Labour

I’ll keep this short this week because not much is happening.

Bitcoin is in a holding pattern ahead of next week’s “halving,” which may or may not be a significant short-term price driver.

Gold is up, but is still short of the all-time high in 1980 in real terms.

Which brings us to labour.

Immigration has boosted the supply of labour.

Businesses used the pandemic to become more automated and digitized. This tax season, did you take your paperwork to an in-person meeting with your accountant? No, your accountant has access to your CRA account, and they download all of your slips and auto-fill your return. Then, if necessary, you have a quick video meeting to discuss it. That’s way more efficient than it was five years ago.

There is slack in the labour markets.  We’ve got lots of available labour.

So, even though the economy looks strong (there continues to be demand for stuff), the supply (labour) is growing even faster, and this divergence will lead to disinflation and lower interest rates.

Is this priced in?

I have no idea, but I’ll let you ponder it, and we can discuss again in the future.