Apr 212013

Hope everyone is having a great weekend. Let’s look at some business and economic news we should care about.

Snail Mail Slowing Down – Canada Post made $127M in profit last year but the amount of shipments have been declining. I hope they can find new ways to make money. This company employs about 71,000 workers in Canada and is a big driver in our economy.

Low Growth – The IMF (International Monetary Fund) has downgraded Canada’s growth prospects to just 1.5% for 2013. This is great news for Canadians with debt because it probably means our interest rates will stay low for the time being. How can we take advantage of this? Well personally I plan to borrow more money to invest in assets that will directly benefit from faster growing developing countries. The IMF says that global growth on average is expected to be 3.3% this year 😀 So if we’re doing worse than the average, then there must be other countries that are doing better 🙂 My strategy is to leverage borrowed money from a place of low growth to invest in high growth environments 😉 

Losing its Glitter – Gold fell in price dramatically lately. I’m not too worried even though I’m invested in gold. China and India are huge customers of gold. China’s economy is still growing north of 5% a year so eventually precious metals should recover which means now might be a good time to start buying some gold if one doesn’t yet have any.

Blog roundup – Personal finance and other interesting articles from around the web
Being frugal has an article on suggestions for lending money people close to you
Add Vodka warns that over deprivation can actually backfire
Agent Fang shares a frugal way to prepare some delicious home made chicken karaage
Dividend Ninja takes us through a couple of resource stocks he just bought.
Girl meets Debt discusses what she likes and dislikes about blogging as a PF blogger
Modest Money has a post on what you should if you’re traveling and run into problems with a rental car

Liquid Updates – What’s new with me

Bought some cool entertainment recently. Thought I’d share in case anyone was curious to know what I do in my spare time.


I also recently made a major purchase. It costed me over $2,000. Since I didn’t have any savings or an emergency fund I used my line of credit to pay for it haha. I’ll blog about my new awesome purchase this upcoming week, but here’s a hint; vampires are allergic to it 🙂

I think I may have a spending problem. I keep buying stuff I don’t even need. As if going into $2,000 of debt wasn’t bad enough I also found myself purchasing something else last week. Except this one costs WAY MORE. It’s so expensive it makes $2,000 look like a rounding error. If you follow me on the twitter, you may have seen this. 13_04_twitterland

More details to come later. It will probably mean going into more debt for me to finance the purchase. But I’m okay with that since using other people’s money was how I made 12.5% on my farmland investment last year. Some might say going into debt can restrict your freedom. But I think it can also create the foundation for wealth and financial freedom. Debt is a tool. It just depends on what we use it for 🙂

Mar 302013

Happy Easter folks 😀 It’s one of my favorite holidays because every year my boss would hide Easter eggs around the office for everyone else to find. I found 2 this year :0)

Cost of Education
13_03_tuitionSo many of my friends both in real life and on the internet are either having, or talking about having children. I don’t see myself having kids for at least another 5 to 10 years, if at all, lol. But a big factor in making big life decisions is money. According to a new study by the Canadian bank BMO, kids born in 2013 could pay $140,000, which includes tuition, food, and housing costs for a 4 year university degree. While inflation was only 1.3% in 2012, tuition fees increased 4.3%. I work part time at a local college and just got a 4% raise last year. So now I know where that extra money came from (^_-) Now I’m torn. I don’t want education to be so expensive, but at the same time I don’t mind getting raises. In any case, to make the best out of the situation I’ve been saving all my raises from my school job and putting them into an educational fund for my possible future children 😀

Back in the Black (Berry)
ht_blackberry_z10_q10__ll_130130_wgBlackberry, which used to be called Research in Motion, made a small 94 million profit on $2.7 billion in sales in their recent quarter. Not bad considering they were losing money last year. Their new z10 phones are doing better than expected. I’m waiting to see how the Q10 will
be received by consumers later this year because that’s the one with the physical qwerty keyboard 🙂 I bought some Blackberry stocks last year around $25/share. Needless to say the company has not done well since then trading at just $15/share now, but maybe they could make a come back. Putting all my eggs in one basket is risky, so that’s why I have Apple and Google stocks as well, the other players in the smartphone market 😀

Blog roundup – Personal finance and other interesting articles from around the web
Myfijourney evaluates Microsoft stock. I’ve been looking at buying some MSFT too
Lifeandmyfinances describes what Savings Bonds are


Mar 082013
Happy International Women’s Day

13_03_friendsbenefits, celebrate women's dayToday is March 8th so let’s celebrate women’s economic and social achievements. I watched an 11min interview featuring a couple of representatives from TD Bank. Ms. Caranci is an economist and Ms. Caskey is a portfolio manager. They mentioned that studies from Credit Suisse and other notable institutions show that corporations with more female board members outperform those that have less. For example looking at the S&P/TSX Composite index over the last year companies with at least one woman on the board have seen a 7.2% return on average, while the overall index returned just 4% 😀 Makes sense to me. Women represent half the consumer market place. So if I was running a company I would certainly want to have a woman’s perspective when it comes to making strategic business decisions. It’s too bad that only 11% of board members of companies on the TSX Composite are female. In the interview, Ms. Caranci says this is partly because of the composition of our industries. For example, half the stock market index is made up of resource companies and they “only have 6 to 7 percent representation of women, so they’re really pulling down those numbers.” So what can corporate Canada do to get more women represented on company boards? There are a few ideas floating around. For instance some European countries have strict quotas for their companies. In Norway publicly traded companies must have at least 40% female representation on the board, or else the company faces penalties or sanctions, such as being de-listed from the stock exchange 🙁 I don’t think Canada should necessarily adopt those kinds of laws because some argue mandatory quotas does more harm than good for women in the workplace, but I’m sure we can figure something out.

So how can the average investor use this information? Well since the research has suggested that a board of directions with a diverse background of both men and women tend to outperform the benchmark, we should consider this information when researching which stocks to buy. Thankfully, Ms. Caskey gave us a list of some notable companies that have a relatively high female representation on the board or executive team. I’ve listed a few below. Stock symbols are in (brackets) 😉

Potash Corp (POT) – 23% female board
EnCana (ECA) – 30% female board
Lululemon (LLL) – 45% female board

I currently have POT and ECA in my long term buy and hold portfolio. LLL is a very interesting company that started in Vancouver and has expanded very successfully into other countries. The brand was even featured on Oprah, lol. I’m a little concerned about the stock’s valuation because I don’t know how long it’ll continue to grow at its current rate. So this athletic apparel company is only on my watch list for now (^_^) Side note: LLL is not included in the TSX Composite index.

13_03_lululemonbrand, women's day

February Employment

How about some good news to end the work week 😀 Canada created 51,000 new jobs last month, and most of them are full-time work. The overall unemployment rate remains unchanged at 7.0 from the month prior, however this means more people are in the workforce which is a good thing. ON and BC made up most of the gains, with 35,000 and nearly 20,000 new jobs respectively. In the United States about 236,000 new jobs were created in February and unemployment edged down to 7.7% which gave investors the confidence to push the Dow Jones Industrial Average up by almost half a percent today to end the week at $14,397, yet another record high 😀

Blog roundup – Personal finance and other interesting articles from around the web
Passive Income Earner explains the difference between Bonds and Preferred Shares
Mrs. Pop from Planting our Pennies shares their up to date balance sheet (net worth) They have a ton of assets
Mr. CBB from Canadian Budget Binder has some pretty impressive numbers for his family as well.
Laurie from Frugal Farmer encourages anyone who might be struggling with their finances to take back control
Money After Graduation on the value of a concert ticket
Pauline from Reach Financial Independence on realizing not everyone has to have the same goals because we all have different values
Jordann from My Alternate Life on what it takes to become an entrepreneur
Frugal Rules has several tips on doing your income taxes
Mo’ Money Mo’ Houses tells us a little bit about the writer behind the blog, herself


Feb 082013

Highest Debt Level Ever
Credit bureau TransUnion released their quarterly report recently on the credit history of 25 million Canadians. They’ve found that excluding mortgages, we each owe on average $27,485 of debt, which is up $1,500 from last year and a record high. The average balance owing on a Line of Credit (LOC) grew by 2.6%, installment loans (such as my farm loan) grew by 6.7%, and car loans were up by 8.9%. I don’t think it’s a big deal though. It’s true that our debts are $1,500 more than last year, but according to StatCan our earnings year-over-year has also increased by 3.2%, or roughly $1,500 so everything balances out 😀 No surprise then to also note that delinquency rates are declining, meaning less people are defaulting on their payments :0)

weekend business, Canadians taking on a lot of debt

Photo by Ryan Remiorz , THE CANADIAN PRESS

What does this mean for you? It depends on how you’re using your debt. I’m borrowing over $15K more from my LOC and margin account than last year. Not counting my mortgage I have over $150,000 of debt today. Most people are scared to take on debt, but using the right kind of debt at the right time can be a very useful tool. I couldn’t have increased my net worth by $12K last month if I didn’t have all this debt to leverage my investments. But on the other hand, if I had bought a new car and taken on a car loan then that would actually negatively affect my net worth. So again, it all depends on what constitutes your debt and what you’re using it for.

With the success of their iPads and iPhones, Apple have been making billions of dollars in profit every month. Currently they have about $137 billion of cash sitting in the bank, including short term investments. This is the biggest cash pile of any company in the United States. And it’s not doing anything productive or profitable for the company. They currently have a dividend of roughly 2.2% but an activist investor, David Einhorn, who manages a hedge fund and holds a lot of Apple stocks, is encouraging Apple to give more money back to shareholders. This can be done by either increasing the dividend, or offering preferred shares with a higher yield, but don’t allow for company voting rights. I’m in favor of more dividends, so we’ll wait and see what Apple decides to do 🙂 Many investors are chasing after yield, if Apple gives in to these demands then I might just buy some more Apple shares. Who knows, maybe one day I’ll even accumulate enough for them to DRIP haha (^▽^) half joking there.

The Oily Bottleneck
We pump out a lot of oil and gas in Canada but we lack the infrastructure to get these products to the proper markets. This isn’t a new problem but a research paper out of Calgary suggests there is a 2 to 5 year window for us to get our resources to the Asian markets, otherwise we’ll be at a huge disadvantage. Countries in southeast Asia want our oil and will pay us the proper market price for it. But currently we sell close to 100% of our crude to the US at a 45% discount. You’re welcome America 😛 Canadians are losing out on $100 million of oil sales every day 🙁  Think about the tax revenue generated from that alone, and all the healthcare, education, or paying down the national debt we could do with all that money if only…

Frenemies everywhere
A new season of The Real Housewives of Vancouver started airing this week. It’s a bit ironic because the individuals portrayed in the show are often more fake than real. It’s pretty entertaining though, especially if you happen to live in Vancouver and recognize a lot of the shooting locations 😀 You can learn a lot about personal finance from the show, like how being excessively rich can come with excessive drama and consequences.

weekend business real housewives of vancouver

Blog roundup – Personal finance and other interesting articles from around the web
The Dividend Guy has a nifty chart that lists some popular Canadian stocks and when the go ex-dividend
Frugal Rules on how he makes use of wish lists and is giving away $500 on his blog
Modest Money on how to be frugal on valentines day
Passive Income Pursuit on how being laid off from work has taught him a very important lesson about life

Jan 192013

Blackberry maker Research in Motion is doing really well this year :0) The cell phone maker’s stock price has gone up more than 100% since just half a year ago. Many people thought RIM was dead but investors are taking a second look now. As one of Canada’s most iconic tech companies I really hope they can make a come back. We sell a lot of resources in this country but it would be great to improve the number of knowledge jobs as well. RIM plans to release its new product the BlackBerry 10 later this month. Will it be a successful launch or a big flop? Who knows. Disclaimer: I have 50 RIM shares myself.

NHL is back on
After a long lock out, the season finally gets started today. This is great news for sports bars and helps to stimulate the local economy. Go Canucks 😀

Resource Conferences
Gold metal oreCambridge House International will be hosting a number of investment conferences throughout the US and Canada.  Most of their events are free like the one I’m going to in Vancouver tomorrow. Last year more than 500 companies and a number of analysts gathered here to network and share ideas. They have another event held at the Telus Convention Centre in Calgary later this year. If you live in a city where they will come to I recommend going to these conferences. You will learn a lot about investing 😀

Random Useless Fact: You can save money by not buying new calendars every year. For example in 2013 you can re-use calendars from 2002, 1991, 1985, 1974, 1963, or 1957.