Although I trade mostly U.S. stocks, Canada is actually my home country and dearest to my heart. Unfortunately, I see the same long term economic consequences in the years ahead, perhaps even worse than America. Canada is a great nation and believe it is still one of the remaining nations of great integrity and honesty. However, we face economic hurdles, because of continued lack of diversification from the oil & gas (8.2%) and financial sectors (7%), the two sectors that are primarily being devastated right now. Most of us remaining Canadians are employed in services, which I cannot see being supported once our primary industries are taken out.
Canada's Elliott pattern seems clearer to me than the American one, likely because there has been much less central bank interference. Nonetheless, I see a reset toward at least 2008 levels, and possibly 1987 levels in the years ahead.
This is a bleak picture, so what can Canadians to do? Well... I would say continue to be Canadians. Love and respect each other. Be kind to our friends and neighbours. Be friendly. Be generous. But also... prepare for a possible 10 year economic set back. Pay off all our loans. Reduce aggressive investments. Keep a cash reserve that can outlast any long term set backs. Learn to grow our own food. Build a strong supportive community. Trust in the strength and goodness of the human heart in the end. Perhaps even learn to short the market during periods of volatility, but be extremely careful. Become the new leaders to diversify our country.
TSX 60 P/E is much lower than S&P500, Canada has a lower debt to GDP, and more importantly foreigners don't hold huge amounts of Canada currency or debt or stocks.
I don't think it will be as bad. 3000 points? 87 levels? That's just too much I think it's way over a reasonable target.
There's going to be a big change, and maybe Canada won't be able to rely on importing goods as much. Even the USSR after the collapse did not drop that much.
That's like the end of civilisation or something.
Now in reality Canada is already at 87 level, and it will go lower.
It's going to be a buy in the low ranges, unless they do something completly crazy.
The USA are going to provide smart investors with lots of cheap buys on foreign stocks.
Most people will probably wrongly chase the bottom with the USA.
supere
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@MrRenev, yes maybe 1987 is a bit far fetched. The system is completely overloaded with debt though, even more so than the gfc, so something will eventually have to give. Maybe 2008 formed the floor and we will just bounce between here and there for the next decade.
I don't think it will be as bad. 3000 points? 87 levels? That's just too much I think it's way over a reasonable target.
There's going to be a big change, and maybe Canada won't be able to rely on importing goods as much. Even the USSR after the collapse did not drop that much.
That's like the end of civilisation or something.
Now in reality Canada is already at 87 level, and it will go lower.
It's going to be a buy in the low ranges, unless they do something completly crazy.
The USA are going to provide smart investors with lots of cheap buys on foreign stocks.
Most people will probably wrongly chase the bottom with the USA.