia.org/wiki/History_of_Federal_Open_Market_Committee_actions

FOMC voting members:

https://en.wikipedia.org/wiki/Federal_Open_Market_Committee#Current_members

Well, at least we know where 2 of those 12 votes is headed: no rate drops foreseen for 2023.

The other is Vice Chair Lael Brainard (Fed Reserve) “the central bank’s policy brain trust” – NB I resisted the obvious pun there.

https://www.cnbc.com/2022/08/30/feds-williams-pushes-back-on-market-expectations-of-a-rate-cut-next-year.html

#33 DON on 08.30.22 at 5:30 pm

There’s also a certain irony to how Powell’s warning was interpreted. Doomers, including many who post here, were more than happy to uncritically accept the Fed’s now gloomier outlook. However, at the same time, these same Doomers rejected the Fed’s sanguine outlook last year when it said inflation was “transitory”. But the point is that the Fed can be, and often is, wrong. Which raises the larger question: are these pessimists interested in fair criticism of the Fed or are they just enamored with their own continuously pessimistic agenda? Powell’s speech thus put confirmation bias on full display.

**** Given the shenanagans the Fed has been involved in (stock trading ethics and bowing to Trump’s rate decreases to shore up economic appearances etc) I didn’t trust their transitory nonsense and I still don’t trust them. Their outlook didn’t make sense in middle class land. Right now they are still trying to save face. The jury is still out on what is being surpressed prior to the midterm elections.

Trust is gained not assumed. No easy elevator ride back up the Trust Ladder. Everything they say should be analysed by the experts/others. Not betting against the Fed…just not hanging on every word they say as the full truth.

If Garth or You were the head of the Fed, I could sleep well knowing the truth was in good hands and the ship was being steered accordingly.

The trick is to analyze all the data without bias and to walk in someone’s shoes.

Cheers,

#34 Doug Rowat on 08.30.22 at 5:46 pm

#27 1255 on 08.30.22 at 5:21 pm
There’s never been an unwinding of a $9 TRILLION balance sheet.

There’s nothing to compare it against in history.

—-

I said every cycle’s different. But the sign of a true Doomer? Not even giving a begrudging nod to history.

—Doug

#35 Apocalypse NOW on 08.30.22 at 5:47 pm

Gorbachev was about to criticize Putin.

Putin took care of him, now he’s gone. While he works to collaborate next moves with China and Iran. Desperation and nukes is a terrible combo.

Huge escalations coming very soon.

Fill your gas tank tonight.

PREPARE

#36 Søren Angst on 08.30.22 at 5:47 pm

Besides FOMC voting Powell, Williams & Brainard recent rate comments here is Mester of the Cleveland Fed from Jackson Hole – I like her plain speaking way:

https://ca.finance.yahoo.com/video/fed-mester-fighting-inflation-less-194154078.html

You can tell she really cares about American families getting hammered by high inflation.

Her opinion of Mr. Market actions and whether the US Fed cares:

“And the markets are going to react the way they react, whether it’s based on their difference of opinion about the outlook or whether they’re not understanding or believing that we’re committed to this. But I can tell you that we’re very committed to making this happen.”

“this” = rate increases or holding at high rates until high inflation brought to heel.

#37 Loonie Doctor on 08.30.22 at 5:56 pm

I think the market will price in the eventual outcome before people come up with the narrative to explain it. As usual. Powell seems to create unnecessary turbulence. I remember end of 2018 he spooked markets saying he was going to raise rates. They recovered quickly and the Fed’s next move was actually a rate cut. In the current case, tough talk may help his cause to scare people from spending. The eventual pivot will be interesting.

If we are going to consider narrative, then markets do ok when the Fed is raising due to a hot economy. Not so much when they are raising to squash inflation. Tough to separate the two for an amateur like me. Corporate profits are still robust, but a trailing indicator. So that part is still ok. When inflation peaks (or has peaked), I suspect that is or was the bottom. We will only know retrospectively. So, interesting for discussion, but best course seems to just stay invested as always and enjoy the occasional fireworks.
-LD

#38 SW on 08.30.22 at 5:58 pm

#15 @ Angst

Thanks for that well though out discourse.

#39 Speak the Fed on 08.30.22 at 6:07 pm

“…In fact, positive market gains were recorded in 11 of these 12 cycles with an average annual return of 9.4%.”

Wait! you mean in some of those instances where 4 years lapsed, the market yoy avg return was less than 2.5%??
For all that headache, give me my GICs.

#40 Nonplused on 08.30.22 at 6:24 pm

I’m not too worried about the Fed and interest rates. Interest rates cannot totally kill an economy because all they do is affect the price of loans. It is also a “man-made” input, so if the rates go to high they can be lowered in a day.

Can the cost of loans affect the real economy? I guess to a point, because cheap loans does affect the money supply and also creates an incentive to bring future demand forward. Likewise expensive loans encourage savings and may delay demand. But over the long haul I am not sure moving demand forwards and backwards has any affect on long term demand. Loans have to be paid back eventually.

So then can the cost of loans even affect inflation? Well, yes it can, because if enough loans are created such that demand exceeds supply capacity then prices will rise until supply and demand are in balance. This is I think what the Fed is attempting to do. Reduce loan demand to an appropriate level.

So ya, that shouldn’t be doomsday for the stock market. Even if we went all cash there would still be demand. In the end of the day, loans or no loans everyone has to produce an amount equivalent to that which they need to consume. Loans just make big ticket items easier to finance, since if say in the example of housing everyone had to pay cash they would get their first house right about the time they don’t need a house anymore. Loans facilitate aligning production and demand in the 4th dimension, time.

The real driver of long term inflation is going to be energy. Cheap, abundant energy is what kept inflation low all these years. It is what allowed farming yields to skyrocket and population to grow. It is what gets fresh water from where it is to where it is needed. It is what extracts minerals from the earth and trees from the forest. It drives the machinery that created the productivity miracle that has been going on longer than any of us have been alive.

So what happens when energy is no longer cheap? The Fed can’t fix that. Whether it be peak oil or the drive towards green energy, energy availability looks to be headed down. That is not good. A fundamental shift in the S-curve is required (like, say, affordable and safe nuclear). Short of that, things cannot be fixed. This winter in Europe could be a harbinger of things to come for all of us. But shifts in the S-curve happen. Actually modern history is a tale of one shift after another. So there is hope. And cheap, safe nuclear looks like it may be on the horizon.

————————————–

#24 Don Guillermo on 08.30.22 at 5:11 pm

“Peer pressure is not a reason to have children. It’s OK to choose not to. The pressure on young women can be relentless.”

The only reason there is to have kids is because you want them. There is no other. You don’t have to worry about any sort of social obligations or saving the planet either from overpopulation or population decline. Nor religious or family obligations. None of that stuff. If you don’t have kids, someone else will happily step in to fill the void. The world will go on.

Of course, like with many things, Darwin will have something to say about it. Since electing not to reproduce is not a good survival strategy for genes, it is always trending down, while behaviors, attitudes and memes that encourage reproduction always trend up.

And therein lies the only real explanation you need for why religion is so pervasive and large families tend to beget large families. It is “survival of the fittest”, which means “survival of the most successful reproducers”. It is not “survival of the smartest”.

So if you don’t want kids, don’t have them. That is the sort of void nature fills most quickly. No one else will be affected. Not in any real way, anyway. Perhaps your parents will be pissed they spent so much time and money raising you only to have you cut the lineage tree down, but as far as the rest of us are concerned other trees will grow in its place.

#41 Søren Angst on 08.30.22 at 6:26 pm

#34 Doug Rowat

History. She is indeed a good teacher.

Good to read the Blog today that she has a pupil that reads her textbook and not just the book covers. *

———————

* And is also pretty darn good at Cdn oil & pipeline Oracling, Oracularly, Oraculi …

https://www.google.com/finance/quote/ENB:TSE?comparison=TSE%3ATRP%2CTSE%3ASU%2CTSE%3APPL%2CTSE%3ACVE&window=YTD

#42 Søren Angst on 08.30.22 at 6:28 pm

#38 SW

The pleasure was all mine.

#43 young & foolish on 08.30.22 at 6:36 pm

What’s different this time? Pandemic fueled monetary/fiscal expansion …. and supply side contractions.

How will that play into corporate profits in the future?

#44 Doug Rowat on 08.30.22 at 6:36 pm

#39 Speak the Fed on 08.30.22 at 6:07 pm
“…In fact, positive market gains were recorded in 11 of these 12 cycles with an average annual return of 9.4%.”

Wait! you mean in some of those instances where 4 years lapsed, the market yoy avg return was less than 2.5%??
For all that headache, give me my GICs.

—-

Reread the chart.

—Doug

#45 Stealth on 08.30.22 at 6:37 pm

Doug thanks for post, I agree markets will be just fine.

That aside is Garth alright (today being Tuesday and he is not posting). He even posts for Christmas all the way since 1867.

Thank you

#46 Wrk.dover on 08.30.22 at 6:53 pm

Hank Paulson begged newly minted Obama and outgoing Bush to keep liquidity up, rather than rerun 1929.

Bernanke seconded the motion.

Now “we’re” planning a lack of liquidity, OOPS!

#47 epic bear on 08.30.22 at 7:08 pm

by “strong” economy, you mean the two negative quarters of GDP we had so far this year? and Q3 tracking at 1.6% so far?

by “year over year” corporate profit growth, you mean ex-energy? (-3.7% Q2 vs +6.7% including energy, wow. that’s a massive difference.. )

there is about to be an abrupt and violent correction in stocks. call me when the SP is back down to 2500 and we can talk again.

#48 Franco on 08.30.22 at 7:12 pm

Does not look good at all. Hoepefully it does not last.

#49 Quintilian on 08.30.22 at 7:12 pm

Inflation running at high single digit (but in reality, it’s much higher), but will go with that to keep it simple.

Unemployment at zero.

And people are still debating whether the FED will keep raising rates to curb inflation when real rates are still negative following a couple of jumbo increases.
How, why, who is still wondering as to what is the right thing to do?

#50 Catman01 on 08.30.22 at 7:16 pm

#1 Dogman01

Too much truth.

Year back I was speaking to a friend.

I said, can you believe the violations that are taking place? Of our freedoms, liberties, Charter.

I said, this doesn’t look like Canada, this looks exactly like the communist country we came from.

He said, “Have you been asleep? You live in a police state. Did you forget what happened at the Toronto G20 some 10 years ago?”

This freedom and liberty enjoy can be quite an illusion Dogman01.

#51 Ted on 08.30.22 at 7:32 pm

Good it is about time fake markets get whacked hard. The whole thing is all about getting rid of competition with low interest rates for decades anyway.

#52 Theory of Everything on 08.30.22 at 7:32 pm

#18 Boomer busted

I think you have it all wrong, Doug. As described above, the problem stems from those poor young people who were punished, if not brutally tortured during COVID.

In fact, many were forced to make huge sacrifices by having to wear masks to protect the health of their parents and grandparents. Can you believe it? The audacity… I completely understand how they must feel … and all of that pent up anger that they harbor. Yes, my father fought in the Second World War to give us the freedoms that we enjoy today … but, like hey, that was before I was born so that doesn’t count. What has he done for me lately?

—–

You still trolling Boomer busted?

Your father fought in the Second World War you say?

And what are you doing here Boomer Busted? Fighting with keystrokes in the comment section on the wrong side of the argument?

Your father fought for freedoms that we enjoy today?

What freedoms? The young were locked away. Their freedom taken away. Their liberty taken away. Charter of rights suspended. Emergency declared for protesters but not for devastating storm that caused death and destruction.

What person, who enjoyed their prime, freedom and liberty, would want all of that taken away from the young?

I’ll tell you who Boomer busted, NOT YOUR FATHER!

Now, keep barking.

#53 Km on 08.30.22 at 7:37 pm

I hope rates go to meaningful enough levels to stop the cheap money for real estate investors and to lower inflation. I get it means a decline somewhat economic wise but seeing how the job market is begging for people it might work out fine in the long run.

#54 Yukon Elvis on 08.30.22 at 7:44 pm

Food shopping in Kelowna today. Three large supermarkets. Based strictly on memory, food prices are up 15-20% this year. For what it’s worth…….

#55 VicPaul on 08.30.22 at 7:44 pm

#5 Faron on 08.30.22 at 4:09 pm
#120 Sail Away on 08.30.22 at 1:49 pm

All that said, I am happy to negotiate a truce…

What can you offer? In addition to my earlier comment, my concerns would be the off-base personal attacks WRT mental health (of which you engaged again today) and quit slagging on the homeless and/or addicted unless you have data backing up your claims.

It’s no surprise that I get disagreement here. This is a forum composed of about 95% conservatives. I hold a liberal point of view. You constantly troll liberals and specifically opposition to points of view I have expressed and are surprised you get a response? Maybe bring your chatty chat to a Lib forum and see how that goes?

Finally, as always in every day life and surf, respect gets respect. If you mock this comment, I’m going to continue to grindingly criticize you and your view ls when I have the time to do so.

*********

Attention-seeking ideologue. You have repeatedly demonstrated little respect to anyone who disagrees with you. Weak.

Simpering, emotional plea – akin to “If you break up with me, I’ll say mean things about you and I’ll…”.

How many entries per day are you up to? You know, to share your viewpoint with the “95% conservative” readership. It seems your Don Quixote-like grandstanding is not unlike a young (or finely preserved older) woman wearing an alluring gown for a spike of attention – and she would warrant such.
I’m quite sure you said you are male – just not sure how you identify.

M58BC

#56 Victor Llearna on 08.30.22 at 7:45 pm

Jerome Powell was shorting SPY

#57 Sign o' datimes on 08.30.22 at 8:04 pm

What they aren’t telling us is that there is a huge amount of intergenerational boomer excess liquidity being cycled through the system. The elite want to dissipate this and so the great unwashed masses can expect higher inflation, increased income tax and inheritance tax … and who knows, maybe war?

#58 Sail Away on 08.30.22 at 8:06 pm

#5 Faron on 08.30.22 at 4:09 pm

Terms

———–

Well, my comments are my comments and will continue as such. I try (and will continue to try) to ignore you as much as possible, but occasionally respond to evidence-less invective or misrepresentation.

There are respectful ways to disagree. If my views of politics, addiction, social issues and etc. vary from yours, you may just have to find a way to ignore or disagree without the invective. Your opinions are yours, mine are mine. I feel addiction is a choice and strongly believe there are two sexes, for example. You believe the US southeast will be unliveable in a couple of decades. We’ve both stated the same. Opinion. It’s ok.

#59 baloney Sandwitch on 08.30.22 at 8:06 pm

Great chart Doug. Like I said before bargoons abound. Stocks will be higher in a year.

Also looks like RCMP is going after the goon who was menacing Chrystia Freeland in GP AB.

https://smartcdn.gprod.postmedia.digital/edmontonsun/wp-content/uploads/2022/08/freeland-3-e1661629457835.jpg?quality=90&strip=all&w=564&h=423&type=webp

#60 crowdedelevatorfartz on 08.30.22 at 8:08 pm

@#52 Internet Theories
“What freedoms? The young were locked away. Their freedom taken away. Their liberty taken away. Charter of rights suspended. Emergency declared for protesters but not for devastating storm that caused death and destruction.”

+++

This is how I look at the anti vaccine/gullible protesters of today that feel they are so hard done by.

https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved=2ahUKEwiZtM6y5O_5AhUtAzQIHZBsCnYQtwJ6BAgCEAI&url=https%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DoL2B-AAnsHo&usg=AOvVaw1rjiGJlrJIsQpIeElKLYWY

There are 1,000,000 job vacancies.
If you can’t find one you like….
There is something seriously wrong with you.

#61 Summertime on 08.30.22 at 8:42 pm

https://ca.finance.yahoo.com/news/posthaste-bank-canada-could-put-120042588.html

Posthaste: Bank of Canada could put rate hikes on pause after September, CIBC says

———————————-

The sad truth? They are preparing the ground for stopping rate hikes and the reversal/cuts, based on ‘data dependent, soft landing, neutral rates’ et. BS.

How can one believe that people who got it that wrong for that long will now get it right at this peak debt situation?

Does anyone in their right mind believe anything about the inflation numbers? Just check the grocery and energy prices against a year ago. 15 % is the minimum number for real inflation IMHO. Maybe 18-20 %.

How many got that increase in their income?

The truth is that we have already entered an extended period of rising inflation and strongly shrinking consumption that translates into negative real GDP growth, i.e. real GDP contraction which when considering the real inflation of necessities can only be viewed as what it truly is: Severe stagflation that evolves fast into inflationary depression thanks to 2 factors:

1. Decades of wrong monetary policies and zero rates
that brought record debt and huge assets inflation

2. collapse of supply that leads to much higher imports and commodity prices due to geopolitics and resources limitations.

Forget about pulling any more rabbits out of the hat by central bankers. We are facing the predicament of much lower standard of living that is permanent and has nothing transitory in it.

#62 Flop… on 08.30.22 at 8:51 pm

Flop Drops.

I could keep working for another 15 years, or I could just collect a dollar for every time someone on here tells me to shove the assessment where the sun don’t shine.

Oh, and by the way you can shove your asking price in the same crevice.

That’s why I buy my undies from Walmart.

Let’s see what these guys got up to in Mission Impossible.

The details…

9205 Hayward Street, Mission.

Original ask 2.18

Just sold for 1.27

Assessment 1.74

https://www.zealty.ca/mls-R2713429/9205-HAYWARD-STREET-Mission-BC/

So they tried to jump on The Covid Cocoon, and ask 2.18 late last year.

Blew down all through the recent assessments, Lakefront properly, so by the looks of it someone scored a decent deal.

Forget the land, they’re not making anymore of it cliché.

Tired.

Droughts are no match for the cartel.

Lakefront, they’re not making anymore of it, should be the new realtor siren…

M48BC

#63 Landlord no more on 08.30.22 at 8:51 pm

Sail Away! I love your posts. I chuckle sometimes, and at other times I want to follow your advice. One day I will climb Mt Benson. Do not be cancelled, just because someone disagrees with you. We all need to listen to others, and respect their ideas. NOT cancel them. Maybe respectfully debate against them, give reasons. Then we all learn. Thank you Sail Away.

#64 JacqueShellacque on 08.30.22 at 9:08 pm

“[T]hroughout this current tightening cycle, corporate earnings have continued to show year-over-year growth.”

Because everything denominated in inflating currency goes up, Doug. That’s part of the delusion inflation itself causes. Mises, ‘Theory of Money, Credit, and Banking’:

“If the value of money falls, ordinary bookkeeping, which does not take account of monetary depreciation, shows apparent profits,
because it balances against the sums of money received for sales a cost of production calculated in money of a higher value, and because it writes off from book values originally estimated in money of a higher value items of money of a smaller value. What is thus improperly regarded as profit, instead of as part of capital, is consumed by the entrepreneur or passed on either to the consumer in the form of price reductions that would not otherwise have been made or to the laborer in the form of higher wages, and the government proceeds to tax it as income or profits. In any case, consumption of capital results from the fact that monetary depreciation falsities capital accounting.”

So rather than being a healthy sign, these seemingly healthy corporate profits actually represent a consumption of the means of production, and will make us poorer in the end.

#65 JPN on 08.30.22 at 9:26 pm

# 54 Yukon Elvis.. What is your obsession with Kelowna bashing ? Dude.. the same prices are all over the place.. Canmore, Oliver, Merritt … it’s getting a little old …

Move already …

#66 Heddok on 08.30.22 at 9:39 pm

Hey Doug

What happened in 1972? I was still in high school and we were all still depressed about Jimi Hendrix dying 2 years earlier and were protesting the war and smoking lots of dope. Which was kinda silly because the Americans were not drafting Canadian high school kids.

I do know my first year of Uni in ’74 cost me $400 tuition which was only 150 hours working at the minimum wage.

Anyhow my memory is blurry about what was going on in the world then (reference dope smoking above)

#67 crowdedelevatorfartz on 08.30.22 at 9:42 pm

@#63 Landlord no mas

Yep.
Total agreement.
Always a chuckle reading Sailio’s posts.
Whether I agree with them or not.
Who am I to censure…?
I’ll just disagree in a Furzy frenzy

#68 Ohm on 08.30.22 at 9:45 pm

So what are you exactly saying??

Average folks are just suppose to accept these high prices from groceries to gas and everything out there while the corps are raking in record profits?? Yet again!!

Socialism and Capitalism is/has been broken, squandered for a number of years, yet people and analyst keep hoping; hoping for what???

The vast of us see this and live through this. We are pissed off by constant preaching that its everybody else’s fault but there own.

Have you seen what the major cities in the U.S. have come to??

Golden parachutes, politicians do as I say not what I do while speeding off to their next vacation on tax payers dimes.

The whole system is broken and I forecast that in the next couple of years the shit will hit the fan.

That is my lowly, pissed off prediction, visit me in two yrs and tell me how wrong I was..

#69 DOWn on 08.30.22 at 9:50 pm

Who actually owns the Federal Reserve?

#70 Linda on 08.30.22 at 9:51 pm

LOL Doug on your Doomer-geddon:) Of course the doomers are going to shriek the sky is falling. Those folks just live for drama, the more, the better.

That having been said, I did wonder the other day why Powell’s comments apparently caused a collective market cow. Another commenter shared that rumors had erupted regarding a lessening of the hawkish stance on Powell’s part. Don’t know if any of those rumors had even a grain of fact behind them, but apparently they were enough that the declaration that the Fed, in fact, would actually stand its ground was enough to trigger a rush for the exits. Never underestimate the ability of the masses to ignore the facts! Especially facts they don’t like.

#71 Linda on 08.30.22 at 9:57 pm

#6 ‘Jess’ – have to say, the ability of the government to present new ‘solutions’ to the affordable housing issue as if they have thought of something new is truly funny. If you think about it, a mortgage IS ‘rent to own’. Because until you pay that mortgage off, the landlord is the financial institution who actually ‘owns’ the property. Except the mortgage holder as landlord has successfully offloaded all responsibility for the maintenance/upkeep of the property onto the mortgagee. Got to think that any ‘rent to own’ housing scheme would be much the same. Also will be interesting to see if any private housing providers will be willing to tap that market. Seems unlikely, given that the companies need to answer to shareholders who are not in the business of running a charity.

#72 Doug Rowat on 08.30.22 at 9:58 pm

#64 JacqueShellacque on 08.30.22 at 9:08 pm
“[T]hroughout this current tightening cycle, corporate earnings have continued to show year-over-year growth.”

Because everything denominated in inflating currency goes up, Doug. That’s part of the delusion inflation itself causes. Mises, ‘Theory of Money, Credit, and Banking’:

“If the value of money falls, ordinary bookkeeping, which does not take account of monetary depreciation, shows apparent profits,
because it balances against the sums of money received for sales a cost of production calculated in money of a higher value, and because it writes off from book values originally estimated in money of a higher value items of money of a smaller value. What is thus improperly regarded as profit, instead of as part of capital, is consumed by the entrepreneur or passed on either to the consumer in the form of price reductions that would not otherwise have been made or to the laborer in the form of higher wages, and the government proceeds to tax it as income or profits. In any case, consumption of capital results from the fact that monetary depreciation falsities capital accounting.”

So rather than being a healthy sign, these seemingly healthy corporate profits actually represent a consumption of the means of production, and will make us poorer in the end.

—-

Sounds like a page-turner.

—Doug

#73 Reality is stark on 08.30.22 at 10:10 pm

Trying to borrow your way to prosperity seldom works.
Now we are finding that hackers stole millions of CERB funds.
Borrowing 500 billion to create 250 billion of value may seem like brilliant policy to many (happy days are here again) but a socialist backwater is still a socialist backwater no matter how much lipstick you stick on the pig.

#74 Faron on 08.30.22 at 11:28 pm

#58 Sail Away on 08.30.22 at 8:06 pm

I sincerely apologize for the name calling. That’s unequivocal. If I get an unequivocal apology from you for disparaging my mental health we are square. If not, this parlay will be deemed fruitless.

#75 TurnerNation on 08.30.22 at 11:28 pm

I’m not posting so much these days. Appears, #1 Dogman01 is picking up the slack here haha.

At any rate this is the future. Prison planet. Enslaved by the global corps. So close to 2019 Normal.

.Millions in new COVID lockdown as China keeps strict policy. China has placed millions of its citizens under lockdown following fresh outbreaks of COVID-19 (abcnews.go.com)

.U.S. Supreme Court’s Sotomayor keeps New York City COVID vaccine mandate (reuters.com)

— Essential goods only for purchase Comrade! You were already trained on this.
The first things cut during a War are the Supply Chains. And WW3 kicked of March 2020.

.China shuts world’s largest electronics market as Shenzhen imposes more lockdowns (edition.cnn.com)


— The global corps. They run this world. The veil was dropped, March 2020.

https://www.politico.com/news/2022/08/29/fda-authorize-moderna-pfizer-biontech-omicron-boosters-00054108
“The speed of the planned vaccine authorization and rollout has sparked criticism from some public health experts, who have questioned whether the administration should greenlight the boosters without having any human studies showing their effectiveness”

#76 Russ on 08.30.22 at 11:51 pm

Theory of Everything on 08.30.22 at 7:32 pm

#18 Boomer busted

Your father fought in the Second World War you say?
And what are you doing here Boomer Busted? Fighting with keystrokes in the comment section on the wrong side of the argument?
Your father fought for freedoms that we enjoy today?

What freedoms? The young were locked away. Their freedom taken away. Their liberty taken away. Charter of rights suspended. Emergency declared for protesters but not for devastating storm that caused death and destruction.

What person, who enjoyed their prime, freedom and liberty, would want all of that taken away from the young?

I’ll tell you who Boomer busted, NOT YOUR FATHER!
======================

Hey Theroy,

You have many good points. Nice retort.

Now, what are you going to do about it?
(freedoms & opportunities taken away in the prime)

Is it time to step up?

Cheers, Russ

#77 the Jaguar on 08.30.22 at 11:54 pm

“Doomers, including many who post here..”

Interesting. Previous ‘Doomer’ references on this blog usually belonged to Rosenberg, but now it appears anyone who advances thought or opinion contrary to ‘uppa, uppa’ is branded similarly. That ‘end run’ approach won’t ‘end well’, as a way to shore up confidence in my opinion, but it’s your call. Your blog.

When you have had this funny little feeling for some time that you are being lied to by media, government, international players and organizations that swear they speak on behalf of you, humanity, etc., ….well, you know. It just doesn’t inspire confidence on any level.

Why should anyone believe what they are being told about ‘markets’ when the lies about other world events are hiding in plain sight? Not for those who have drank the Kool-Aid, but for those who have been paying attention. (Not an invitation to debate, by the way.. Just stay on your own side of the exercise yard, please….) Those who have read the history that led up to current events, and have no skin in the game vis a vis their tribal influences. History since 1950 never had it’s ass handed to it in quite the manner that reflects the current environment.

Oh well. The beauty of the fast paced, digitally connected world we live in, combined with the stupidity of some nations, means it cannot blunder on too much longer. Midterms approach as does some old character called ‘winter’. Mean old bastard. He doesn’t even have to show up, his unpopularity is that feared.

We can agree to disagree knowing we won’t have too long to wait for signs of the final outcome. The fall months means shorter days and the ‘run way lights’ are easily to spot when darkness falls.

The photo of Jerome Powell makes me feel tremendous empathy for him. A terrible weight on the shoulders of a soft spoken man. Timing is everything when one steps into these high profile jobs. Good luck to you, Jerome Powell.

#78 Shawn on 08.30.22 at 11:56 pm

Alberta projected surplus came out today.

The projected Alberta surplus is now an EPIC $13.2 billion even after some new spending.

#79 Russ on 08.30.22 at 11:59 pm

Sail Away on 08.30.22 at 8:06 pm

#5 Faron on 08.30.22 at 4:09 pm

Terms

———–

Well, my comments are my comments and will continue as such. I try (and will continue to try) …
========================

Nice try guys!

‘ looks like I’ve missed quite a bit between you two in the past week away.

Please keep up the good effort to bring peaceful discourse to this pathetic comment section.

I have effected repairs on the yacht, checked in on project progress and ‘am heading off grid for a time again.

Plus my cheap RCA tablet doesn’t recognize the same old PIN anymore. Whatta POS!

cheers, R

#80 Ponzius Pilatus on 08.31.22 at 12:14 am

Gorbachev dead at 91.
As I said before, if you want to live a long life.
Become a politician.

#81 Sharkey on 08.31.22 at 12:15 am

In that chart, are those returns nominal or real?

#82 1255 on 08.31.22 at 12:24 am

34 Doug Rowat on 08.30.22 at 5:46 pm
#27 1255 on 08.30.22 at 5:21 pm
There’s never been an unwinding of a $9 TRILLION balance sheet.

There’s nothing to compare it against in history.

—-

I said every cycle’s different. But the sign of a true Doomer? Not even giving a begrudging nod to history.

—Doug

—————————
Really? Doomer? I said this has never happened in history and that makes me a Doomer?

#83 Diharv on 08.31.22 at 1:05 am

I also wondered why Powell’s comments caused the market to overreact to the downside. He didn’t say anything new except add a bad noun or adjective or adverb here and there. Anyone who previously thought his stance was going to become “dovish”, (sheesh, what a word) were speculating out of their posteriors. Then, when he reaffirms his stance and dashes the false hopes of said speculators, the market has its cow. The market has been pricing in rate hikes for half a year now and reading in the news day in and day out that the markets are falling because investors and analysts are”worried” about rate hikes is getting old and tiresome. I may not like what it’s all doing to the portfolios but I do like that the CBs are acting in the interests of the economy as a whole, and not in the interests of Wall and Bay Streets.i’ll stay the course and remain invested B&D as per Mr Turner.

#84 Ken on 08.31.22 at 1:18 am

Free music concerts in several GTA locations; Free books, music, movies, toys, bike borrowing, tool borrowing, etc. etc. at my local library; 99 cent frozen dessert PLUS a free coffee until Labour Day; Free wifi almost everywhere; Absolutely free and informative financial blogs with postings all 365 days of the year!!!

Inflation…what inflation!

#85 Alberta Boy on 08.31.22 at 1:23 am

I moved another 1/3 to GICs last week (first third last fall). I had to use the “it’s not you, it’s me” line on my advisor a few times while he came back at me with, “but look at the historical charts.” It was as awkward as a teenage break up. Financial assets look just as vulnerable a real estate to me; they both remind me of patients kept alive by drug cocktails and ventilators. The ventilator is coming off. Just because the charts show they will eventually come back does not mean I want to be on the ride down and I am certain we’ll blow by June’s lows. My wife is staying firmly invested. She got a warm feeling when she looked at the charts……..is it bad that I hope her portfolio takes a beating? Haha!

#86 DJT on 08.31.22 at 4:31 am

Once China joins Russia to stop Brandon the US Civil War will start, then things get interesting.

#87 DJT on 08.31.22 at 4:32 am

#69 DOWn on 08.30.22 at 9:50 pm
Who actually owns the Federal Reserve?

The private banks.

#88 Bezengy on 08.31.22 at 6:41 am

#59 baloney Sandwitch on 08.30.22 at 8:06 pm

Also looks like RCMP is going after the goon who was menacing Chrystia Freeland in GP AB.

——————

30k assaults on police officers in Canada last year.

46 percent claim they have been assaulted 11 times or more in Canada.

Teachers, tellers, cashiers, bus drivers, you name it, all are fair game. Trudeau stands there and declares it’s unacceptable. Somebody should do something, blah, blah. Not sure why she thinks she’s so special to not be be subjected to the same treatment as every other person working with the public.

#89 Bezengy on 08.31.22 at 6:43 am

46 percent of nurses that is.

#90 Steven Rowlandson on 08.31.22 at 6:52 am

“Amongst Powell’s many non-market-friendly comments were that the Fed, through higher interest rates, was going to bring “pain” to households and businesses.”

Cause and effect folks. Businesses under pay their workers and charge a lot for some things and sell too much mickey mouse stuff that is imported and of course households cost too much relative to what workers get paid. Then there is the governments.
Those irresponsible people with their out of control reckless borrowing and spending. They need a few centuries paying medieval interest rates until they learn not to borrow, ever. Borrowing creates currency which is inflationary which leads to accumulating debt and higher prices and no wage gains real or nominal.
Can you say pain or worse? I thought you could.
Some one has to pay for their financial sins……

#91 Steven Rowlandson on 08.31.22 at 6:58 am

“There’s never been an unwinding of a $9 TRILLION balance sheet.”

How leveraged is that? How much cash and debt in the US economy has that 9 trillion created?

#92 green valley on 08.31.22 at 7:03 am

https://www.msn.com/en-ca/money/topstories/more-gta-homebuyers-turning-to-private-lenders-here-s-what-you-need-to-know/ar-AA11iXbN?cvid=72d97a26b981489a93f4042933525a80

They still want the big house.

#93 Steerage Doom on 08.31.22 at 9:19 am

Two years til we hit market bottom… Doomerberg has never wrong

https://www.theglobeandmail.com/investing/markets/inside-the-market/article-david-rosenberg-the-bear-market-rally-is-unravelling-heres-why-it-may/

#94 Dharma Bum on 08.31.22 at 9:47 am

NEVER underestimate the power of DOOM!

https://m.youtube.com/watch?v=wcW_Ygs6hm0&feature=emb_logo

#95 Theory of Everything on 08.31.22 at 9:49 am

#76 Russ

Hey Theroy,

You have many good points. Nice retort.

Now, what are you going to do about it?
(freedoms & opportunities taken away in the prime)

Is it time to step up?

Cheers, Russ

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

Good and valid question.

I am but one man, and this government has shown us how over-the-top it will go to take people’s rights, freedoms and liberties away. From children not able to see their friends, go to school or participate in sports, to protesters arrested for questioning the logic and scientific basis upon which decisions are made to attacking bank accounts and false detention of individuals around Canada Day.

Since I am but one man, I protest accordingly by living my life and voting with my actions and wallet. Offering moral support, trying to make people laugh, smiling when I’m out and about, trying to be more kind to people, more patient.

What more can we do Ross? What can we do when we live under a government like this? A government, which through shear willful neglect let so many of our most vulnerable die, many likely not even of Covid, and continues to spit on us and tell us it is raining?

#96 epic bear on 08.31.22 at 9:53 am

But the sign of a true Doomer? Not even giving a begrudging nod to history.

—Doug
_________________________________

Doomers??

you do not include this year’s rate hike cycle in your chart. hiking started Mar 17, SP YTD -9.75%. not even 5 months …

you should be asking yourself “WHY IS THE SP DOWN so much this time around, when the historical pattern is normally up”?

as a professional trader, i worry when i’m right. i worry a lot more when i’m wrong.

and you should be worried.. because so far this year, the market isn’t working out according to your plan.. stocks down, bonds down, reits down, prefs down. … if i were you, i’d be questioning why… rather than sitting and holding onto losing positions.

#97 Dharma Bum on 08.31.22 at 9:56 am

#72 Doug Rowat

“Sounds like a page turner.”
——————————————————————

Now THAT’S FUNNY right there, I don’t care WHO you are!

https://m.youtube.com/watch?v=RFlCD5CYAcU&feature=emb_logo

#98 Wrk.dover on 08.31.22 at 10:04 am

Powell hawkish so, all lights being turned off and all car keys being thrown in the lake.

Therefore, barrel of oil going back to free!

Or not?

#99 Sail Away on 08.31.22 at 10:15 am

#74 Faron on 08.30.22 at 11:28 pm
#58 Sail Away on 08.30.22 at 8:06 pm

I sincerely apologize for the name calling. That’s unequivocal. If I get an unequivocal apology from you for disparaging my mental health we are square. If not, this parlay will be deemed fruitless.

———-

There may be a misconception here, so I’ll try to be clear: I have zero interest in any interaction with you. No insults, no apologies, no parlays, no fights, no makeups, no deals.

Your attentions are unwelcome. For my part, I’ll kick it off with sheer indifference.

#100 Re-Cowtown on 08.31.22 at 10:18 am

The Russians are cutting off all natural gas to Europe. Canada could easily have supplied LNG to support Europe, but Trudeau was hell bent on creating a green Utopia and would not allow a single LNG export terminal to go ahead.

This situation is like watching your family drown in icy water because the government took your boat to protect whales.

#101 Sail Away on 08.31.22 at 10:26 am

#79 Russ on 08.30.22 at 11:59 pm

I have effected repairs on the yacht, checked in on project progress and ‘am heading off grid for a time again.

———

Enjoy! I greatly enjoyed my years of sailing, but don’t miss the maintenance and repairs… at all. Every boat, at any time, has something that needs attention.

When my boat sailed away with the new owner, I had an overwhelming sense of peace. And a wad of cash, of course.

#102 Mehling on 08.31.22 at 10:49 am

Goldman Sachs back to office:

https://nypost.com/2022/08/30/goldman-sachs-lifts-covid-protocols-urges-workers-back-to-office/

#103 Ponzius Pilatus on 08.31.22 at 10:52 am

#78 Shawn on 08.30.22 at 11:56 pm
Alberta projected surplus came out today.

The projected Alberta surplus is now an EPIC $13.2 billion even after some new spending.
———————
I’m looking forward to my equalization cheque.
I promise not to piss it away.

#104 Doug Rowat on 08.31.22 at 10:56 am

#85 Alberta Boy on 08.31.22 at 1:23 am
…The ventilator is coming off. Just because the charts show they will eventually come back does not mean I want to be on the ride down and I am certain we’ll blow by June’s lows.

—-

Never be certain when investing. Be balanced.

—Doug

#105 KLNR on 08.31.22 at 11:01 am

@#59 baloney Sandwitch on 08.30.22 at 8:06 pm

Also looks like RCMP is going after the goon who was menacing Chrystia Freeland in GP AB.

https://smartcdn.gprod.postmedia.digital/edmontonsun/wp-content/uploads/2022/08/freeland-3-e1661629457835.jpg?quality=90&strip=all&w=564&h=423&type=webp

her security detail should have taken that waste of a life down hard.

Every citizen has the right to yell at an elected official. It sure happened to me over nine years, including getting egged on Parliament Hill. This snowflakism is more disturbing than the ill manners of a good ‘ol boy who displayed his cultural background, and should not be arrested for it. We are losing perspective. – Garth

#106 Faron on 08.31.22 at 11:30 am

Reading Hillary Clinton’s “What Happened”. Political memoir is a bit dry and an ego trip for the author, but one thing that stands out in light of the recent verbal assault on Chrystia Freeland, in light of the comments here about her looks, her ass, is the similarity to what Clinton faced.

Why did Clinton default to wearing pantsuits? It (obvs) wasn’t style, it was because people had taken upskirt photos of her in the past and she was tired of it. She doesn’t dwell on it in the least, but the fact is an indictment of where we are, how far from any kind of equality we are despite progress this century. This in the chapters preceding Trump’s leering prowl in the debates and the endless revelations of how much of a garbage person he was and continues to be.

We learn more everyday why Trump was a terrible president, an utter criminal, and completely unfit to govern. The world would be in a different, better, place if the popular vote prevailed in 2016.

Keep this in mind with PP on the upswing in Canada. He’s a slightly smarter and certainly more mainstream version of Trump. But, he’s another step along the path to an eroding of Canadian politics following on the trucker convoy. Don’t repeat the US’s mistakes.

#107 DON on 08.31.22 at 12:02 pm

#98 Wrk.dover on 08.31.22 at 10:04 am
Powell hawkish so, all lights being turned off and all car keys being thrown in the lake.

Therefore, barrel of oil going back to free!

Or not?

************
Apparently increased instability in Libya and Iraq are swinging the oil markets and of course what is already known. Also reports that China is reselling Russian oil to Europe. Then there’s the Western countries still wanting to do business with Russia and China as the almighty market share and profit come first.

#108 IHCTD9 on 08.31.22 at 12:32 pm

#95 Theory of Everything on 08.31.22 at 9:49 am

…What can we do when we live under a government like this?
_____

As you said, vote. But also avoid supporting them via your taxes.

Consume less, buy used, repair the old stuff (better quality most of the time anyway). Work less, or earn differently. Get a more fuel efficient vehicle, heat partially or wholly with wood. Fill your RRSP and your FHSA if you qualify to get some income taxes back. Do your own roof, fix your own car, maintain your own property – no taxes are paid on services not rendered.

Federal revenues come mostly from income taxes and retail taxes. Downsizing and simplifying is good for the soul, good for your finances, good for the planet, but punishes Ottawa. Some innocents get punished too with this action, but you can’t do much without some collateral damage.

If you can choose to do this, be glad you can do so at your option. The way things are heading in Canada, more and more will have to downsize their lives whether they want to or not.

#109 Faron on 08.31.22 at 12:32 pm

#99 Sail Away on 08.31.22 at 10:15 am

I’m glad you showed your “maturity”. Apology retracted, olive branch retrieved and set aflame. Badgering of any and all garbage ideas and behaviour from you to resume which you will be unawares of because you don’t read my commemts. Perfect. Win win.

#110 Faron on 08.31.22 at 12:40 pm

#105 KLNR on 08.31.22 at 11:01 am
@#59 baloney Sandwitch on 08.30.22 at 8:06 pm

Also looks like RCMP is going after the goon who was menacing Chrystia Freeland in GP AB.

https://smartcdn.gprod.postmedia.digital/edmontonsun/wp-content/uploads/2022/08/freeland-3-e1661629457835.jpg?quality=90&strip=all&w=564&h=423&type=webp

her security detail should have taken that waste of a life down hard.

Every citizen has the right to yell at an elected official. It sure happened to me over nine years, including getting egged on Parliament Hill. This snowflakism is more disturbing than the ill manners of a good ‘ol boy who displayed his cultural background, and should not be arrested for it. We are losing perspective. – Garth

In an era in which violent rhetoric aimed at public officials is backed with actions like armed goons headed to Ottawa, attempted kidnapping of Michigan’s governor, some idiot trying to take out an FBI field office etc. Garth, you have to shift gears into understanding the increasingly violent acts and sentiment of the right wing of which you are a part. This crap needs to have the hammer dropped on it where dropping the hammer is at all lawful. I don’t think you perceive just what’s going on in your country. Canada is slipping right in behind the US.

Extreme, superficial, disappointing comment. Those who disagree with progressive policies are not all goons. Nor is this the US, so your American examples are pointless. ‘Dropping the hammer’ on dissent just makes the dissenters into heroes of their cause. No solution there. – Garth

#111 Sail Away on 08.31.22 at 12:41 pm

“Every citizen has the right to yell at an elected official. It sure happened to me over nine years, including getting egged on Parliament Hill. This snowflakism is more disturbing than the ill manners of a good ‘ol boy who displayed his cultural background, and should not be arrested for it. We are losing perspective. – Garth”

——–

Well said, thank you.

#112 KLNR on 08.31.22 at 12:43 pm

@#105 KLNR on 08.31.22 at 11:01 am
@#59 baloney Sandwitch on 08.30.22 at 8:06 pm

Also looks like RCMP is going after the goon who was menacing Chrystia Freeland in GP AB.

https://smartcdn.gprod.postmedia.digital/edmontonsun/wp-content/uploads/2022/08/freeland-3-e1661629457835.jpg?quality=90&strip=all&w=564&h=423&type=webp

her security detail should have taken that waste of a life down hard.

Every citizen has the right to yell at an elected official. It sure happened to me over nine years, including getting egged on Parliament Hill. This snowflakism is more disturbing than the ill manners of a good ‘ol boy who displayed his cultural background, and should not be arrested for it. We are losing perspective. – Garth

snowflakism?
a ‘ good ‘ol boy’ eh?

Ok Garth. oh man.

#113 IHCTD9 on 08.31.22 at 12:45 pm

#101 Sail Away on 08.31.22 at 10:26 am

Enjoy! I greatly enjoyed my years of sailing, but don’t miss the maintenance and repairs… at all. Every boat, at any time, has something that needs attention.

When my boat sailed away with the new owner, I had an overwhelming sense of peace. And a wad of cash, of course.
__________

Speaking of boats, here’s a sweet 16’er, all welded aluminum boat build time-lapse courtesy of a few Cortes Islanders in BC:

https://www.youtube.com/watch?v=xJmduAP3cdw

Seeing as though he hung a YAMAHA outboard on the back, maintenance on this rig should be near zero. He’s got several other nice builds on his channel too.

#114 IHCTD9 on 08.31.22 at 12:55 pm

#60 crowdedelevatorfartz on 08.30.22 at 8:08 pm

This is how I look at the anti vaccine/gullible protesters of today that feel they are so hard done by.
___

Ha! This is me when I read Trudeau’s policies:

https://www.youtube.com/watch?v=RP4abiHdQpc

#115 Dogman01 on 08.31.22 at 12:59 pm

Every citizen has the right to yell at an elected official. It sure happened to me over nine years, including getting egged on Parliament Hill. This snowflakism is more disturbing than the ill manners of a good ‘ol boy who displayed his cultural background, and should not be arrested for it. We are losing perspective. – Garth

———————————————-
Brilliant Garth, I don’t want to be condoning the a-hole , but the regimes over reaction seems to be a another disturbing stratagem.

#88 Bezengy on 08.31.22 at 6:41 am; has it in perspective. Powerless Non-Regime frontline working people face this type of thing on a regular basis, our MSM trying to create outrage when it happens to a leading politician for a party that has constructively divided their society.

#116 Faron on 08.31.22 at 1:06 pm

#110 Faron on 08.31.22 at 12:40 pm
#105 KLNR on 08.31.22 at 11:01 am

. Those who disagree with progressive policies are not all goons.

Wait, the guys arrested smuggling in arms at the Alta border are something other than “goons”? That’s thoroughly goonish IMO.

Nor is this the US, so your American examples are pointless.

Garth, the conspiratorial Q-anon crap that fuels what’s happening in the US is also in Canada. I see Q-anon stickers on the backs of f-350s and Ram 2500HDs on the regular around here. Listen to the Day X podcast series — violent far-right extremism is on the uprise globally, including in Canada. The Nazi, confederate and Trump flags at the Convoy in Ottawa were a pretty good clue it is well established here.

What’s the solution? Wait until Freeland is physically assaulted or some other politician assassinated?

#117 Sail Away on 08.31.22 at 1:36 pm

#109 Faron on 08.31.22 at 12:32 pm
#99 Sail Away on 08.31.22 at 10:15 am

There may be a misconception here, so I’ll try to be clear: I have zero interest in any interaction with you. No insults, no apologies, no parlays, no fights, no makeups, no deals.

Your attentions are unwelcome. For my part, I’ll kick it off with sheer indifference.

———-

I’m glad you showed your “maturity”. Apology retracted, olive branch retrieved and set aflame. Badgering of any and all garbage ideas and behaviour from you to resume which you will be unawares of because you don’t read my commemts. Perfect. Win win.

——–

???

Maturity? My response is courteous and unequivocal. I’m saying no. No means no.

There are people who refuse to accept a no. I reiterate: Your attention is unwelcome.

I find your vow to continue the badgering disturbingly strange from a middle-aged man. Abnormal behaviour.

#118 Bdwy on 08.31.22 at 1:39 pm

Deranged leftie Uber snowflake faron is the type I’d worry about the most. Like the guy who shot up the softball game of republican reps.

Don’t snap faron. It won’t help anyone.

Feel free to yell at pollivere though.

#119 IHCTD9 on 08.31.22 at 1:43 pm

#116 Faron on 08.31.22 at 1:06 pm
#110 Faron on 08.31.22 at 12:40 pm
#105 KLNR on 08.31.22 at 11:01 am

. Those who disagree with progressive policies are not all goons.

Wait, the guys arrested smuggling in arms at the Alta border are something other than “goons”? That’s thoroughly goonish IMO.

Nor is this the US, so your American examples are pointless.

Garth, the conspiratorial Q-anon crap that fuels what’s happening in the US is also in Canada. I see Q-anon stickers on the backs of f-350s and Ram 2500HDs on the regular around here. Listen to the Day X podcast series — violent far-right extremism is on the uprise globally, including in Canada. The Nazi, confederate and Trump flags at the Convoy in Ottawa were a pretty good clue it is well established here.

What’s the solution? Wait until Freeland is physically assaulted or some other politician assassinated?
___

Faron, you’re starting to spiral.

#120 Shawn on 08.31.22 at 1:47 pm

Equalization payments

#103 Ponzius Pilatus on 08.31.22 at 10:52 am
#78 Shawn on 08.30.22 at 11:56 pm
Alberta projected surplus came out today.

The projected Alberta surplus is now an EPIC $13.2 billion even after some new spending.
———————
I’m looking forward to my equalization cheque.
I promise not to piss it away.

***********************************
I’m sure you know that the Equalization is paid by the FEDs. They can use their increased income tax from energy companies operating mostly in Alberta but owned mostly by non-Albertans to fund equalization and for any other federal spending that they would like.

Albertans are not hard done by when it comes to equalization. The province is hard done by when the FEDS fail to allow and to support pipelines to cross this country.

To benefit from the $13.2 billion surplus you have to move to Alberta. What are you waiting for?

#121 Bdwy on 08.31.22 at 1:49 pm

On topic….

Not a bad day to be a newly minted bear.

Off topic… just rescued a seagull who some how flew into and snagged a wingtip on a suspended line of twine.
He was screaming blue murder hanging 20 feet above the water. The line is like a 150′ zip line to deliver cold drinks to the dock from a deck up on a bluff. There was a bunch of extra line that I released slowly lowering him to the water. Once he swam a bit upwind and I dropped the line it came loose. No harm done it seems.

And since my last comment probably won’t make it through … faron stop being a crybaby snowflake.

#122 Shawn on 08.31.22 at 1:51 pm

Oil and gas is bringing home the bacon to this province and country

I mentioned some weeks ago the MASSIVE trade surplus in Energy. At Q1 prices it was running at $159 billion annualized net exports and the next biggest category was forestry and agriculture each around $26 billion. Energy was more than six times higher.

This bacon is now evident in the Alberta surplus. The province is going to eating well for a while.

The whole country is benefiting as well from massively higher federal corporate income taxes on this sector. Windfall! It’s raining money!

#123 Faron on 08.31.22 at 1:52 pm

#115 Dogman01 on 08.31.22 at 12:59 pm

Powerless Non-Regime frontline working people face this type of thing on a regular basis, our MSM trying to create outrage when it happens to a leading politician for a party that has constructively divided their society

You are correct about unnoted harassment of non-politicians. In fact, I get this kind of junk from engineers on a regular basis, some of it here recently. Still, that it’s not reported doesn’t make it okay for harassment of politicians at this level to occur. It’s even less okay when the threatener is about 2x the size of the threatened.

#124 Sail Away on 08.31.22 at 2:03 pm

#113 IHCTD9 on 08.31.22 at 12:45 pm

Speaking of boats, here’s a sweet 16’er, all welded aluminum boat build time-lapse courtesy of a few Cortes Islanders in BC:

https://www.youtube.com/watch?v=xJmduAP3cdw

Seeing as though he hung a YAMAHA outboard on the back, maintenance on this rig should be near zero. He’s got several other nice builds on his channel too.

———

Oh, that’s a beauty. The perfect setup: open, walk-around, centre console, lightweight. In 30 years, the grandkids will be using that same boat.

My ideal is the exact same layout, just 4′ longer for the smoother ride and big-water capability.

#125 Faron on 08.31.22 at 2:11 pm

#119 IHCTD9 on 08.31.22 at 1:43 pm

Faron, you’re starting to spiral.

By writing coherent rebuttals and writing clear opinions on my understanding of a small portion of being a feminist politician? I mean, my lefty views are sure to garner lots of attention and today I have the time to respond.

What’s about to happen and is happening is you, bdwy and other are about to pile on with ad hominem personal attacks having nothing to do with the topic at hand. Here’s you doing it and I see Bdwy has stepped in.

#126 Bdwy on 08.31.22 at 2:23 pm

https://www.reddit.com/r/vancouver/comments/x1v49e/pierre_photo_op_on_east_hastings_street/?utm_source=share&utm_medium=mweb

Speaking of future pm, PP . He waded into the dtes sewer yesterday, prob not alot of con voters there though.

#127 Faron on 08.31.22 at 2:23 pm

#117 Sail Away on 08.31.22 at 1:36 pm

Watch out, your indifference is showing.

I humbly offered you an apology and asked for one in return for making off-base personal insults. That was pretty simple, took some ego swallowing effort on my part and was pretty mature IMO. Ask Russ.

I find it disturbing that a person 5 years my senior and who has also behaved poorly (note that we are both asked to STHU as we will, rightly, again here) refused to even budge.

As I’ve made abundantly clear, your views are in polar opposition to mine and I strongly disagree with them. There’s evidence many of your views are radically misguided (climate, gender etc.) and therefore garbage just as a notion that the earth is 6000yrs old is nonsense.

I will comment on your trash when I see fit. You are a one stop shop for when I want to blow off some steam about the morally withering state of right wing politics. You are free to ignore as you promised you would. Now, live up to it. Goodbye.

#128 epic bear on 08.31.22 at 2:24 pm

#122 Shawn on 08.31.22 at 1:51 pm

Oil and gas is bringing home the bacon to this province and country

__________________

and yet, the loonie is trading where?
where’s the real bacon?

#129 Faron on 08.31.22 at 2:25 pm

#121 Bdwy on 08.31.22 at 1:49 pm

Very kind of you to rescue the seagull Bdwy.

#loveBdwysHate

#130 Faron on 08.31.22 at 2:30 pm

Finally, one of the king Bitcoin pumping maniacs, Michael Saylor, is being sued for tax fraud. Love to see it.

#131 Wrk.dover on 08.31.22 at 2:36 pm

I agree, bad manners should not be a civil crime.

The next level is, which the story says he did not reach.

Thanks for the oil talk Don.

#132 Dragonfly58 on 08.31.22 at 2:47 pm

Great point Garth ! You are so correct on the Chrystia Freeland ” assault “. At todays news conference J.T. plus several other Gov. speakers seemed to be describing a bodily harm event rather than a bit of heckler , verbal mud slinging. Almost comes with the territory in the political game.

#133 Brian on 08.31.22 at 3:13 pm

#105 KLNR
Every citizen has the right to yell at an elected official. It sure happened to me over nine years, including getting egged on Parliament Hill. This snowflakism is more disturbing than the ill manners of a good ‘ol boy who displayed his cultural background, and should not be arrested for it. We are losing perspective. – Garth

Your so right Garth!

#134 Sail Away on 08.31.22 at 3:36 pm

#127 Faron on 08.31.22 at 2:23 pm
#117 Sail Away on 08.31.22 at 1:36 pm

I find it disturbing that a person 5 years my senior and who has also behaved poorly

There’s evidence many of your views are radically misguided (climate, gender etc.) and therefore garbage

I will comment on your trash when I see fit.

You are free to ignore as you promised you would. Now, live up to it. Goodbye.

——-

1. Incorrect. My behaviour is beyond reproach.

2. Difference of opinion, immediately followed by a couple ad hominen attacks, and finally…

3. Misrepresentation. I promised no such thing.

Oh, and… Your attention is unwelcome. Stop compulsively badgering me. No means no.

#135 chalkie on 08.31.22 at 3:38 pm

Powell’s speech signaled that the Fed was ready to take some economic pain to fight inflation & they will, but maybe the markets doubt that resolve, and question if the Fed’s will hike rates through a recession: There is dumb, dumber and dumbest, but the Feds has to move forward to protect the non-believers, what happens in Vegas stays in Vegas, but differently what happens in the United States crosses over into Canada, folks hold on for the long ride of rate increases & we need them, like the song-have to make a living.

#136 Ustabe on 08.31.22 at 4:37 pm

One of the features of a narcissistic personality is they are either right or the victim…in their eyes they are never wrong.

Couple that with a higher level of sociopath-y than most of us walk around with and, well, there you go.

#137 Phylis on 08.31.22 at 7:57 pm

I’m waiting for the caps lock comments. Then I’ll giggle.

#138 The Awakened One on 09.01.22 at 1:58 pm

Thank you Doug: you always give us a good read, with perspective on the big picture during the times of vicissitudes.