Sunday, November 12, 2017

If it looks like a duck and it quacks like a duke, it probably is a bull market

Well. I feel the thrill.  And to speak with BB King “the thrill is [not yet] gone”.   This market definite starts to feel, quack and look like a euphoric bull market.

When we have speculative bubbles in bitcoin and other crypto currencies; when oil seems poised to break out to $60 or higher; when we are at 52 week highs in the stock market and when we see the small or ‘mom and pop’ investor return to the stock market we have entered the last inning of this bull market. I know the feeling, I’ve been through it before.  The thing is with bull markets that it can go higher than anyone expects and during bear markets it can go lower than one imagines (not the most original insight). Often, we’re dealing with raw emotions.  There is still a fair bit of pessimism so likely we are not quite euphoric especially with earnings growth predicted for next year in the S&P500 of nearly 11%.  As a rough guess, including multiple expansion, next year’s upside could be 20% or more.  But the peak is getting closer any day. So don’t be afraid of taking profits!

Canadian Banks have been on a tear for now and likely will keep on doing so for the coming months or so. Just a guess.  I plan to take profits in January. Despite gurus dismissing gold, it hasn’t collapsed in price and I wouldn’t be surprised if it goes higher over the coming 6 months or so.  I see $1350 as a distinct possibility. Economic growth is doing two steps forward and one back. Calgary’s oil patch is still in the doldrums but overall, Alberta’s economy is improving. I expect real estate will do fine although it may be a bit depressed in the hottest markets in this country.  If there is truly a recovery in fossil fuel pricing then Alberta real estate will likely start playing catch-up.

Remember the last number of posts; we are playing musical chairs and you may have to cash-in profits on a moment’s notice.  If you get caught in a downturn, don’t sell in a panic. It is better to close your eyes, scream but DO NOT SELL IN A PANIC ON THE WAY DOWN! It may take a couple of years to recover but it will recover, especially if you have some cash on hand for buying opportunities once the market is near bottom or starts to go up.  Many investors are still bearish enough to hold close to 30% in cash; we are not yet euphoric though we’re getting close.

One of my biggest mistakes is that when the money of a late stage bull market starts to roll in, I do not recognize how exceptional that money is. I become sloppy in my investing ways. Oh….  Easy come; easy go!   Who cares, I can always make more in the market. I make more in the market than during my day  job.  Must be a “new economy”.  Those are tempting statements you may also feel yourself or hear around you. Don’t get fooled!   Another one is… ‘Oh I have been waiting so long to make decent profits, now I finally start to make money, so we can’t be near a crash”.  Well, if you think that way or hear others speaking like that, get ready for your musical chair - the peak is near.  You will keep on hearing  “Buy on the dips” but you know that when everyone tells you to ‘buy the dips’, then better start taking profits and sell your shakiest investments.

How long before the next peak?  No idea; 4 months; six months a year?  Not a lot longer.  A perfect crash would be during the re-election campaigns of a certain Notley and a certain Trudeau. You know, those silver spooned closet socialists.  Be careful with the coming energy bull market. I am skeptical regarding a future with electricity destroying fossil fuel demand but… what do I know? Don’t be afraid to put a few irons in the fire for self-driving cars (NOT the Tesla scam though); solar or wind or even nuclear. I am considering solar for my new residence. That is diversification with a green tinge. I may not be an anthropogenic climate change believer but climates do change. I also don’t believe that mankind should limitlessly spew emissions and other harmful chemicals into the environment; especially not if we are going to count 10 billion on this planet within a decade or two. Please, stop pro-creating! 😊

It is quite well possible that we will start a hydrocarbon boom that will be interrupted by a near future stock market crash; after that the energy boom may resume. So, although I think that it is good to invest in energy right now, it most likely will not go up in a straight line; I expect a major set-back in the beginning of this new energy boom.  Well, it is not quite year-end so it’s a bit early for a 2018 forecast; but I am rosy, at least until year-end. Safe investing.

Sunday, November 5, 2017

One of the most important investment pod-casts today!

If you think that what I am ‘spouting on this blog” is my own original thinking than I have a bridge for sale, just for you, in Manhattan. 😊 I don’t only think about investing, but I read a fair bit about it as well (books and investment research newsletters) and every weekend I listen over an enjoyable breakfast to investor pod casts such as Frank Curzio’s and Stansberry Investor hour. BTW. If you see the ‘not-so-skinny guy’ on the Investor Hour webpage, that is Porter Stansberry, founder of Stansberry Research.  I saw him in real life on last year’s Stansberry Investor Conference in Las Vegas and that is his typical appearance as far as I know. Don’t under estimate this very down to earth person who is the founder and co-owner of one of the world’s largest on-line investment newsletter conglomerates.  He is closely affiliated with Agora, the digital investment news letter publishing company owned by another financial rebel: Bill Bonner.

Sometimes, I think the two are dooms-day prognosticators. But anyone who analyses the debt existing in today’s nations; in many corporations; and with the consumer has to become convinced that this cannot end well. We thought this in the 1980s, but if you thought that debt was bad then; or if it was bad during the financial crisis then think again!  Canada in the 1990s had a close call.  Now U.S. debt has grown tenfold and there will be a day of reckoning.  Will that mean mayhem in the streets? Will that mean a federal government's army surrounding your neighborhood? A federal government that is bankrupt and uses violence more open than ever to maintain ‘order’  or is it a gradual build-up to something more scary than the crash in 2008? 

How and when will it happen is anyone's guess.  Jim Rogers, in an interview with Porter, says (I paraphrase): I am sure it will happen; I just don’t know when…..   Japan with its enormous debt along with the West, in particular the United States, come to mind as the centers of crisis.  If I was a young Japanese adult, I would buy an AK47 right now, because I am sure that young adult would experience this debt crisis in his lifetime.  Porter believes in a ‘Jubilee’ a term brought forward by a former Blackrock executive at Jim Grant's fall conference on interest rates.  The term is (I believe) based on a Jewish tradition to forgive all debts that cannot be repaid every 50 years. We may, according to this Wall-street insider, and Porter agrees, get a worldwide Jubilee any moment now and it won’t be pretty. The insider foresees a Jubilee in Japan within 3 years!

As Jim Rogers points out, a lot has to do with having confidence in government and central banks; but that confidence has been eroding. When that confidence fails watch out. Here is a link to the interview: Episode 24: JimRogers and Porter Stansberry . I promise you, it is not all doomsday; in fact it is a lot fun. It is one of the best interviews I heard on this topic.  It is soo good, I made a permanent link at the top of this webpage along with other videos that are my favorites.

As said before. We want to diversify our investment portfolio and that portfolio includes our total net worth; including our career(s). We also need a series of investment scenarios, good and bad. Determine the odds of them happening and be prepared for them financially and in our overall life expectation. In investment, typically the optimists win. But surviving the (financial) flue days is critical for a long-lasting future. Why else do we take a flue shot?

Sunday, October 29, 2017

New bubble in the making; new debt crisis  

We have arrived at the ninth inning of the longest bull market in history other than the 1982-2001 bull. But look, today even our definition of bull market has changed.  Typically, many mean 4 to 7 year market upturns, now we’re suddenly comparing it with the 1982-2001 ‘bull market’. However, I remember that in that ‘bull market’ there were many traumatic downturns such as the 1987 crash; the 1990 Savings & Loans crisis involving George Bush Senior’s son Neil. When George Bush Senior’s “Read my lips” back fired. Oh and 1998 with the Asian Tiger currencies collapsing. I remember the end of the 1982-2001 bull market, now called the Tech Bubble (and crash)? 

The world has dramatically changed and now the FANG or is it FAANG? are driving a new bubble. Their stellar performance reminds me of the Nifty Fifty crash in 1973. Remember Warren Buffett apologizing for mediocre performance in 2000-2001 because a lot of the profits were only made in the ‘.com’ companies while the rest of the market lingered. Remember Nortel that by itself drove the TSX to unheard highs; until it went bankrupt? 
If you look at today’s market, low interest rates have pushed many investors into stocks and lately, ‘Mom and Pop’ investors are returning to the stock market in droves. Salivating at the returns of FAANG stocks and buying index ETFs. I like ETFs, but I fear for the day that the market crashes, when FAANG makes up a disproportional large part of the S&P500 and Dow. Meanwhile, we may be experiencing a bubble in credit as well. A debt crisis that has, thanks to QE and other stimulating central bank policies and unabated government spending, nearly doubled U.S. national debt (and that of many other countries) over the last decade.  If you forget provincial debt in Ontario, thanks to Steven Harper, Ralph Klein and Paul Martin we have a relatively low federal debt; but Trudeau is rapidly ‘correcting’ that. We went through so much pain in the Canada of the 1990s, but the Millenniums have forgotten that painful lesson and adore the disastrous second Trudeau. Really, it is uncanny… So Father, so Son. In economic disaster as well as in divisiveness the Trudeaus always shine!  Everyday now we learn about the crookedness of the Clintons and the parallels to the Trudeau family empire are striking. Not that the rest of the political establishment is so much better. Look, every politician benefits from larger government. And even if a guy like Trump seems to fight the ‘Deep State’ he is being swallowed alive, if he was not already part of that same corrupt system.

But we are talking about a stock market bubble, Mom & Pop are starting to believe that the market is not coming down. Gurus are increasingly optimistic. Then there is the cryptocurrency bubble. Yes, it is revolutionary just like the in 2001 when we were talking about the ‘New Economy’. Cryptocurrencies are a response to high government debt; loss of confidence in fiat money, as well as disgust for the deep state and elitist government system that we have now throughout the world. The hunger for more power by strongman politicians is scary and if not halted may lead to a 3rd world war as discussed in an earlier blog.  But… the patterns of a new bubble are deeply embedded in today’s markets.  Look at bond markets, at the stock market and the cryptocurrency markets.  Traditional investments are languishing by comparison. Commodity bear markets seem to be ending, but… what would happen with the next crash not that far in the future?  Say one or two years.  Well there maybe a silver lining: a one term Trudeau, Notley and in BC NPD/Green government. Possibly a one term Trump as well.
But first the bubbles will rise higher than most of us will think is possible.  Way back, I guessed that the TSX would be peaking around 18,000 but that has been taken much longer than I expected. I don’t think I know where and when it will peak. But we have definitely entered the musical chairs stage of the 2009-2018 bull market. So, when you have big profits, especially in the FAANG stocks be not afraid of taking them and hold cash, or better gold. The banks and financial industry have been doing terrific for decades, the exception was 2008, but Canadian banks escaped most of that and are currently again on a rocket trajectory that probably lasts into the new year. But the Toronto and Vancouver housing market bubble weighs heavily on them. Don’t grow complacent. This is not a time to sleep at the wheel; be ready to let your profits ride and jump at the sign of trouble.  

On cryptocurrencies and blockchain. It is a very promising technology but right now it is clearly in a speculative bubble. I don’t think it will go away and it may even become mainstream over the next 15 years or so. Especially if we go through yet another major crisis of financial of confidence.  I hate to say those things, but it is likely we will go through another big debt crisis soon after the current bubble bursts. Based on history, just like after the tech crisis, crypto currencies will be out-of-fashion for several years before it will truly take off. During those years of consolidation, you may discover and invest in the survivors who likely will be at the root of a tech and banking revolution. In the meantime, there is a good chance that gold will shine. This is of course all speculation. If the next crash would be mild, it does not pay to sell off a lot of your stock holdings (where would you place the proceeds? In Canadian or U.S. dollars; gold or silver may be better). There are a lot of problems underlying the current ‘boom’ and many of those may come to a head during the coming crash. Consider physical assets; diversifying in cash; gold and silver bullion and Calgary real estate, which may be stable as commodities likely will recover but very slowly if there is a near future crash.
Good news is that Jason Kenney has just been elected as leader of Alberta’s UCP (on the first ballot). With the Carbon tax for pipelines deal severely back fired; Alberta’s current lacklustre economy and a possible new economic crisis; Mr. Kenney may have all the wind in his back during the next election and we won’t see here another NDP government for 40 years. Is that good for Alberta; this mono-party system?  I doubt it; but alternative political parties have proven to be an even worse choice.  

Don’t become complacent on the way to this bubble’s peak. The crash may come when everybody feels most confident!

Sunday, October 22, 2017

Risk and Risk Management and much more

I know how to read an annual report. I know the concepts of value investing and how growing earnings per share ultimately results into a higher stock price. But I am not a stock analyst.  I don’t peer over corporate balance sheets and try to forecast earnings for the next quarter nor the next decade. Yes, sometimes I look at how earnings grew and how much debt a company has on-line in Globe Investor or in Yahoo-Finance.  But if you consider how often and by how much all those highly-paid analysts miss the next quarterly earnings results, then this is obviously not all that there is to successful investing.

Yes, I do run an Annual Property Operating Data statement to estimate a property’s economics and I know that I want a cap-rate of at least 3% before I consider buying real estate. But there is a lot more than an APOD involved and often it turns out different than what was expected based on the APOD. If it was just about the balance sheet and profits, then how do we explain Amazon or Tesla? 

One can only look at the numbers so much! Investing is not about how many dollars you have in the bank account. Currencies and cash are just ways to temporarily store income and other proceeds from your assets. You also need cash, whether it is in the form of dollars in you bank account or other currencies in other accounts or gold or money market funds. It is all the same. For longer term cash, I start more and more to lean towards gold. With government debts; consumer debt and student debt and even subprime auto loans very high, there could, as by many dooms-day-sayers have predicted, another big crash.  In what does Venezuela differ from the U.S.? Or from Canada for that matter? Politicians spend and borrow like crazy. To a lesser degree Consumers do the same.  Corporate debt is apparently not far behind.

No, I do not invest in dollars, I invest in assets, often income producing assets, in various asset classes. Because really, I do not know which ones will work out. Owning assets gives you options. If there is a stock market crash you may say: Oh… I lost 30%. But so did your neighbor!  Relatively, you will still be just as well off as before the crash. Exception may be the person who didn’t own anything because 30% of nothing (whether up or down) is still nothing. The real question is what would be better a portfolio of collapsed stocks or a real estate portfolio?  What would be better a gold portfolio or a portfolio in bonds? Often though, if the stock market crashes, real estate is not far behind. During the depths of the 2008-2009 crisis, even gold was down. So even in the total portfolio, net worth goes up and down. However, compared to other investors you may not have become a lot richer or poorer. It also depends whether your assets are priced in gold or U.S. dollars of course. And, as Warren says, when the tides rises it lifts all boats (except the ones that sunk during bad weather – that is me).  So that is where the real risk lies: the boats that were sold at the bottom of the market or that went entirely broke.  That is why we tell our readers: ‘Don’t sell in a down market; just sit it out and wait until prices have recovered or have done even better’ or never sell (except commodities).

Investing is about the assets you own – not their current valuation. That latter is temporary but should go up over the long term. He or she who owns assets has options and as long as you see cash as a temporary means for exchanging assets you don’t have to worry about valuation too much. Of course, it is much better to buy ‘cheap’ than expensive. Buy at depressed prices and sell high.   But if you wait for things going on sale; you may have missed a lot of the interest or dividends that are produced by these assets. Sometimes the income generated from an asset contributes 50% or more to your final profits. There is a balance and consequently don’t be overly obsessed by asset value and appreciation.

The asset classes themselves do not guarantee always the best return. If the stock market is down big time due to a government collapse induced by high debt, rental income and dividends are likely to fall as well. On the other hand, gold might be high in demand as a stable and reliable currency. Gold may allow you to buy food and new assets that are cheap.  As to how do you prepare for the ‘End of America’?  Have gold, some cash and have a lot in various assets such as a diversified stock portfolio combined with real assets such as real estate; maybe bare land; art, a business, own physical commodities, whatever but be diversified so that one asset type may do poorly while the other is just fine or maybe even boom.

The main thing is, do you have access to enough cash so that there are no forced sales at the bottom of a market and for the duration of the downturn.  Also, assets that were closest related to the cause of the collapse are often the ones that recover slowest. For example, U.S. banks were at the center of 2008-2009 and still are dirt cheap.  If during the next collapse, national debt and subprime-autos are the focus of the collapse don’t expect a large-scale recovery there. My feeling is that like the Nifty-fifty stocks were the at the center of the 1972 collapse, so will be the FANG stocks at the center of the next collapse. First though the FANG may shoot to the sky - to absurd valuations.  Real estate should be away from ground zero, but governments and banks may once again take large hits. Also avoid the automotive industry.  Commodities may prove interesting as well as they are already in a downturn.  Toronto may be hard hit because of topsy real estate and being the center of finance. Gold may go down initially but rise like a phoenix from the ashes of a collapsed fiat monetary system. Not sure about crypto-currencies as they are so speculative, but blockchain technology may be taking over from the traditional banks just like Amazon affected traditional retail (that again may change soon though).  Above all, diversify and hold physical assets and have your own business or start one. 

Personally, I think we may go into a completely new world with a different financial system; reduced nationalism; people being and taking more personal responsibility and the days of income-redistributing governments over. In the near and intermediate future, tensions are growing in Asia where Japan starts to rebuild its army; with North Korea and a more militant China that wants to spread its ideology throughout the world. The west is still in the grip of self-accusation and recrimination over things they cannot really change. If we don’t watch out, we may have a crisis of confidence, become paralyzed and get overrun by the ‘Hun’ who does not have that much of a guild-complex. There are lots of tensions and conflicting interests in this world. Let’s hope we get through this with minimal violence. I can see the perpetual fighting in the Middle East escalating; China, North Korea at Japan’s and South Korea’s throat. India and Pakistan going at it.  Europe may be ‘too old’ and tired to get involved but what will Russia do? Die of old age or blow itself up? Strangely enough, North and South America may stay out a lot of the fighting but are paralyzed by self recrimination and isolationism. A nuclear missile from Asia may wake us up like Pearl Harbor did. Africa will be Africa – I hope it doesn’t completely fall of the cart.  I see a world full of promise but also one that may after 70 years of 'peace' approach a violent breaking point. Let’s hope that Humpty-Dumpty can be put together again when it is all over. One thing is for sure; we won’t recognize our world half a century from now, when I reach the ripe age of 114 with more ripening ahead. Keep accumulating a wide range of assets some will carry you to an even better time.

Wouldn't that be something? Me still blogging 50 years from now. Can you imagine all the posts full of nonsense you would have to read?

Post it on Facebook

Here is something for you to consider. When planning for your financial future you may come across ideas or projects that seem unsurmountable to you.  To plan for something 30 years from now is not something that comes naturally for most of us. But you must take action now!  Otherwise, you are already defeated before you start.  Is it impossible to become a millionaire?  Not really, most of us can – we just have to inform ourselves, make a plan 10, 20 maybe 30 years out and execute one little step at a time.

The two really difficult things are 1. Taking action, i.e. starting and 2. Sticking with it. That latter is one of the most difficult things to do; it is sometimes called self-discipline.  Sticking to it during economic downturns; personnel hardship and crises is far from easy. But if the goal is worthwhile it can be done. Use everything in your power from visualization (see yourself in your dream house with wife and happily squealing kids! – maybe more realistic: grand kids) to programming your brain (book is titled ‘The Answer’ if I correctly recall) to self-hypnosis, whatever.  I don’t recommend self-flagellation or forms of masochism! 😊

Starting to implement your plan is often far from easy.  Say you want to build your dream home. Why not design it; visualize the neighborhood where it is going to be. Make yourself feel as if you are there and that it is real and possible. Failure is not an option. Nothing is truly for nothing. So, one way to get committed is by telling everybody around you about it. Some may make fun of you; but you will show them!  Some may think you have too high an opinion of yourself; prove you are as good as you know you can be! And you will soon find out who the ones are that try to pull you down in life; that suck up your energy instead of supporting you. Drop them like the cancer they are! Stick with the ones who are rooting for you; even want to help. Make sure you don’t mix-up support with a rip-off scheme. Trust people until they prove otherwise; if they take advantage of you get rid of them forever. Be merciless in your pursuit of what is important to you.

What better way to disclose your ambitious, maybe even your most ambitious plans, to your friends and family; put it on Facebook. You’ll soon will find out who you really can count on. Constructive criticism is fine; but block those who just are negative and suck away your motivation. Great plans always lead somewhere. Nothing is for nothing. The road to the goal is more important than actually getting there but your commitment; your tenacity is key. Put your dream on Facebook; show pictures of what you want to do, who you want to be and where you want to be. Life is about putting energy in and pursuing those things that you feel are important and worth pursuing. The end result maybe different than you visualized when you started the journey. More often than not; you will go far beyond what you imagined.  So start by posting it on Facebook. Let the world see what you want; somehow you will find resources in the most unexpected corners that will help you to achieve what you want.

For us investors we may start out simple; it does not have to be complex.  You can start with saying: I want my first million by age 35. I want a happy family with 2 kids and a beautiful wife. By 40 I want two million including a family home with large garden. By 50 I want 4 million and teenagers that don’t drive me mad. By 60 I want 8 million; grown-up happy offspring; doing whatever I want; including nice vacations to exotic places hand in hand with my loving spouse (or partner or whatever). You think this is overambitious?  Not really; it takes a rate of return of less than 10%!  Put it on Facebook; when others know your intentions, they may help. Drop the ones who sabotage you!

BTW when dealing with teenagers. Realize that the difficult ones may prove to be most successful and the ones you are very proud of. I have two kids they both had their struggles in various stages of their life. But I am proud of both and how they make successfully their own life. I am sure they will reach, in one form or another, what they want in life and become successful adults; who can ask for more? If you think Steve Jobs or Bill Gates or the Beatles were easy teenagers, think again… and again!

Is insurance a scheme or a real product?

Albertans are very lucky, we have “free” healthcare.  Sorry if I show a bit of sarcasm when putting “free” in between brackets.  Because the sun going up is one of the few things that is truly for free. Our province is the main customer of the healthcare industry and it represents us tax payers. Close to half, if not more of our income goes to the tax man through income tax, parking fees, property tax, GST (and not in Alberta, PST) and sin taxes, lottery tickets, tuition fees and god knows what more. Out of those provincial revenue streams (from your pockets to theirs) some is used to pay for basic healthcare. BTW, if you hear Calgary’s newly elected mayor boast that we pay one of the lowest property taxes in North America did he include with that parking fees?

Did you ever try to save on your energy bill?  You hear that nice story: Oh… with a High Energy Efficient furnace you reduce your energy consumption by 30%!  Yeah but not your energy BILL! Because the energy charges make up less than 30% of your energy bill. The rest are ‘administration fees’; ‘transmission fees’; provincial tax, etcetera, etcetera.  Who owns ENMAX? If you see the bureaucracy you have to deal with as an ‘Enmax customer’ you know: yep it’s the City. So all that money, in the form of ‘dividends’ get’s sucked into the municipal coffers (they have many), is not tax?

NOTHING IS FOR FREE! Sorry to disappoint. If you have insurance on something, say your house and it burns down do you get a new house from the insurance for free?  Then why are they so profitable?  Why is Geico such a profitable part in Warren Buffett’s Berkshire-Hathaway?  Of course, you don’t get that house for free! You along with millions of other customers pay insurance premium. Which is nothing more that a forced-savings plan. out of which your new house was paid The pool of money you and your fellow customers save together is enormous and that is borrowed for FREE by the insurance company to invest. Even if they make only a 0ne percent rate of return on the investment; the insurance company’s return (because they use your money and don’t pay interest) is infinite. To add insult to injury, the premium is not all going into that forced savings pool; you also must pay for overhead: marketing; accounting and of course the CEO’s salary — sorry, compensation. Ohh and they have to make a profit on your premium as well, of course!  OF COURSE only the sun goes up for free and I really wonder what environmental price we will have to pay for capturing all that solar energy that we are draining from the system? 😊

So, excuse me, if I try to avoid insurance companies like the pest, except for investing in them. Of course! I have been prescribed some pills – alas not medical marijuana. One of them is a new drug that I may have to buy for the rest of my life. It costs me $100 per month, but my doctor gave me a discount card (because the pharmaceutical company wants to show Alberta’s government how beneficial it is for people with my condition; so  that it may be included in Alberta Healthcare). Then they can really pump their prescription drug income!  A couple of months into the discount it is cancelled!  Now I must pay those exorbitant fees again!  Why was it cancelled? Because the Alberta government took the discount and only made it available for insured people! 

Well, I was pissed on the Notley bunch.  But then I did the math for a BlueCross insurance premium policy by the province. I calculated the annual premium and subtracted my prescriptions and dentist bill and my eye doctor. If I got it right, with the Blue Cross, more than the sun goes up for free.  It is a good deal!  I will check one of these weeks whether I understand this right. Heck, I may even vote NDP next time!  Eh…. No ffng way! But I am going to get a bit of my taxes back!

BTW:  I love our universal health system and I think it is good that we all get the same basic care. I don't think we have the right to have healthcare - after all doctors, pharmacists and others should also have the right to make money and proportional to demand!  But access to good healthcare for poor and rich is just the right neighborly thing to have. My experience with universal healthcare is good except within the city limits - probably a lack of resources.  Let me know how your experiences are with Alberta Healthcare.

Sunday, October 8, 2017

It is a good thing to rock the boat from time-to-time; but blundering through the china-cabinet is outright stupid and hurts everyone.

I don’t follow NAFTA negotiations between Mexico, the U.S. and Canada closely but it seems Mr. Trump’s strategy is one of bullying and intimidation.  Mr Lighthizer, the U.S. trade representative, has come up with outrageous demands that seem to say: “We demand any rule that we think favors U.S. manufacturing and we want anything that is not in our favor cancelled. If you don’t agree we walk”.   Well even within the U.S. there is a lot of opposition to this behaviour.  Because many U.S. manufacturers feel that NAFTA has been beneficial for all, including the U.S. and that the U.S. is busy to destroy a good thing.  In fact, many feel that NAFTA has promoted U.S. competitiveness worldwide.
Demands that Mexican farmers have an unfair advantage because their wages are lower than those in the U.S.; that Mexican weather Is better and that they can harvest 3 times per year rather than 2 times as in California is utterly ludicrous.  That is what a free market is all about: efficiency!  Imagine that Canadian farmers were saying that California wine is competing unfairly because they have warmer weather.  Even the Canadian consumer would be upset by that; they like their Californian wines. Here we’re trying to get rid of Canada’s dairy boards because they force our cheese and milk prices through the roof and then we would have to accept the bullying demands of that U.S. buffoon that are out of this world. We all benefit from NAFTA and updating the accord to reflect today’s progress is one thing. Having a protectionist U.S. elephant threaten its much smaller neighbours is not only bad form but it creates a lot of bad blood on this continent.  The Boeing-Bombardier spat is an exact mirroring of these negotiations and to some degree so is that perpetual lumber dispute.  It is all about, when the bully cannot compete it harasses the neighbourhood.  I think JT should cancel the Boeing contracts right now. I think he should cancel every U.S. defense contract right now!   What is Trump going to do: Invade Canada?  Who is going to pay for the defense of this continent’s North?  Trump is even upsetting Great Britain one of the U.S. staunchest allies over the last 100 years or so. It is a good thing to rock the boat from time-to-time; but blundering through the china-cabinet is outright stupid and hurts everyone.

Maybe Trump follows his ‘Art of the Deal’ strategy but I call it the ‘burning of bridges’ strategy. Upon the Donald’s election I had hopes he could clean-up elitism and bureaucracy in the U.S.  I thought, here is finally a guy that may tell governments to back off invading individual rights. Instead, we seem to have nothing but a bully. The U.S. better starts to shape-up and behave in a more acceptable way towards its friends; because currently with the U.S. as a friend, who needs enemies?  It seems, the U.S. prefers to cut-off its nose in order to spite its neighbours. From a Canadian point of view, the U.S. has historically been the elephant in the porcelain cabinet; but right now, that elephant is not even trying to keep things working.