CS Investment Counsel Corp. focuses on the variables we can control, and protects against the ones we cannot, except for asteroids. The world of markets, economies, and even politics is in great flux today. In many ways, it seems like a new world out there. CSIC has tailored it's approach accordingly. Instead of hiding from these new realities, we concentrate our efforts on what has long proven to be the most significant force influencing personal real-life financial outcomes; behaviours and decisions made by the client.
It is important to note that we are not in the financial punditry business. We are not interested in debating the causes of the latest crisis du jour, or making predictions on specific economies, markets, industries or securities. Many experienced advisors realize that this leads to confusion, doubt, and paralysis – enemies of good financial decision making.
That being said, we are always curious about markets, economies, money, and the world around us. The following documents are taken from our endless readings on political economy, and I thought some of them would be of interest to fellow curious traveler…
WORLD GDP BY COUNTRY
Watch the economies of the world's leading countries change over our lifetime.
AVERAGE STOCK OVERVALUED SOMEWHERE BETWEEN TREMENDOUSLY AND ENORMOUSLY
Here is the gold standard of valuation, showing we are in perilous territory.
EVIDENCE MOUNTS THAT TORONTO IS IN A REAL ESTATE BUBBLE
Bubble risk appears greatest in Hong Kong, Munich, Toronto, Vancouver, London and Amsterdam. Major imbalances also characterize Stockholm, Paris, San Francisco, Frankfurt and Sydney.
CANADIAN BANKS LOSE CUSTOMER DATA EN MASS – AGAIN. NEW CLASS ACTION LAWSUIT FILED AGAINST BMO AND CIBC
How many times is this now? If data can’t be kept safe, what other risks do bank customers face?
UNDERSTANDING THE TRUE SIZE OF US DEBT AND WHAT THAT TELLS US ABOUT THE ABILITY TO HONOUR FUTURE "PROMISES"
Here is a beautifully simple presentation to US congress by per-eminent economist Laurence J. Kotlikoff showing them just how deep a hole the US is in.
WHAT YOU ALWAYS SUSPECTED - FEELINGS AND INVESTING DON'T MIX: HOW MOST INVESTORS TALK TO THEMSELVES THROUGH INVESTING CYCLES
Prolific commentator Barry Ritholtz keeps us fresh with an update of a set of sentiment charts. Yes, many of these charts repeat the same message. But simple is often correct. Definitely worth a three minute scan.
EASY-TO-DIGEST EXPLANATION OF ZERO INTEREST RATE POLICY AND WHAT IT MEANS TO ALL OF US
Clever commentator Grant Williams shows what happens when markets no longer provide their fundamental function of determining fair price. There is a bit of a silver lining though. 40 minutes that are pretty well assured to make you a honourary member of the highly unpopular "oh, I get it now" society.
A NEW MASS MEDIA DOCUMENTARY ON GOLD IS... ACTUALLY WORTHWHILE
The CBC just released a documentary that touches on the fundamental importance of gold through recent history. It opens the door to big issues such as: Where is the gold anyway? How is the paper price of gold manipulated? And, why does any of this matter? This is a well-spent 45 minutes that gives the viewer a rare glimpse into the murky world of the most durable financial instrument.
RESIDENTIAL REAL ESTATE RETURNS IN THE BIGGEST ECONOMY IN THE WORLD DURING ITS ASCENDANCY
Surely this would have been the ride to be on, right? Well, no. Actual real (after inflation) return over the last 120 years in U.S. residential real estate has been… 0.11% per year. In fact, if you were endowed with magical powers and bought at the absolute low in that period (1920) and sold at the absolute high (2006) your real return reaches only 1.29% compound per annum. Factor in property taxes and any maintenance that would apply to any house and that number becomes convincingly negative.
VERY SOON EVERYONE WILL NEED TO KNOW SOMETHING ABOUT GOLD
The clever folks at Visual Capitalist have put together a visual executive summary that will almost certainly enable you to shut down that annoying Keynsian at your next cocktail party.
SCI-FI COMES TRUE: A VERY SPECIAL INITIATIVE BY VERY WEALTHY ACTORS WITH VERY BIG CONSEQUENCES
And you were just mentioning that we should be mining the asteroids. What a coincidence!
CHINA AND INDIA’S ECONOMIC DOMINANCE IS THE HISTORICAL RULE, NOT THE EXCEPTION
Here is a nice concise chart of the share of world GDP made up by major powers over time. Nice to see a chart start from year “1”. Sorry about the missing 3,000 years before that, Egyptians...
MOODY’S: CANADA IS STILL TRIPLE A
Here the oft-maligned credit rating firm takes a strong positive stance on dear old Canada, in the midst of their recent downgrades of several other G20 sovereigns.
HIGH RISK = HIGH RETURN BELIEF IS QUESTIONED
Here is a nice recent study that supports what many of us have believed for a long time:
HOW TO APPROACH LIFE, MISTAKES AND OPPORTUNITIES BY AN ABSOLUTE MASTER
Ray Dalio is a self made billionaire, and runs one of the most successful (for the clients) hedge fund companies in the world. He has been extremely generous with his personal insights and processes in this document called "Principles".
TONY ROBBINS (WTF?) EXPLAINING THE SIZE OF THE US DEFICIT (the difference between government spending and revenues) IN 2012:
Laugh all you want, this guy is great at communicating a message clearly and meaningfully. He may mix up the words debt and deficit a couple of times but the numbers reconcile with my extensive reading on this subject.
HAS THE BUSINESS PRESS FAILED THE PUBLIC TRUST?
Was the business press successful in sufficiently exposing the risk and malfeasance within the financial sector in the wake of a financial crisis?
A PICTURE IS WORTH A TRILLION WORDS...
Ever wondered where ALL the money is in the world and what it's doing for the economy and you? The link below will give you a pretty good idea.