Global Thinking

US equities have taken center stage over the last few years and are touching all-time highs as consumers continue to show strength with healthy balance sheets and less sensitivity to higher interest rates. But is all this good news already priced in?   What may be surprising is that returns are no longer being powered primarily by the “Magnificent 7”. Instead, forgotten and unloved sectors are now witnessing a steady bid.   In this episode Rob sits with BMO’s Chief Investment Officer, Sadiq Adatia, to talk about their recent market outlook and why they believe a broadening market rally is in the cards for 2024. While high quality and financials in the US are in focus, gold and commodity-oriented equities could see a continuation of strength.   Global Thinking Podcast Forstrong Insights Ask Forstrong: A Broadening Bull Market? Forstrong Dashboard: Breaking Breadth Forstrong 5 Minute Macro: A Broadening Bull Market? Forstrong Rebalance Summary: Q2 2024 Invest in Forstrong ETFs

One year ago, market forecasters were in absolute agreement. A Bloomberg consensus survey showed that 100% of the respondents predicted a global recession in 2023.  Rising interest rates would surely create an inevitable “hard landing”. When such agreement exists in the investment world one must ask the obvious question, “What don’t we already know?”.     Since then, fears over hard landings have vanished as the powerful surge in US-led growth has thinned out the recession camp. But less discussed is that economic activity outside America has also firmed, led by a liftoff in global trade.   Does this mean that the bull market in US stocks will also start broadening out? We think so. In fact, investor optimism has created bull markets from New York to Tokyo.  Japan, France, Canada, Switzerland, Germany, Taiwan, Netherlands, Denmark, Italy, Brazil, and India are in or near bull market territory touching highs last seen in the Post Covid rally.   So, what don’t we already know?   As the Magnificent 7 continue to grab headlines and push prices and valuations to historical highs, opportunities for a follow through trade are all around us. In this episode Rob and Tyler discuss why a broadening rally is so important and how best to position portfolios to profit from this emerging macro trend.

On this episode Rob sits down with our good friend Rodrigo Gordillo from Resolve Asset Management. Rodrigo has a fascinating background and shares how hyperinflation in 1980s Peru shaped his life and investment philosophy. He also discusses why emerging markets have been more proactive in combating inflation over the last few years, and why inflation volatility will be higher this decade than the last. For more information on our podcasts please visit: https://forstrong.com/podcast/  Bitcoin ETFs: Crypto Moves Further Into The Mainstream Forstrong Global Insights    

Welcome back to all our listeners. This is now Season 4 of the Forstrong Global Thinking podcast and there is no shortage of topics to dive into. In this episode Rob sits down with Tyler Mordy, CEO and CIO, to discuss which macro trends are shaping the investment landscape.  Looking back, last year was one of heightened risk aversion: some $1.3 trillion dollars ran into global money market funds. Meanwhile, our investment team has a thesis that may stretch minds: we are entering a new risk-taking cycle based on an entirely different set of macroeconomic conditions and investment leadership. As 2024 progresses, Forstrong forecasts recession fears will again recede, and aggressive rate cut expectations will be unwound.  Tune-in to hear why shifts away from cash will lead to a big rotation into the cheap, cyclically sensitive and inflation hedging assets. Click HERE if you would like to subscribe to our weekly emails.  Forstrong Super Trends - Macronova Ask Forstrong - Inflation: Mission Accomplished  

It has been four long years since Forstrong last visited mainland China. In that time, the country faced a real estate collapse, technology crackdowns and more than 1100 days of brutal lockdowns. Given the size and scale of China’s influence on the global economy, their reopening is something that smart investors need to monitor.   After a month on the mainland Shibo Gu, Forstrong’s Research Analyst, sits down with Rob to talk about his firsthand experiences and Forstrong outlook on the awakening of the world’s second largest economy. Additionally, they discuss whether the recent Alibaba spinoffs are a positive for the sector and which emerging countries are best positioned to benefit from the reopening.    Ask Forstrong: Postcard from China, Part 1 www.forstrong.com  

Cette semaine, nous avons un invité très spécial pour notre podcast "Global Thinking". Omar Rayes de Forstrong s'assoit une deuxième fois avec l'Honorable Clément Gignac.   Clément a eu une longue et brillante carrière dans les secteurs public et privé. Sur la scène internationale, il a présidé en 2012 le Conseil de l'agenda mondial sur la compétitivité (division du Forum économique mondial). Il est également membre associé de la Conference of Business Economists, un groupe d'éminents économistes mondiaux basé à Washington, D.C. Il est maintenant membre du Sénat du Canada.   De 2012 jusqu'à sa récente nomination à titre de sénateur indépendant, M. Gignac a occupé le poste d'économiste en chef chez iA Groupe financier. Il était le porte-parole du Groupe sur les questions économiques et présidait le Comité d'Allocation d'Actifs. Avant de se joindre à iA Groupe financier, M. Gignac a travaillé comme économiste et stratège pour de grandes institutions financières, notamment comme économiste en chef pour la Financière Banque Nationale de 2000 à 2008.   Clément est également un ami de longue date de la firme et a travaillé en étroite collaboration avec notre équipe de gestion de placements dans le passé.   Dans cette vidéo, Omar et Clément discutent de la récente hausse des taux de la FED, de l'effondrement de la banque SVB et des principaux facteurs macroéconomiques, notamment l'inflation et la perspective d'une récession.

This week we have a very special guest for our “Global Thinking” Podcast. Forstrong’s Omar Rayes sits down for a second time with the honorable Clément Gignac.   Clément has had a long and distinguished career in both the public and private sectors. On the international scene, he chaired in 2012 the Global agenda council on competitiveness (a division of the World Economic Forum). He is also an associate member of the Conference of Business Economists, a group of distinguished global economists based in Washington, D.C. He now serves as a member of the Senate of Canada.   From 2012 until his recent nomination as an independent Senator, Mr. Gignac held the position of Chief Economist at iA Financial Group. He was the Group’s spokesperson on economic matters and chaired the Asset Allocation Committee. Prior to joining iA Financial Group, Mr. Gignac worked as an economist and strategist for major financial institutions, including as Chief Economist for National Bank Financial from 2000 to 2008.   Clément is also a long-time friend of the firm and has worked closely with our investment management team in the past.   In this video, Omar and Clément discuss the recent FED rate hike, the collapse of SVB Bank, and key macroeconomic factors including inflation and the prospect for a recession.

Silicon Valley’s scrappy attitude of “move fast and break things” not only became standard start-up advice over the last decade, but quickly evolved into a global movement for the technology sector.  Yet, a rich irony has emerged. It turns out that customers can also move fast and break things. Last Thursday, depositors at Silicon Valley Bank (SVB) pulled $42 billion and, in a matter of hours on Friday, became the second largest bank failure in US history. Tune into Forstrong’s latest podcast, where Rob Duncan sits down with Tyler Mordy to discuss the investment implications of these developments, including the following views: Forstrong’s continuing negative outlook on the technology sector (Super Trend 3: Silicon Valley’s Hangover). Reasons why a wider financial contagion, similar to 2008, is unlikely.  Why international assets will benefit from broken structural trendlines.

It has been a long string of surprises over the last year. The Fed was surprised inflation wasn’t transitory. Investors were surprised to see the fastest rate hikes since the 1980s. Economists are now surprised we aren’t in a recession.   Yet, in our view, the biggest surprise continues to be the resilience of the global economy – despite higher interest rates, economic growth has continued to chug along.   Where to from here? Our investment team continues to believe that this is a very different environment from the 2010s, when the market consistently over-estimated growth and inflation. The 2020s will be exactly the opposite: markets will now consistently underestimate growth and inflation.   In this episode Rob Duncan sits down with Forstrong CIO, Tyler Mordy, to discuss economic resiliency, opportunities in commodity exporting Emerging Markets and the growth boom now starting to unfold in Asia-Pacific.  

As it was in 2022, financial markets had their own Kafkaesque backdrop. Investors did not need to stretch their imaginations: reality did it for them. Supposedly rare events appeared more frequently than ever. All of this has forged an easy fraternity for those predicting more macro doom. Global pessimism is now higher than ever. Understandably, the pull of this narrative is powerful. Because the most recent threats to civilization were a pandemic and then an unforeseen war, we expect the next one to take the same existential form. But should we? Looking ahead, it should be clear that the last few years have marked a definitive end to the age of economic placidity of the 2010s — a metamorphosis of the macroenvironment. In fact, today’s conditions are barely recognizable from the “new normal” features of sluggish growth and low inflation that dominated the last decade. To be sure, the coming metamorphosis will be uncomfortable at times. Different conditions will take some adjusting.  Yet many macro trends are spring-loaded to last for years. New bull markets are quietly beginning. More than ever, investors need to look out further and lean into long-term secular themes. Wide-angle global perspectives will be crucial to discern the path ahead and set the right investment roadmap.

It is now abundantly clear that last year was a hinge moment in history. The world of tomorrow will resemble nothing of what we see today. “All life is a process of breaking down, but the blows that do the dramatic side of the work…don’t show their effect all at once.” Great American author F. Scott Fitzgerald once wrote in an essay for Esquire. The writer was referring to his personal challenges during the mid-1930s. But the observation could have applied to the global economy moving into 2022: we are only getting early glimpses of how transformational the pandemic has been. Full impacts are still to be seen. In this Part 1 episode Rob sit's down with Tyler to review, and grade the team, on our 2022 Super Trends which were published in December of 2021. Tune in to hear how our views played out during a transformative year and which trends continue to unfold in our Part 2 episode.  Links are below to read the entire article, don't forget to subscribe to Global Thinking podcast and emails.  Forstrong Super Trends 2022: World in Transition A Pandemic Reboot  A Clunk Transition to a Lower Carbon Future China No Longer a Deflationary Force Upon the World Canada: Stuck in the Middle Breaking Up Big Tech Policy Makers Fighting the Last War Global Inflation: The Force Has Awakened A special thank you to our partners and clients for joining us on this journey. It is a distinct privilege to steward your financial futures.

In this summer edition of the Global Thinking Podcast, Rob Duncan sits down with Forstrong's CEO and CIO, Tyler Mordy, to discuss the most topical macro issues moving markets today.  -Is the global economy in a recession or headed for one -Has inflation peaked or will it be more persistent -Why every bear market leads to a change in leadership -What are the investment implications To read more or subscribe to Forstrong's Global Insights, please visit Forstrong Global Thinking Insights. 

For those who have been hiding under a rock the last 6 months, global markets are in uncharted territory. In the face of slowing economic growth and surging inflation, central banks are increasing interest rates at levels not seen in over 30 years. How have markets responded? Global equity and bond markets have plunged deep into negative double-digit territory, an outcome not seen in over 70 years of recorded history. So where to from here? As the sugar high from a surging tech boom fades and interest rates begin to normalize, opportunities are emerging globally.  Consumption is still growing. The labour market remains robust. Capital Expenditure is positive. And yields are becoming attractive.   In this episode Rob sits down with the founder of Shaunessy Investment Counsel, and newest member of Forstrong, Terry Shaunessy, to talk about our recent partnership, his history on Bay St., and how ETFs and active asset allocation have helped his clients navigate volatile markets for over 20 years.

It is no surprise the last few months have been jarring for financial markets. The Fed, initially believing price spikes were short-term, were caught in an almost cartoon-like backpedal as inflation instead accelerated to a 40-year high. Now markets are on edge the Fed will tighten too much and short-circuit the economy. Forstrong's Tyler Mordy explains why he expects inflation to moderate and how global risk appetite will continue. 

The world has been transfixed by a strange spectacle: a scarcity of nearly everything. It has been a cinematic experience complete with congested shipping lanes, gas shortages and rationed microchips. This kind of drama is entirely unfamiliar a decade after the global financial crisis's chronic oversupply. Now, the gluts of the 2010s are giving way to a far different world. Welcome to the new shortage economy. Rob sits down with Forstrong's CIO, Tyler Mordy, to talk investment implications and why this could be a barn burner. 

Global stock markets maintain double digit gains year-to-date, but as the recent selloff deepens market pundits continue to point fingers and provide reasons why this is the end. In this podcast we sit down with Forstrong PM, David Kletz, to discuss Evergrande's impact on markets and our recent portfolio rebalance. Not surprisingly, we see the macro environment remaining supportive into year-end. 

Viewing the globe, we note a very unusual situation — most likely attributable to the post-Covid rebound. For the first time on record, developed nations have been growing faster than global GDP growth. And global growth is currently faster than that of emerging countries. This must resolve itself in one way or another. What will be the likely outcome? Rob Duncan speaks with Forstrong Portfolio Manager, David Kletz, to discuss their recent rebalance and whether or not the reflationary trade still has room to run. 

What happens when the world is cooped up — in some cases against its will — for more than a year? We are now getting answers to this global experiment. To no one’s surprise, it turns out many are increasingly unwilling to delay gratification which has sent inflation soaring all around the world. Rob Duncan sits down with Forstrong's CIO, Tyler Mordy, to discuss how the pandemic is creating an inflationary regime shift with lasting impacts few can predict. 

Has crypto-mania gone too far? Naysayers have an almost unlimited arsenal of reasons why this bubble will pop and leave investors in a wake of devastation. Citing everything from security issues to regulation, environmental impact to the explosion of offerings, these things should come with a warning label. In a recent Ask Forstrong, The Cryptocurrency Bug: Catch Me if You Can, our CIO, Tyler Mordy, hammers home these warnings with cold hard facts. Cryptocurrencies are highly volatile. Investors have lost billions in fraud and theft. There are now 4000 currency offerings claiming to be the future. And, last but not least, government regulation is cracking down to thwart tax-evaders and black market participants. Warning label firmly attached. Yet many investors still have burning questions. Will cryptos impact my life and should I care about them? This is a much harder question to answer. To tackle this question Rob Duncan sits down with Reza Samahin, Portfolio Manager and Professional Engineer, to provide insights into blockchain protocol, currency mining, differences between Bitcoin and Ethereum, smart contracts and decentralized finance. We made the pivot from cryptocurrencies as the future of fiat to providing a future benefit and financial utility. It wasn’t easy and it took 40 minutes, but if you want to impress your friends on your next Zoom call then click the link.

Social media platforms take center stage as rWallStreetBets channels it's Reddit commentary to prop up stocks impacted by the pandemic and targeted by hedge fund short-sellers. In this podcast Rob Duncan sits down with Forstrong's CEO & CIO, Tyler Mordy, to discuss this incredible phenomenon and how situations like this have played out in the past. While it received incredible headlines, investors should focus on what is really driving portfolio returns.