Brad Simpson

[music] >>Hello I'm Greg Bonnell and welcome to MoneyTalk Live, brought to you by TD Direct Investing.

Every day I'll be joined by guests from across TD, many of whom you'll only see here.

We'll take you through what's moving the markets and answer your questions about investing.

Coming on today's show will discuss how investors should be reviewing volatility in the markets with TD Wealth's Brad Simpson joining us. MoneyTalk's Anthony Okolie will have a look at a new TD Economics report on Canadian Canada's productivity problem. And in today's WebBroker education segment, Megan Henriques shows you how you can use alerts on the platform. You can get in touch with us by emailing moneytalklive@td.com or fill out the viewer response box under the video player on WebBroker.

Performing at all that in our guest of the day let's get you an update on the markets. Checking in first on Bay Street with the TSX Composite Index of a healthy gain of 150 points.

Two thirds of a present of the upside. The price of West Texas intermediate crude up 3% today of course after pulling back three or 4% previous sessions. Gold silver, platinum, Palladium, copper all rallying that is the minors rallying on Bay Street as well.

Barrick Gold at 27, 90 up almost 4% keeping an eye on the Air Canada of course we have those contract talks with the pilots coming out of the Y this weekend.

1566 Amada's bid for Air Canada at 1.6%. South of the border let's check in the S&P 500.

Inflation cooperating on a headline basis we found out yesterday more information today that inflation is moving in the right direction.

S&P 500 sort of bouncing around.

Right now modestly lower by four points or seven tics.

The tech heavy NASDAQ. Holding onto its earlier gains.

They want big gains of 45 points to the upside about 1/4%.

Now yesterday, Nvidia jumps about 8%.

Not sure if they closed with again but they made a sizable gain up another percent today. The CEO came out saying there is still sing incredible demand that seems to be enough to get money moving back in that direction. The big tech stock and that's her market update.

After a period of relative calm and financial markets, investors have been hit with bouts of volatility in recent weeks.

Joining us now to discuss whether this bumpy ride is set to continue his Brad Simpson, Chief Wealth Strategist at TD Wealth. Always a pleasure to have you on the program.

>> Always great to be here.

> I was looking at some your work over the Summer because of course the first bout hits in August and in September it hit us again. We did go through a period of relative calm.

Could it stay calm forever?

>> It's true and we have to start on your intro on the way in here. Nvidia is seeking demand?

Who knew?

Oh my gosh I did not see that coming.

It gives you a bit of highlight of really what some of the movement that we are seeing and I think that it can lead into the kind of a volatility story so if we go backwards a little bit, in, every quarter we publish our strategy quarterly with this big thought piece of what we think will be going on.

We call that "all is quiet?" We publish a July 29 and it was, you know, like, let's look at equity markets and let's look at bond markets and currency markets in particular.

We said "you know, there's been some bond market volatility over the last few years of course but that had quieted down and we said look, if you look at equity market volatility, it's in the lows of 1993. It is in an area that is merely unprecedented.

And currency markets, volatility, very similar to that.

And our "all is quiet" is thinking about this thinking "really? How do you shape that out and think about this in terms of the markets concern of enough about all the money is flowing to a handful of growth names concern that growth isn't data come from other areas in the market".

Like flowing at the Nvidia's of the world if you sat back and said "okay we also have in a three week period, we don't have to go through because it's all kind of old news," but an assassination attempt of a former Pres. of United States, a sitting President of the United States that did a debate that was shocked to the world's inability to build a string of thought an answer to a question, and then, within a few weeks after that, was replaced a major political party with a new candidate for the, of course I am… So if you look at that, there's no volatility.

> It's a busy Summer.

>> It's a busy Summer!

So lo and behold it really picked up indeed at its height, we saw the effects go up to 65.

The neat part is what we did is we actually mapped out saying "this is what it would look like when it elevates again" and it was within that zone. You know, the other side is what we saw, the trade unraveling in Japan.

We saw the… Down 12%.

Going through all this is one could argue is is this to say we got basically somewhere between 3 to 6 months of volatility just packed into a few days.

>> Summer vacation some of us.

>> Part of it is that Summer vacation, a lack of liquidity in the system which is helping drive that.

So they can exaggerate those moves and I think there is some of that as well.

If I'm an investor and I think I'm looking back and you know, I brought a charter long and I'm not sure if we've got it.

>> I think so. We can show the audience.

What are we looking at here?

> Where are we? All were looking at here is, of course I'm looking for January 22, but you're looking at 2024 and what you're seeing is the depths way down.

CBC bond market, you see the bond market which is elevated a little bit.

All were showing here is the movement upwards of all of them and more activity in those three. I think that's really, I think that's really important for what were talking about here.

In that first and foremost, in a strategist which I am in an asset allocator in an acyl asset allocation Portfolio Manager, the key is to think about volatility for people like me and it's like earnings to an equity analyst.

It is the big thing because number one, you want to manage those but you also want to capture the upside with that.

I think as investors we have to look God is first the most important pieces that I think people see volatility and think it's dire right?

. I think you have to step back and look at it and go "first of all, it was a changing of the unemployment rate in the United States. That by one percentage point okay?

That this was a market looking for an excuse to correct. It was going to be something.

So her commentary wrote about it because it was like striking a match on a tender, dry forest.

I want our investors to go "what we are starting to move into, the middle of here, is actually equity markets and fixed income markets and currency markets and commodity markets.

Actually starting to normalize. The process of saying "you're not just good to be asleep or have any exchange of going on and just everyone focus on one thing.

We are, a lot of what you and I are going to talk about today isn't just AI. We are going to talk about the business cycle.

Where are we in that business cycle?

What's happening in those?

Ultimately, what is that mean for currency markets and commodities markets and equity markets?

That's really a breath of fresh air quite frankly and so we think that elevation, we think we are going to see more of that but in a positive way.

And that we are starting to focus on the things we should be focused on again.

>> You talk about the labour market. Where are we in the business cycle?

As humans we want to put a story in their about the moves were seeing in the markets.

One of the moves about volatility, what if you done if it's slowing too quickly?

What if we are heading for a hard landing?

So I think there is a really interesting one to and, you know, the consensus call is that there's going to be a soft landing.

And of course, what you want to be in doing what I do is you want to be off consensus and say "well we think… But it's a pretty compelling case.

I think that's your starting point.

I think you want to look at it in terms of… I think> We have a picture.

Yes.

> I think this really does help.

What we are looking at here is the economic cycle but we are looking at the economic cycle through the lens of the quantitative work that we do globally.

So we look at it and we take Canada and the United States and Japan. In the euro zone and we look at hard and soft data and so the stuff that you get from going up and phoning and asking Sodi how you feel about something to looking at something of "what are your sales and what is that look like? Right?

First of all, I think the interesting part here is you can see that in early stage cycle when we were showing this in the first quarter of this year, China was in an early stage economy and that is still true. And I want us to remember that through an early stage economy, and they are having a heck of a time getting things going again. And one of the things that we said at the beginning of this year, we eat some humble pie as we thought, we knew it was good to be difficult but we thought they were going to build at least on an incremental basis, work their way through some of us.

Because we throw an adaptive approach to doing things, we'd be in the camp of "you know what? All bets are off.

We know about the long-term structural problems that are in place. The near term structural problems are continuing to be a huge headwind there. The other point we are looking at is the rate of change of this.

So Canada which was kind of like getting into that later stage, has started to slow more than the other three and really quite quickly.

In the camp it would be a soft landing to but you're also doing, what are your odds and your outcomes?

There's a lot more odds that it could be a could become something more sinister than that.

Then it would if you compared it to the United States which is also experiencing a slowdown but that slowdown is going through is that all things are pointing to a soft landing.

So the key to this and one thing I know that you and I've talked a lot about some of the last times I was here, is there is an enormous amount of focus on unemployment.

The reason for that is the couple fold.

Central banks basically have two main things they are here to do.

Manage inflation and manage unemployment.

If push comes to shove, the thing most important to them is unemployment.

Because you know, you have to keep people working.

Inflation two.

If we looked over here, we could reasonably do our discussion today and not talk about inflation once right?

> If you been watching, the only place in the world where there is that discussion going on or in presidential debates right now and apparently there are runaway roaring inflation.

And I know both candidates when they're doing that.

They know it isn't true right? So if you put that aside, unemployment is the thing you're going to watch.

And unemployment is the thing, even for the global economy, that because China is in a difficult spot, often you want to kind of spread your risks around which we still do, but also you want to see different drivers at this.

The main driver of global equity markets, Global Fixed Income markets now is the US, second one of that is the US and what could happen the labour market there, is the main thing that is in a call the day and we have been writing and showing this deterioration of that labour market for months now and this is what we think is going to transpire. But we are still talking about a fully employed population and it slowdown, we think, is a slowdown that's very manageable and we think you will be seeing more prints showing up and at the end of the day if you look at the other side of the coin, which that leads to the consumer slowing down as well and we are seeing that.

It is being done at a rate as desired and, you know, you don't want to be doing any victory laps here on this. But, if I am Jerome Powell, I'm feeling pretty good about this and >> That was it right, instead of saying we are going to hide rates… >> It hasn't happened and you can double down on that now, looking at it in terms of it coming out in Jackson Hole saying "look, we've got this road to 2% inflation we are well on the way here.

Whether we drop and… They are watching and that's the thing they've got circle now.

And, you know, I confess, we spent an enormous amount of time thinking about this and looking at this.

I think they are in pretty good shape.

It's gonna get worse but I think you could reasonably see that this soft landing is well-placed.

>> Great insights and great sort of the program.

A lot more to talk about with Brad Simpson and we will get your questions for Rado market strategy as well and just a moment's time.

A reminder of course that you can get in touch of us any time by emailing moneytalklive@td.com or Philip at viewer response box under the video player and WebBroker. Now let's get you updated on some of the top stories in the world of business and take a look at how the markets are trading.

Shares of Empire are in the spotlight today the parent company of grocery chain sobeys gruesome same-store sales excluding fuel purchases by 1% in the quarter compared to the same period last year.

While it's discount banner fresh co-attracted shoppers looking for bargains, Empire says it's full-service stores including sobeys, Safeway and IGA are also performing well.

B2Gold is among the most actively traded names on the TSX comps at today.

The Vancouver-based miner has reached an agreement with the government of Mali, covering operations in that country. In a note to clients, TD Cowen says uncertainty around Mali's new tax code has weighed heavily on B2Gold shares over the last couple of years in the new agreement provides certainty for shareholders. A new update here indeed.

Down to the tune of 17%, Madura not.

The drugmakers are announcing to cut $1.1 billion in costs by 2047 while hoping to launch 10 new products over that time.

Madura is attempting to chart a new course as its COVID business continues to see declines in sales. Quick check on the market starting here on Bay Street with oil higher with the metals higher in the minors higher, we do have a bit of green of the screen.

Hundred 65 points to the upside almost a three the building of the gains of a morning session and south of the border, the S&P 500 can't decide if he wants to be positive or negative right now. Right now modestly positive a foreign half points, the whole eight tics to the upside.

Back now with Brad Simpson taking your questions about market strategies. First one for you here, how are you viewing geopolitics as a risk?

>> I think the starting point, you know, I often like, I really enjoy listening to your commentary >> Thank you!

>> I never miss it.

But you know, I think it ties into the geopolitics and I think one of the great lessons of what you're talking about there are 2 Full Is, #1, I think if we zone back and did rewinds in our interviews and 21 and 22, my whole portfolio would be in the dharna.

You know what I mean?

But let's go through our viewers questions right now.

My whole portfolio Madrona? Or should I have some of that… And you know, here you are a few years later and the other side of the coin is that, so what happens in growth markets and growth stages, there's darlings of the day and so you go and you have if you look at kind of the factor exposures that you would have, yet your growth exposure and then growth exposures turns into momentum factor and what you do is once you get into that momentum, you get 1/4 after quarter of better earnings, the market really starts to roll into it and that's what happened with Madrona.

You get cyclic goals, like what you were just going through there. Minors and gold.

I mean they go dormant for years right? And then what happens is as you think you're getting into late stage, and as you think you're gonna start to burn into an early stage again?

What happens is cyclical start to move in money starts to go in there and really, a lot of just, what I like about it is just the context of what you and I are talking about today.

There it is in real time seeing kind of the play of what happens with growth.

How you have to think about it now which is really, the AI growers which of them are dharna's of two years ago when you think about one of the things really like is our cyclical's. Why I kind of go even that, how you connected into the geopolitics is this. First and foremost is that, one of the things that I find stunning has been in this year, and even in the last year, we are right now, across the globe, to major war fronts.

And you will hear them saying military excursions… No.

These are two wars in two very difficult parts the world that, quite frankly, both of them are escalating right? Now we look at them in terms of, we look at the Russian and Ukraine wore a we look at that still in an area of containment and we say you know that's 50 or 60% scenario that containment is going to stay there.

Now, if you go to containment, what are you talking about, Ukrainian Army is moved into Russian territory, but the background on that is that, actually moving that forward is actually a part of containment and one of the problems, you know, long story short I was going to be a Strategic studies per professor when I was a kid.

Part of when you are looking at a war is that if you're always in a defensive position, after a while your enemy always knows what you're gonna do and starts to turn the tables. Their ability to move forward actually adds to this because it ruins the other sense of offensive activities of the going through. So that's what we look at.

Looking at the Israel/Hamas war. We think again that if we look that that a few weeks ago, kind of the height of the concern that this was going to go outside of this containment zone and go into something that is something much bigger and much greater and have a lot more Nations involved.

And that risk seems to have dissipated in the short term here.

I think they are high on not but both on both outcomes are kind of, 5060% of likely outcome is for them to continue into that zone now.

That's the military part of it.

Then, when you think about it in the market terms of it, is that, you know, we believe that we have moved into a world where we are going to see more of these kind of things.

And you know, we wrote an article a couple years ago there which I know you and I've talked but of the past.

So I think investors need to think about this in terms and go first and foremost, markets are ultimately agnostic to this.

Just like they are in politics over the mid-or long term.

You know, markets ultimately look at what you're going to pay for the exchange between inequity, what am I going to pay in exchange to lend money without be a government bond to a high yield or an investment grade want gain one?

What am I gonna do?

Pay for a commodity? And that's ultimately had a price things out with the supply and demand side.

Now, looking at that from our perspective, from the geopolitical side, would I do about it? What we think what you do about it is that you add exposure to commodities to your investment portfolio.

That is number one.

The reason for that is that commodities are a very good diversify or when it comes to geopolitical risk and most people are under allocated there. You go wait a minute! We are in Canada!

I know companies and many of them are resource companies. They react differently than this.

So you know, owning oil and owning Suncor are not the same things right?

Suncor is an operating entity.

Thinking about how the market reacts to it.

So I think that most people's portfolios don't have active management in this and we think of it as a diversify or and in the hedge it makes a lot of sense.

It also makes sense from an investment perspective.

But because the reality is that we have gone through almost 3 decades of not building infrastructure to have more of an increased output for commodities and so even if you say "I don't want more commodities" and were going to do everything we can for the planet to stop it? As long as we have population growth, we still have a demand out stretching the supply.

And so, that exposure that we are going to have to do to build that out and the infrastructure to do it, is a really good reason for us to have exposure to there as well.

So I think if you take the reality of these two wars we have now, in a extrapolate that forward to say the likelihood that we are going to see these types of excursions, or difficulties between Nations as long as we're moving to a world where there are more tariffs, more battles over currency, that this is an important part of our investment portfolio that I know that most wealth investors don't have the exposure to.

>> Fascinating stuff is always at home make sure you do your own research before making investment decisions.

We will get back with your questions for Brad Simpson on market strategies at just a moment's time. In the meantime remember you can email us at moneytalklive@td.com. Now let's get to our educational segment of the day.

If you're looking to stay up-to-date on news and events in the market, WebBroker has tools which can help.

Megan Henriques, Senior Client Education Instructor with TD Direct Investing joins us now with more. Great to see you again! Let's talk about how people can use WebBroker to stay informed with the events shaping the market?

>> Of course.

Basically for a lot of investors, there's so much information out there that it can be hard to reduce some of that noise. On WebBroker, I will show you how we can filter out some of that information through using alerts.

So let's get into WebBroker so I can show you how, one way you can stay up-to-date on what's going on in the markets.

So if we were to start her "research" and then we go under "markets" to "overview".

Here's where you'll see a lot of information and you will see reports and below we have some of the market commentaries.

So we have some global news and commentary and life briefs.

You can actually filter this to see some of the Canadian information and then toggle on the right side of that section, there's a Canadian flag in a US flag.

If you click here then, for that section you will get the American news.

I'm just going to show you a little quick saying that not many investors know.

If you go to the "news" tab on the top, you can enter a keyword or a symbol.

For instance if I put "dividend", this will help us filter that information to see this news that is important to us.

Now, let's get into how we can do it using alerts.

So, we're gonna go back to her main menu and click on "research".

This time under "tools", were going to go under "alerts".

So very similar to that information we saw before but instead of you having to manually look at that information, you can set the alert of a markets by clicking on this "set news and research" alerts.

From here you can either toggle to ""news and research" so that when your favour report comes in, you can select that and, for instance, let's say I picked the TD morning call, I can be sent this by email so when a new report comes in, I'll be notified right away.

> All right now we know how to stay on top of the big news. What about people interested in individual holdings or stocks is always there can be news, important news, material news around those names as well.

>> Exactly.

If you are doing research in WebBroker let's go back and so I can show you how it's done.

So were going to go back to "research" and then "stocks". And here I just have a random company. So we are looking at Microsoft. If you are already on this page, you can click on the top.

There is like this quick information.

You can click on "set alerts" and now it's gonna bring you directly to the alerts for Microsoft specifically.

So you have price and volume, you have news, ratings and in the theatres and so on. For the price and volume, with really fun as you can also be notified through your mobile app. So if you have so you can be notified by email or you can get a push notification if you've been able to get that.

So maybe let's set one up now so let's say if it drops to four, 10, send me an email.

If I had it synced to the demo account I would be able to select this.

So then from here, I'm going to do "save".

Then where we were before, let's go back to research, under "tools" were going to go to "alerts".

Now we can see that Microsoft one that I just elected.

So that is one way that you can create your alerts or directly from this page, you put in a company, I just went to put it in TD and then same as before, you will have the same choices.

You select what matters to you and then this way, you can get that email notification or, if it's on a price and volume, you can also be notified through the app.

> Meigan, great stuff as always thanks for that.

> Thank you.

>> Our thanks to Megan Henriques, Senior Client Education Instructor with TD Direct Investing.

And for more educational resources you can check out the learning centre on WebBroker or use this QR code to navigate to TD Direct Investing YouTube's page to find more informative videos.

Back with Brad Simpson taking your questions on market strategies.

This one is an interesting one.

What's the environment like first stockpicking right now?

>> I think this is a, I'm trying to think of a good way to put this, I think this is a stock pickers dream right now.

Really. If you go back to where we started today, we talked about volatility and volatility in the S&P 500 and there wasn't any.

The reason there was no volatility as if you broke down the S&P 500, not only was there absolutely no activity in correlations between the underlying Securities, and that's what brought about, it's just, like, if you were to dance and the music was playing and you turn the music off and everybody just kind of stares at each other waiting for things to go again.

Imagine you were doing that and then all of a sudden, you know,/from guns and roses fell from the sky with an electric guitar right?

Slash from Guns and Roses fell from the sky with an electric guitar and started riffing on it? One of the things we talked about is this is a market that has shifted its attention to saying "well, if there is a soft landing, what would be the beneficiary of that?" So what happened is it came to life, bounced all over the place and now, you look at it and, this is a market where, you know, people are plowing money into passive investments.

And we allocate a lot to passive investments. I am agnostic.

I allocate to passive investments and managed investments.

But you know, piling money into passive investments, chasing data and that's the world we lived in from us the past 10 years. But this is the market, when these correlations kick back in again, and people start being worried about where we are in the business cycle again?

You start going sector by sector and saying "look, one of the winners going to be?

" Part of the trademark we think that's really interesting is the biggest beneficiary, one of the biggest beneficiaries of AI is actually software.

Software has really been struggling and so you have to look at the software sector and some of the underlying names in there and you look at some of the potential for AI and for the earnings growth, we think that that's something that makes a lot of sense. And so, it's not just going by the sector but it's going and choosing those right names and I think for stock pickers out there, for people doing their own research, I know I run a passive team in an active team in research of their great now. I'm super interested in what my individual analyst are saying on equities. You can go through months where they can be absolutely in love with something but the market is not I do anything.

This is a great market for that right now.

>> Interesting stuff. Another question now in from the audience. We get these often when you're on the program.

Don wants to know where he can find Brad's reports?

>> I was just beating the door down!

(Both laugh) I want I don't want this to seem like a new Taylor Swift record but it's close!

I think often there on money talk, you can find them a TD Wealth or a good way to do it is also just, you know, reach out to me on LinkedIn. Everything gets published through my LinkedIn and it's a great resource for that.

>> I'll admit that we were talking at the top of the show and Brad is on his way this weekend and what is your LinkedIn profile?

That's how I access a lot even that webwork here at the Bank. Don, I Hope that helps you out.

Great work to go through and do your research on.

We look affect your questions with Brad Simpson on market strategies in just a moment's time.

As always make sure you do your own research before making investment decisions and a reminder that you can get in touch with us at any time.

Do you have a question about investing, or what is driving the markets? Our guests are eager to answer your questions so send them to us here at MoneyTalk Live. You can send your questions two ways: you can send us an email any time at moneytalklive@td.com or you can use the question box at the bottom screen right here on WebBroker just type your question and hit "send". We will see if one of our guests can get you the answer right here at MoneyTalk Live!

>> Canada has seen its productivity go from bad to worse since the pandemic and this continues a risk to drop in living standards. According to new TD Economics report. Anthony Okolie digs in and tells us what were seeing here.

>> Canada since the pandemic, without that productivity growth, work has faced stagnating wages and government revenue falls below spending promises. Now I brought a chart the kind of highlights this.

You can see in the decade prior to the pandemic, the business sector produced a production crew respectively respectively at 1.2 annual rate. But from then you can see 2019 to 2013, production ceased to expand and that puts Canada as one of the worst-performing advanced economies. Now, TD Economics highlights a couple of reasons behind this productivity slump. One, Canada is getting worse at making goods. Since the pandemic, more workers are needed to produce the same amount of goods whether it's agriculture, manufacturing. Secondly, Canada's economy has shifted away from oil and gas to construction which is seen the biggest decline in labour productivity since the pandemic.

And finally, the US is outperformed Canada across most major industries with Canada lagging in the adoption of both information and Communications technology.

Now, TD Economics does outline some policies to boost productivity. For one, they talk about tax reform.

Simplifying and broadening the corporate tax code, reducing taxes on investment in maintaining Canada's competitive advantage.

Second, help boost construction productivity.

You talk about things like breaking down jurisdiction will barriers to growth improving smarter regulations among barriers there. Finally illuminating barriers to investment. Promoting mobility and investing increasing investor trends transparency as well.

If Canada doesn't focus on labour productivity in the coming years, we risk a continued drop in our living standards, worsening wage growth and significant pullbacks in our public services.

Greg?

>> Anthony, this report was my morning read on the way in.

I have to stay there is a lot of stuff in there that you illustrated that is troubling and some real problems to overcome.

We talk of a productivity, there were some bright spots.

Amid all that.

> Yes not all negative.

We did see some bright spots in certain sectors in Canada.

Particularly wholesale and reap retail trade.

Accommodations and food services as well as real estate, rental and leasing which saw improve productivity since the pandemic. The reason is those sectors really are driven by trends in automation and digitization.

Again, they benefited from that. Those sectors of the strongest wage growth since the pandemic and have a.

> Interesting stuff. Thanks for that Anthony.

>> My pleasure.

>> MoneyTalk's Anthony Okolie.

Now for an update on the markets.

We are having a look at TD's advanced dashboard, product platform designed for active traders available through TD direct investing.

Were looking at the heat map function here which gives you a view of the market movers on the TSX 60 by price and volume.

Gold and silver are all rallying.

It's a bright spot on Bay Street today.

A bit of a mixed picture across the board.

South of the border, let's see what's going on with the S&P 100.

Of course the 500 is been going back and forth between modestly negative and modestly positive.

Nvidia had a big jump to the tune of about 2%. Some of the other check names getting a bid. Across the rest of the board again, a bit of mixed picture out there.

Back now with Brad Simpson, TD Wealth strategist with TD Wealth.

What's your view on commercial mortgages, US and Canada giving the easing trend in North American central-bank policy rates?

>> I'm an answer that question right away.

I love that question.

I also just want to touch on the TD Economics piece right?

Because you know, sometimes I get the question. Brad are you an economist? The answer is no.

Our chief economist is brilliant and has an incredible team there. We use her work a lot.

We are saying the will of a soft landing, what is that look like?

We are doing that research and using that research. And it's a tremendous team.

And so, but, the use of that data, what we do with it is different than what the other consumers of that data do. Business owners are politicians, our clients who are running businesses and thinking about how do I use this for deployment? My job is to think of what terrain we are running through and how do we allocate this?

One of the things I want to hit home that's really important for Canadian investors to look at, is every country has home bias right? Where you want to be invested in.

Even if you look at, we were talking about where there has been productivity gains?

Like look, our economy is geared at real estate and the exposure is that you're getting in Canada, you're getting mining, you're getting oil and gas, you're getting a few railroads, you get financial services companies and those are the things, and real estate, you know that the correlation between those, between the resources to build that real estate to the transportation to get those materials there to build that real estate, to the financial services company to finance that real estate, it's all kind of like one player in there.

What Canadians, if you think about what you're talking about the market all day and you to sop up this exposure here right now, kind of interesting you know the stock pickers market, what is it, Intel was down 1.8%.

That's a stock pickers market. That's what it looks like right? Short until there, your long Nvidia there.

The point I think for Canadians of this domestic bias that we want to warn against is what were not writing about is going that we have a tech sector that is thinking about how it's geared towards AI. We don't have one. It doesn't end. We have to construct and build that out.

But as an investor, you're not getting that exposure if you're not allocating capital into US markets.

Implore people to start thinking about that in those terms and yes, it's good to own Canadian content.

But if your whole portfolio is made of that, and there's lots of Canadians who still are, you're missing that.

Healthcare, we have this massive aging population in North America.

The healthcare sector in Canada, the largest healthcare stocks in Canada are pot stocks.

Right? So it's imperative that we do that.

From the economic standpoint, you know, bless her and her team for writing these articles so that our politicians can read this.

Our business owners can look at it and say how you're making decisions? My team is to say working with wealth clients and let's look at your investment portfolio and say "this the problem to rectify itself but let's make sure were doing the things in your investment portfolio today that are going to build more with this. This actually goes into the commercial mortgages.

>> You're saying okay let's talk about this portfolio.

(They both laugh).

I will look at this in a different light. In January and February hear what we were talking about was the banking crisis in the United States and ever since there's been a banking crisis, one of the things is that central banks have been trying to take liquidity, take money out of the system to slow things down and they also have a gift because, the skin is sound strange but because you had a banking crisis, what's happened is that lending and the ability to build the land from public organizations and publicly allocating it has really dried up.

And this has been a trend not just since early January but is a trend that we have really seen happen since the great financial crisis.

Just chipping away more and more and more and more.

So the answer to commercial, I will take it one step further is that a place in people's portfolio is that for commercial mortgages, the spot that you both want to have is that you want to make sure, and a great way to get exposure is actually through the private space with that.

And what you want to the private space of God is you want to have a name brand, well known, lots of risk management, lots of structure, lots of understanding of that bot risk structure and depth of experience at doing it. And looking at it at an investing in private commercial space in an era right now where there is pressure on that kind of landing, that pressure, remember what I said, pressure is volatility and people like me low volatility.

That's for all opportunities come in the commercial space makes an awful lot of sense.

Going across the capital stock, an awful lot of Canadian investors do not have exposure to private credit.

And so what they are missing is so much of great businesses getting finance now, not through publicly accessible vehicles to build the trade-in but actually private ones and that I know most Canadians don't have that as an exposure.

From our standpoint, we think that's an imperative to do.

We construct and build our portfolios for them based on that and we think that commercial is part of that sleeve that you need to have with that but across the capital stock, there's lots of opportunities for people to be invested in because what happens is great companies today, instead of going to a publicly traded entity, go to an entity to say "customize my credit needs for me " and so what I think, you want to be an investor that sort of thing.

Of course all the rest of it but that's how I dance of the commercial.

>> Brad thank you so much always great to have you here and look forward to our next chat.

>> Our thanks to Brad Simpson Chief Wealth Strategist at TD Wealth as always be sure to do your own research before making any investment decisions.

Coming up on tomorrow's show we will hear from Cowen's Mario Mendonca. That's all the time we have for today thanks for watching and we will see you tomorrow.

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