April 24th, 2018
When emotions win over common sense!
All financial indicators are green and yet the Dow Jones lost 5.15% in the last month? In the United States, economic growth indices show a very strong economy. In the last 4 months of 2017, growth was 2.5%, an exceptional rate. In Canada, Minister Morneau is reassuring that everything is fantastic. Minister Leitao’s budget points in the same direction with respect to Quebec.

So what’s going on?
Logic does not necessarily guide the short-term behavior of stock market indices. Emotions often dictates the short-term behavior of investors.

Here are some recent examples

1. Facebook and Cambridge Analytica
Nobody can say that this usage, to say the least doubtful, may have affected the vote for Brexit in England or the Trump election in the United States. We are still in the realm of high speculation. However, this has led to both the fall in the share price of Facebook and the Dow Jones index. Emotions has prevailed over logic.

2. Mr. Trump’s 1001 Tweets that play on people’s emotions.
• The imposition of duties on Canadian aluminum (which will not occur),
• Those on the trade war with China,
• The war of nerves with North Korea,
• The expulsion of Russian diplomats,
• Attacks on Amazon and Intel,
• The Stormy Daniels case.

In the short term, these Tweets negatively influence the behavior of investors who are afraid and cash their winnings.

Our strategy
We have defined with you, a unique long term strategy based on your situation and your needs throughout your life. We have articulated it around reliable economic indicators. We strongly encourage you, as I will do, to stay the course and not succumb to the emotions caused by situations that have no long-term impact. Whether Facebook or the Trumpitudes.

Last minute new Tweet: attacks on Syria.

Mauro Di Cesare,  Fin.Pl.