The Crypto Cleansing

November 19, 2022

Year to date: Bitcoin is down 66% Ethereum is down 69% Cardano (ADA) since January 19 is down 89% DOT is down 80% You get the picture.  2023 has been a brutal year for crytpo.  For comparative purposes: Gold is down 4% The TSX is down 7% The S&P 500 is down 18% The DOW […]

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The FTX Bankruptcy

November 12, 2022

The cryptocurrency exchange filed for bankruptcy this week, as did many of its associated companies.  What went wrong? It was a Ponzi scheme; that’s what went wrong. The Boy Wonder “Youngest Self Made Billionaire in History,” Sam Bankman-Fried (who will be forever known as Sam Banking-Fraud) also ran affiliated crypto trading firm Alameda Research, […]

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The Unemployment Data is Not What it Appears

November 5, 2022

On Friday, the unemployment numbers were released in the USA (and Canada), and everything is great!  Unemployment increased slightly, but it’s at very low levels, and employment is up, so all is good!  From the Bureau of Labor Statistics: Total nonfarm payroll employment increased by 261,000 in October, and the unemployment rate rose to 3.7 […]

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The “Not So Much” Interest Rate Tsunami?

October 29, 2022

Last week we discussed the Interest Rate Tsunami.   I made the point that the 5-year bond yield determines 5-year mortgage rates, and the bond yield was going up.  Way up. Then, this week, the Bank of Canada surprised everyone and “only” raised interest rates by 50 basis points, not the 75 everyone expected.  As a […]

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The Interest Rate Tsunami

October 22, 2022

Today we discuss something that we never discuss on this humble blog: interest rates.  Let’s start with a chart of the Canada 5 Year Government Bond Yield: In 1996 the yield was over 9%. In May 2020, at the depths of the pandemic, it was around 0.25%.  That’s practically nothing. Today it sits at 3.74%, […]

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The Time to Stack Cash is Now

October 15, 2022

Let’s start with a look at the S&P 500 Index, weekly chart: The last eight weekly bars are red.  On Thursday the SPX bottomed at over 27% lower than its peak on January 4 (before recovering slightly on Friday).  The “line in the sand” appears to be the March 2020 pre-lockdown high of 3,392.  A […]

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Protect Cash Now – Build Wealth Later

October 8, 2022

Over the long term, the market goes up.  Here’s the S&P 500 Index since 1872, on a log scale: The obvious trend is up.  Equally obvious is that there are periods of “down.”  The crash of 1929 is obvious on the chart, as is the 2008 meltdown. If you have a long enough time horizon, […]

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Dancing on the Line

October 1, 2022

The S&P 500 Index closed the third quarter in a very ugly fashion, and is now back where it was in November 2020.  All of the gains of 2021 and 2022 are gone. The next obvious resistance level is the pre-pandemic high in March 2020 or around 3,400.  If that breaks, I have no idea […]

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How Low Can We Go?

September 24, 2022

The markets are going lower.  I can foresee no circumstance where, while in a recession, the Fed raises interest rates, and the markets go up.  That’s not how it works. Yes, we could have a short-term bounce.  That is inevitable.  We will likely have one this week. But in the medium to longer term, there […]

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Is Inflation Done?

September 17, 2022

I have not published anything for the last few weeks, because I haven’t had much to say.  Today, I have something to say: I think we are already at peak inflation, or very close to it. I know, the common media narrative is that inflation is only just getting started, and by this time next […]

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