The market has it all these days. Not much good except the hint of leadership in Biotech and the ability to finally rally.
The other good news is internet growth. Fred Wilson has posted some of the global internet growth numbers in this post .
Fred’s takeaway…
When we went out to raise a second fund at the start of this year, we told our investors that the Internet was getting more global, more mobile, more social, more intelligent, and more playful.
Of course, that’s already happening because North America is only 20% of the global internet audience but it attracts well over 80% of the investment capital. And that will change. It already is.
The world is truly shrinking and the opportunities are now everywhere. I was in Bracebridge, Muskoka for the last week. It’s a very quiet summer town that I spent my first 20 plus summers eating candy bars and pizza slices. It now has some of the best sushi I have ever had. You can get what you want when you want in the world we now live in.
The BAD is something we are now paying for and sit in which is the excesses of credit and spending and global growth.
My takeaway is that we still need patience as the process heads toward the consumer. This morning Costco missed it’s numbers and I expect many more retailers to feel the pinch brought on not only by higher costs, but by a more nervous, tight consumer.
I like this quote from Todd Harrison:
Capital preservation, debt reduction and financial literacy remain our staunchest allies as we wade through one of the most interesting economic junctures in American history.
Also – keep these tidbits in the back of your mind while you decide if we are closer to a bottom or a top…
As you all know, I am very long Canada and have spent the summer getting a better feel for the landscape. I think that Toronto is the most undervalued (real estate) of the big, global cities and that combined with Fred’s thoughts above and having RIMM so close to town and the Canadian Dollar so close to par, that the Canadian web scene will thrive for the forseeable future.
One industry that Canada is about to lose other than all things auto related, is the hollywood north label. The weak Canadian dollar WAS a boon for US Hollywood as they saved 30-40 percent coming to shoot and produce up in Canada. Poof!
It’s never perfect out there.
If you want to get up to speed quickly on all things Canada and the web, read Jevon’s blog ‘StartupNorth.CA ‘. He also has created an index for the companies and the fundings.
Ok. Go to work. I am picking up my kids from camp and have to believe days like this are the biggest days of the year for McDonaldd’s.
Billions, likely trillions of profits are being made and lost.
You can slap all the fundamental and technical analysis on this trend that you want, but it’s quite simple. If you print ANYTHING non-stop, it loses value. Dollars, Lithographs, Rocky movies…
Back just in July I tried to exchange a Canadian $20 to get uptown to a meeting. No dice. Today that dollar is worth 2 cents more than a US Dollar, which is a gigantic 7 percent move in the exchange. Here is the Canadian/US dollar chart and ETF (symbol-FXC).
Here’s the drama as it unfolded:
That raspberry salesman made out like a seasoned currency trader .
You would think I was peddling Greek ‘Drachma’s’ on the streets of New York last week. My Canadian $20 bill was poison as I tried to survive for a few hours.
I have played the trade with gold and oil stocks and keeping money in Canada. Readers have suggested FXC, an ETF that mimics the currencies. All have been profitable. All should continue their trend.
‘WINflation’ is my new term for making money off inflation.
All the smart people talk about it. They have no idea. BUT YOU DO. You spend money.You read.
You know this war we are waging in the middle east will not stop.
I am long the stock market because my WINflation play is that the market goes up during inflationary times. Most assets do. It won’t end well, as I have warned many times, but this blog is not about timing for the most part. Especially as something as big as the top.
Precious Metals is another one of my FAVE WINflation plays because the biggest area of true inflation is our monetary policy. We must pay and continue to pay for our ‘protection’ and aggression in the Middle East.
Hard assets are the best ‘WINflation’ play
Before this cycle of monetary inflation runs it ’s course, the Canadian Dollar should be well over par, oil prices should be much higher and Precious Metals should rally further.
Lately, my gold and silver stocks have been rallying. SLW, MDG, PAAS, IVN, GOLD to name a few.
I am starting to add again. I think they are leading a metal move and will be adding the metals themselves. I have been investing in Toronto, my hometown in Canada, for the past three years and that has been the right thing. I am doing more of that over the summer. I own a bunch of oil stocks as well.
I should have been doing all of this with just Canadian dollars, but alas, I am not that smart.
Canadians are like ‘Deers in the Headlights’ at the moment. They can’t imagine their dollar just 6 cents from par. They have massive US dollars that won’t come home, until the END of this trend, the acceleration phase.
They don’t get WINflation though and that trends go much longer than you think. Barring a real change in US Monetary Poilcy, the Canadian Dollar will zoom past par in the years ahead. Of course that will hurt large Canadian businesses, but thousands of small businesses will erupt as talent that never wanted to be paid in Canadian Dollars will flock for a strong currency and good quality of life just north of the border (despite the shitty UNIVERSAL HEALTH CARE ).
The Canadian start-ups will be funded in part by all the oil money, real estate money, water money, bank money and RIMM money being made. You Watch.
Not sure, but I am bullish on the Canadian Dollar. No one in Canada believes in their own dollar. Inferiority complex I guess. I see things differently as a transplanted Canadian.
Before the Candian dollar run is over, it should shoot well past what anyone believes is possible and I think past par and past $1.10 U.S.
Safest way to play that trade would be to open a canadian cash account at a bank and just leave it. Canadian denominated gold and oil equity positions are a more aggressive play.
I can’t fix the weather although Al Gore would tell you there will be no winters here soon – but a more backwards currency and third world airport in Toronto need changing.
I have been here a week and am toting around 5 pounds of Loonies and Toonies. This is an old story, but it is an assanine, taxing, arrogant policy – what gives? It is like 15th century Europe. All my suit pockets are permanently stretched from the coins. Larry David should do a show about this already. Coins are a huge tax on wealth due to loss and just general neglect.
Pearon Airport – For all the years I have landed at Toronto’s airport, I have never felt welcome. It could be Russia for all anyone knows. Long walks, dim lighting, a dungeon for customs and insane rules by the grounds crews leave an awful first impression. Bags are not unloaded from airplanes during rain! This is a city that likely has 100 days of rain!
On a bigger issue of currency, why not do away with coins on a global basis and round up or down to the nearest dollar, pound, euro. Save billions in printing and taxes which would offset and extra costs born by the consumers. Just get it done already!
Posted on July 3rd, 2006 | Category: Canada, Complaints | Comments Off
(Hat Tip – Soren).
