January 2019 edition of Views from the Crowsnest

Welcome to the January 2019 edition of Views from the Crowsnest.

Long-term financial prosperity pre-supposes survival of short-term crises. Survivors are guided by brutally-honest practicality versus high-minded theories and prognostications. People who obsess over appearing impressive rarely are (e.g. cable news), whereas those who focus on being effective usually succeed. Therefore, I will concentrate on practical solutions to a couple key challenges that we see from up here in the Crowsnest. Do what works – and nothing else.

In this issue: 1) easing the burden for those charged with handling the financial affairs of deceased and/or incapacitated family & friends, and 2) allowing the Canadian energy industry to prosper while keeping Confederation intact.

Fortunately, the world is full of smart, dedicated, conscientious and industrious people of good will. It’s our job to find, harness and direct the best in their respective fields to optimize Client outcomes. Leveraging technology positively is the common thread in our solutions. Do what works – and nothing else.

1) In 2019, we’ll be introducing a service to our Clients which will significantly decrease the stress, time and complexity associated with the management and wind-down of an Estate. This will include helping our Clients to minimize the burden left for their offspring, as well as other family members. Anything substantive we can do to reduce preventable stress for our Clients is a priority for IWM. This will be an additional service in our overall wealth management offering, with zero additional cost to Clients. We’ll roll it out no later than this summer, starting with our retired Client Families. Technology is the key.

2) How can we allow the Canadian energy industry to prosper while keeping Canadian Confederation intact? This is THE question emerging from the current Canadian energy industry crisis. Make no mistake; this is a national crisis that just happens to be headquartered in Alberta. The financial consequences for all investors could be disastrous, not to mention the future political stability and peacefulness of our very nation.

The fancy people in the mainstream media are downplaying the rising voices of Western Separatism, and it really annoys me. While we fully expect that from our state-owned broadcaster, the self-appointed leaders of popular opinion are (ironically) completely detached from popular opinion in Alberta. Is this a deliberate choice by owners of The Globe & Mail, Post Media and the Toronto Star? After all, they have to “earn” their piece of the new $595 million slush fund offered by the federal Liberals to help in their October 2019 re-election bid. The longer the mainstream dismisses or ignores this reality, the worse the situation becomes.

Meanwhile, back in the real world many serious people are talking more openly and sincerely about how badly Alberta is treated within Canada, and what must change in order for Alberta to remain. For the 35 years since the National Energy Program hatched by the smarter Trudeau, Albertans have quietly muttered about how Quebec is treated “more equally” than any other province.

Fortunately, we’ve had our time filled with things like work. When economic times are good, everyone is “fat and happy,” busily enjoying the fruits (and carbs!) of their labor. Not anymore. The anger is palpable, the rhetoric is rising, and the financial facts are pretty damning.  Albertans’ collective frustration is legitimate and understandable.

For the sake of crystal clarity, I am NOT a Western Separatist. I am a very passionate and frustrated patriot. I exist – quite literally – because of Canadian bravery, resilience and pure grit during World War 2. My parents recounted the elation they – and all of Holland – experienced as CANADIAN TROOPS liberated their starving, bombed-out country.

Being the 8th born of immigrants whose homeland is largely below sea level, I’m a hard-core pragmatist. Thanks to Jim Dines, I also understand the power of mass psychology; in this case the rising popularity of the desire of many Albertans to self-determine, rather than being treated as the goose that lays the golden egg…and which the political and media elites look down upon as an embarrassment that leaves unwanted treasures on their yachts.

Canada’s golden goose – the fossil fuel industry – has a major image problem. The industry hasn’t fought back early (or strongly) enough against the decades-long “de-marketing” and disinformation campaign waged by the radical environmental activists – funded largely by US donors. Canada’s energy industry is full of ethical, educated, innovative and industrious people…but they forgot to watch their own backs. Vivian Krause will shed more light on this on March 16, 2019.

Now the industry has awakened to how much abuse it has taken, and how deliberate the process of land-locking Alberta oil has been. Anger PLUS feelings of righteous indignation combine into a very powerful – and dangerous – force. We need to collectively inform, direct and harness this energy in a positive way…or there’s REAL trouble on the horizon. We need calm, mature and principled leadership to get us through this; but we currently have Justin Trudeau.

Integrated Wealth Management is stepping up to do its part: a) I’ve already initiated discussions with our Portfolio Managers on defensive measures that need to be in place should this situation escalate, b) I will be travelling to Ottawa in February to participate in a planned rally in support of the Canadian energy industry. We need to bring this problem in front of the Ontario and Quebec media, and c) we’ve scheduled a special event for March 16, 2019 to specifically address this issue.

The event on Saturday, March 16th 2019 will be held at Mt Royal University. When we booked this venue in the summer of 2018, we had a different agenda planned but have shifted gears to adapt to the biggest financial issue facing Albertans. We’ll have four primary speakers: Mark Milke, Josef Schachter, Vivian Krause and Michael Campbell. Click here

Tickets will be free for our Clients, and we’ll also offer a discount PROMO code for our clients to share with their family and friends. We’ll have full registration functions up and going on our website shortly. Capacity for this venue is around 600, so we recommend registering when we send out the first invitation.

We’re also making excellent progress in the development our long-term project: a long-short pool combining the expertise, systems and insights of some key professionals. We’ll be ready when the last remaining analytical tool becomes available, hopefully very soon.

In the meantime, North American equity markets appear to have bottomed since Boxing Day. It’s been an ugly year-end in global equity indices (particularly on Canada), and we’re very grateful that our Portfolio Managers have done an admirable job of buffering client accounts from the worst of the damage. We’ve taken some bruises, but nothing close to catastrophic. Mission accomplished on surviving this recent mini-crisis. Long term financial prosperity can now be pursued.

And just today, it appears that there MAY be some positive movement in the US-China tariff battle. I don’t want to read too much into this just yet, but this headline from the BBC suggests that China’s leadership MAY have just blinked in the negotiation process. I’ve openly criticized Trump’s use of tariffs (a tax on consumers to temporarily save some jobs in key states), and I sincerely hope that he pulls a rabbit out of the hat here. I will gladly “eat that hat,” speaking figuratively, of course.

IF Trump somehow manages to pry open China’s domestic markets for wider American competition – which no one else has ever managed to do – he will have pulled off the greatest economic victory of the last 50 years. Goodness knows there’s been more than enough chaos and hysteria around his administration…it would be nice if a second unambiguously positive policy could emerge from the White House. Tax reform was the first.

Patience and Discipline are accretive to your wealth, health and happiness – so focus on these.

Cheers,

Andrew H. Ruhland, CFP, CIM
Founder, Integrated Wealth Management
t: 403-517-2234