Jaygo

Bravo Rosie. Except on economist productivity readings. Canada's economy will never have the productivity rates of the USA and comparing the two is stupid. Canadian people as in individuals are most likely equally or even more productive simply because we are less obese (sorry) But for our economy as a whole the numbers will show less productivity. It is nearly impossible for the whole place to freeze over and remain in static productivity vs our friends to the south where half their landmass remains relatively unscathed by cold. On the rest of his ramblings id have to agree, the economy is hurting because interest payments and the prospective of higher payments is taking a lot of juice out of consumers. Lets not forget that the long depression of 1873 ( railroads, excessive immigration and real estate) and great depression (stocks and real estate) were caused by a debt fuelled asset booms and subsequent government intervention causing bust. Ouch Id wager that our dollar will crater to the lowest valuation ever in the next couple of years and canada will be the best place for Americans to invest without a doubt for the second half of the 20's, it probably already is but there will be bumps a plenty. If i was an American I would be studying the top 20 or 30 names to be prepared for a bargain basket. ill toss some names for those interested. There are lots of high quality midcap names that are very dynamic. The Kitchener, Cambridge, Waterloo area of the GTA and Ottawa to Montreal corridor is nurturing some incredible small companies especially in the smart industrial space and tech. The bond proxies like banks, utes and telcos are all very good as well due to the oligopolies that exist but since the dividends make up a lot of the total return and is not tax efficient for Americans they are probably less favorable. Equitable bank BRP Richelieu GFL Opentext, CGI, CSU Linemar, magna, ATS Smartcentres, Granite Reit, MEQ, MRG Thomson Reuters BN and colliers Terravest, Exchange income corp, transforce, Gildan Activewear Wajax and toromont There are many others but these are all pretty reliable and could be spectacular if we have a stock slump combined with currency appreciation.

Agreed. When you look at colliers ect. Kw seems like picking the runner up just because there is some history.

SSNT for a tracker on Brad Jacobs. On December 11th he is doing an announcement on his plans for the company.

https://www.arcgis.com/apps/mapviewer/index.html?webmap=96ec03e4fc8546bd8a864e39a2c3fc41 Here is a map of major rail lines in NA. The permafrost in canada is on arch that stretches from midpoint Alaska to around the middle of Hudson's bay or about 2500km north of the bulk of the Canadian lines. Quebec that has abundant natural recourses and seems to have the will to exploit them has barely any rail at all. I think there is lots of room to grow track miles into Quebec alone. Quebec is almost 3 times the size of the state of Texas. The other amazing thing about this map is just how dominate the rails are. It is truly an oligopoly. From the map I cant help but lean towards the CPKC as the top dog with its stretch into the manufacturing regions of Mexico. Another standout is how the Eastern lines of Norfolk and CSX are so regional vs the big 4. Wonder if they will someday fold into BNSF and UP. CN announced that they are buying 270+ track miles of the Iowa northern railroad today btw.

Really enjoyable to read or listen to PZ. I would say that his quality has gone down a bit since become so marketable. I would imagine his difficulties lie in being invited to comment on just about everything now so he is bound to be more inaccurate. His long term focus is probably what is best to listen to and his short term ideas and view on current battles ect are to be taken for what they are, Soundbites. His understanding of history and geography is impressive and his ability to send his message to the public is better than most historians therefore he is very popular. The future is unknowable and the more we predict the more we are wrong. Tim marshal, Robert kaplan, Brzeinski are good too but dont have the personality that PZ has. I wish we could have had a long form discussion with a guy like PZ and Kissinger.

With the current government who may be considered business neutral to unfriendly we have about 550 billion in ongoing or planned projects for the next 10 years. Site C, LNG Canada, Wood fibre LNG, TMX, Coastal gas link all in beautiful BC wilderness. If CN has an economic project that is also needed by the local population and major projects I think it would go ahead. There may be overruns and some backlash but at the end of the day the Canadian government knows who butters their bread.

I hold CP and CN mostly because of a fascination with railroads, robber barrons and anything 1800's. Personally I hate trucks on the roads, they are unsafe imo and cause alot of the congestion we have. Rails may not provide the best returns but id bet they are one of the only industries that will remain in a similar state 100 years into the future. The companies could change but those rails and need for heavy transport is pretty static if our quality of life is to remain. The one thing id say for the Canadian rails is that i think we will build more lines. Northern canada has few rails (not including tourist lines) and lots of resources. I could see more track getting laid down in the centuries ahead. Think northern Quebec, Yukon, Ring of fire in Ontario ect more lines to Churchill port if it ever goes ahead.

Hey SD. I appreciate you are probably uncomfortable giving advice to strangers on the web, but just to help the discussion can you elaborate on this. What in your opinion would be a profitable way to navigate the next 6months?

When a big portion of the CPI increase is related to extra cost due to higher interest rates we have a pretty obvious case of the dog chasing his tail. Should they raise rates to combat inflation that is being caused by higher interest costs?

Just about every retailer is guiding down. I'm curious to see the united rentals, cintas, aramarks ect to see what they say. My guess is softness started this Q and the outlook is uncertain

The reality is they spend tomorrows dollar too but it was more about individuals or corporations saving in the economy building up resilience vs governments who spend all income.

Ordered it on thrift books last night. As well as a book about John a Macdonald.

Yes taxes are innately inflationary. Governments generally do not save like a populous would. All taxes are sent back out the door as expenditures. Often times to special interests and middle men unfortunately. When I bring in a dollar I spend 60 cents and save 40 for future consumption and strengthening of my families balance sheet, this savings give me and mine resiliency in hard times. When governments brings in a dollar it spends 100 cents. The only resilience in hard times is a governments ability to borrow.

A book about the Canadian Pacific Railroad. A quick read and entertaining if you share my love of railroads, economics, history, politics and adventure. The building of the railroad was about as ambitious and difficult a project as any in history, on par with the pyramids and space travel in its absolutely ridiculousness of an idea, shedding of economic realities and nation building potential. It is safe to say without the CPR Canada would be a mostly maritime country never expanding past lake superior to the west. The main take away is just how awesome Canada is. We have a continental country touching 3 oceans all without the wars and terrible history of our southern neighbors or the indefensible colonial empires of history. Granted there were a people here before who's population was going through a population decline and cultural decimation all the while the settlers poured in around them. For the original natives the result was less than satisfactory and death, starvation and humiliation was common. Canada of late has a shame surrounding the founding of the country and treatment of the first nations but in my estimation we as a whole acted with the best intentions and morality given the times. This is compared to the barbaric Spaniards, Americans, Belgians, Dutch, French and Japanese. We were less colonizer via the bullet and more fat guy who sits beside you on a plane and steals your armrest, his sweaty arm pushing you further away to create a void which is quickly filled. Canada as it is known today comes from that expanding railroad and the European settlers who filled in along the line. A book id highly recomend. https://a.co/d/6G4lPpO

Not sure id agree. I have a fairly large mortgage . Single income family of 4 At 2.5% mortgage rate I dont even think about it. New truck at 2 or 3% sure. At 7% mortgage or 10 on the truck its a bigger nut and I spend less on everything. Since my spending is another mans income and on and on we have an economic slowdown. Large depts with low rates is not an issue, its only an issue with rising rates. I think people only devote to paying down dept when it gets above the economic rate of interest. (imo that is anywhere above 3% these days)

As long as people do not expect significantly lower prices in the future or are expecting a long term loss of employment a deflationary bust is unlikely. What looks like is starting to happen is that major manufactures are slowing. Germany, China, SE asia ect This is because European and North American consumers are starting to say uncle, rates have done a lot of damage and most are still happy with their fluffy nest from the covid days. The thing to watch is services, we know trades are looking for work again but lets look for weakness in travel vs 2019, IT spend, and other cyclicals and that will tell is we need to run for cover or just ride through the bumps. I'm absolutely certain Canada is in a fairly deep recession right now. We will not see it in our numbers because we have a few gigantic construction projects going on that will lift the GDP plus its before Christmas and we know how to spend. It is more visible in the minute details. Having one less drink and app at dinner, choosing the cheaper sofa. I would love to see a 5 year graph of detailed credit card data to prove out what i expect. It all starts with small item decisions because in the back of your mind something doesn't feel right. Were spending too much on our groceries, mortgages and the boss has been in a bad mood lately lol. One thing is certain, if Westerners dont start spending the above manufacturing nations are going to take a royal economic shit kicking and that will then trickle down to us. The old adage was when America sneezes the whole world catches a cold. Well I believe that China is also there today. If China struggles the whole world is going to struggle. Look at Resource economies currencies for the proof of something dark brewing. The easy solution is for the interest rates to drop immediately to the proper 2% level that they belong at. The western consumer will then feel good and spend and that will help to bring prosperity back to the manufactures and resource economies, China can keep a happy populous by being employed and sheltered and wont have to start a war to distract from policy errors and we can all go back to doing what we do best.

Wow. Really great points here. It’s something I will have to noodle on a little more to fully understand

I agree that life is much better today but when the improvements slow down it feels like reverse. From 1900 - 1930 we went from shit ridden city streets rife with pestilence to inexpensive cars, penicillin, aircraft, electricity and a whole host of incredible things. I have a theory that is hard to quantify but I dont think our culture is producing truly individual people and I think that it will have negative long term consequences, maybe depression maybe suicide maybe just far lower productivity and inventiveness. The way mid twenty year old's act these days is truly baffling to me, they want everything, whine when they can have it then ask mom if the laundry is done. I'm all for tight families and my time with my parents was precious but i really cant understand why so many still live at home. The general thought is to save money but give me a break, how do you learn anything on your own. Why not rent a shit hole? work your ass off and get out of it to better digs. My theory is that the above is a result of a slow mental training of inadequacy and needing protection by having bylaws and rules for everything imaginable to keep us safe. My kids cant wear sleeveless shirts at school, Why? At every assembly we recognise some Indian tribe as the original owners of the land, That's f....cked? why? I did not, nor did my kids take anyone's land. My kids hockey team is not allowed to change in the change room. why does he go home in sweaty clothing? Just because of a one in 100,000 pervert? Why do I do 4 hours of safety training for some jobs that take me 10-15 minutes to complete. No wonder transmountain cost 30 billion. Imagine we tried to rebuild the CPR today. Today we have so many small rules that probably have good intentions but really make it kind of shitty when looking back to times with more freedoms. My dad in the 70's spent a year working on and off in a logging camp in northern Vancouver island. He made a bunch of cash then lived on the beach in Tofino for 3 months, it got too cold and he and two friends drove to grassy key in Florida and camped on the beach for the winter. Two summers ago we went to Tofino and as beautiful as it is the beaches are now controlled ( no fires, no camping, no parking, dont even dream of drinking a cold one) Sure, we dont want vagabonds everywhere but we are also kind of making life miserable for the young and stupid. This rules upon rules kind of mentality is doing damage. I just cant really explain it, I just feel it. So yes we live longer today but were hooked to the internet and afraid of everything, most are too poor to really live and the ones who cast aside the rules are considered weird and antisocial. I'm in the camp of no boom till we let people be individuals, make mistakes, get hurt, go broke and fight back swinging.

In the 20’s era the personal car and widespread electricity were just gaining serious traction In North America. That’s a tough comp for any era but it really did bring a sense of freedom and possibility. kind of a far cry from today. Yea our standard of living is better today than 100 years ago but our improvement steps are getting incrementally smaller. I think our main goal today should be to bring back some sense of pride in education, excellence and competition. We should squeeze out the rent seekers defined as everyone from welfare jobbers to uncompetitive monopolists. When the war years ended everyone was already geared to striving to be the best or else risk loosing the war. Today we are bloated, lazy and frankly trivial in our ambitions. When you look at the growth of Dubai or Shanghai and some other jurisdictions you can kind of see a boundlessness in it but that ain’t the west that’s for sure.

I think there is very good potential and pent up demand. I’d love to see some loosening of the nimbyism and bureaucracy since most people today are rule followers and just say wah, I can’t build that id never get a permit, wah. I think a guy like musk championing some diy engineering brilliance is also due. Where is todays Carol Shelby or Edison or Eiffel. Our trans mountain pipeline is almost done, the budget overruns and beurocratic nightmare has been legendary. I don’t think we can have a true boom of confidence and intelligence and economics without cutting some damn red tape.

Never say never. We are addicted to the internet at our fingertips imo not the actual device. for now apple is great, obviously. I Just don’t like having my 340 brk.b’s so damn leveraged to it if it does go the way of all other phones before.

I think it was a Ted pick or at least the idea. But WB was likely the one to put it on in size. Ideas are a dime a dozen, knowing when to go big is the secret sauce and they really hit a home run. doesn’t it seem crazy having 156b in apple vs a market cap of 800b. Its almost 20% of cap. Taxes ect will make the numbers imprecise but wowza. Take 50 billion and buy in the stock and we’d still have a gigantic stake in apple spread over 6% fewer BRK shares.

I’m not picking on apple specifically and sure as hell am not providing stock investing advice to Buffett. I’m jaygo on the internet, he’s a billionaire genius. im just thinking along the lines of the goat investor built this incredible conglomerate that has an all weather feel to it but 1/3 of it assets are publicly traded stocks. Why not take a little pressure off the next investment manager and take that down to 15 or 20% of assets and with the proceeds shrink the equity. it makes those future investment decisions slightly less critical and it will make the mistakes less damaging. If not I’d suspect that it ends up being markel like with a quasi index tracker over time because most are too afraid to work in buffetts shadow and ruin what he built.

I was hoping they would start winding down the publicly traded asset column to a more manageable level. Say 20% of total assets and with the proceeds shrink the share count a bit to make it easier on future managers to make investment deductions. having 150B in apple alone is one hell of a decision for management to make. if the future managers are very good they can grow it back with their own performance not relying on the goats picks from decades past.

Hey SD, I really appreciate you knowledge here so can you expand on this a bit. Are you implying that once that extra capacity is gone ( as in the pipe is filled and pumping) the market would cool off for WCSB The mid caps like WCP seem hungry to buy, rumours of a SU or CVE purchase of MEG. Seems like the whole return all money to shareholders and not grow thing has changed. Im pretty happy with what ive made in the Canadian names, some like wcp and cnq (the safer bets have doubles or triples since ) I am cautiously optimistic and would like to dabble in the TVE, BTE, SGY, SES of the world but hate to give it all back over a bit of greed at the top.