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Hello i'm Greg Bonnell and welcome to Moneytalk Live which is brought to you by TD Direct Investing. It's a new program broadcast daily on Webbroker. 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 up on today's show: we'll discuss whether there's any signs of inflaiton pressure easing with TD Asset Management's Scott Colbourne and in today's web-broker education segment, Caitlin Cormier will take us through how a laddered bond strategy works and here's how you can get in touch with us, just email moneytalklive@td.com or.. Fill out the viewer response box under the video player on Webbroker >> And now on the market action, good health again, 18,910, up one point, 7%. Building on hit yesterday's game, we held onto our gains. West Frazier timber seems to be in the spotlight, unconfirmed reports out there that it could be a takeover. Unconfirmed reports but clearly moving the name at 126. . . (. . . ) We are getting into the thick of earnings season south of the border. let's check out the NASDAQ 100, a little bit firmer than the S&P 500. And Bank of America, some of the financial names are working in favour of people on the market today. 33 bucks and $0.17 a share, you have Bank of America almost 3%. And that's your market update. Central banks have been delivering super-sized hikes in an attempt to control rising costs, and while you can make the argument that inflation has possibly peaked, our feature guest says higher consumer prices aren't going away anytime soon. Joining us now is Scott Colbourne, managing director of active fixed income at TD Asset Management. Scott great to have you on the program. Inflation is all people talk about. Maybe inflation has peaked. But you say not to get too excited. We might be in this for a while. >> I think you can find some positive news now. I'll start with a bit of positive news. We certainly have seen some moderation on the supply chains right? . That is taking the edge off a little bit. Inflation expectations of the market have stabilized. There are levels where we saw sort of Midsummer. So there is some good news and commodity prices are off their peaks as well. So there is evidence leading to focus that we have likely peaked on headline inflation. But I think the challenge for investors is, policymakers, what you do with the core? It's off-peak level but it is sticking. Talking about wages, shelter, healthcare. These are things that are not just subject to the big ups and downs in demand. Those are sticky. Those are going to be persistent. That is going to be the big question for central banks and investors as we go along. As we see headline inflation coming down. As a fixed income investor, that is what we are trying to get her head around for next year and the balance of this year. >> Is there much the central banks can do about that stickiness at the core? It's one thing to aggressively raise rates like they have. Perhaps, we are seeing of the housing markets, some of the demand, the game is changing… We need to figure out where we are heading. But as far as wages, the central bank offer power there? >> I think at the end of the day there is limits to what you can do as a policymaker. They obviously can't address the supply signed their. They will address over time as we sort things out. They have to deal with the demands. The tight labour market, the wage pressures and stuff like that. So we are seeing a response with the Bank of Canada. We are going to get 75 points from the Fed… Those are all things, the best they could do. Continue to push and we are going to see slower growth. You know, over time that will feed into shelter. It will feed into wages. We will see some adjustment. We are seeing some of the higher frequency data slowdown for sure but it's going to take a while. >> The Fed next week is 75. There was a brief period where they may be thought "hey, maybe they go 100 just like the Bank of Canada did". Is there a rationale in terms of what we are seeing? Do we have to go quite as hard as the BOC just went? >> It's a fine line. Safety is the new 25 and now 100 is the new 50. I think that the Fed did 75 and they will do 75 again. There was a little bit of pushback from the central bank governors. The regional ones, they don't want to push the limit too far here. so the terminal rate where the market gets to by the end of this year, not only next year or two. It is been pretty steady around 3 1/2, 3 1/4%. I think the Fed just wants to keep moving steadily above that neutral level that has targeted for. >> I guess as humans we like to look forward to relief on the horizon. It is interesting. Although we are even done with the rate hiking cycle, sooner rather than later, we are going to see cutting again. Is that too much optimism? The central banks keep writing to the rescue. But a lot of people sitting in the chair, probably you the last time you were here, you can expect them to ride the rescue forever. >> There is a sense that they will overshoot and really slow things down. There is a possibility, you know, lots of talk of a recession. And then, the markets natural condition is to make cuts. In fact, next year they priced into cuts by the Fed. I don't think they're going to get there. When we started off this conversation about sticky inflation, I think it's going to be a headwind for them. One of the issues that investors will have to wrap their heads around his as we see slower growth and inflation, core inflation remained sticky, one of the policymakers that governments and monetary policy officials have as we potentially enter into a slow growth recessionary environment? Given the sticky inflation, the envelope is reduced in terms of what they can do. So I'm not a big believer but that's what's priced in the market. >> Is the term "stagflation" which is been thrown around, some people still throwing around, does it have any bearing on the forecast for a while? Or is it to Dyer? You can't bring prices down with the economy. Not doing us any favours either. >> I mean there's lots of focus on what stagflation is at a recession. There is different flavoured, different issues. Canada has its own Achilles' heel with the housing market. In Europe, we are dealing with the conflict as well as the gas and how much it's going to be coming into Europe during the winter. Then in China, we have basically flat growth in zero COVID policy. So if you want to you can drill down into various parts of… What this will look like. Certainly, Europe and Asia don't have the same inflationary pressures that we have in North America. So it's going to be different around the world. I think moving away from, through those labels, if you will for investing purposes… Digging down into what it means regionally is really the more important thing for the balance. >> Is that will beget the clarity from? Showing the audience a nice market rally at the beginning of the show. But I have no idea what's going to happen tomorrow. Based on the same conditions. (. . . ) > We used to have pretty low inflationary, low growth environment with central banks were always able to give us the put. We just don't have it anymore. We have so much uncertainty. Some of that is geopolitical, out of the realm of policymakers. Maybe if there is some resolution on the conflict or relief on commodities, we will get a little bit more clarity. But it is a very difficult environment that we are operating in. With labour shortages, tight labour markets, high supply chain challenges globally. It's not going to pop up anytime soon. > Great start the program. Working to get to your questions about fixed income for Scott Colbourne from TD Asset Management in just a moment. And a reminder that you can get in touch with us any time.. Just email moneytalklive@td.com or fill out the viewer response box under the video player on Webbroker. Now here's an update on the top stories in the business world today and a look at how the markets are trading, a strong run this year for the U.S. Dollar is proving a challenge for IBM. The hardware and services giant warns foreign exchange pressures could result in a 6 percent hit to revenue this year – amounting to some $3.5 billion dollars. The warning comes as IBM reports strong demand for its products and services. IBM is not alone in its foreign exchange challenges. Microsoft and salesforce are among other big tech names that have said repatriating overseas sales into U.S. dollars in hitting the revenue line. "Netflix" is expected to release its latest earnings after the closing bells, and subscriber numbers will be in focus for investors. The streaming service warned in the spring it could lose 2 million global subscribers in its second quarter. Pandemic lockdowns were lucrative for Netflix as households looked for entertainment options at home. But the economic reopening and increased competition in the streaming space have been challenging for the company. It appears global mining giant "BHP group" wants to accelerate its plans in canada. The company says it's working toward stage 1 first production at the Jansen mine in Saskatchewan ifor 2026. And BHP says it is "assessing options" to accelerate Jansen stage 2. Geopolitical conflicts and snarled supply chains have pushed fertilizer prices higher as the market tightens. And here's how the main benchmark index in Canada is trading… A nice 303 points, 18,808 98,. The S&P 500, often close to being up of almost 2%. 1.88% through the upside. Alright we're back with Scott Colbourne from TD Asset Management taking your questions about fixed income what's your outlook for high-yield bonds? > So, broadly speaking if you take a look at high-yield index,… When you look back historically it's a pretty attractive level. We've got, when you move from 8 1/2 to say, 10 1/2% range on that high-yield index, it starts to make sense to look at buying that. You know the challenge that I sort of outline is that inflations can remain sticky. Policymakers will continue to lean into it. There is a heightened sense of some sort of slowdown, you know, with the possibility of a recession to parent depending on where you are in the world. I'm not saying you're a set up for a big rally here on high-yield. But, you know, in general whether it's high-yield or fixed income, it makes sense to add in these yields. There are attractive levels that we haven't seen in actually an 8 1/2% income… That's not bad. It wasn't long ago we were at 4 1/2%. So it makes sense to start nibbling at high-yield for sure there. >> In an environment like this where we just talked about how we will have a lot of clarity. … If you're approaching fixed income, high-yield, what you think about in terms of duration? That always seems to be an important part of the conversation. How long is that entity going to have my money for? >> The next thing about high-yield is it a shorter duration. Typically the duration is around four years give or take four the high-yield index. So that benefits less interest rates. More and more income is coming from yield the income part of it is providing you with a lot of buffer for high rates. So that is an advantage. But, you know I think we've got the bank of Canada 2 1/2%, markets priced in a 3 1/2% by the end of this year. I mean you're well along the interest rate cycle. And I think you know at this point the markets looking forward while it may be sticky, I sort of reiterated here that it makes sense to buy, even buying longer duration assets. Some of my colleagues were on talking about rebalancing your portfolio and making sense of that. There are still a lot of hurdles and challenges. >> Alright corporate and government questions we are getting from the viewer. Our corporate or government bonds looking more attractive right now? >> Short-term trading out on versus long-term investor. It depends. I would say we have become more constructive on adding corporate's. But we should start nibbling away. I am not, we are not putting a trading out on. We are not saying "by here, cell here." For price appreciation gain. This is a portfolio construction sort of approach to fixed income. Whether it's high-yield or corporate or government. You're paid to take some risks here and get some income and build at that portfolio and hopefully, if you've been on a fixed income, this is time to build. >> Because you build a portfolio obviously. We are always told to keep the emotion out of it right? I think a lot of investors are stumped this year. They might've had a balance on her portfolio. But both hurt us for the first half of this year. >> These are extraordinary circumstances. We haven't had this in decades. 4050 years right? So we've had a real recalibration. A regime that is inflationary. We are talking about how that is not going away anytime quickly. The repricing that is gone on in fixed income, the total return loss we've had is because you've had the duration a lot of these assets. That is the challenge in the repricing it's gone on. The markets were too good there as well. So we have repriced. The past is in the past and we've got to move forward and hopefully there is room to rebalance your portfolio and continue to build fixed income. >> Here is an interesting question. We've been getting a lot of questions for the past month about GICs. This when asking if it's better to use the cashable GIC during the hiking cycle? >> I mean, if you've got cash… You're betting four basis points between money market, GICs and cashable GICs. I think you want to be in an instrument as liquid as possible. When the opportunities to rebalance your portfolio, being fixed GIC, lack of GICs are little bit better. I prefer to be in a situation of liquidity to rebalance than worry about the fine points between cashable GICs and the market. >> For the longest time, when I look at web broker, I look around seeing across one, 3 to 4 to 5 interest rates. Further up that scale, you have your money for a lot of period of time. >> You have to think about flexibility in your portfolio. Fixed income provides you income and provide the preservation of capital but also provides you with liquidity and the ability to rebalance on a regular basis. > Here is one question we just got on the platform. I'm just going to throw it out there because I don't think we have an interesting at an answer for this one. Will central banks of more than 100 basis points…? >> I think for the cycle that's the limit of what they're going to be going for for now. You never know. Who knows? We might've to go more. >> I founded an intriguing question. I'm sort of digesting the idea that 100 can happen and it did happen. You're scaring me over that question. >> As always sure you do your own research before making decisions. We will get back to you in a moment's time. A reminder of how you can get in touch with us. Now let's get to today's educational section. Web broker has tools that can help you. Joining us now to discuss is Caitlin Cormier client education instructor at TD. Let's get started of what a bond letter actually is? >> You can add monster portfolio. What is that look like? How can while broker help us out? A bond ladder is a fixed income type of strategy where investors can purpose a number of bond products of different maturities staggered over typically years. It could be months. But typically years. The reason we look at something like this to prove that predictability of future income, ensure there is adequate liquidity, so we're looking at maturity dates over certain periods of time to make sure there is cash coming up on a regular basis. We are also trying to reduce risk, increase yield of the portfolio and have diversification as well. So lots of different factors that we are taking into consideration as to why we would consider a bond ladder. >> Okay so that's the strategy and tell me how web broker can help someone create a bond ladder? >> We are going to hop under the trading tab in web broker. Look down under fixed income to get to our homepage. Within this page, in order to build a ladder, what we have to do is actually find some fixed income products to add to that specific strategy. So I've done some of the legwork. Let us show you how to add to a portfolio. But we have two kind of pre-create one to save time today. What I'm gonna do is limited choose one of these types of bonds to add to our portfolio. I click here between the five and 10 year corporate bonds. I am looking for something specifically that's going to be coming to you in 2027. So I got some staggered dates. I've got some already built into my portfolio. So 2027 is what I'm looking for. Corporate Canadian dollar bonds specifically. So to choose one here. Let's go ahead and choose Bell Canada. So we see the information here about the maturity date and the ask price. Although sorts of things are available. I'm gonna come up here to add selection two. I'm going to click my portfolio which is 500 ladder and click "add to portfolio." That's can bring you to the portfolio that I've already pre-created here. We can see there are a number of bogs here. They're all different types. What a minute do is I'm going to add an actual hypothetical quantity. Of how much we would like to purchase of these individual bonds. So I put $10,000 for each bond in this hypothetical situation to see what a portfolio would look like if we build this particular ladder. So once I'm done that, I'm in a click my calculate button. Then I will click "create ladder report" right here. I want to make sure we have equal amounts of everything. A minute create my ladder report and it's gonna bring up a separate PDF here that is going to give us some additional information of what this portfolio looks like. So let me make this a bit bigger so we can see. We have agency bond, we have a corporate bond, provincial or municipal bond. Lots of diversification in terms of fixed income. We can see the price that we paid. We are still under that price as far as our purchase price is going to be. Our leak yields of maturity, our total for the portfolio is listed. We've got our duration that we've been talking about, that kind of impact if interest rates were to change, what the impact of the portfolio would be as well as our total annual income would be for this portfolio specifically. And again as we scroll down, there is even more detail in terms of when our income… Regular fixed income payments over time, when our portfolio is broken down, our credit rating… So there's really a ton of information that we can pull from this report. So if you are looking at fixed income, this is a really great tool to be able to use to see what the outlook is for your portfolio with those individual securities that you've chosen. >> Very interesting stuff as always. Caitlin thank you for that. >> Thank you so much. >> Caitlin Cormier is a client education instructor at TD investment. Pay attention to where broker for master classes and webinars. Before we get back to your question, on fixed income for the day, a reminder of how you can get in touch with us. Do you have a question about investing or what's driving the market Russian Mark our guests are eager to hear what's on your minds and so sinister questions. There are two ways you can get in touch with us. You can send us an email anytime at moneytalklive@td.com. Or you can use the question box here and where broker. Just writing your question and hit send. We'll see if one of our guests can give you the answer right here at MoneyTalk Live. Ok we're back with TD Asset Management's Scott Colbourne taking your question on fixed income Can your guests please explain the impact of M2 balances the velocity of money on inflation. M2 is increases substantially over the past two years and doesn't seem to be decreasing. >> I guess I'll start with the fact that I'm not a strict monetarist I don't think it's a predominant driver and of inflation as a starting point. When you look back, over the last couple of decades, M2 has grown depending on the year and a year out. You know, we have had a low and stable inflation during the pandemic. We've had a rapid growth. That was a policy response. Is not the cause of inflation? I don't think so. In fact it's come crashing down. Inflation has remained sticky. As I've talked about on the show today. So for me, it's a bit of a leap to say that this is the driving force. Certainly, you know, the extraordinary policy response, whether it's fiscal or monetary policy… There's been research that some of the federal researchers have talked about the fiscal stimulus in the state, continuing with inflation. The supply chain, COVID, there is a multiplicity of factors for inflationary impulse and, as I said, I'm not a monetarist but certainly the response by the central banks is contributed to both our ability to get through the pandemic. But it's also contributed to inflation for sure. They are responding now. >> As you pointed out, after the financial crisis, in the lead up to COVID, a lot of us were left scratching our heads for the longest time. Saying "you know, I'm not seeing any inflation." >> We talked about that. We are shifting at a regime that's different. Globalization is changed, interest supply chain has changed. The influence of commodities… Feeding through new inflation. This is all factored in to inflation. Obviously there are specific factors in each country they contribute to inflation for sure. >> All right. Another question coming in, people are curious with the central banks. Do you expect central banks to keep on hiking or we getting near the end of this? >> Well you know, what is priced in is a good place to start. 3 1/2% plus or minus a few basis points. A little more plus and minus. Maybe 3 1/2 to 3 3/4 in both Canada and the United States. So we are now at 2 1/2%, let's say here in Canada. We still have room to go towards the end of the year. And where we are right now. So no, it's not over. We expect central banks to continue to tighten. We have the ECB up this week. There is speculation today. Starting at a 50 basis point hike for them. There are still more hikes to come out of central banks. Are we in the sixth inning? Probably yes. If you think about where we are, if we go back to the original Target for inflation, 1 to 3% in Canada : about 2 to 3%… If we are six, seven, 8%, do we get from 8% down to four or 5%. And how do we get down to two or 3%? She that's what the markets will have to digest. We might all get surprised if it remained stubborn and sticky next year. >> At the textbook understanding to of what central banks change their policy rate. It takes time to filter this way through the economy. We are getting supersized hikes. But at some point, I guess in that framework, I guess it's conceivably… We can let this work through the economy and see what it does. >> That's a great way to phrase it. 6 to 8/4, sort of the textbook timeframe for monetary policy impulse. The rate hikes to feed through. They talk about neutral. Here in Canada it's 2 to 3%. So let's just say that the Bank of Canada wanted to get just above neutral. That's what it's been talking about. So 3 1/2%. It gets there. To your point, maybe it pauses and reflects. It sees how sticky inflation is. Is it coming down? How is demand? How is housing in Canada working through? And then reassess if it wants to go to three or 4% to what's priced into the market actually starting to cut it in 2023. That's another scenario. >> All right. Another question coming in from the platform. Are you seeing opportunity in emerging markets or is it too risky right now? >> It's a great area to be invested in. It, like everything else, high-yield credit has underperformed. We've seen negative returns in that space. There are two spots you can invest in emerging market. Hard currency as we call it. US dollars predominantly enters local currency. I would say you really have to do your homework. You've been burned by Russia, you've been burned by Argentina in the past. There are pockets of opportunity. But you really have to look at the fundamentals. The pressure right now with really strong US dollar, a slow global growth, you are seeing some really episodic weakness in some countries like, for example, Chile. Copper… Weak balances and trade deficits. Their currency is really underperforming. We are seeing it in other pockets of vulnerability around the world. So with that, the repricing has come and attracted opportunities. But you really have to pick your spots in where you want to invest. One of the markets that we have invested in is actually more comfortable with that. On a hard currency basis. But there are other opportunities. >> When you talk about the Fed, obviously, to watch the actions of it, we are talking about central banks. Of course the rate increases. The supersized rate increases. They're capturing all the headlines. For good reason. It's changed the lives of Canadians and Americans. We have talked about tightening. What is the interplay here? With with the Bank of Canada is doing? They are embarked on QT. > The shrinking of the balance sheet. The online is just a reduction in overall liquidity of the market. That's what capital markets have had to deal with. You've got a slowing global economy, you have pressures from the commodity side and the rapid tightening and monetary policy, the rate hikes as well has contributed to a shrinking of liquidity. By and large, we have seen a big repricing of that and the markets have been dealing with the reduction liquidity. You are seeing and feeling as investors the reduction liquidity, the anecdotal conversations that we have about reduced liquidity in the treasury market, the corporate markets. That is laying over things and periodically we get these rapid repricing in the markets. You are trying to put rhyme or reason on it going up because of this, that, going down… Some of it has to do with positioning and lack of liquidity the markets. I would generally describe the markets as in the cab of a slower growth. Possibility of recession. Position for that. So you know periodically, we get these rapid repricing is where… Some of it has to do with liquidity and that reflects what policymakers have. >> Interesting stuff. We'll get back to your questions questions for Scott Colbourne from TD Asset Management taking your questions on fixed income in just a moment. As always, make sure you do your own research before making any investment decisions. And a reminder that you can get in touch with us any time.. Send us your questions. There are two ways you can get in touch with us. You can send us an email anytime at moneytalklive@td.com or you can use the question box right here on the screen at web broker. Just writing your question and hit send. We'll see if one of our guests can get you the answer right here at MoneyTalk Live. The price of oil is trading back above $100 today, but new research from td securities suggests it may not stay there long-term. Joining us now for more is Moneytalk's Anthony Okolie >> TD security says they are less… On oil and oil supply over the next 12 months. That's according to official sources and their peers. Now in sharp contrast to early March when WTI crude peaked at just over hundred $30, US per barrel. Prices actually broke over $100 per barrel last week. Now prices sit above $100 per barrel. Around $96 per barrel. TD securities points to simple factors driving the weakness in oil. That includes, US seasonal demand data. Also a very strong US dollar. This of course hit its highest level since 2002. Also concerns of demand from China as infections continue to spread across the country. They also point to what they call someone unrealistically optimistic OPEC supply projections. Interest takes over the Federal Reserve. Now historically, crude oil prices have declined between 50 to 75%. TD securities concludes that despite a recent move above $100 per barrel, they say that a key North American benchmark crude brings to an $80 range over the next six months. As recession concerns continue to move front and centre. Greg. >> Under what circumstances would TD security see oil move higher? >> TD security does not see prices moving higher until the Fed pivots toward… We start to see demand rebounding and reflection of higher prices. Now, in those circumstances, TD securities believes that a move into the mid-90s or even higher is quite likely. >> Interesting stuff as always, Anthony thank you for that. Money talks Anthony Okolie. Let's start here at home with the TSX. 1. 6 to 1.7%. 310 points to the upside. Broad-based rally our hands today. I told you earlier about unconfirmed reports of West Frazier could be a takeover Target. Some of the competitors in the space two. 29 bucks and $0.97 a share. Almost 9% on this session. There is some interest. … Based again on unconfirmed reports. Let's take a look at the S&P 500 and see how things are holding on south of the border. We are about 2% now hundreds of the gains. 500,013. Now the NASDAQ 100 at this hour. 2.21% for the NASDAQ 100. IBM at the top of the show we were talking about how foreign-exchange effects are hitting the sales line. All these big tech companies in the states of course have foreign sales and they repatriate those dollars. That strong US bug… It does present a bit of a hit. In terms of that revenue. Even though there was a fairly strong quarter, they said demands or products warning for the year, stock down to 6 1/2% at this hour. They are not alone. Other big US tech companies with sales up about hundred 29 bucks ^... ¸ AND WE'RE BACK NOW WITH SCOTT COLBOURNE FROM TD ASSET MANAGEMENT TAKING YOUR QUESTIONS FIXED INCOME And now a question of why would you buy bonds at about 4% when reliable companies pay over 6 1/2%? >> Obviously there's equities that are riskier. It's just a different part of the capital structure and your pay to take more risks. So look, you can… It depends on your age and your circumstances and your portfolio construction of how much equity you want in your portfolio. Certainly there are attractive dividends whether it's the preferred share market or common shares with attractive dividends. Obviously that makes part of your portfolio. How much is up to you. How you decide to do it, in a way that makes sense, right now, you definitely think about fixed income. Because for the first time in a long time, you're getting income. Whether it's corporate or corporate's yielding more than 4%, about 5%, you were stepping into high yield. I'm not a big fan of high-yield. You are at 8 1/2%. Investors forget. They think high yields is just junk. It's by nature bad. But when you look at the long-term in terms of high-yield, you know, you are getting equity north of 7% with a fraction of the volatility of the market. So, if you are risk seeker and you want equity like fixed income and your portfolio, you can do better than 6 1/2 by putting yourself in a broad index of high-yield bonds. It will have less volatility than the economy… It really is circumstantial. It depends on your tolerances and how you want to invest in your portfolio. For the first time in a long time, you are being paid to think about fixed income. >> Interesting response to that one. We have another question here we have coming in, the US dollar, we just talked about the strength of the US dollar were with IBM and what it's done of the salesforce over the past year. Do you expect this US dollar strength to continue? > So we looked at the US dollar over the last year and it's up, on a broad basis, the broad and bet the broad index of the US dollar is up about. In some currencies it's more than that. . . . . . . . we've had this rapid adjustment of monetary policy. I would say there's a lot of good news priced into the US dollar at this time. I'm not saying it can continue to remain firm. But I think we are running into a point where it's a hard consensus trade. The marginal trade for here is going to be harder. We've had, today, we are off a little bit. Surprised news that ECB might raise rates 50 basis points. I think that by large, the US dollar will remain firm but the pace of gains is going to slow down as we move to that point where central banks sort of, reassess and take that pause point. Maybe a 3 1/2%. Maybe at that point you will see some continuation of production in US dollar strength. >> Here's an interesting question although we are not oddsmakers. I'll share with the audience. Question is coming in: would you put a percentage chance of a soft landing for the Canadian economy given the recent 1%, 100 basis point rise by the BOC? Tough medicine. Can they achieve that soft landing? >> Soft landing. It's a narrow runway to get to a soft landing. You navigate a big economy and in the imbalance in Canada it's really the housing market. You tell me which way and how hard the housing market lands in Canada. You know, I can tighten up the probabilities. It's going to be led by the consumer of North America. Canada more so by the housing market. The Bank of Canada has said to be forceful. It's nothing to back off anytime soon. So I can give you a number. But certainly you can distill probabilities from various embassies in the markets that's over 4% right now, pricing in a recession. Right now, with the consensus sintering on a softer landing in North America, it's tough. It's tough to put a number on it. >> Didn't think would be in this situation, talking about 75 and 100… That's actually all the time we have questions. Any final thoughts for viewers right now when it comes to fixed income? Heading into the fall? >> I think we've talked about thinking about fixed income and how it plays no portfolio. We have to be mindful of the fact that the factors influencing policymakers right now are different than when Ruth where we've been over the last 10 or 15 years. Expecting yields from that reprieve and cut to lift the markets in the new year might not be something that we can expect. But certainly, the discussion that we had, >> Always great to have you Scott. Our thanks to Scott Colbourne, managing director for active fixed income at TD Asset Management. And stay tuned tomorrow: Daniel Ghali from TD Securities will be on the program tomorrow taking your questions about commodities and a reminder that you can get a headstart, just email moneytalklive@td.com that's all for our show today, take care! (music)
