Investment Q&A

Q: Hi 5i team. This is a general economics question. is there evidence that the US economy is capable of growth in the absence of stimulus? My simplistic calculation (14 T economy, 1T pump-priming) suggest that if QE is taken away, GDP growth will be zero or even negative. If that is the case, is the euphoria in the markets thus far this year based on the notion that, at least, things have improved so that we no longer slide towards recession (assuming the Fed will not stop QE) and actions taken by the Fed later against a better growth background (when it happens) will not affect the economic outcome drasticlly and this, against a backdrop of negative real returns on 10 yr treasuries now has push the markets up? Do you not find this going-in-because-it's-the-best-of-a-bad- bunch a little worrisome? Thanks. Henry

Q: Hi Peter, Your thoughts on today's blood bath and jobs report please. How bad is the report in your opinion. Thanks

Q: Three years ago this month the TSX was 1,100 odd points higher than DJI. Yesterday, DJI was almost 2,000 points higher than the TSX. Is there any significance in that?

Q: Hi could i get your opinion on the news this morning about a Cyprus bank tax.
thanks

Q: I am interested in your overall impression of the last couple of days. Bull market correction? Or downward trend due to negative sentiment that is building? Do you still have positive outlook for the remainder of 2013? Thanks.

Gerald

Q: SH-N With the US market having been on an upside ride for a while and at fairly lofty levels, does the risk/ reward ratio of using SH to short the market in order to protect myself against losing some of my gains seem like a reasonable trade? SH appears to be at about a 5 year low.

Q: Could you please give me your view of the Canadian Bond market. We have a fund that follow the Dex Universe Bond Index. Recently , we have heard that a lot of managers think that bonds are at risk for a downturn and that they are drastically reducing their exposure to this sector.
Thanks

Q: Peter. How's about a nice hefty correction of NA markets by mid to end February. I have been reading a number of SEERS and they all give "good' reason for it.
Regards - Sittin' in cash Bob Rushton

Q: Peter, what do you see for the economy for 2013 and the affect on the stock market?

Q: Canadian consumer debt is at 167% of income. Public sector wages are likely to be frozen in Ontario. Do you (your team) foresee a regional or national recession in Canada soon?

Does this factor into your stock ratings?

Q: Will QE help the economy? Do we not need to see higher GDP and increase in jobs before we can have any confidence in the market? I am concerned about chasing this market - what is the downside risk to S&P. It seems (or feels like it) many stocks have priced in the last QE - with the upcoming election, fiscal cliff etc - any negative news we will get a pull back - maybe a significant one. Everybody seems to have different opinions - it is hard to know what to do.

Q: Thoughts on the recent US Q3?
Do you feel it was open ended and will continue into any recovery and thereby make companies less concerned about interest rates?

Thoughts on Euro bonds?

Q: Hello Peter ... my pension plan is interest rate driven,what is your opinion on when the fed is going to raise interest rates ??March 2013??

Q: Hi,your best guess please on the inflation vs de/disinflation debate. Will massive stimulus create future runaway inflation or will debt levels, demographics and structural imbalances win out on the de/disinflation side? Or is it de/disinflation first and inflation later. Thanks.

Q: A couple of weeks ago I thought I heard an analyst state on BNN that 2012 is shaping up like 2008. Given that he saw a major drop in the markets comes September. Any thoughts here? Technical indicators?

Thanks,
Ronald

Q: Peter,

ACQ has been falling regularly in a pretty good US market. What do you think might be the reasons behind this? Keeping the uncertainty surrounding Europe, should one be a bit more cautious and reduce positions to keep cash until the situation is back to normal.

Q: So is armageddon coming to the markets Monday?

Q: Hello 5i!
Thank you for your recent "Investment Tips for Individual Investors". The fact that you were talking about me made me laugh. I learn geography best when looking at junior resource companies in god-knows-where locations. Still laughing. It was honest and I appreciate that.

On that note and without futher ado I would appreciate your input regarding a resource company, Arcan (ARN). We recently (wife and I) initiated a position at $2.17. We may be purchasing more but would appreciate input from the all seeing 5i Oracle.

Additionally previously one of your answers had talked about the recovery being long with low interest payments. 10 years was the guestimate for low interest. Could you elaborate on your thoughts for this time frame? Generally if interest rates aren't kept low the debt payments countries are carrying will hamstring them? So Countries will do their utmost to keep interest rates low while hopefully working like hell to reduce/drop debt. Then when interest rates/inflation comes hopefully their future earnings can out compete their future debt payments?

Q: Ipl.un,ppl,and Vsn all got hammered last week, these3 are supposed to be the steady eddies all portfolios count on, what happened and which is your favorite. Dave swidler mont tremblant

Q: When you look 5, 10, 20 years in the future what do you see? Or maybe the question should be 5, 10, 20 years in the future where are you looking?
Is this an exercise that you feel is productive for investing? If yes, are there ways in which you view it as more or less productive?