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09/06/2023

Housing Affordability and Its Broader Economic Implications

With housing affordability under the lens, there's speculation about federal measures targeting international students – a move to potentially cap their numbers.

While this may address housing accessibility in the short term, it could inadvertently exert pressure on consumption due to reduced population inflows.

For those strategizing around real estate and broader economic factors, such policy considerations are pivotal.

It underscores the interconnectedness of various sectors and the importance of holistic financial planning.

09/05/2023

A Deeper Dive into July’s Retail Spending

July presented an intriguing shift with its preliminary estimates, indicating a bolstered growth in retail spending.

While this aligns with our internal assessments based on debit and credit card transactions, it's essential to underline the role of temporary government income supports.

Such boosts, though encouraging, may be fleeting.

It's imperative to discern between transient spikes and long-term trends, ensuring our strategies remain sound and forward-looking.

09/04/2023

Consumer Activity and Its Implications for Financial Strategy

June observed a lukewarm response in consumer behavior, with retail sales demonstrating only a marginal uptick.

As we await the release of the Q2 consumer spending insights alongside next week's GDP data, preliminary indicators suggest a modest 1% annualized growth in overall expenditures.

As financial planners, understanding consumer trends helps in tailoring investment strategies and adjusting portfolios. Stay tuned for more data-driven insights in the upcoming weeks.

09/01/2023

A fascinating trend emerging in the housing sector is the robust uptick in new home sales this July.

With the existing market grappling with lean inventories, potential buyers are veering towards the new market.

For those contemplating real estate investment or adjustments in their portfolios, it's a reminder of the adaptability and dynamism intrinsic to the property market.

Staying informed and seeking guidance during these times can make all the difference!

08/31/2023

In the ever-fluctuating world of real estate, July bore witness to a dip in existing home sales, a tangible response to the increasing rates.

With inventories trailing at a stark 42% beneath the pre-pandemic benchmarks, the scarcity is palpable.

As Certified Financial Planners, it's crucial to understand these market shifts, as they have profound implications on broader investment strategies and financial decision-making.

08/30/2023

Fed's Stance on Inflation: An Insight from Jackson Hole Symposium

In his recent speech at the esteemed Jackson Hole Economic Symposium, Chair Powell shed light on the Fed's view of the current economic landscape. While progress has been observed regarding inflation, the sentiment is clear: it's still considerably high. As we navigate these uncertain financial terrains, the Fed's commitment to tread cautiously, either by adjusting the policy rate or maintaining it, is a testament to its measured approach. For financial planners, this serves as a cue to be agile and ever-responsive to evolving market indicators.

03/31/2023

Have you ever wondered what causes a recession?

Recessions can stem from waning confidence, which creates a sense among businesses and consumers that the economic tide is shifting.

Recessions can also be the result of structural changes in one or more key industries, economic shocks, or even psychological forces such as extreme optimism (which can lead to speculative behaviour).

Financial bubbles bursting (such as the stock market crash of 1929 or the real estate crash of 2007) can also be the cause of recessions.

Recessions can also be induced by central banks; as they try to lower inflation by raising interest rates, they may inadvertently (or sometimes even knowingly) cause a recession.

03/30/2023

When were the most recent recessions in Canada?

In March 2020, a recession began due to the COVID-19 crisis.

This recession ended in April 2020, making it the shortest, but also the deepest, recession.

The Great Recession, which began at the end of 2008 and continued until May 2009, was another significant recession in Canada.

Real GDP fell roughly 4.3% from its pre-crisis level to its recessionary trough, and unemployment peaked at 8.1% during 2009.

While similar developments unfolded in the U.S., unemployment didn’t peak until October 2009, suggesting the end of a recession doesn’t necessarily signal the end of economic distress.

03/29/2023

Are you curious about what happens during a recession?

A recession is typically defined as two consecutive quarters of shrinking gross domestic product (GDP).

However, it can also be described as a sustained contraction in economic activity.

You may notice dwindling production and consumption, as well as higher unemployment or lower prices, during a recession.

The Business Cycle Council of the C.D. Howe Institute is generally recognized as the authority in Canada when it comes to declaring a recession.

They call a recession “a pronounced, persistent, and pervasive decline in aggregate economic activity” and regard GDP contraction and unemployment as two of the most defining metrics.

03/28/2023

Why Investing In Growth Is Important?

Our investment approach to growth investing is based on a simple premise:

Stocks tend to follow their earnings and free cash flow over the long term.

We seek to identify and stick with the rare companies that we believe have the potential to sustain strong growth.

One industry that we believe has this potential is semiconductors.

While there is near-term risk and uncertainty in the semiconductor industry's fortunes, there is also a longer-term opportunity.

The setup in select chipmakers and semiconductor equipment companies looks appealing on a three-to-five-year basis, particularly for those with leading-edge technologies that have already taken some lumps this downturn and serve markets with strong growth prospects over the long term.

03/27/2023

Semiconductors have emerged as a strategic priority for policymakers around the world.

Access to these chips is seen as crucial for a country's economic competitiveness and security.

In fact, the U.S. recently passed the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act of 2022, joining a wave of countries enacting policies to support domestic semiconductor manufacturing.

The strategic push towards "re-shoring" semiconductor production over the coming years should increase the need for the tools and equipment used in the complex process of chip fabrication.

This creates an opportunity for investors to get in on the ground floor of an industry that is set to see increased demand in the future.

03/26/2023

As the world becomes increasingly digitalized, the demand for semiconductors is set to increase.

The technological challenges of increasing processing power by squeezing more transistors onto smaller chips mean that the industry faces higher costs to expand manufacturing capacity.

And these new lines are typically less productive than in the past.

But the combination of growing demand and the increasing cost of incremental production should translate into higher sales volumes and prices for semiconductors over time, which could bolster some chipmakers' profit margins.

This creates an opportunity for investors who can identify the right companies with leading-edge technologies that have already taken some lumps this downturn and serve markets with strong growth prospects over the long term.

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