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The main cause of the stock market crash in 1973-1974 was not the rising rates, it was the oil crisis. Oil price jumped from $20 to $55.
In 1973 over the course of 6-7 months, oil jumped 4 times in price - 300%. From $3 to $12 a barrel in nominal value at the time.

So imagine if oil went from $65 today to $260 in the next 6 months, just like 1973. That could definitely hit stocks really hard. That would be real money leaving the economy to keep people's cars running, food cooked, and houses warm. You know, important stuff, not like spending your money on crypto or GME.

Capital investment is down massively in a industry that requries massive capital investment. There could easily be a shock or who knows what that could cause a spike. Watch out.
 

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Now that the US 10s have started to settle into a range, and every major publication has pushed out article after article about "inflation is coming" scaring off the crowd, I wonder if it is time to consider getting back in.
 

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In 1973 over the course of 6-7 months, oil jumped 4 times in price - 300%. From $3 to $12 a barrel in nominal value at the time.
So imagine if oil went from $65 today to $260 in the next 6 months, just like 1973. That could definitely hit stocks really hard ...
Sure ... but that would miss out on the effects of the US stopping being the top producer, coupled with OPEC stopping shipments to the US and other countries at the same time.
There were more factors in play than just price increases.

Cheers
 

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The Bank of Canada released a statement on its strategy going forward, how it's going to handle stimulus

The roadmap laid out by Macklem is consistent with what economists and markets have been anticipating -- a final taper later this year to bring net purchases of bonds to about zero, followed by a first rate hike later in 2022. Swaps trading suggests that investors are pricing in a 100 per cent chance of a hike over the next 12 months. Three hikes over the next two years are fully priced in, which would leave Canada with the highest policy rate among Group of Seven economies.
Notice what the derivative market already believes. The market is expecting several rate hikes over the next two years.

 

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The Bank of Canada released a statement on its strategy going forward, how it's going to handle stimulus



Notice what the derivative market already believes. The market is expecting several rate hikes over the next two years.
We desperately need to hike interest rates, but the politics will be risky.
With near zero rates, housing has rocketted up, even small hikes are going to tank the real estate market, and put people in dire straits.
Talking to people, many are maxxed out on variable <2% mortgages. They've very vulnerable.

Too many people are in too much debt, we're simply overleveraged, the individual person/family all the way up to the government.

I've been lucky, I didn't go crazy during COVID with renos, and didn't pile on debt.
 

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Bonds seem to be falling swiftly now, and yields are rising.

Maybe interest rates are finally going up? Not the central bank overnight rate (yet) but the rest of the yield curve seems to be moving higher.

Would be excellent, if it happens.
 

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Bonds seem to be falling swiftly now, and yields are rising.
I have been noticing this.
I actually alllllmost added to my bond component earlier this week but I have held off for now.

My bond component is 2% of my portfolio 😬
 

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These bond yields are going to start getting pretty juicy. Already the XBB yield-to-maturity is over 1.7% which is much higher than any savings account you'll find in the country.
 

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I whole 2% heh? Why bother holding such a small amount?
I have a 25+ year time horizon.

I'll add more as I age. I usually try to time my bond buying as opposed to adding regularly on a fixed or consistent basis.
 
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