Index investing in S&P 500 ETFs offers diversified exposure at low cost.
Canadian provinces demand pause on carbon tax increase due to living cost concerns.
Economic indicators like Producer Price Index suggest potential impacts on monetary policy.
Deep dives
Benefits of Index Investing
Index investing, exemplified by owning an entire index like the S&P 500, is praised for its long-term benefits. An example provided is BMO's S&P 500 index ETF, which tracks this well-recognized and popular index, offering exposure to market returns at a low cost with a management fee of just 0.08 percent. This ETF is highlighted as a convenient and diversified option for investors seeking exposure to the largest and most liquid public companies in the United States, effectively reducing single stock risk and saving time and effort.
Challenges Around Carbon Tax
Discussions revolve around the challenges and controversies related to the carbon tax, particularly concerning its impact on various Canadian provinces. The episode delves into the ongoing debate surrounding the increase in carbon tax rates, with several provinces like Saskatchewan refusing to collect it. There is a call from various Canadian provinces, including New Brunswick, PEI, Saskatchewan, Alberta, Ontario, Nova Scotia, and Newfoundland and Labrador, to pause or cancel the upcoming carbon tax increase in April, reflecting concerns about its effects on cost of living and inflation.
Economic Indicators and Market Dynamics
The podcast covers current economic indicators and market dynamics, emphasizing the significance of Producer Price Index (PPI) data and its implications. With PPI showing unexpected growth, there is a focus on the potential impact on monetary policy and market movements. Discussions also touch on rising bond yields, reflecting changes in market sentiment and liquidity. The episode highlights the interconnectedness of liquidity flows, market complacency, and perceptions of risk, drawing comparisons to past market bubbles like the 1999-2000 tech bubble. The episode concludes with a cautionary note about understanding market dynamics and the importance of maintaining balanced perspectives amidst market exuberance.
Economic Outlook Based on Indicators
Indicators like exports from Korea and consensus economic forecasts in the US point towards a re-acceleration in growth. The discussion also touches on PMIs and ISMs indicating a bottoming out and overall improvement in growth expectations, leading to a potential dilemma for the Federal Reserve.
Impact of Fiscal Spending on Economic Growth
The conversation delves into the impact of government fiscal spending on economic growth, highlighting concerns about increasing debt and its sustainability. The dialogue between the hosts emphasizes the importance of considering population growth, productivity, inflation, and the need for a balance between government spending and economic sustainability.
Premiers across the country are demanding Trudeau to pause the Carbon tax increase. US inflation jumps on higher producer prices. The crypto bull market is back. Rich takes the helm at the Bank of Canada.
