Matthew Lekushoff | www.matthewlekushoff.ca

MARKET UPDATE

The markets continue to float happily upward with the exception of gold. Since gold serves a number of purposes in a portfolio (from a hedge against inflation to a hedge against the world going crazy), people often invest in it during times of volatility. 

However, when markets improve, as they are now, investors often trim their gold positions to beef up securities they feel will grow faster, despite the potential risk, usually giving gold a negative correlation to most stock markets.  

FOOD FOR THOUGHT

" History cannot create laws with predictive power. An understanding of the past might help in the present insofar as it broadens our knowledge of human nature, provides us with inspiration of a warning or suggests plausible, though always fallible arguments about the likely possibilities of certain things happening under certain conditions. None of this, however, comes anywhere near the immutable predictive certainty of a scientific law."

-----  Richard Evans

CORPORATE TAXES

The Canadian government recently released some information on the upcoming corporate tax changes. Likely due to the unexpectedly vocal opposition to the ideas put forward over the past few months, the government's updated vision appears to ensure the changes won't adversely affect middle-class Canadians, but will tax wealthy Canadians more.
 
Some highlights from the proposals are:
As things can still change, until legislation is put forward and subsequently passed, it's best to not make any drastic changes to your situation.

IN THE REVIEW QUEUE

Ubiquity: Why Catastrophes Happen  by Mark Buchanan: A really interesting book on how a variety of events from earthquakes to forest fires to traffic jams, and even stock market crashes, follow similar patterns over a long period of time. Mark Buchanan proposes that these episodes organize along a "critical state," or "knife-edge" of instability. While in this state, it may only take something very small to trigger an event that can range from insignificant to much more severe.  The good news is these events follow a power law, meaning each time they double in significance, they occur exponentially less frequently. The bad news is that like many of the stock market crashes in history, it is almost impossible to predict their size or severity before they happen.
 
Entropy: Why Life Always Seems to Get More Complicated  by James Clear: Most of us never give the second law of thermodynamics a second (ok, maybe first) thought. However, it's always at work in our lives. This article does a good job (without being too science-like) of describing how. 
   
'Sleep Should be Prescribed': What Those Late Nights Out Could Be Costing You  by Rachel Cooke:  We all know sleep is important, but it's possible sleep may be way more important to our health and happiness than we ever thought. If you don't think you're getting enough sleep, do yourself a favour and read this five-minute article.
 
Bias from Incentives and Reinforcement  by Farnam Street: If you aren't thinking about the importance of incentives on a regular basis, you likely are missing out on one of the most important factors to influence human behaviour.
 
Bill Gates and Warren Buffet Interview with Charlie Rose :  A great conversation with two of the world's most successful people-----  who happen to be good friends, as well. My favourite part was Warren Buffet pulling out his calendar. I bet you can't guess what is in there.
 
Where is Global Growth Happening?  by Visual Capitalist: If you still think most of the world's future growth will come from the developed world, think again. This chart shows the expected growth in the next couple of years in absolute terms. It would be more dramatic if it measured year-over-year growth.

VACATION ALERT: HONEYMOON EDITION

As some of you already know, I'm getting married in a few days! More importantly-----  for you-----  I will also be on my honeymoon for the first three weeks of November. Come next week, we'll be  on a boat , cruising down the east side of South America to the west via Cape Horn.
Although I will be checking email, I won't be in touch as often as usual. However, Sarah will be here in case you have any need, either  by email  or phone at 416-777-7182.  
Wish us luck!   J

Matthew Lekushoff
416-777-6368
www.matthewlekushoff.ca


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