Hello
The Canadian Market has lagged this year and Brian Belski explains that it is not the time to give up; I agree.
I was told a couple weeks ago that the big UK accounts are focusing on Nat gas as solar is continuing to disappoint and that the need for LNG will be around for a long time. A couple majors also share than view as a Bloomberg piece explains.
Brad Hayes is one of the best commentators on the energy sector and he gives his take on a recent document from our federal government.
The Fraser Institute recent publication shows how Canada is falling behind on Business Investment per worker. It is quite alarming.
Goehring & Rozencwajg founder Leigh Goehring was on Macro Voices and like Don Coxe before, their group is looking at sunspot activity as one of the primary reasons they see cooler temperatures ahead that will affect crop yields.
He mentions that US Nat Gas is the favored commodity in the shorter term and likes Uranium.
They are bullish on the Fertilizer names and Farmland ETFs. As my smart friend has been saying for months now, investors should look at farmland in Canada as an asset class.
Steve Saretzky’s piece on the housing market has some good charts and comments. It is interesting to learn that just 30% of the mortgages in Canada have been affected so far with these higher rates.
A big conference is coming to Vancouver in July. LNG 2023 is here as it was going to be in St Petersburgh Russia and naturally a change in venue was needed.
It was a crazy week in Russia, so it is best to listen to one of the brightest geopolitical minds out there. Pippa Malmgren was a guest on Macro Voices
The capital markets business has really slowed down and we saw BMO law off many in the investment banking area. At the same time, KPMG dropped their contract with Canopy Growth.
I was told over a decade ago how the federal and the provincial governments were pushing more responsibilities to the municipal levels. Hence, it was so important to have quality leadership and stewardship at these city halls as the homeowners and businesses bore the consequences. This news story I included about Vancouver is just a start of many where reality is kicking in due to overspending, inefficiencies at so many levels and poor leadership.
Have a great long weekend!
David and Amy
Number 2 - Gas is Here to Stay for Decades - Bloomberg
I attached the Bloomberg piece on the majors concentrating on nat gas. That coincides with comments from a top energy infrastructure analyst. He met with big UK accounts this month and they are focused on Nat Gas names since solar is disappointing in terms of costs and output.
Number 3 - Canadian energy modelling flawed and futile - Brad Hayes of Big Media
https://big-media.ca/canadian-energy-modelling-flawed-and-futile/
To sum up, Canada’s Energy Future 2023 lays out possible pathways to Net Zero GHG emissions by 2050 in Canada, much as the IEA’s Net Zero by 2050 report did globally. Both reports assume the final (net zero) outcome, then adjust inputs to show what is required to get there – as opposed to sensible modelling exercises that use reasonable distributions of inputs to test the outcomes that might reasonably be achieved from the input data.
The CER report methodology generates many highly unlikely to practically impossible situations – massive changes in energy supply and utilization without consideration of supply chain, social, economic, or technical hurdles that would be encountered. Perhaps worst of all – no certainty that security and affordability of energy supply could be maintained for all Canadians.
Canada’s Energy Future 2023 is a political document to promote reduced GHG emissions. It is not a suitable foundation for creation of Canadian energy policy.
Number 4 - Fraser Institute
- Economists have warned of Canada’s weak business investment, particularly compared to the United States. This should concern Canadians as strong business investment is key to higher incomes, greater economic prosperity, and improved living standards.
- Real ($2012) non-residential business investment per worker in the United States exceeded that of Canada in every year from 2002 to 2021: Canada’s business investment grew by $2,889 per worker from $11,798 to $14,687 while US investment grew by $11,064 per worker from $15,686 to $26,751.
- The gap between Canada and the United States increased significantly after 2014 as real business investment began to decline in Canada. In 2014, Canada invested about 79 cents per worker for every dollar invested in the United States; in 2021, investment was 55 cents for every US dollar.
- In 2014, three Canadian provinces had significantly higher real business investment per worker than the United States ($23,333): Alberta ($52,533), Newfoundland & Labrador ($48,867), and Saskatchewan ($44,699). From 2014 to 2021, however, US growth in real business investment per worker was higher than growth in any Canadian province except Ontario. In fact, growth declined in five provinces: Alberta, Newfoundland & Labrador, Saskatchewan, Manitoba, and Nova Scotia. By 2021, real US business investment per worker ($26,751) exceeded that of any Canadian province.
- Canadian prosperity depends in large part on the strength of business investment. Policy makers must recognize the current challenge, understand its causes, and prioritize policies that support business investment moving forward.
Number 5 - MacroVoices #381 Leigh Goehring: Global Food Crisis Update
https://macrovoices.podbean.com/e/macrovoices-381-leigh-goehring-global-food-crisis-update/
MacroVoices Erik Townsend and Patrick Ceresna welcome Goehring & Rozencwajg founder Leigh Goehring to the show and the topic is an update on the formative global food crisis resulting from more of the world’s economies advancing to the point where far more people eat meat all over the world. https://bit.ly/3Pr09wU
Number 6 - Steve Saretsky “There will be blood”
Housing has been propped up by a 20 year low in new listings for nearly six months. This isn’t sustainable, and neither are 6% mortgage rates. Something has to give, and it will soon.
Number 7 - LNG 2023
One of the great stories of the summer of 2023 is the fact that Vancouver is hosting LNG 2023 which was to be taking place in St. Petersburgh, Russia (you can see why a change in location was necessary)
The Canadian Gas Association really stepped up, especially Tim Egan-
https://www.lng2023.org/speakers/tim-egan
They only had a year to get ready for this event that happens every 3 years.
The last one was in Shanghai which was 4 years ago (due to Covid they changed timing) and the next one is in Doha.
Some 15,000 delegates are anticipated to attend from about 80 countries.
What an event for Vancouver…for Canada…and for our resource sector.
Check out the sponsors on the link…the global energy leaders are coming to town!
Number 8 - MacroVoices #382 Dr. Pippa Malmgren: A Tale of Two Civil Wars
https://www.macrovoices.com/1214-macrovoices-382-dr-pippa-malmgren-a-tale-of-two-civil-wars
Erik Townsend and Patrick Ceresna welcome Dr. Pippa Malmgren to MacroVoices. Erik and Pippa discuss:
- Wagner group vs. Russian Ministry of Defense
- Translating the Russia/Ukraine conflict into market analysis
- Control of nuclear assets
- Upcoming Presidential election
- Mainstream media’s censorship on election candidates
- Civil war on the horizon for US?
Download the podcast transcript: [Click Here]
Number 9 - BMO Cuts and KPMG Drops
BMO cuts in The Capital Markets area
https://www.bnnbloomberg.ca/bmo-capital-markets-cuts-about-100-jobs-with-deals-drying-up-1.1939180
KPMG drops WEED.
Number 10 - The City of Vancouver is in dire financial straits
…could leave homeowners on the hook for property tax increases of close to 10 per cent in each of the next five years, according to city staff.
We hope you found the Top Ten interesting this week, and are looking forward to another selection of articles, stories, and commentary next week. If you know of anyone else who would be interested in receiving our weekly note, please let me know.
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