Precious metals play a role as they generally move in opposite direction to the stock market.

The place for precious metals in a portfolio

Even though it’s the worst-performing asset class, gold has a purpose

Over a 210-year period, the after-inflation value of a U.S. dollar was a nickel. A dollar invested in gold became $4.52, in T-bills $281, in bonds $1,778 and in stocks $704,000, making stocks the runaway leader. (Jeremy Siegel: Stocks for the Long Run) Despite this long-term track record, gold has a place in our portfolios […] Read more

Year and decade financial review: Part 3

The best market predictions are based on probabilities calculated from past performance

The last two columns reviewed Canadian and U.S. decade-long economic and investment performance. Successful investing takes a long-term approach; understanding the underlying reasons for the macro picture is important. Let’s look more short-term. What happened last year, how did our portfolios perform, and what is likely to happen in 2020? I concluded my 2018-19 New […] Read more


Year and decade financial review: Part 2

Can Canada rise from the ashes and generate profitable returns on our investments?

My last column painted a picture of the dire state of the Canadian business and investment climate. Layering in consumer data makes the picture look downright depressing. Canadian consumers are more indebted than ever. Household debt is the highest amongst the G7, about 175 per cent of disposable income. The U.S. has gone in an […] Read more

Year and decade financial review: Part 1

Canada started the last decade strong, but wound up weaker than the U.S. Why?


2010 was a good year, but from all the gnashing of teeth, it didn’t seem that way. The world had narrowly escaped another Great Depression, only experiencing the Great Recession. The financial crisis emanated from a U.S. housing crash, quickly spreading to Europe and around the world. Canada stood strong, and by comparison, the 2008 […] Read more


Primary energy consumption by source, world.

The sky is not falling, Part 3

The best investment opportunities occur when negativity rules

World total energy consumption has been steadily rising, increasing 3.5 times in the last half-century. This is driven by the more than doubling of population, increasing economic growth and prosperity. Energy consumption temporarily declined twice in the last half century — during the 1980-82 recession and the 2007-09 Great Recession. Energy consumption and economic growth […] Read more

The Sky is not falling, Part 2

The Sky is not falling, Part 2

Free markets are best equipped to find solutions to global problems


Developed economies operate under a democratic, capitalist, free-market system. Developing countries often have socialist, autocratic, controlled-market systems — although many are becoming freer. It seems obvious to me which system is superior, yet the continuing tug on free-market economies is towards socialism, because “profit” is considered a dirty word implying that one party took advantage […] Read more


The investment world ebbs and flows with sentiment, something that holds very true when it comes to Canada’s oil and gas sector.

Investing for a positive, progressing world

Herman VanGenderen wants to assure you that the sky is not falling

Chicken Little is a famous storybook character. He (or she) had an acorn drop on his head and concluded the sky was falling. As he rushed to tell the king, he ran through the countryside yelling “the sky is falling. The sky is falling.” Along the way he collected other like-minded fowl, all yelling, “The […] Read more

Leverage and the fascinating world of stock options

While the world of stock investing is misunderstood, options are truly the great unknown

While the world of stock investing is misunderstood, this pales in comparison to misunderstanding around leverage or options. Leverage is the use of borrowed money to accelerate the purchase of a larger asset than you could purchase with cash. It is often possible to purchase real estate with as little as 10 per cent of […] Read more


U.S. average stock market returns, 1925 to 2018: U.S. stock market average returns have been 40 per cent or higher in five years. Only six of the 94 years have seen losses of 20 or more. In most years, average returns cluster between 30 per cent.

Why the odds are in favour of investing in stocks

Over the past century, the stock market has vastly outperformed “safer” forms of investing

Annual returns from the U.S. stock market have averaged 9.4 per cent since 1900. Over these 119 years, inflation has run 2.9 per cent, so long-term after inflation returns have been 6.4 per cent. Stocks exhibited significantly better real returns than bonds at 1.9 per cent, T-bills at 0.8 per cent and residential real estate […] Read more

Farming and investing in the stock market: there are many similarities

Farming and investing in the stock market: there are many similarities

Both have randomness and volatility; plus, good management doesn’t always lead to good outcomes

Stock investing and farming entail variability and random chance. Both also create opportunities for profit when randomness and volatility are understood. I introduced the “bell curve” in my last column, demonstrating how portfolios have good and bad outliers, while most stocks clustered around the mean. Does this concept apply to farming? Say you farm 11 fields of canola […] Read more