Canadian Stupidity or Lies? Bear Market Rally, Gold Roars Back

Canadian Stupidity or Lies?

I cant believe what I am hearing on the Canadian election so hopefully as the saying goes believe nothing you hear and only half of what you see. This is where the liberals took Canada.

Mark Carney and the liberals show a big lead in the polls. This is the same liberal government, except that Trudeau's economic advisor Carney is now the PM. If you listen to Carney and the liberals, their election promises are against all the things they previously stood for. What, why the change? The party and it's people have not changed, it is simply election time and they are making promises they will never keep. If elected they will go right back to the path they were on previously. Above chart is where that led.

One of the big reasons Canada declined as shown above is there was way too much immigration and refugee influx for a country Canada's size. That big increase over ran Canada's health and education systems and caused the housing shortage. Not to mention crime coming with it.

Who is right about the Housing Crisis Solution?

PM Carney is advertising and going around saying the liberals will build houses like never seen before. This is simple propaganda because government does not build houses but skilled labour that Canada has a shortage of is suppose to.

According to industry organization BuildForce Canada, 22 per cent of the workforce is set to retire in residential construction in the next eight years. That's approximately 259,100 workers. However, retirements are expected to outpace new entrants into the industry, with 228,100 projected to enter the industry in the same time period.

A recent CBC news article titled - Why Canada is on the cusp of a housing construction crisis. It says - Immigration system bringing in wrong type of workers, warns industry.

Stats Canada's own report In the Q4 of 2024, over one-third (37.3%) of all businesses in Canada expect to face labour-related obstacles over the next three months. Recruiting skilled employees, reported by over one-quarter (28.3%) of businesses, was the top labour-related obstacle.

The liberals have been silent on any change to immigration. Conservative Leader Poilievre has a way better plan, because he also says he will implement incentives to train 350,000 more trade workers across the country. Billing it as "more boots, less suits," Poilievre told reporters in Ottawa a couple weeks ago that his plan will "bring home a country that works for the people that do the work."

This poll on oil&gas is really unbelievable

Polls say liberals better to lead Canada on conventional energy. WTF, are people this ignorant or are polls lying? Carney is going around saying his government will build conventional (oil&gas) when throughout his career he has been pushing alternate energy and against fossil fuels. Meanwhile the liberals have a ban on new pipelines, ban on oil tankers on the west coast despite the new pipeline there and are maintaining their oil&gas cap. Wow, talking out of both sides of your mouth, and Canadians are gobbing it up. Unbelievable!!!!!!!!

Check out at the 1 minute mark on this Toronto Star video for Poilievre on energy. You can watch Carney at the beginning too, blaming Trump.

That is the other bizarre thing, the Canadian election seems focused on a foreign leader, with the propaganda bamboozling Canadians.

Way biased media

Last night I listened to legacy news on TV and everything they said about Poilievre was spun with something negative about it while everything about Carney was positive.

One election promise Carney will keep is to give the CBC another $150,000 million. Meanwhile Poilievre is promising less funding to the CBC. Is it any wonder the media reporting is one sided?

Some people use to question why I follow politics, and my response was the government policies can really effect markets. You have to look no farther than the big stock rally when Trump got elected and now the crash on his tariff policy.

Maybe this election in Canada will be similar to the Donald Trump and Hillary Clinton election of 2016. Polls showed Clinton was way ahead and was expected to win in a land slide. However Trump won proving the polls were way off.

My other observation is Poilievre is getting huge crowds at his rallies and Carney small crowds. It does not make sense by what the polls say.

Poilievre has no Smoking Gun - Chinese Interference?

Trump had Clinton's hacked email account that was a no, no to use a private email sever for government communication and was quite embarrassing for Clinton.

Perhaps Poilievre has Chinese election interference helping Carney but seems this story is being buried. The Security and Intelligence Threats to Elections (SITE) Task Force reported this week that the top news account on the popular Chinese social media platform WeChat had published two articles in March about Carney, and that their narratives had been “deliberately” amplified in a “coordinated and inauthentic way.”

I read an article by Scott McGregor who is a former Canadian Armed Forces intelligence operator and intelligence adviser to the RCMP. He is the co-author of “The Mosaic Effect: How the Chinese Communist Party Started a Hybrid War in America’s Backyard.”

“As Canadians prepare to cast their votes in the upcoming election, there remains a conspicuous silence echoing through the chambers of power and on campaign trails alike: the problem of Chinese Communist Party (CCP) influence in Canada. It is not a question of whether this influence exists, but rather how deeply it has embedded itself—and why few seem willing to speak about it.

I’ve seen first hand how Beijing uses sophisticated non-military tools—what we now define as hybrid warfare—to infiltrate and influence democratic institutions. At the core of this strategy is the United Front Work Department, an agency of the CCP that specializes in co-opting elites, manipulating diaspora communities, and shaping foreign policy in target nations.

I refer, of course, to the problem of interference in our electoral process. Despite decades of intelligence by the Canadian Security Intelligence Service (CSIS), at least one report (by former Gov. Gen. David Johnston) and a lengthy inquiry (the Hogue commission), this is generating next to no attention in the current race to determine who will form the next Canadian government.

It is not as if the warnings are not continuing. Reports of AI campaigns for or against Liberal leader Mark Carney, and a candidate calling for a Chinese bounty on a perceived dissident running for office to be collected, are two of the latest examples. The list goes on and on.

And yet, how much time and energy is devoted to this in the debates and stump speeches? While I am certainly not following every candidate stop at a sugar shack, I cannot recall seeing anything that suggests this threat is receiving the concern and attention it deserves.

The question then becomes… why?”

I think I know the reason why and that is because the interference is beneficial to the liberal party so them and all their Canadian media shills keep it quiet as they can.

Bear Market Rally

Yesterday was a strong and surprise rally when Trump announced he would delay his reciprocal tariffs by 90 days. The White House says 75 countries have contacted the White House to negotiate trade. If the Trump Administration can negotiate better trade deals and not have to use tariffs extensively it will be a real win for Trump. However, China will fight all the way because they have been preparing for this.

Although the S&P 500 did not enter an official bear market yet, it came very close, so I am going to label yesterday's rally as a Bear Market rally. I mentioned that these rallies are when you make portfolio adjustments if you need to. Markets pretty well tested resistance around 5,500 and there is more resistance between there and the 200 Day MA.

Markets headed back down today on an inflation report, a CPI Surprise. The CPI unexpectedly fell -0.1% in March, as the 12-month inflation rate slid to 2.4% from 2.8% in February. The core CPI edged up just 0.1% vs. 0.3% forecasts. That lowered the 12-month core inflation rate to 2.8%, the lowest since March 2021.

I have been commenting that inflation will not be a problem and tariffs will likely not cause any either. A weak economy is going to be the dominant factor that will ease price pressure. I said this would be obvious in the 2^nd half of the year. Maybe it is already getting started, but one month does not make a trend. That said, the drop in energy prices if they hold will bring April's inflation number down because they are much lower then April a year ago.

I want to emphasize again that this bad market is not caused by Trump Tariffs, they are basically the pin that pricked the balloon. The market was a bubble just waiting to pop. This new bear market is going to be driven by a likely recession and stock values coming back to the norm.

More bad economic news. Total consumer debt contracted by $0.8 billion, a -0.2 percent decline, according to the latest data from the Federal Reserve. The slowdown in borrowing was sharp and unexpected. Analysts had forecast a $15 billion increase in consumer debt.

Households are buried under a record level of debt. As of the end of 2024, total household debt stood at $18.4 trillion.

Americans have now run up their credit card balances to a record $1.32 trillion and defaults are rising. I think many got fooled by the narrative that the interest rate increase would be temporary. Rates are probably going to start coming down, but for the wrong reasons.

Reported April 8, the NFIB Small Business Optimism Index continues to slide. It declined by 3.3 points in March to 97.4, falling just below the 51-year average of 98.

Another negative factor will be a trade war with China, but this was going to happen regardless of other tariffs.

Another reason that tariffs get the blame for the market crash is what I call the hate Trump syndrome. The media digs out anything they can to bash Trump. I follow Martin Armstrong and although he has what some may call a checkered past, you cannot deny the accuracy of his computer model on the economy, geopolitics and markets. His comment summed it up nicely.

“The market drops, and the headlines create confusion and panic. This time, it was far worse. The hatred of Trump sends the press off into a fever, foaming at the mouth, hoping this will be the silver bullet to kill him once and for all. They exaggerate all for rhetorical points. They care nothing about the people, the nation, or anything other than their personal hatred. They are traitors to the country. If you cannot be objective, being in the media with such personal vindictiveness should be a crime. These are the lowest type of people in humanity. I would sell every share in every media company that spews out this constant hatred.”

Gold and Gold Stocks Roar Back.

I called the correction gold over to the day and that gold would go back up, but the strength of this recovery was a bit surprising, basically gold has had two back to back days of about $100 gains. I commented we could see new record highs next week, it might happen Friday.

Some of the gold stocks have been slower to recover but they will all get to new highs as well. The HUI index is making new highs today. I commented I wanted to see a 375 close as a clear break out, we are almost there.

Rio2 Ltd. TSXV:RIO – The stock closed at $0.78 the day I put the newsletter out, so will use that has our buy price.

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