Welcome to my very first post where I do the week in review and touch upon some things you might have missed and what I’ve been up to. These days, a week can seem like an eternity with all the social, political and economic noise out there. So let’s review.
Stocks Tumble most since February!
Well folks, this week IT happened. Investors finally woke up to the challenges and risks facing the global economy. I mentioned these growing risks in my monthly update and how people should consider their risk exposure and rebalance if necessary. Personally, I was only beginning to rebalance when all hell broke loose this week.
Now I’m down about $30k but I’m not worried. These are only paper losses and I invest with a time horizon that is decades away. If you invest for the long term, my advice is to stay invested and keep putting your money to work for you. If you’ve been waiting for an attractive price on a certain stock or ETF then maybe now’s the time to look more closely at buying.
If you want to take a step back from stocks and invest in a safer alternative until stocks offer more compelling valuations, then consider parking your money in a high interest savings account at EQ Bank. Right now they’re offering a chance to win a $1,000 when you open an EQ Bank Savings Plus Account. Never heard of EQ Bank? Check out my EQ Bank Review.
I’m actually planning on adding to some of my existing positions mainly in the utility and pipeline space. These guys have been the big losers this year. I like them for their dividend income and relative safety. These stocks currently yield anywhere from 4%-7% so the income stream adds up pretty fast.
The Dow plunging 800 points on Wednesday was reminiscent of October 2008 when it would regularly plunge 500 to 1,000 points daily! At the close on Friday, the Dow and the S&P 500 were down a little over 4% and the TSX down about 3.6%. These aren’t huge losses, but they seem to have unnerved a lot of investors that are used to the “sky’s the limit” market predictions.
Of course, the big question on everyone’s mind is whether or not more losses will come next week. All of a sudden the market experts are super cautious. Keep in mind that these were the same guys telling us to buy all year long and that the market wasn’t outrageously priced; just a little expensive relative to all the historical metrics that they play around with. Will someone please tell me the difference between a market commentator and the weather forecaster?
IMF World Bank Meeting
Amid the market turmoil was the IMF meeting where world financial leaders gathered. Key takeaways from the meeting were: (1) that global growth has reached a plateau and was revised downward for the year; (2) global debt levels are a concern; (3) Trump’s trade war is killing the global economy. All of this means that the storm clouds are no longer on the horizon…the storm is here. Unless political leaders can get their sh*t together we are so screwed!
Hurricane Michael and the UN Climate Change Bombshell
On Wednesday Hurricane Michael made landfall as a category 4 in Florida. The storm caused extensive damage and was responsible for over a dozen fatalities. That same day, the UN Commission on Climate Change released their report that we have 12 years (2030) to reduce our carbon emissions or else we will face irreversible catastrophic climate change. Basically, the earth is heating up faster than anyone predicted and right now, the situation is completely out of control.
There is no political will among world leaders to really do anything about climate change. Why would there be? It’s not like they face any real domestic pressure to save the Earth. Everyone is way too busy bickering to come up with any form of consensus on solutions to solve the existential threat that is climate change.
What’s at stake in all of this? The report clearly lays out that everyone’s food and water are at risk. Fish stocks are collapsing, the oceans are dying, forests are being destroyed, crop failure will become much more widespread etc. This all means that half the planet’s population will die of starvation by 2050. Oh and the extreme heat will cause severe droughts that will greatly reduce the amount of fresh water on the planet.
Yes, we are in for a world of sh*t. But there are things that we as individuals can do to make things better. We can find ways to save more of our money to invest when the market inevitably corrects. And we can try to make smart choices to help the environment like recycling and opting for energy efficient devices, appliances and vehicles. We can lobby our political leaders to enact regulations that will reduce our carbon footprint.
My Week in Renovation Land
As usual, my week was consumed with overseeing the various projects around my house so that we can be done with our home renovations by early November. I will be publishing a post soon on our year of renovations, but for those of you who don’t know the background, we had a problem with a leaky basem*nt this year and for the past few months I’ve been gutting and fixing up our basem*nt on the inside and our foundation on the outside. This work is labour intensive and super expensive but in the end we hope to have one kick ass basem*nt!
We finished the exterior waterproofing, sump pump installation and basem*nt electrical this week. Now my yard is a muddy mess. I have to install a freeze guard for our sump pump discharge line and dig a trench to extend it about 25 feet. Then landscapers can grade and sod around our house. I also have to fix some hole in the basem*nt ceiling where we ran new electrical.
I’m finally starting to see the light at the end of the tunnel though. Monday the electrical inspection happens and Tuesday the contractors will come to frame out and repair a wall before painting the basem*nt. I already painted the ceiling and trim and primed most of the walls so I’ll be finishing that stuff up this week.
With any luck this construction and painting should be wrapped up the following week and I can get started on installing the sub floor and painting the basem*nt bedroom/office. Once that stuff is done the carpet and baseboard go down and we are all done!
Thanks for reading and I’ll be back with another update next week. Please note this post contains affiliate links. As an affiliate of EQ Bank, this blog receives a small commission for each signup.
