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Re: tax loss sellingPreferred bank stocks. Interesting play. The preferreds have sold off with the commons. From what I observe, charts for American and Canadian bank preferred shares are rather similar. The preferred shares are best for conservative income. For capital gains and actively trading business cycle fluctuations, the commons tend to be better. Preferred bank shares are not an obvious way of playing tax loss selling but, frankly, why not? "I strongly believe that the Fed is under tremendous pressure to not kill the economy, so their future rate hikes will be smaller and maybe even less frequent. My bet was on that." -m The Fed has so far failed to significantly dent inflationary expectations; thorny supply issues (mostly driven by politics) persist in the background. Due to past transgressions, the Fed will have no choice but to continue to raise rates in H2 2023 and will have to put the US economy into recession in order to bring down inflation. People are not screaming about this on the investment chat boards either but the senior people in US economic and financial elites lived through the 1970s when guns & butter fiscal policies and stimulative monetary policy created stagflation that coincided with stagnating productivity growth. (Not really a 'coincidence'.) That was a formative period for many. So were the Paul Volker rate hikes in the early 1980s. I expect at least another 150 bps FF rate hikes between now and late winter even if they come in only 50 bps increments. A US recession is more than likely coming. The term spread/yield curve forecasting models are as about as clear on this as they have been in post-war period. Figure 2: 10 year-3 month Treasury term spread (blue), and 10 year-2 year spread (red), %. Source: US Treasury, author’s calculations. Both spreads are now firmly in negative territory. My latest estimates (for data through Nov 23) here. ------------------------- One can play bear market rallies but for many, they are viewed as risky. I have a couple of friends who are essentially sitting on and cash until H2 2023. The bet is that a US recession will be underway and stock markets will be near a cyclical bottom. Other than hydrocarbons and maybe a couple of other sectors, I find that strategy attractive. Precious metal prices can steadily climb while overnight central bank rates climb. Junior precious metal miners have sold off hard this year. Not for me but that bet could work for others. Many base metal junior and mid-terms have sold off hard during 2022 but it is not clear how they will make out as the global economy slows into recession. All this talk of fantastic exponential growth in demand for battery and electric grid metals will not translate into higher prices for the next while if much of the world is in recession. ----------------------------- Of possible interest: One way to find tax loss opportunities is to construct watch lists of stocks on a site like the TMX.com and then look at the 52-week range price chart. |
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Msg # | Subject | Author | Recs | Date Posted |
62163 | Re: tax loss selling | makemoneyinoilandgas | 0 | 12/5/2022 2:32:33 PM |