The year is nearing its third quarter and America is finally “Great Again”.

Supposedly the world will not survive with all the carbon floating around the world today.  So let’s tax it and scare investment away.  Afterall, jobs no longer matter.  Money is no object anywhere in the world because all you need to do is borrow it.

Thankfully, soon we will be using 100% renewable energy.  The truth is it is estimated renewable energy will be able to produce only 5.5% of the world’s electricity.  Do not tell the Greens, but renewable energy will cost more than coal, oil and natural gas.  Fortunately, all consumers will gladly pay the extra costs even though it will do little to cut green house gases.  If you do not believe us, just ask the consumer in Ontario.  They are paying North America’s highest electricity prices.  Plus, they love to send their extra energy to New York State cheaper than what it is sold for in Ontario.

The Dow Jones, NASDAQ and S&P 500 indexes are up 27% this year eventhough corporate profits are where they were in late 2015. The Dow Jones Industrial average is at an expensive 20 times earnings versus the long term average of just over 15 times.

No profits?  Not a problem!  Who needs them?  Tesla is worth more than GM even though they lose gobs of money and will not make any for years to come.  The company relies heavily on government handouts.  Ontario rewards buyers with a $14,000 rebate from the taxpayer for buying one.  Oddly enough, sales of the vehicles have collapsed in all markets that pulled the plug on government incentives for electric vehicles. The only reason the company is afloat is because they are loved by Wall Street who makes wads of cash from the numerous underwritings needed to keep Tesla afloat.  Of course, Wall Street will gladly unload these new “blue chip” shares to investors.  There is no shortage of these companies out there.

Amazon will soon take over the world once we wake up to the fact we never have to leave our couch to go shopping.  The stock is only trading at 625 times earnings.  In other words, it will take a short 625 years to return its current $1000 purchase price to the shareholder. What a bargain! 

Most preferred shares on the Toronto stock market traded at yearly highs over the past few weeks, thereby lowering the yield.  At the same time interest rates have increased pushing up the risk-free rate of return.  This has never happened in recent history.  I  guess finance theory is no longer relevant.

Ottawa, Alberta, Ontario, and B.C. are saving Canada from the evil oil & gas sectors.  It’s OK though; governments do not need the billions in tax revenue or jobs created by them.  Instead, the consumer and small business will make up the shortfalls without affecting consumption…somehow. 

Buying a home is the ultimate retirement fund they tell us.  Real estate prices just continue to increase.  Stress tests and higher interest rates will never affect the market.  Prices will continue to soar for years to come.  Wages no longer matter, so why wait for yours to increase?  Just join the largest mortgage club in Canada’s history and buy right now.

Enjoy it while it lasts. There is a huge economic correction coming. When?  It is hard to give a time line which is why we stay invested, collect those wonderful dividends, and keep a 30% cash position for future opportunities.