Not anytime soon, but the receding ice packs in the Canadian arctic are sure to open up vast mineral wealth to the Canadians who will be able to find massive oil, gas and mineral deposits off the islands that are being unfrozen in the northern Canadian arctic.
Up until now, it has been very expensive to drill for oil offshore northern Canada in the area formerly covered by massive ice flows. Special drill rigs which could withstand immense pressures from ice flows were required.
The consistent recession of the northern ice pack has opened up huge new offshore oil and gas resources in the Canadian arctic to exploration and development. We view this as just another reason to be bullish on Canada and the Canadian dollar.
U.S. Federal Reserve leaves rates unchanged, but Korea and Canada raised their interest rates this week…all the more reason to hold currencies other than the U.S. dollar.
OUR CLIENTS’ PORTFOLIOS
We are holding resource and foreign companies for our clients. We hold very few U.S. stocks that are not involved in resource industries.
AS WE HAVE SAID RECENTLY…A GLOBAL MARKET RALLY IS UNDERWAY
Take your pick. Most countries are enjoying a good summer rally with many new highs. Let’s start with the I’s, India and Indonesia, then Singapore, Thailand, Philippines, Hong Kong, Korea, and even Japan is flirting with multi-year highs. China has had a good rally but it is still below the highs of May and June.
How about the Americas? Canada, Brazil and Argentine are at new highs. Even the U.S. is in new high territory. Europe also has many markets hitting new highs.
Global liquidity patterns are strong. Central banks are supplying excess liquidity and someday it will all come to an unpleasant end. However, the sun is out today and we will enjoy the good financial weather and keep an eye our for rain clouds. The year has been a good one and we will want to protect our profits. We expect a good market rally through August and then we will watch for a fall correction, so we expect to take a lot of profits in mid to late August, and then recommit after the expected seasonal pullback.
As many of you may know, the last six decades the mid October to mid May period has been the best for U.S. stocks, with May and June usually weak and July-August often providing a summer rally, followed by a decline in September and early October. This pattern is not a guaranteed annual event but it sometimes works out that way.
Other parts of the world have different patterns and are driven by a much different, and currently much better, fundamental backdrop. Globally corporate profits are growing much faster than in the U.S., global economic growth is much faster than in the U.S. and so on.
We expect a continued uptrend in the better global markets punctuated with periods of correction. For the past several years, the wise approach has been to buy during these periods of correction. We plan to continue that approach.
Thanks for listening
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