In This Week’s JMRD Market Observer
A Brief Market Update
What We are Reading this Summer
NBFM Monthly Fixed Income Monitor – July/August 2017
Technology (Thematic Research): Some Thoughts on Amazon and our “Flyers”
JMRD Basket Corner
Reads of the Week
With summer approaching quickly and a few well deserved vacations to come, we hope that you will excuse our leaner-than-usual Market Observer this week. Furthermore, as it has been a heavy news and event driven start to 2017 we thought a lighter themed Market Observer would help to supplement your summer reading and maybe provide some fuel for conversation over your summer vacations.
Should you be interested in further discussion about your accounts or current market conditions, we will be available throughout the summer and will strive to meet and exceed the service you have come to expect from the JMRD Wealth management team.
A BRIEF MARKET UPDATE (As of June 22)
WHAT WE ARE READING THIS SUMMER
We received some fantastic feedback on this section last year. We hope that you enjoy it again or at least find something here that peaks your interest. We also welcome feedback on our Reads of the Summer and any suggestions for books we should be reading are always appreciated!
Shoe Dog – Phil Knight
In this candid and riveting memoir, for the first time ever, Nike founder and board chairman Phil Knight shares the inside story of the company’s early days as an intrepid start-up and its evolution into one of the world’s most iconic, game-changing, and profitable brands.
Red Notice – Bill Browder
A few of us in the office have read this book and can’t recommend it highly enough.
A New York Times bestseller, “does for investing in Russia and the former Soviet Union what Liar’s Poker did for our understanding of Salomon Brothers, Wall Street, and the mortgage-backed securities business in the 1980s. Browder’s business saga meshes well with the story of corruption and murder in Vladimir Putin’s Russia, making Red Notice an early candidate for any list of the year’s best books” (Fortune).
Barking Up the Wrong Tree: The Surprising Science Behind Why Everything You Know About Success Is (Mostly) Wrong– Eric Barker
Much of the advice we’ve been told about achievement is logical, earnest…and downright wrong. In Barking Up the Wrong Tree, Eric Barker reveals the extraordinary science behind what actually determines success and most importantly, how anyone can achieve it.
How to Make Money in Stocks – William J O’Neil
The fourth edition of a classic investing book, O’Neil discusses his CAN SLIM investing system and offers guidance for those who want to make smarter investment decisions. Based on a major study of market winners from 1880 to 2009, the book discusses proven techniques for finding winning stocks before they make big price gains, tips on picking the best stocks, mutual funds, and ETFs to maximize gains and plenty of charts to help spot profitable trends and avoid negative trends.
By Chance Alone – Max Eisen
Finalist for the 2017 RBC Taylor Prize. More than 70 years after the Nazi camps were liberated by the Allies, a new Canadian Holocaust memoir details the rural Hungarian deportations to Auschwitz-Birkenau, back-breaking slave labour in Auschwitz I, the infamous “death march” in January 1945, the painful aftermath of liberation, a journey of physical and psychological healing.
The Undoing Project – How a Nobel Prize–winning theory of the mind altered our perception of reality- Michael Lewis
Forty years ago, Israeli psychologists Daniel Kahneman and Amos Tversky wrote a series of breathtakingly original studies undoing our assumptions about the decision-making process. Their papers showed the ways in which the human mind erred, systematically, when forced to make judgments in uncertain situations. Their work created the field of behavioral economics, revolutionized Big Data studies, advanced evidence-based medicine, led to a new approach to government regulation, and made much of Michael Lewis’s own work possible. Kahneman and Tversky are more responsible than anybody for the powerful trend to mistrust human intuition and defer to algorithms.
Influence: The Psychology of Persuasion– Robert Cialdini
Influence, the classic book on persuasion, explains the psychology of why people say “yes”—and how to apply these understandings. Dr. Robert Cialdini is the seminal expert in the rapidly expanding field of influence and persuasion. His thirty-five years of rigorous, evidence-based research along with a three-year program of study on what moves people to change behavior has resulted in this highly acclaimed book.
Parenting with Presence: Practices for Raising Conscious, Confident, Caring Kids– Susan Stiffelman
Our children can be our greatest teachers. Parenting expert Susan Stiffelman writes that the very behaviors that push our buttons – refusing to cooperate or ignoring our requests – can help us build awareness and shed old patterns, allowing us to raise our children with greater ease and enjoyment. Filled with practical advice, powerful exercises, and fascinating stories from her clinical work, Parenting with Presence teaches us how to become the parents we most want to be while raising confident, caring children.
Willing Wisdom – Thomas Deans
7 Questions to ask, family, friends and charities to help guide giving-decisions. For those who already have a Will, the book helps readers confirm whether their giving decisions continue to feel right. The answers to these 7 Questions reveal whether gifts will release potential or destroy it. Only through conversation and the wisdom shared in both directions can anyone begin to know how it will be for their beneficiaries. In a busy world where conversations about life, death and wealth are often avoided, Willing Wisdom confidently guides readers in a brave new direction.
Thank You for Being Late: An Optimist’s Guide to Thriving in the Age of Accelerations – Thomas L. Friedman
A New York Times Bestseller. A field guide to the twenty-first century, written by one of its most celebrated observers. We all sense it—something big is going on. You feel it in your workplace. You feel it when you talk to your kids. You can’t miss it when you read the newspapers or watch the news. Our lives are being transformed in so many realms all at once—and it is dizzying.
In Thank You for Being Late, a work unlike anything he has attempted before, Thomas L. Friedman exposes the tectonic movements that are reshaping the world today and explains how to get the most out of them and cushion their worst impacts. You will never look at the world the same way again after you read this book: how you understand the news, the work you do, the education your kids need, the investments your employer has to make, and the moral and geopolitical choices our country has to navigate will all be refashioned by Friedman’s original analysis.
Don’t Sweat the small stuff at work– Richard Carlson
In this classic road map to managing your high-tension job, Richard Carlson shows how to stop worrying about the aspects of your work beyond your control and interact more fruitfully and joyfully with colleagues, clients, and bosses. His key insights reveal how to:
- How to manage rush deadlines with rushing
- How to transform your outlook and prepare for the day ahead
- How to enjoy corporate travel
- How to have a really bad day . . . and get over it
An Astronaut’s Guide to Life on Earth– Chris Hatfield
As Commander of the International Space Station, Chris Hadfield captivated the world with stunning photos and commentary from space. Now, in his first book, Chris offers readers extraordinary stories from his life as an astronaut, and shows how to make the impossible a reality.
Technology (Thematic Research): Some Thoughts on Amazon and our “Flyers”
A brief look at some trends underscored by Amazon bid for Whole Foods.
Friday’s blockbuster bid from Amazon to acquire Whole foods for US$13.7 billion underscored some of the underlying trends that impact our technology “high-flyers”. From a technology perspective, we see a swelling opportunity for a number of our names as we expect them to benefit from changing behaviours caused by generational shifts, consumer tastes, and IP/technology that offers a gateway for change. That’s the reason we think a number of names in our group remain compelling for investors. This note highlights two of those “flyers” in Kinaxis and Shopify and how Amazon’s big move on Friday underscores some trends driving those names.
Note: Kinaxis and Shopify are owned in JMRD’s DIG Basket.
Forex (July 2017) – FX Update
With the Bank of Canada signalling an upcoming policy change, we have brought forward by one quarter to October 2017 the timing for when we expect an increase in the overnight rate. As such, we are now even more upbeat than before about the loonie’s prospects and have accordingly lowered our near term targets for USDCAD, expecting the cross to trade in the 1.25-1.35 trading range over the next 12 months.
The US dollar seems to have peaked. True, the world’s reserve currency could temporarily move up if, as we expect the Fed raises interest rates again in September (that hike is not yet priced in by markets). But the outlook for the greenback afterwards isn’t rosy considering that absence of inflation pressures and the expected shrinkage of the Fed’s balance sheet which could reduce the need for rate hikes over the next several years. While the euro could benefit from the dollar’s woes over the coming months, the upside should be limited amidst Brexit and the European Central Bank’s loose policies. True, the ECB said interest rates will not be cut again. But the central bank made clear it stands ready to increase its QE program if inflation continues to disappoint. Recall that the ECB again downgraded its inflation forecasts for 2017 as well as for the next two years, all well below its 2% target.
Reads of the week
Monday June 26th – None
Tuesday June 27th – Consumer confidence Index (US)
Wednesday June 28th – Pending Home Sales (US)
Thursday June 29th – Average Weekly Earnings (Cad)
Friday June 30th – Real GDP (Cad)
Monday June 26th – None
Tuesday June 27th – Canopy Growth Corporation
Wednesday June 28th – General Mills Inc. (US)
Thursday June 29th – Nike Inc. (US)
Friday June 30th – None
Have a good weekend!