News Tidbits

14-Oct-2011 | Reggie | Asia Banks Bonds Canadian Investing Commodities

 

Canadian banks managed to escape the debt crisis of 2008 without much trouble thanks to their safe balance sheets and relatively high capitalization ratio.  That safety is paying off 3 years later as banks in Europe are once again struggling with high debt levels.  In order to raise capital, Euro banks are unloading assets and Canadian banks are in great shape to snap those up.  So far RBC has grabbed up some assets from Dutch bank Dexia and will probably get more.

 

Inflation in China is down slightly from their highs which came as a bit of a relief to Chinese authorities who have been struggling hard to get rising prices under control.  Over the past year, China has constantly raised interest rates and bank reserve rates in an effort to get inflation under control and it finally seems to be working.  Food prices are still up significantly which means that there likely won’t be any rate decreases in the near term future.

 

Bill Gross: “This year is a stinker.” This comment was made by the world’s biggest bond manager in his October newsletter.  He attributes the poor performance to investors moving into US government bonds as European debt issues continued.  The PIMCO bond fund was positioned to perform best in a scenario of about 2% global growth.

 

Oil price rise over $3.00 thanks to strong economic data released today.  The price increase is being mainly attributed to strong US consumer spending, increased bank lending in China, and the G20 meeting where the European debt issues continue to

 

Occupy Wall Street continues in New York and spreads throughout the world.  The protesters that have been basing their operations out of Zuccotti park will be allowed to continue to camp out in the park thanks to the Canadian real estate trust, Brookfield Asset Management.  Brookfield owns and controls the park in downtown New York.  The movement has gained more momentum as folks and businesses continue to make the endorsement and activists spring up in different cities throughout the globe.  The Canadian Auto Workers union is one of the latest to give their encouragement to the movement.

 

This blog has been prepared by the Retire First Team. The blog expresses the opinions of the writers and not necessarily those of Retire First Ltd. Statistic and factual data are from sources Retire First believes to be reliable but their accuracy can not be guaranteed. This blog is furnished on the basis and understanding that Retire First is under no liability whatsoever in respect thereof. It is for informational purposes only and is not be construed as an offer or solicitation for the sale or purchase of securities. Retire First Ltd. And its officers, directors, employees and their family may from time to time invest in the securities discussed in this blog. This blog is intended for individuals where Retire First Ltd is registered as a dealer in securities.

Retire First is a member of the Canadian Investors Protection Fund.

Commission, trailing commissions, management fees and expense all may be associated with mutual funds. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. A recommendation of any of the mentioned investments would only be made after a personal review of individual portfolio. Third Party research has been used in formulating the writer's opinions.

No Comments

Chinese Power Supply Falling Short

27-May-2011 | Reggie | Asia Market Outlook

As the heart of summer is quickly approaching, it looks as though China will be facing a major shortage in electricity.  Power shortages in China is nothing new as the infrastructure has been struggling to keep up with the rapid increase in demand from industrialization as well as the increase in demand for personal use.  But this year China’s Electricity Association is warning that it’ll be the worse shortage in 20 years.

In an effort to make the shortages as orderly as possible, governments have begun to place limits on consumption.  This will of course lead to huge decline in growth as manufacturers and other industries have to call it quits early.  Workers will see reduced pay thanks to the reduced hours they work and a lot of very hot people unable to use their air conditioners throughout the very hot Chinese summer.

The problem stems from the regulated prices charged by power companies.  Much of Chinese power is supplied by coal fired plants.  Coal prices have been on a steadily rising for the past 2 years as the economy recovered from 2008’s crash.  While the price of coal has been steadily rising, the power companies have only been able to raise their rates by a tiny amount.  Unfortunately it looks like it’ll be a dark and hot summer for the people and industry of China.

 

This blog has been prepared by the Retire First Team. The blog expresses the opinions of the writers and not necessarily those of Retire First Ltd. Statistic and factual data are from sources Retire First believes to be reliable but their accuracy can not be guaranteed. This blog is furnished on the basis and understanding that Retire First is under no liability whatsoever in respect thereof. It is for informational purposes only and is not be construed as an offer or solicitation for the sale or purchase of securities. Retire First Ltd. And its officers, directors, employees and their family may from time to time invest in the securities discussed in this blog. This blog is intended for individuals where Retire First Ltd is registered as a dealer in securities.

Retire First is a member of the Canadian Investors Protection Fund.

Commission, trailing commissions, management fees and expense all may be associated with mutual funds. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. A recommendation of any of the mentioned investments would only be made after a personal review of individual portfolio. Third Party research has been used in formulating the writer's opinions.

5 Comments

Fewer Canadian Commodities Sent to China

10-May-2011 | Reggie | Asia Commodities

Compared to a year ago there was less Copper, Iron ore, Aluminum, and Soy Beans exported to China.  One of the only commodities we went more of was Crude oil, but only by a small margin.

This could potentially serve as quite a wake up call for investors in commodity stocks out there.  Until now many have been assuming that Chinese demand is basically insatiable.  With a limit being found prices for commodities will have to be rethought along with new project and expansion plans.

Rebuilding Japanese cities devastated by the tsunami will help balance out some of this drop in demand, but a decline in commodity prices still seems likely.

 

This blog has been prepared by the Retire First Team. The blog expresses the opinions of the writers and not necessarily those of Retire First Ltd. Statistic and factual data are from sources Retire First believes to be reliable but their accuracy can not be guaranteed. This blog is furnished on the basis and understanding that Retire First is under no liability whatsoever in respect thereof. It is for informational purposes only and is not be construed as an offer or solicitation for the sale or purchase of securities. Retire First Ltd. And its officers, directors, employees and their family may from time to time invest in the securities discussed in this blog. This blog is intended for individuals where Retire First Ltd is registered as a dealer in securities.

Retire First is a member of the Canadian Investors Protection Fund.

Commission, trailing commissions, management fees and expense all may be associated with mutual funds. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. A recommendation of any of the mentioned investments would only be made after a personal review of individual portfolio. Third Party research has been used in formulating the writer's opinions.

No Comments

China continues to pump the Brakes

11-Feb-2011 | Reggie | Asia Canadian Investing Commodities Real Estate

State capitalism in the People’s Republic of China means that what China wants for their economy they can get.  Right now they want to slow things down and keep inflation under control.  The latest policies instituted by the government are designed to do just that.

As China continues on its path of growth, millions of people are joining the ranks of middle class.  The country is rapidly moving towards all our urbanization as people flock away from villages and farms towards cities in search of higher paying construction, industrial, and technological jobs.  As billions of dollars get created and spread to the general Chinese population the inevitable surge in demand for consumer products and the new found ability to own property has resulted in sky rocketing prices.

In order to put a stop to these rapidly rising prices, China has been busy.  They have been busy mass producing housing to increase the supply of low-rent housing available, as well as adding new taxes and restrictions to curb the purchasing of properties by real estate speculators.  Interest rates of been increased again and again.  With these deterrents all in place, it shouldn’t be long before prices correct.

With the Chinese economy being largely state controlled, its hard to say what exactly the fallout of the decision will be.  If panic selling were to set it, it could certainly set forth a domino affect that would surely be felt here in North America.  However, the Chinese economy has been incredibly resilient when it comes to growth.  If the government wants more construction it will get it, and if the government wants to slow things down, it will eventually get that too.

This blog has been prepared by the Retire First Team. The blog expresses the opinions of the writers and not necessarily those of Retire First Ltd. Statistic and factual data are from sources Retire First believes to be reliable but their accuracy can not be guaranteed. This blog is furnished on the basis and understanding that Retire First is under no liability whatsoever in respect thereof. It is for informational purposes only and is not be construed as an offer or solicitation for the sale or purchase of securities. Retire First Ltd. And its officers, directors, employees and their family may from time to time invest in the securities discussed in this blog. This blog is intended for individuals where Retire First Ltd is registered as a dealer in securities.

Retire First is a member of the Canadian Investors Protection Fund.

Commission, trailing commissions, management fees and expense all may be associated with mutual funds. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. A recommendation of any of the mentioned investments would only be made after a personal review of individual portfolio. Third Party research has been used in formulating the writer's opinions.

No Comments

News so far this Week

17-Nov-2010 | Reggie | Asia Commodities Currency

Caterpillar buys Bucyrus, maker of mining equipment for $7.6 billion

Caterpillar, the maker of industrial machinery made the offer to purchase Bucyrus early this morning.  Bucyrus specializes in the production of equipment such as drills, shovels, excavators, and mining trucks.  The CEO of Caterpillar, Doug Oberhelman stated that the mining segment is a key strategic area for the company where they see strong demand in the future as urbanization continues in the developing world.  He even went on to say that he believes the mining sector is in the early stages of the cycle.

Chinese Banks basically Shut Down Real Estate Development in an effort to Combat Inflation

While this is being denied by the country’s top four banks, a Chinese state newspaper reported this morning that any credit that was being made available to real estate developers has been taken off the block.  There is a limit to how much can be lent for the purpose annually, and it has been reached.  Chinese real estate prices have been sky rocketing over the past few years which has created fears regarding a bubble and inflation.  It doesn’t seem clear how putting a strangle hold on further development will help to combat rising housing prices…

Sarkozy has had enough of the US Dollar

French President Nicolas Sarkozy, who took over the presidency of the G20 has made his agenda quite clear.  He seriously questions whether the US dollar should act as the world’s reserve currency and what other options may be a viable alternative.  For now there aren’t many viable alternatives and the US will certainly resist any attempt at change put forward.  With a year left in Sarkozy’s reign it should make for a lot of continued discussion on the subject and make for a lot of action in the price of gold while it all happens.

This blog has been prepared by the Retire First Team. The blog expresses the opinions of the writers and not necessarily those of Retire First Ltd. Statistic and factual data are from sources Retire First believes to be reliable but their accuracy can not be guaranteed. This blog is furnished on the basis and understanding that Retire First is under no liability whatsoever in respect thereof. It is for informational purposes only and is not be construed as an offer or solicitation for the sale or purchase of securities. Retire First Ltd. And its officers, directors, employees and their family may from time to time invest in the securities discussed in this blog. This blog is intended for individuals where Retire First Ltd is registered as a dealer in securities.

Retire First is a member of the Canadian Investors Protection Fund.

Commission, trailing commissions, management fees and expense all may be associated with mutual funds. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. A recommendation of any of the mentioned investments would only be made after a personal review of individual portfolio. Third Party research has been used in formulating the writer's opinions.

22 Comments

« Older Entries