Always Expect the Unexpected

One of the hardest challenges in stock picking/ investing is to anticipate government policy and its taxation on capital..which influences the cost of capital as we measure risk and then the allocation of capital.

Last month Canada with its newest elected officials went completely against what they were elected into office on and now will tax all trust formats in Canada..the capital markets immediately lost well over $50 billion in a matter of days...that would equate to a 10% market correction here in America. China changes their policies almost weekly as they are reforming their capital markets....and now with the stunning upset in Washington...policy makers are sure to once again change the tax code here in America. Investors need to be aware of the material ramifications of raising taxes and the future value of equities. Higher taxes equals a lower stock market. Pretty simple.

The stock market is climbing a classic wall of worry, it is forcing those in cash to chase the rising indexes and those short to cover losses as certain stocks break out to the upside. Start putting your tax loss selling candidates together...there are many great buys out there now..looking to make bottoms.

Barkly seen here is watching the beginning of the hockey season here in Minnesota. The Bantams are looking pretty good this year!