Stocks - The Best Buys 2

[jayswin]

Oh man, I'd be waiting for sure.

[skudr248]

Originally Posted by Mayo

I can't imagine buying into the Toronto/Vancouver housing markets right now

Not saying I know it's the wrong decision - but those prices are hard to explain

I have a friend that just bought 2 bedroom, $965K condo in downtown vancouver. Seems okay with it though...

[Slava]

I can’t really guess what will happen in Vancouver or Toronto, but don’t forget about the weak Canadian dollar. I know there’s a tax for foreign buyers, but if the dollar stays low then those buyers might keep things rolling in those markets.

[bluejays]

Originally Posted by Mayo

I can't imagine buying into the Toronto/Vancouver housing markets right now

Not saying I know it's the wrong decision - but those prices are hard to explain

Downtown, for sure. I bought a pre-construction stacked townhouse, 1800 sqft for about $520,000 just outside the city which is pretty good in the Toronto market. Just a year ago when I was looking for condos, a condo uptown (not downtown) for 650 sqft was on average going for $575,000. That's bonkers, so I jumped on this one which was more on the outside. Ontario has very little land available from the government to build on, and a lot of immigration which is why the prices have gone up over the years.

[bizaro86]

Originally Posted by fleury

I was going to create a thread, but thought I'd just keep it here, but what does everyone think of the financial ramifications beyond just stocks for Canada? For me, I think Canada has a huge amount of money to make up in quick order so I think there will be a few changes over the next few years.
1) Increased immigration to bring in more contributors to the tax pool
2) Housing supply opening up, so I think housing prices will be stable



I'm in the process of acquiring my first mortgage in Toronto, and really weighing my options hard for term and fixed/variable. I can't see the bond market drastically improving so fixed should go up (according to the economics I know), and I can't see banks passing on BOC savings to customers as they need to keep their margins high, so can't see that going down much either. I don't know though, so I'm wondering what others feel here?

I think this crisis is just as likely to reduce immigration because of increased xenophobia and to 'protect jobs for Canadians' as it is to increase immigration to broaden the tax base.

[bluejays]

Originally Posted by bizaro86

I think this crisis is just as likely to reduce immigration because of increased xenophobia and to 'protect jobs for Canadians' as it is to increase immigration to broaden the tax base.

Yeah, that's possible too, which I didn't consider. Though you have to think as Canadians, and with Trudeau at the helm that probably won't change. Additionally, if there is a movement to buy Canadian and manufacture here, it opens more possibilities for bringing in skilled workers to do so. Who knows? Just a theory.

[Samonadreau]

The thing to remember is it seems this virus doesnt discriminate and every country is going to be in rough shape coming out of this... i think this will dampen the economic effects of government debts in the individual countries. Everybody is sort of in this together.

[bluejays]

You're right, but in a capitalist world, where everyone is wanting to get ahead, you know a country like China will use any leverage they can pull to get ahead. It's just how things are done. So first world countries will try and pull ahead to make up as much money as possible and in the zero-sum game world we live in, it'll likely be at the expense of smaller countries. I wish it weren't so, but every country wants leverage. Ultimately large corporations who can create jobs, like Amazon, will bend countries backward to create jobs in their districts. Interesting few years ahead.

[jayswin]

Originally Posted by fleury

You're right, but in a capitalist world, where everyone is wanting to get ahead, you know a country like China will use any leverage they can pull to get ahead. It's just how things are done. So first world countries will try and pull ahead to make up as much money as possible and in the zero-sum game world we live in, it'll likely be at the expense of smaller countries. I wish it weren't so, but every country wants leverage. Ultimately large corporations who can create jobs, like Amazon, will bend countries backward to create jobs in their districts. Interesting few years ahead.

Yeah, so we're going to be the "small country" eventually, and maybe sooner than we were expecting. Amazon and other major companies are destroying the economies as we know them and they're almost all American.

Add to that America has effectively destroyed Canadian Oil without even going to war with us so yeah, we're in for a reckoning here in Canada. We used to have a give and take relationship with America that worked, in the recent decade we are seeing the transformation to a relationship where they take and we give to their economy in almost every way.

[Vansmack]

Any thoughts on covered call ETFs like zwb and zwu, or covered calls in general?

[flamesfever]

This latest Trump move, to prevent 3M from giving us the masks we ordered, got me thinking about where Canada should go after the virus is over.

I have always been somewhat leary when doing business with the Americans. Growing up in Toronto and Trenton, Ontario in the 40s and 50s, it seemed that most of the Ontario factories were merely branch plants for big American companies. Whenever a recession hit, the Canadian company workers were first to be laid off.

In those days, there were canning and cheese factories everywhere. It was the High School kids who provided much of the labor in the canning factories during the summer. I was a sampler and tenderometer (grading) operator at a pea canning factory called Stokley Van Camp. I made 75 cents an hour and you could work as many hours as you wanted during the 6 week harvest. I made enough money to buy my first second-hand car at the age of 16...a 39 chev coup. There were rumors that the Americans bought up most of the canning factories in Canada and shut them down, making us more dependent on them for our canning needs.

During the 70s the big American Business Schools were teaching that when a company is threatened by a smaller company taking a part of their market share, they should do everything in their power to put the smaller company out of business. I witnessed large companies dropping their prices on products long enough to put smaller Mom and Pop companies out of business. In many cases the smaller companies were building market share by producing better products. However, that mentality gradually ended, as it was considered more ethical to simply buy out the smaller company.

As for energy, much has been said about American interference in our attempts to build pipelines. I think this is just one more example of their “Us vs Them” and "Win at all Costs" mentality.

Obviously many things have changed over the years, especially with technology and globalization. I realize that it is in our benefit to have a free trade agreement with the Americans. However, when the virus is over, I think we should establish a task force to make sure Canada is independently self sustaining in the event of another pandemic. Things like security of medical supplies (including drugs), food and energy should be top of the list.

[OMG!WTF!]

We've hit the 50% retracement level on the S&P. I'm not into elliot waves or fibonacci levels or anything but a lot of people point to 50% as a common retracement during big crashes. it's pretty obvious where the money is coming from when you see headlines like this...

[Poster]

Originally Posted by OMG!WTF!

We've hit the 50% retracement level on the S&P. I'm not into elliot waves or fibonacci levels or anything but a lot of people point to 50% as a common retracement during big crashes. it's pretty obvious where the money is coming from when you see headlines like this...

Can you explain in simpler details for us laymen?

[OMG!WTF!]

Oh it just seems odd to me. Such a massive number of unemployed juxtaposed with the stock market having it's best week since 1938. Something is off. I think your guess is as good as mine, short covering, rebound from over sold. Most likely massive liquidity forced into money markets finding its way to risk assets. It just seems like anything other than fundamentals. So much fun though. Best trading I've ever seen.

[DoubleK]

The economy is not the stock market.

I have to keep telling myself that.

[bluejays]

Yup, ain't that the truth. A week and a half ago I was going to put every penny I had into a week trade on Shopify @ $485 when they announced they weren't going to announce estimates for the upcoming quarter (perfectly reasonable). I thought it was good for a trade to $540 and I'd be out. I didn't buy. Today that POS is $690. Damn it's upsetting to lose out.

[Enoch Root]

Originally Posted by OMG!WTF!

Oh it just seems odd to me. Such a massive number of unemployed juxtaposed with the stock market having it's best week since 1938. Something is off. I think your guess is as good as mine, short covering, rebound from over sold. Most likely massive liquidity forced into money markets finding its way to risk assets. It just seems like anything other than fundamentals. So much fun though. Best trading I've ever seen.

Unemployment is a lagging indicator, meaning people lose their jobs because things have gone bad already - whether that's the company, the economy, or whatever.

The stock market is very forward looking. The information about how many people would lose their jobs was already baked into the market. The market is trading today on new information, and new expectations about the future, not about how many people lost their jobs last week.

Also, the market had a great week because it had recently dropped 30%, so there was lots of room to go up. It's not like it's setting new highs or anything.

[Enoch Root]

Originally Posted by Poster

Can you explain in simpler details for us laymen?

Fibonacci levels are very commonly used for technical analysis.

When the market drops a significant amount, technical analysts will look for signs about how much it might recover.

The most common Fibonacci levels are 38.2%, 50% and 61.8%, and people will look for a rebound of those amounts. It becomes somewhat self-fulfilling.

Also, like all technical analysis, it works when it works. And when it doesn't you are just supposed to ignore that fact until next time. (confirmation bias)

[Enoch Root]

If you are wondering why those are the levels, that is a function of the Fibonacci sequence itself:

1,1,2,3,5,8,13,21,34,55...

Each new number in the sequence is (approximately, and limiting towards) 61.8% larger than its prior number. For instance, 55 is 61.8% larger than 34 (the ratios are obtuse at smaller numbers, but become more precise as the numbers get larger (i.e. limiting towards those ratios)

Conversely, you can look at it another way: 55 is 21 bigger than 34, which is approximately 38.2% (again, as the numbers get larger in the sequence, these ratios become more precise)

Honestly, I don't recall where the 50% comes from, and don't feel like looking it up.

[jayswin]

So, I'd imagine there's a pretty good chance of a drop off soon?