Investing During A Depression
I am writing this one as a private citizen not as a mayoral candidate - I also take no responsibility for your finances; go for a walk or talk to someone, take lots of time before you do anything with your money.
Ive been spending the last while looking at real estate in the area as well as doing my solar project that I wanted to expand (now wait lists are as high as a year for big installs). I still think its one of the best deals going but make sure you do your due dilligence and factor in HST, income tax, insurance increases, etc. Most accountants I speak to always say the same thing - real estate, equity, cash and either debt, universal life or both (I will talk about debt later). A balanced approach is important but it seems like most people get stuck at the equity part and end up losing money. I will show you one thing you can do to stop losing money Monday morning and have something to talk about at cocktail parties. Most people own mutual funds which can in theory be a good thing; in practice however it has seemed to only be good for the managers. They charge 1-2% in "MER" or management fees regardless of if they made or lost money; theoretically they could lose half of your money and charge you 2% of your investment to do it. That type of gross incompetence is not my cup of tea. Many will blame the market or bad intel or "thats life" but its not life - it is sheer incompetence. I started to look at my stock list and go over the fundamentals to make sure I am not it anything too risky or anything too boring and saw things were good. Stocks havent been much better than cash lately (GICs) - I have some of those at amazing rates, but again you want a balance. GIC is taxed as income (up to 50%), Capital Gain is taxed in such a way that it usually works out being very low (A capital gain is when you buy something for 10 and sell is for 12, $2 would be your gain), the final is dividend which is when a company declares a profit and distributes it to shareholder (the best tax situation around).
So I only buy stocks that are dividend stocks unless I am gambling (my fathers view of stocks). Dividend stock are fantastic because you get very little movement in terms of the capital price and you get dividends typically at regular intervals. The two stocks I will tell you about are BNS and RY. That is Bank of Nova Scotia and Royal Bank, $48 and $52 respectively. They consistently pay their dividends on the same 4 days of the year, the amount of the dividend is predictable and usually only changes with inflation (if you look at their history). Right now Scotia is paying 49 cents a share and Royal is paying 50 cents.. I can see the better buy can you? In a real world example lets say you bought 100k worth of Royal Bank at $50; you would have 2000 shares which means you would get $1000 every 3 months which works out to 4% on your money paid in cash (or reinvested) that also does not take into account the fact that there will be movement in the stock with time just like anything else - depending on your age you may want to just reinvest half and some of you might want to take the cash and dump it into a GIC or a little business you have been dreaming of. 50 cents is really good quarterly per share.. If you look at WMT (WalMart) you will see a $50 stock with a 30 cent dividend (at least they have them). There could be a lot of upside in a WalMart or one of the other few hundred dividend stocks. BCE (Bell Canada) is another stable good one - its $30 and they have been paying out a 40 cent dividend. So your 100k would net you $5332.80 which of course would be 5.3%. There is lots of opportunity out there if one looks - my personal feeling is if you are going to invest your money do it in something you know and think will be there tomorrow and seek the dividend paying stocks only.
Things have been quiet on the campaign trail other than the normal chatte - summer is upon us and I have a feeling it is going to be pretty dry until September hits.  I will of course keep posting and hopefully getting email from all of you to answer.