Opportunities in global markets, and more musings

September 19, 2023No Comments

New trading opportunities in global indices

I recorded a video a couple of weeks ago on global country ETF’s that look technically appealing. If you are shopping for new ideas to add to your watch list, this video should offer some good insights. New trading opportunities in global index ETF’s – ValueTrend

One example from the country ETF’s discussed in the video was Italy. New high, pullback to neckline seems to be holding:

More musings

Deja vu’ all over again

On the eve of recessions in 1990, 2001 and 2007, many Wall Street economists proclaimed the U.S. was on the cusp of achieving a soft landing, in which interest-rate increases corralled inflation without causing a recession.” Why a Soft Landing Could Prove Elusive: Wall Street Journal

Oil prices

“If we were to break above the $93.74 intraday high seen back in November last year, then the street is going to raise targets to $100. This move is having a multi-layer impact on financial markets. First, it will potentially stall out the disinflation trend that has allowed traders to become more agreeable with the soft-landing scenario.”  Andrew Pyle

 

Inflation growing in Canada due to gas prices. Gosh, really? Who’da thunk it?

“Canadian inflation reaccelerated to four per cent on a headline basis, the highest level since April. This was driven mostly by gasoline prices, while food inflation cooled somewhat to 6.9 per cent in August versus 8.5 per cent in July. It is unclear whether the Bank of Canada will look past the uptick in inflation because it was driven by energy. However, the core inflation rate also picked up to 4.1 per cent. The cost of housing is also continuing to climb higher, in large part because of rising interest rates. Mortgage costs are up 30.9 per cent from last August and rent rose 6.5 per cent. The next rate decision isn’t until Oct. 25.” BNN

Oil prices are up, but the carbon taxes have accelerated and exasperated the problem in Canada. Note the Statistics Canada data chart below, data effective today August 19. Despite Government claims that Canada’s inflation is falling – the chart tells you the opposite:

 

Debt matters 

Recall the MMT theory that governments could spend what they want, it didn’t matter? I guess it DOES matter, after all. Don’t say I didn’t warn ya. In August 2021, I wrote about the fallacies of MMT – specifically, the criteria you would need for it to work. Proponents were assuming that the government is ethical, and qualified/knowledgeable about the correct ways to deploy that money. Neither was the case in Canada – which is why I correctly predicted that it would fail. And here we are.

“A spike in interest rates over the past year and a half has made the cost of servicing the national debt way more expensive, posing significant risks to the fiscal and economic outlook.” Seeking Alpha market commentary

So…Where is Canada’s spending going? Well, a bit of it goes to GDP enhancing expenditures that can help offset debt costs, per the MMT theory. But most of it, not so much. For example…Poilievre’s comments on some of that spending.

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