Matthew Lekushoff |


December has been another good month for global markets with most indices trading positively.

Two of this year's laggards, Emerging Markets (EMs) and Canadian energy stocks, have particularly come to life in the last few weeks. Emerging markets are up about four per cent on the month, while Canadian energy stocks are up an impressive nine per cent. The two still lag behind other markets, but, as EMs are closing the gap, Canadian energy stocks have just crossed into positive territory for the year.

Their rally is not random. Both were hurt by the U.S.-China trade war, which has finally seen some meaningful progress. The countries have agreed on the first phase of a deal, which expects to see the U.S. rolling back some levies on Chinese products, and China increasing its purchases of U.S. agricultural products. It's important to remember that nothing is signed yet, but this positive sign has seen the markets respond in kind.

Aside from the U.S.-China trade deal, the Canadian energy sector has benefitted from some other good news. As I've mentioned in the past, the oil patch has been challenged by Canada's limited pipeline capacity. On December 1, Enbridge's Line 3 opened its Canadian section - expected to increase capacity by almost 200,000 barrels per day. When the U.S. side opens, hopefully in the next 12 months, capacity should double to a total of about 4000,000 barrels per day.

Lastly, one of the results of the recent Canadian election has been a federal government with a newfound desire to move forward with the Trans-Mountain pipeline. Along with higher oil prices, all of these developments have given investors renewed interest in Canadian energy stocks. For perspective, the sector's index is still about 50 per cent lower than it was a decade ago. But, with continued positive developments, there is reason to be excited about this sector again!


There is an old saying in marketing: "Only half of advertising works, we just don't know which half that is." I think, to a degree, this also applies to the things we believe.  For this reason, I'm always looking to update my beliefs. My  latest blog post  covers a few things I've recently changed my mind about.


Unbroken  by Laura Hillenbrand:  One of the marks of a good book is if it can change the way you think.  Unbroken did that for me. It's a testament to one man's (Louis Zamperini) strength of character and ability to endure the unendurable. Since finishing Unbroken, my mind turns to Zamperini when faced with even the slightest challenge. Unbroken is difficult to read in parts, but I couldn't put it down! Unless you are squeamish, I highly recommend this book!
Elephant Song by Wilbur Smith: I've gifted more of Wilbur Smith's books than any other. He used to be my favourite author. Yet, although I've had at least 10 of his books on my shelf, it's been almost a decade since I last read one. 

I recently took Elephant Song, written in 1991, off the shelf because I've become interested in elephants and their social structures (yes, I should get out more). Smith is known for his research, so I thought fiction would be an engaging way to learn about these modern mastodons. Unfortunately, Elephant Song contained little about elephants. However, I did learn about African politics in the '80s and '90s, the continent' tribal strife, colonialism's residual effects, and the harm corporations have done to the continent.
Elephant Song is a gripping book that offers a great way to learn about Africa and get wrapped up in a compelling story.


Military Spending by Our World in Data: Ever wonder which countries spend the most on the military? Wonder no longer. But before you do, take a guess at the top five. I was surprised number three was even in the Top Ten.

The Bus Ticket Theory of Genius by Paul Graham: "If I had to put the recipe for genius into one sentence, that might be it: to have a disinterested obsession with something that matters. Aren't I forgetting about the other two ingredients? Less than you might think. An obsessive interest in a topic is both a proxy for ability and a substitute for determination. Unless you have sufficient mathematical aptitude, you won't find series interesting. And when you're obsessively interested in something, you don't need as much determination: you don't need to push yourself as hard when curiosity is pulling you."
Common Plots of Economic History by Morgan Housel: Once again, Morgan Housel does a great job of distilling huge swaths of information into a handful of common trends and plots. This time the topic is the history of economics. As most everything he writes, you'll want to read this!

Exercise as a Treatment for Depression by Dr. Rhonda Patrick: Given how many people struggle with their mental health, I believe it's important to openly share credible information on the topic. With that in mind, this short article and accompanying video offers some of the latest research on exercise and depression. I've followed Dr. Rhonda Patrick for a number of years. She has a well-earned reputation of being a passionate and gifted researcher. If improving your diet, exercise, or mental health interests you, her website Found My Fitness is quite good.

You Are Not Your Anxiety: A Journey Into the Anxious Brain (Part 1) by Lawrence Yeo: An interesting essay on anxiety, how it works, and where it comes from.


As many of you know, I post regularly on social media. This quote I recently posted on Twitter received more attention than usual.  If social media is your preferred way of keeping track of things, you can follow me on Twitter, LinkedIn, and Facebook. And coming in 2020, Instagram.


"The best way to keep a prisoner from escaping is to make sure he never knows he's in prison." - Fyodor Dostoevsky


As  if the holiday season couldn't have gotten any better, the Buffalo Bills clinched a play-off berth last weekend. 

At just the second time this has happened in the last 20 years, I'm sure, like me, you were all at the edge of your seats during Sunday's game...


This newsletter has become a labour of love. I can only hope you've enjoyed reading it half as much as I have in creating it. I'd like to thank everyone who has reached out to mention how much they enjoy reading it, and to those that have offered suggestions and opinions to improve it.
Most of all, I'd like to thank all of my clients. Your trust and support mean more than you realize, and I'm forever grateful for it!
We will return to our regular newsletter schedule in January, with the next newsletter going out on Thursday, January 30.
Happy Holidays! Here's to 2020 being an even better year!

Matthew Lekushoff

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