Ben Gossack

[music] Hello. I'm Greg Bonnell and welcome to MoneyTalk live right by TD investing. I'm just I guests and many from you only see here. I will answer your questions about investing. Ben Gossack from TD asset management will talk to you about market management and we will take your questions about investing. We'll talk about income investing today. Some of that will include dividend paying stocks and in the education segment we have Nugwa Haruna education instructor at TD investment to teach us about research in stocks in a WebBroker. Here's how you can get in touch with us with your questions. You can email MoneyTalk live@td.com or Philip the response box right on the video player here on WebBroker. Before we get to all of that let's get you updated on the markets. It is not a pretty sight today, starting here at home, were not on quite as much pressure on Main Street is on Wall Street, but a seven point deficit right now for the TSX index down 1 1/3%. Pretty hard to find green on the screen with any conviction today and pretty much across all the sectors in negative territory. Heck is getting hit on Bay Street and Wall Street courts in the big-name always focused hearing you talk tech is shop if I must check in on shares and that comparing now, at 43 bucks and $0.17 and down on this section and where single pullback with them strengthen the dollar when back higher-than-expected on inflation and states, pressure and some of the mining names including Hudbay minerals at 50 bucks and down 3 1/2%. In South of the border, deeper in the red right now in the American market at the S&P 500 at 3979 down more than 3% at this hour. Some of the maker cuts on names and significant pressure today. Let's check on the tech heavy NASDAQ down more than 5%. assure you Amazon and Apple at this hour, 36 bucks and change, Apple enjoying a nice rally in recent days coming down a little more than 4%. That is your market update. Latest inflation numbers in United States increased the rate hike by the Federal Reserve and you make that decision next Wednesday. At a 75 basis point increase is expected. For more on all of that, the market reaction, we have Ben Gossack at TD management. Good to have you with us, and data points are so carefully watching going into this, we got hotter and I walk me through reaction. >> Market is been participating over the week and special portions are high. Obviously, that didn't help for inflation the least you and I get to enjoy talking about it! I see the big headline that was leading up to this, month over month inflation have been coming in at around 1%, a steady increase. In July, there is a marked deceleration. I think that brought hope and optimism that the interest rate hikes put in and the financial constraints have been doing their work on slowing the economy, slowing the pace inflation and now we are starting a new trend. Economists are watching gasoline prices and gasoline prices have come down and they thought that that would also bring down the inflation. They were right on that part. But we saw today for August, it was not the beginning of a new trend that these prices had held steady for the core, for month over month. Was up to 10 basis points, sorry, for the headline and so that is for gasoline, 10 basis points. I think with surprise market was the core, we take of gasoline and energy, it was up 60 basis points, so 6.1%. your year was 8.3 for the basis and for the core, shows a price or holding steady. And for the Fed and our meeting next week, 75 basis points is priced in and I think it opens up the window 400 basis point increase in that discussion is in there and I think that is why the markets are down today. >> Let's talk about futility of going under basis points, just done that in this country for the Bank of Canada. In the end, I guess it is time to change consumer psychology. If you can't crack supply chain problems and can't correct conflict in Europe, I guess the only thing you can do is slam the consumer into place where they have to stop throwing money around. >> There's not much the Fed can do things many federal banks can do. When you look at Europe, you know that the rising prices do not follow the central bank, but the central bank has to raise rates. And constrain and obviously that puts pressure many financial institutions and individuals. I think only zoom out, I think with the market is more worried about is if inflation continues at this pace, the Fed and other central banks will have to keep hiking and now we look at where we think the Fed funds rate will peak, looking about north of 4% at the end of Q1 in 2023. Effective funds rate for the Fed is 2.3. We're talking but a doubling of the Fed funds rate. Again, that the thought pressure corporation and that's a lot of pressure on individuals. What is interesting to me though is that we are having a lot of inflation today, and it continues to last a lot longer than anyone expects, we look at long-term inflation expectations, I noticed action went down today. Look that inflation expectations over tenure. And we can cut that up and look at the first five years and we can look at the back half and all those inflation expectations have been coming down. >> What is going on longer term? When you get past this volatility from time to time and we can even say at the inflationary environment in the future? >> It is supply-chain and geopolitical tensions. It is still robust, surprisingly the market. In Canada we've seen job losses in the last three months in the US is held up a lot stronger and more of us have expected. Those prices have persisted. I think the market believes all that will come down because central banks will hiked one time too many causing something to break. I think long term wise and we look at long-term inflation expectations, we start to think about the drivers before COVID. There was a life before the COVID-19 pandemic and so when I look at the US tenure rate, it is about 3 1/2% and I look back across the historical chart, we were at those levels in 2018. And back in 2018, wherein a slower growth environment. You talk about the inflation and we thought inflation have been cured and we never had to worry about it. Even back then, today, 3% is a pretty good yield and that wasn't satisfactory for many investors four years ago. Many of them didn't want to have fixed income in their portfolios. Were going into corporate bonds or other exotics to find their income. I think all of those pressures in terms of the amount of debt that the economy was carrying, the demographics of our population, and that the inflationary forces of technology haven't disappeared and if anything they've been below the surface because of been distracted by many different headlines. >> What does this mean for income investors? This is going to be a bumpy ride for a while, but which is expected in the short term? >> If the separate the short-term and long-term. But in the short term, those forces in 2018 and everyone away, we are set up for shorter and novel growth. In slower nominal growth, I think that leads to a lower interest rate environment. Again, putting pressure back on workers, putting pressure on people that have retired about our living longer, so having to still set aside savings in order to mix that they don't outlive all of their savings. Again, that will put pressure on people to find income. But having said that, there are many places with this income and that is where we are growing. While the overall economy may be slowing, maybe go back to 3% nominal growth, you want to look at the areas, the secular trends that may be in healthcare, may be in payments, maybe in electrification, clearly decarbonization are big trends in those areas that will grow up faster than GDP and those are the areas that is income investors, our income growers, that is where we'll be putting in our investments. >> It sounds like patience will be key. Maybe because we've lived there with the pandemic in full force in the spring of 2020, I think I'm a less patient person. I want things resolve quickly, I want to be behind this and maybe time to take a breath and look longer term and be a bit patient. >> Especially when it comes to income growth, it is important to be patient. I was getting my haircut recently and the person cutting my hair was talking about looking for dividend paying stocks. And having a few shares and getting a few pays in dividends and getting annoyed, getting frustrated, but again over a five-year period, tenure period, 20 year period, if those companies are compounding, growing their dividends year after year at 10+ percent, and not very long all of a sudden the income commission on a quarterly or monthly basis is sizable and income level that you can actually live off of. >> Great stuff and a great start to the program, Ben Gossack here to take your questions on income investing. And talk with the strategy as well and will get that in a moment's time. Of course, here's how you can get in touch with us with those questions. No MoneyTalk live@td.com or Phil at the viewer response box on the you're here on WebBroker. Right now, give you an update on the stories here in business and check in on how those markets are trading. Roots says the return of in-store shopping drove sales growth in its recent quarter. The Toronto-based retailer reported a 23% jump in revenue of $40 million for the second quarter. A stronger showing than analyst expected and gross margins improved as well. That said, Ruth reported a net loss of eight cents per share and that is a wider loss than in the same period last year when pandemic related government short of the bottom line. Shares in Pelican interactive showing shakeup in the branch. Two cofounders of the exercise branch company leaving the executive roles and that is as it attempts to turn its business around and reinvent sales after demand for home exercise products plunged coming out of the worst of the pandemic. shares of lost more than 90% of their value compared to the pandemic ties. Oracle supporting an 18% jump in sales for his most recent quarter compared to the same period last year. The topline was boosted by its recent acquisition of healthcare sales for the recent quarter. Oracle cloud business also came to see strong consumer demand. Let's take a look at how the markets are trading, it is a tough one for anyone, starting here on Bay Street. pretty hard to find pockets of strength and today. The technology stocks as well, and south of the border, it is even a little more negative in the downspout, picking out and SPX 500 and down to the tune of 2.90% of some of those companies getting hit bad today at a hotter than in expected inflation print. Where back today with Ben Gossack the former manager of TD asset management taking your questions on income investing. What is your outlook for the energy sector given lower oil prices? We came up the highs that this summer, the price of a barrel. >> It is been rockier than normal because of the pandemic, and we got about these cents a barrel, because of the tensions in Europe. I think most investors and that would be analysts and those who own the stock, I think it is well understood. I think people recognize when a tight supply market and we don't really see relief in the next quarter or six months or a year. It was also interesting on the supply side is that we have the US releasing special reserves and that is also what China, with growth, it is underperforming. It is not as if everything is taking off. What happens if there is recovery in China at the same time as those reserves come off and take away supply from the market? I think what is not well understood and creates a lot of uncertainty is the demand side. So, I think most people are starting to gear up for a mild recession. It is a question of is it a mild recession, is a anemic growth for the next two years? Or is or something worse and we have a severe recession, how long do the things last? I don't think anyone has an answer. But if any of those come into play, you have oil at hundred $20 or oil could be at $60 and all of that is possible. I think that has to get factored in and that creates the unknown. So, I wish silica call in with the crystal ball and tell us where it is going. For us, and our portfolios, will be due at the long term set up for energy, again, that supply-side story is very strong. We have to factor in the demand of certainty we have reduced our exposure. Again, when someone says you don't understand, the supply, they are absolutely right. But today I cannot answer the demand side so I have to factor in what if oil is $60? >> That is a pretty good way of saying 120 and early this and were at 120, the biggest story for an income investors that you have a lot of companies in the Canadian energy patch promising to reward shareholders because they were all washed in cash. We are not at 120 anymore, but what can we expect from the space? I was still very good in the cash position? >> The cash flow still pretty amazing. And the management team so that we pretty disciplined and they remain disciplined. That is on both sides of the border. The US majors and Canadian majors, and if you look at them from a cash flow characteristic, if you look at their free cash flow or their market, or if you look at their actual cost per barrel versus what they're getting, oil may be at 60, but majors are probably still very profitable just on a cost basis per barrel. Yes, from a cash flow characteristic, still very healthy. Until something changes. One thing that I do worry about, we are starting to see this in Europe, but given the pressures on the consumer for gasoline, for energy bills, you are hearing talks to governments going in and taxing energy companies, utility companies and saying you're benefiting too much off the backs of consumers and corporations. Need to put in your fair share. >> Another question, what would you do to make your portfolio more recession proof? >> Very difficult, especially when your long term only. I look at it as participating or not participating, those are the outcomes. Yes, you always have some exposure. For us it is more about, again, we are long-term investors and it is about cash flow and cash flow compounding. I took that I was focused on the secular trends. Sometimes there is near-term pay again you're looking for a trend that is going to go fast as the GDP. It is about balancing the cyclical and the defensive exposure. In some cases, you would think that if I went into a consumer staple company that should be considered offensive because regardless of the environment, people are going to have to buy toothpaste in your every day goods. Versus let's a discretionary company which is, okay, I like those flashy sneakers and I can wait 1/4 or a year, it won't change my life but I do need to eat cereal. Having said that, in this environment it is been slightly different. The staples have struggled and I do find that is been a challenging year for many investors which is defined the defensive areas of the market. In this case, if you look at what is rallying today to spin utility companies, it is sometimes in some cases the real estate companies. And a select few staples. And the energy companies. You think that if we are worried about a slowdown, energy companies would also be struggling today, but again, they've benefited in this environment and benefited from the inflationary environment as well. For us, it is about reducing our statistical exposure and that is been technology and some financials. Ants trying to increase countries where again, their business models will be as effective, so healthcare companies, again very select staple companies. There is even defensive industrial, select the waste management company. Regardless of the environment will still generate garbage and that garbage has to be collected in those companies made money. >> Interesting stuff. I think we are intriguing the audience with these discussions, one question, which Canadian energy stocks are you watching? >> We watch lots of stocks. For us in our style, focus on large companies and I keep my eye on small companies, sometimes are interesting to track because he might be specifically focused on LNG for drilling and sales, second zero cents for the actual trends because we get to a bigger company, multiple different revenue sources. Mainly for us we're looking at the major Canadian companies and the major American companies and European countries. But that is what we are looking at in our portfolios for energy companies. >> When you divide up the bigger names in the states, he got the upstream and downstream. In a situation like this, that a positive or a negative? Or is it what they are? >> It depends on the cycle. If your early on in the energy cycle, people tend to gravitate toward EMP countries, so exploration companies the ones that are getting in, they would benefit. As a get to the later end of the cycle, people may switch to refined. While oil may be coming down, refiners, that is her input price. And they're selling to the gasoline stations. There is a shift depending on the cycle and it is very important to be aware of. And then you have the pipelines as well. I tend to avoid the pipelines. Lots of people of the pipelines especially for income investors. >> People see it as utility play within that space. >> They do pay high dividends. I tend to avoid those companies. It is because all they do pay a high dividend yield, for them to grow that to keep growing there X and they have to fund that. And a lot of times they found that with shares. As an equity investor, does monitor company, if the companies issuing more shares and they delete you as a shareholder. I may be looking at a 56 or 7% yield, and they continue have to issue shares to fund these future investments, I'm not really getting that five or six or 7% yield, I went to get an adjustment of that amount. Another thing that has always bothered me about it, it is not just the pipelines, I see it in some US calicos as well, when I look at the price of the stock, kind of like we're talking about back to the future and the driving forces of the inflation, some these prices were the same price they were in 2015, 2016, or 2014. income investor, I'm looking for income and growth in my Northstar is total turn. A lot of these companies, you're getting your 6%, but on total recurring basis. . . >>interesting indeed. More of your questions, you can email MoneyTalk live@td.com. And look at her educational segment for today. During our conversation with Ben, what a dividend paying stocks and we have Nugwa Haruna just about research dividend stocks on the platform. Always a pleasure to have you here! Let's dive in here, some important dates that investors be aware of when doing their research as well as the topic. >> Hi Greg and yes investors are interested in researching dividend stocks should be aware of certain important dates, especially when you're hoping to receive the next dividend payment if the company does have one. You're going to want to WebBroker and I'll show investors where they can find these dates as well as exactly what these dates mean. Once WebBroker and investor click on research and will go to stocks. We'll stick with energy because that has been a popular topic between yourself and offend today so we will go with the company in the energy space and once in investor word click on the tab that says events. And then they will click on dividends. This does is give you a calendar of events of upcoming dividend payments that the company has. Let's touch on some of the dates that are on screen here. We start in the event date which is also known as a declaration date. This is when the company management will announce that there can be a scheduled dividend payment and with that payment is going to be in with the payment date is as well as the X dividend date. The reason this is important is because companies are not obligated to make dividend payments, so they don't have declaration date, the investor should not expect a dividend payment. There's also a date known as the ex dividend date and the date that investors want to be aware of if there hoping to receive that next dividend payment. That is because the ex dividend date or the ex-date lets investors know when the eligibility expires for them to receive the next dividend payment. While they will be eligible for dividend payment that occurs after this, if one does happen, they're no longer eligible to receive this dividend payment itself. The declaration and date also makes an announcement of when the dividend payment would be, in this case investors able to see when that payment would be and is able to see how much the investor is receiving per share. These are the dates investors able to see in WebBroker if they are to invest in dividend paying stocks. >> An apartment information if you're going into security, and import to see who is paying dividends out there. I've a feeling that maybe screening tool on WebBroker for that? >> There is and it is one of our most popular tools in WebBroker because it is a powerful tool for investors to specific criteria to filter down information that they want to see. The top into WebBroker and look at a screener or looking at dividend payers. Under research, and investors going to go to tools and click on screeners. Typically, this would build the screen together from scratch but this time I'm going to use a screen that is already been a preset for an investor who maybe doesn't have the time or maybe doesn't feel like they have the knowledge. You can actually use one of our preset screens and that's created by trading centre which is company the makes available the screening tools and were going to focus on the top dividends here. Once I pull that up, with this is done is it is filtered through the US and Canadian market would come up with a 525 matches. That is a lot of stocks. An investor can decide, maybe I want to near the Stan or maybe I want to do it just the Canadian market. And then an investor can actually go through some of the criteria was used to create the screen. Bennett mentioned something very important about knowing what the dividend yield is and so investors can see what was used to create the screen and in this case dividend yield is at least 2% and then investors could also consider looking at what the dividend rate has been over the last five years. In this case, is a minimum of at least 5%. Now we have 74 matches and investors able to scroll down, filtered through and dig a little deeper into each of these companies. >>great stuff as always! Here's a look at some of the webinars such as ways to avoid these for dividend investing mistakes. I want you to find it with you for our makes you tick at the learning centre on WebBroker for more educational videos, master classes and webinars! Before I get back to questions for Ben Gossack at TD management, reminder pay can get in touch with us. The question about investing what is driving the markets? Our guests are eager to hear what is on your mind so send us your questions. There are two ways you can get in touch with us. You send us an email anytime at MoneyTalk live@td. com or you can use the question box right below the screen here on WebBroker. Writing your question and hit send. We will save one of our guests can get you your answer right here on MoneyTalk live. Let's get back your questions now for Ben Gossack as were talking about income investing in here's an interesting one, it is couple of good sessions there, what are your thoughts on Apple and the iPhone 14 release? >> Yes, last week Apple had the release of iPhone 14 and I think a new watch and new iPods, but iPhones are big deal. I think it is up half the revenue even though the other areas of success are growing. I followed and invest in Apple for many years and I've always tracked iPhone cycles. Going into iPhone 14 after the iPhone 13, I was actually surprised by the uptake of the 13 and it was actually a pretty big cycle. We come into the 14, some minor changes, nothing too big. Something called a dynamic island, which all the tech people figure that out on their blogs. But the uptake over the weekend has been good. I think that has surprised many analysts and yesterday were up about 4% on that information. Obviously, today macro forces are bringing the stock down along with everything else. But I think that starts to set up for a pretty good cycle going forward. Two things I did with that there were interesting, they didn't raise the prices on the 14 and the US and in China. In other places they had to adjust for currencies but that was an interesting sign business and companies raise prices that might've been enticing. I think one thing I had factored in as much that was a bit more noticeable, these are expensive phones. The phones keep getting, there the most important electronic object. We should pay for them and we can drive a lot of value. But is a chunky one time purchase. We've seen a lot of these by now and pay later sites, so I think could be served 1200 or $2000 investment might just be a 70 or $80 monthly payment, no interest, spread equally over two years and I think that is very enticing. So people are worried about a recession and that people will pull back on discretionary spending. The $70 for no interest for two years, that is enticing and that might help with uptake. I do like Apple and it's kind of set up and I think it's from the most important stock in the market. That is just a factor that I think the seven are almost a percent of the S&P 500. I look at apples where the market is going. Amazing dividend payers, but also dividend growers. Growing their dividends into high single digits but we are also getting per share growth at almost the same if not better. Over the long run, they have been just winners. They reported their Q3, yes there in their Q3 and we are not still finished Q3 for the calendar year, but as everyone that works for a bank nose, the end of the bank fiscal year's Halloween, October 31. What we got end of earnings was very strong long growth, almost double digit long growth which was a bit surprising as we've seen weakness and those of held up. More importantly, the spread. They lend out that they also have to find that lending and so that spread widens. So, more loans and better spread and better margins and leads to better net interest income. That was very healthy. The other factors, there was weakness in the capital market and of the function of market volatility, stocks coming down, hard to do deals and merger activity drives up. Nobody wants to do IPO. That was a weakness but I think it was a known headwind. Another thing that was surprising was for credit. Banks have to set aside provisions for debt they think it is going to go bad. Fairly benign, again, very surprising. We know things are slowing down, you see headlines in Europe and the US, and Canada we've seen job losses and one is not going to come? Q3 can answer those questions but it does raise a concern, what point to banks of the start raising these provisions? And what impact does it have on earnings? I think the banks are, again, when I think of Canadian banks I think of banks versus the rest of the world. In times of uncertainty, Canadian banks always hold up better. So people will always sell the European banks, you have seen the performance of US banks which is been lacklustre, Canada always hangs in. It is a function of our financial market, a function of our, or the strength of our reserves. I think it is also a function of the structure of the TSX. It does help the Canadian banks in good times and bad because as a small Staples market, benign healthcare market, the options are energy materials or banks. Some of that recycling does help the banks to perform. Again, as an income investor, dividend growth doesn't look to be imperative. From that perspective, Canadian banks don't look like they can hold up. >> Interesting perspective on the banks. Another question now, with the slowdown coming and that is the fear, is not the time to look at income investing? Of course during the pandemic, things shook out during those earnings combos boat growth momentum. >> I think there is never a bad time to look at income investing. Again, is about that studying compounding. When you get into the 40s and 50s and 60s and you're looking for sources of income because you want to work less and you're going to retire, all of that work could have been done if you set a couple of seats aside and planted them in your 20s. You get the power of compounding because of investing in the 20s pays off massively for you in your 50s and 60s and 70s. Having said that, again, we'll get our top 10 holdings, you don't find utility companies, you don't find Staples, you find tech companies, you find financial companies, defined healthcare companies. Again, as income investors we focus on growth because in order for companies to grow their dividends we need them to be explaining their businesses. I do think of myself as a growth investor because albeit, instead of that growth that is sort of the highflying software companies that we saw during the pandemic, I'm thinking about growth of cash flows. And so, I think the big issue that is faced many investors that got caught up in that wave of stocks when up during the pandemic that interest rates have gone up and you compare the interest rates to valuations for these companies, there are still extremely expensive. Even with the 50 to 60% cuts in the all-time highs, there are still very expensive. I struggle to reinvest even though they might look cheap from a price perspective. >> Will get back to questions for Ben Gossack's time and as always, make sure you do her own research before investment decisions and other minor you can get in touch with us at any time. The question been investing or what is driving the markets? Our guests are eager to hear what is on your mind so send us your questions. There are two ways you can get in touch with us. You can send us an email anytime at MoneyTalk live@td.com or you can use the question box right below the screen here on WebBroker. This writing your question and hit send. We'll see if one of our guests can get you the answer right here on MoneyTalk live. Facing some headwinds this year, and aggressive policy and slow earnings growth. That has led TD securities to revise its outcome on the markets in the year ahead and Anthony joins us with all the details. Anthony? >> TD has revised its outlook and its most recent report and I brought along a chart that highlights some of their big calls. As I mentioned, the 2023 S&P 500 top-down earnings forecast has been revised then to $230 per share from $235 and the most recent report. This is consistent with this forecast, TD securities is also cut their 2023 year Antarctica for the S&P 500 to 4600 and that is down from 4800. Another Target, the TSX Target of 20 to 500 and the believes that the tightening and folding inventory correction will contribute to a positive US economic growth as well as a decline in inflation in 2023. Now, the positive economic growth will fall somewhere between according to TD economics to a soft landing or mild recession. The second earning quarters was better-than-expected, TD securities notes that animals have been revising down there outlook for the rest of 2023 at an accelerating pace. The pace of downward revisions has translated into the start of what TD securities believes will be a modest but prolonged decline in for earnings from the TSX and the S&P 500. Securities also points out to report that for PE multiples have expanded over two points from June 16 low and that is driving earnings yields lower. So, with the rising earnings rates and high valuations from many sectors relative to bonds, that seems to suggest that the crutch now underway may continue in the weeks ahead. TD securities does note that while the correction may be material they don't see equity markets hitting any loads or bond yields hitting new highs. Greg? >> We are bracing for rough times ahead, we are optimistic creatures! >> TD believes that what is ahead may last for several weeks but to believe that the outlook is principally brighter, particularly in bond yields will form the first half of 2023 earnings should start to recover in the second half of 2023. >> Great stuff Anthony, thanks for that. Let's check in on the markets now and see how things are progressing on Bay and Wall Street analysts are here at the Tech index and of course the big news of the day landing for the market and we have inflation United States which came in harder than expected. Missing the market reaction which is pretty decisive off diet and were not quite in as much of the downdraft is on Wall Street but 247.1 1 1/4% and sinks in the mining names getting hit in a Kinross and gold and gold making gains in recent days on the back of the US dollar. Weakness for that and the story to play with a higher-than-expected print in the United States but jumped higher again some pressure on the price of gold and some of these names. Not too severe but at 448 a share and down almost 3%. In nutrient, checking in on this name making some gains earlier despite the broader market downdraft at 120 bucks and the other name of about 1.7%. South of the border, checking on the S&P 500 right now. Pretty much near the lowest of the session done hundred 20 points about 3% some of those mega tech names leading the way pretty broad-based right now in terms of this. And checking in on NASDAQ getting a better read on what is happening with tech. Coming off the lows and session at the top of the show were down to the tune about 4% and still sizable pullback but down about three quarters right now. In Wells Fargo, checking in on the financial names in this environment, we have wells at 4351 and down a little more than 4%. And back now with Ben Gossack taking questions about investing in income investing. In a discussion before Anthony joined us about the banks and some were intrigued by that and so we are talking about some of the I guess tax implications from the banks is what the government had talked about about how well the banks of done coming out of the pandemic. And how the government felt perhaps and this is where they're going, process and to do but that with income supports for Canadian families. with the tax profile, what you think of investigating for Canadian banks? >> An election promises, they said they got to the banks I think that is factoring into stock prices. I think when people see that a bank gets find her bank gets taxed, these are one-time events when you think about stock prices, reflects the fundamentals going on in the future. If you're thinking about a forecasting model, the taxes today, it is not in the future unless is it a recurring tax and we haven't seen that. So it doesn't affect the future cash flows. It happens and it is adjusted by the market and we move forward. Again, the bigger issue I think for investors that they should be focusing on especially if you own banks, we have had robust loan of growth as these interest rates creep higher and higher, that puts pressure on companies. Can they sustain that loan growth? And where were going to decelerate? Everything again that people should focus on is provisioning for bad debt. We are below historical trends. Even as bad debt, you should expect provisions to increase just to get to historical trends until we go mild to severe recession they should overshoot that. Again, this with the stock prices will create on and it is that concern over the credit environment, it is what you should be worried but as an investor. >> Get your questions into us and look at the writer I guess, there are smart people in the can answer him on the fly. Don't hesitate to email us those questions or use the box under the video player here. Get more questions now, with the possible recession looming, what you think of stocks like dollar drama? There is none had news for us and I think they indicated that all people of all economic strata were going to those stores looking for deals. >> And if you mention portfolios looking for recession, clearly the dollar stores like dollar drama and Dollar General are really big one in the US that I can't recall, they tend to do better. We think of a market of this size, should we put more money into Pelican or more money into the dollar stores? They have done well and I think dollarama is one of the best performers on the TSX. There are other discretionary funds will look at, I think rural farmers been doing well and their retailers that they specifically focus on like Home Depot and other companies like tracker supplies, so other areas, but we're looking back to consumers and what will they spend on and what will they pull back on? And that in a way as portfolio managers, will become like detectives and try to scour our revenue exposure. Europe is slower and what we have two Europe? What are the domestic economy will be impacted? so as an analyst you're going through that and deciding what you want to adjust and adjusting those exposures. So the dollar stores especially in a recession, low cost and reliable and typically quality products. People gravitate to that kind of stuff. >> We ran out of time particular questions, but any final thoughts, day-to-day this is a tough market in which investors have their heads this fall? >> The Northstar for me is always total return. Can get really pushed aside with macro factors and reading the newspaper, one day everything is good and one day everything is bad. Work with your advisors and stick to your strategies. In the long term, if you stick to your strategies, don't get distracted by all the noise, that typically works out time and time again. It is when you get lost in all of the noise, that is when people make mistakes. Again, for me our strategy is high quality companies, growing cash flows and I like to make those cash flows aligned to secular trends. That is what helps us keep our mast and our boat study when winds are blowing all around and waves are crashing. >> Ben, always great to have you. We run out of time today, but you do have to wait for him to go live, you can get your questions in ahead of time, just email us. We can leave it in the box below when we are broadcasting. And tune in tomorrow. We have Andrew Kelvin coming to the show, the chief Canada strategist for TD strategies on what is next for the Bank of Canada. And more topics but the economy and what is happening in this country. Thanks for watching and join us for more! [music]