March 29 Episode
58:12 Share

Well, good morning. It's Victor Adair, and I'm sitting in for Michael Campbell this week, and we've got a dynamic show lined up for you. And we're going to come out of the gate hot with Ryan Irvine. Ryan's from Key Stocks. And of course, if you've listened to Money Talks at any time over the last 25 or so years, you've heard Ryan many times. He focuses on particularly small cap value stocks. That's what I kind of think of when I think of Ryan over the years. Ryan's

Ryan, honestly, I've loved this guy since we met. When we meet at the different conferences and on the show here, we always kind of kid around and have fun with each other. But let me welcome Ryan to the show. Good to have you on.

And Victor, the feeling is mutual. We shoot barbs back and forth. I think we have been doing it for 25 years, but it's all in good fun. And hopefully we can have a little of that today. But you're right. We started in the small cap sector, look for growth and reasonable price. We're looking at value and growth.

and really sector agnostic across all sectors. We're going to talk about three companies today that show that we don't care about the sector. We just care about the cash flow and earnings and the value in those businesses.

Yeah, I mean, that's one of the things I love about you. You don't care what the hell they do just so long as they've got a good business model and they're making money and they've got an opportunity to grow. But let me just frame something here. Like we both said small cap a couple of times. It doesn't mean that you're unaware of

of the macro picture. And right now, macro, I mean, the first two words in macro are Trump tariffs, you know, like, and that's really important in the market. Give me like a quick take on your macro overlay and how that affects the way you look at your key business.

Yeah, and you're correct. I focus on the micro small caps for Keystone, but we build full 25 stock portfolios. Aaron looks at income stocks and we have guys that look at the US too as well. But on the tariff front, I like to preface it by heading into 2025. We saw the markets kind of historically expensive and we can get into valuations in a second. But as an analyst, these are really fun times in terms of tariffs.

You're examining business structures, supply chains, where the goods originate from, what the exposure is for an individual company, but you're also looking at who can benefit.

Not all of our losers in this scenario. We're looking at a couple, for example, US-based manufacturers right now that may benefit from this. And then you do all that analysis and it can change in a day when the tariffs go on or off. Sometimes it seems like a whim. So fortunately,

We do see markets kind of correct themselves. The sharply lower Canadian dollar, for example, is adjusted for some Canadian exporters. And we have to test these companies to see who has pricing power, who does not. If you have pricing power in this environment, we like that. If you don't, we're staying away.

You have to be mindful of all of this change, but we do not stray again from our fundamental approach, looking at great businesses with strong balance sheets. Right now, balance sheets are really in focus. We love net cash companies because in weaker times or in uncertain times,

They can have a fortress there that they can hold the business, but then they can power out of those times by buying other weaker businesses and grow. Basing an investment strategy on a sitting government policy is often folly. We could see change even in the US in midterm elections. We might not.

but our focus is five plus years when we look at any investment. So we're most often outlasting any sitting government. I'll give you an example of kind of folly of, uh, of basing an investment strategy on a policy. Um, many Canadians this time last year sold, uh, because of the coming capital gains tax, they sold assets that they probably didn't want to sell. Uh,

And then we see a flip-flop from the government, and now there is no capital gains tax. So you do have to look longer than a couple of years out. But if you want to talk about valuations, we can talk about that where we are today after a correction in the market. Should we talk about that? I think valuations is a great idea from my macro perspective looking at the stock market, and I trade it actively. Yes. You know, it was hard to...

avoid the elephant in the room, you know, the Magnificent Seven, or I think if you took the top 10 capitalized stocks on the S&P, they represented 40% of the market weight. Massive influence. Yeah. So tell me about Mag7 relative to the rest of the market. And like you, by the way, coming into 2025, I just kind of had that

gut instinct that, man, we are priced for perfection here. There's a lot could go wrong.

Your gut is not wrong. Heading into this year, we were definitely priced for perfection. We used something that the MAG-7 was powering what we call the high in the Shiller PE. The Shiller PE is a cyclically adjusted PE. It gives you a broad idea of the broad valuations and it massages out some of the fluctuations and earnings over time.

The Shiller PE, starting this year, it was at basically an all-time high. It's only been that high twice in its history. Today, after a correction, it's come down to about 35.1%. That's still 30% higher than the 20-year average and about double the 100-year average.

Now it was within a stone's throw at the start of this year of its all time 20 year high. So it's 20 year high of 38.6. Again, it's only been there twice and been that expensive twice.

over the last 100 years. With that backdrop, it's really not surprising for us to see weakness given this uncertainty largely surrounding new, potentially more protectionist period that we're seeing. I don't think it's really potential at this point. But to be blunt, in the near term, the markets hate uncertainty and the trade war creates uncertainty. We are a bit surprised that the market has not corrected further in some of the names. Now, that's not to say that

There are not some opportunities here, but are we out there, say, aggressively buying auto parts manufacturers or steel makers? No.

There are some select companies that we see value in today, but that's based on a fundamental cash flow basis. And that's looking at, you know, five to 10,000 stocks annually. We have a book of names right now, and some of those include the mag seven, but we have a book of names right now that we're monitoring very closely about 20 stocks, businesses that we really want to buy or want to buy more of in some cases, uh,

but they've been too expensive. So we're awaiting these quality businesses to drop, come on sale, come into attractive ranges.

And I'm going to say, Victor, most people believe that you get rich in boom times. We see it very differently. You make your money in down markets, positioning yourself in great businesses that come on sale in sympathy with the overall market. Now you realize the fruits of that research or your label, you reap that harvest in their portfolio, any bull surge, but it is the work you do during the weaker times, uncertain economic times that allows you

our clients or us to profit in good times. And that's what we're trying to do today. If you look at some great companies have, we want to buy great companies at a margin of safety. And in terms of

finding a discount to their intrinsic value. You don't get that in normal economic conditions. This is both on the small and the large cap side. Like you said, we just did a review of the magnificent seven. The sell-off has placed some great tech businesses closer to on sale. They were very expensive, but have come closer to be on sale than they were in the past, uh, maybe decade. Um,

Amazon, for example, is a company we're monitoring closely. At one point last week, it was down 20% from its year highs. So that's in correction territory for sure. It trades at the lower end of its price to free cash flow multiple over the past 20 years, basically at its lowest rate, despite inflation.

the fact that like you compare to the mag seven, but also compared to a company like Costco. I think Costco is a wonderful business, but it's bricks and mortar. It trades at 51 times forward earnings. Amazon, you can buy now for 31 times. Um,

Costco certainly does not have the largest cloud business in the world like Amazon does. That is a very high margin business. So a company like Amazon and Alphaget, for example, both of them trade at historical lows on their price to earnings and price to cash flow basis. So they are becoming interesting. On the flip side,

Tesla is the most expensive of the mag seven right now. So when we do the analysis there now, and this is not to say, I'm not saying I don't like Tesla or I love Amazon or anything like that. I'm just looking at the numbers and where they lead me. And do I see growth in these businesses going forward? Well, we've seen a slowdown in growth in Tesla. Earnings have actually accelerated in Amazon and you're seeing, uh,

A switch in terms of the multiples. Amazon's at its lowest. Tesla's at one of its higher multiples in the last three years. So these are where the numbers lead us. They lead us more towards the Alphabets and the Amazons. In our upcoming webinars, we're going to review all of those and really drill down in about a 20-minute segment there where we see where the numbers are leading us and where we think the opportunities are in those MAG7 that certainly drive the markets.

Actually, let's talk about that webinar that you mentioned. I think you've got two coming up, April 3rd and April the 9th. You're going to be doing a webinar. Our listeners, the best thing to do here is to go to Mike's Money Talks, the website for what we do here, and you can register for the webinar there.

To come back to tariffs, I know one of the – well, actually, let's do it this way. We've only got a few minutes. It's always a problem, but you're going to give us a little taste, as it were, here today of what you're going to do on the webinar. And I loved your highlight in the note you sent to me where you're trying to find some stocks that –

are not going to be hit one way or the other with the tariffs that are coming out. So what do you call that? Like tariff neutral or something? What's your term for that? Yeah, we're saying tariff proof stocks, basically tariff proof stocks. We've got a couple today that really are tariff proof and these fall into our category of that. We'll talk about it at the webinar to have orphan stocks. Um, these are stocks that are often smaller companies kind of ignored by the investment community. Uh,

They may be trading at low valuations measured against their current or future prospects.

I'll give you an idea of how rare these stocks are. When we look at 5,000 to 10,000 stocks, we might find 2 to 5 on an annual basis. They have the potential to have lucrative profit element. Higher risk they are, but a lucrative profit potential in your portfolio. I'll give you an idea of the kind of magnitude of mispricing that we see in these stocks. We believe that they're 75% to 100% plus undervalued. That's why they're rare, and that's why...

There is higher risk, but the upside compensates you that. Now there's, why would a stock be trading at 75 to a hundred percent below its intrinsic value? Well, it's because it became orphaned for a number of reasons. They're not creating shareholder value, minimal historic profits, weak margins, limited growth, declining businesses, poor business structure, basically the antithesis of everything that we look for in a great stock. So what changes this? What,

brings an orphan stock into, or what brings a terrible business into an orphan opportunity. Most often there's some fundamental change in the business that dramatically alters the company's profitability equation, which is ultimately what drives a stock higher. Often we'll wait until that catalyst occurs

comes into fold until we see it to confirm our thesis, awaiting the release of, say, a quarter of results where we see good, solid growth, and then we'll step up and buy. That confirmation helps allay some of the what we call execution risks and prevents us from being stuck in an investment or concept stock.

Now, there's no magic button to find these companies. It's just brute force volume. We have to look at 5,000 companies, like I said, to come up with two to five. I can talk about a couple if you want to go into those businesses today.

Yeah, let's do that. Yeah, let's talk. Orbit Garant is a company. This is what we call an absolute orphan. We started buying this company in January to start this year around 80 cents. It trades at $1.20. It's about a $46 million market cap. So that's a micro cap in Canada. They're based in Quebec, one of the largest Canadian-based mineral drilling companies, 188 drills that operate primarily in Canada and in Chile. Now,

Why do we like this business? Well, we like growth in revenues and earnings. EBITDA was up 460% in Q2. Earnings went from a loss to a profit of $0.04 in that quarter. For the first six months of this year, the company went from a loss last year to $0.12 in earnings. So trading at $1.20, you're trading at 10 times the six-month earnings. But why do we like it? Again,

the largest mineral based drilling company in Canada. One of the, uh, it's orphaned in investing circles due to a spotty history of profitability and some higher debt that it's paying down. Poor profitability was largely due to its money losing operations in Africa. So the catalyst here for this stock was that they pulled out of Africa. Uh,

and they focused on their profitable operations in Canada and Chile. 80% of the business is drilling for gold and copper. We know gold's at a record high. Copper is surging. The incentive for its clients, which are exploration and production companies, to drill remains high. Our investment thesis centers around them jumping to a higher level of earnings this year. We're already seeing that. We expect they'll earn 20 to 24 cents this year. That makes it trading right now roughly at five times earnings.

half of its peers. This is for investors with a high tolerance for risk. Again, we started buying in the 80 cent range. We think it's 75% undervalued right now. And it has the wind at its back for companies drilling for copper and gold over the next 12 to 24 months.

Okay, that's Orbit and that's OGD on the TSX. I guess you kind of think, Ryan, that if you're sort of bullish, you know, here comes a bull market in commodities, this might be a stock that would fit in that portfolio. It's a picks and shovels way of playing a commodities boom. And there's already a boom right now and you're buying it at a discount to pierce. So we like that. Yep. Good.

Yeah, next orphan stock, NTG Clarity Networks, NCI. We were able to buy this company mid last year, about the 80 cent to dollar. It's $1.73. So you say it's doubled. Why would we like to buy it? Well, earnings and cash flow have gone up far more than double. So they are a Canadian company, provide digital transformation, software development, IT services, but in the kingdom of Saudi Arabia. Now,

Why do we like it? Tremendous growth in revenues, 109% growth in revenues in the last quarter up to 14.7 million. Net income was up 303%. So the stock is up 100 plus percent, but net income is up 300%. We like that.

Why do we like it? Powered by a $1.3 trillion investment in technology by the Kingdom of Saudi Arabia, a massive digital transformation. NTG's investment in this region is paying off. Impressive revenue growth recent years, exponential growth in contract sizes. Overall revenues have nearly risen fivefold from 2001 to 2024. Recent quarters, about 100% gains in terms of revenue.

Parallel that with a backlog that has surged over the past 12 months. They had 20 million in backlog 12 months ago. Now it's 105 million today. So backlog is rising. Again, the stock is up over 100% in the last year, but it still trades at eight times earnings. And we're looking at 35 to 40% growth this year. We view it as an underfollowed growth at a reasonable price, small cap, beneficial cost structure through its massive digital push in Saudi Arabia, low cost growth.

workers in Egypt and it is operating outside tariffs right now. So we like that kind of a tariff proof stock, a tariff proof stock. And that what's that the name again? The company is NTG Clarity. The symbol is NCI on the TSX venture. OK, super.

We got a couple of minutes. You got one more, of course? We got one more. Now, this company has kind of moved lower as it has some exposure to tariffs. But the last time Trump introduced tariffs, this company was able to raise its prices and actually made a better margin. So we think the street is underestimating the story. The company's Group Dynamite, if I can say it, Inc., GRGD on the TSX,

$14 and around that range, $14. $1.5 billion market cap. Doesn't have a yield, but we expect it could implement a dividend over the course of this year. Just listed on the TSX in November. So relatively new, and we think it's unknown. They are a growing women's fashion retailer. About 299 stores across Canada and the U.S. About over 50% in the U.S., which is what we like.

Revenues in the last quarter up 18%, which is good to see. Same store sales growth up 10%. That is high for a company in this segment.

And we saw net income rose 16%. EPS was up to 38 cents from 32. So growth in the earnings like we like to see, but they are an agile company, growing fashion retailer with a superb balance sheet. Midway through this year, it'll be significant net cash. They recently IPO'd. So they IPO'd to the market about 21. You can buy it under 14 today. It trades at about 11 and a half times earnings that compared to peers,

I'll give you a story quickly. Five years ago, six years ago, sorry, about today, we recommended a company called Aritzia. It's gone from 16 to 54. It trades at about 35 times earnings. You can buy group dynamite. It's not a big deal.

Not the same type of company, but similar women's fashion retail are about 11 times. So you're buying it at less than a third of the multiple with similar growth rates. We like growth at a reasonable price. We like both those businesses, but Group Dynamite is cheaper today. So that's why we like it.

Ryan, I'm smiling here. I love it. I mean, you've got three different companies. So one is a driller. The other one is doing high tech in Saudi Arabia. And the third one is women's fashion. And yet, you know, all of these are opportunities with, as you would say, great growth opportunities. And you're looking at the numbers.

We follow the cash flow, right? And it allows you to build a very diverse portfolio. If you follow the cash flow and you buy the best businesses that are trading at reasonable prices in each segment, we're sector agnostic, you get a balanced out 20 to 25 stock portfolio. So I talked about the small caps today, but we also recommend we cover every dividend stock in Canada to help you build that balanced portfolio. We cover the MAG7. We cover a ton of US stocks as well. But the cash flow leads us to that.

It makes our job very interesting because we're not just focused on one sector. We get to interview CEOs.

from amazing businesses across all sectors. And it gets our clients exposed to some really unique companies in all those segments. So I'm glad you pointed out that they're completely disparate businesses because not all people figure that out. So it's good to see. I tell you what, folks, I think this is what Warren Buffett sounded like back in the 1930s or something. You know what? Warren made most of his fortune after 50. You know what? I'm going to start to do that in Canada today. That's our plan, right?

Okay. Listen, Ryan, that was super. You're giving us a taste here of what you hope to do on the webinars that are coming up. People that want to find out more about Ryan and let me, I'll just give him a hundred percent thumbs up personally. I like him even though we do kind of poke at each other and have fun doing it. April 3rd and April 9th, the webinars go to Mike's Money Talks

and get more information. And there you go. Ryan, thanks for being on the show. And it's really, it's fun to see you again. It is great to see you. And we'd love to see anybody at those webinars help you build that simple 20 to 25 stock portfolio. Great to talk to you, Victor. Have a great day. Okay, you too. Thanks, buddy.

Well, folks, you know, Mike usually does a shocking stat, but he's not available this week. And that's good news for him. Grant Longhurst, who is the executive producer of the show, is going, we're going to do some teamwork stuff here. And he's going to come in with a shocking stat for you, as though Mike was here doing it himself. Grant, take it away. Thanks, Victor. You know, elections in Canada tend to reflect some tried and true divisions in our country.

East versus West, Quebec versus the rest of the country, urban versus rural. My shocking stat today highlights a new and I think potentially dangerous divide. Nanos Research published a poll this week on voter intention, basically asking which party do you support in the upcoming election? What's interesting about this particular poll is how it breaks down by age group.

18 to 29, 30 to 39, 40 to 49, 50 to 59, all indicated by significant margins that they would be voting conservative. The one demographic that was overwhelmingly planning on voting liberal by a 50% to 29% difference, 60 plus. So why are the baby boomers so heavily invested in returning the liberals to power?

The main argument is that they have been largely insulated from the negative impacts of the last 10 years of government policy. As longtime homeowners, they haven't been impacted by rising prices to buy or rent. As retired or near retirement age workers, they haven't had to compete with the massive increase in immigration and the job killing net zero policies. And by the same token, they have not had to operate in environments that have prioritized DEI and gender issues.

And lastly, the 60-plus demographic represents the largest consumers of traditional media, especially newspapers and nationally broadcast TV news. And what is of most concern to the boomers? Another poll this week shows that they are the only demographic that puts dealing with Donald Trump ahead of every other issue.

Well, welcome back, everybody. I've got Ozzy on the line with me now. And, you know, this is reminding me. It's going back like 25 years when we used to be at CKNW and we'd be in the studio. Ozzy would come down and we'd be sitting across the desk talking about things or he'd be on the phone. We'd have, you know, we'd be taking phone calls from people, which is something we're not doing here on the Internet. But it seemed it was always sort of two questions.

hey Ozzy uh do you think prices are going up uh or do you think prices are going down or you know I've got this property you think I should sell it or keep it you know and so we anyway Ozzy you and I've had a long history it's always been fun to hear your views on things but I'm getting the picture right now I mean I've read your Oz buzz what does it come out one

once a week or once a month or something. Your latest, Ozbuzz, I've got this thought like as a trader that Ozzy has changed. I mean, I remember two years ago, like it was 20, no, 22, maybe that's three years ago. You said, I think the top's in, in the real estate market just generally. And it looks like you were right. But now I got the idea. You think we're getting into a buyer's market.

Well, there's no question. Well, things change. And the other thing is you yourself in the stock market, actually, I got to salute you. You write a fabulous newsletter that comes out Sunday night. And I particularly like what your little dog always has to say. But the point is you are in the market every single day and things change. At 20 to 1, the whole stock market can go up and down dramatically.

In real estate, we have also a timeline and people forget that. We have an inflation component that I believe is entirely due to how much money we're printing. And that settles down always in hard assets like real estate, like gold and so on, as opposed to whatever our commodity prices do. They could go up and down. It could be in deflation or inflation, but that's an economic issue. I'm just talking about hard asset inflation. So if I believe that that is going to continue or

come back. Then I'm with Warren Buffett who says, you know, when everybody's crying, you should be buying. And right now everybody is crying. The prices are very stable to down and in Toronto we have a 15% pre-construction price

downturn, a 28 year low in sales in condos. And in Vancouver, my God, we sold almost 22,000 condos in 2021. And now we're selling 13,200. So lots of product out there. So if you're a buyer, this is a time for you to look around.

So what you're saying is prices are down off their highs, sales are down. And certainly when we say real estate, there's a zillion different kinds of real estate in different markets. But I get the feeling, again, from reading OzBuzz, that your behavior as a buyer has to be different in this kind of a market, you know, where you're maybe value buying as opposed to a market where you're in a bidding war all the time.

Well, yeah, and this is the crazy thing. For some reason, we think it's a good market if five buyers wrestle each other to the ground or the living room of the seller and then pay $100,000 more than the guy wants. Those days are over. We had four more, the fear of missing out. Well, now we seem to be having the fear of, well, maybe it's going to go down further or whatever it is. But the point is, in the pre-sale construction market, which is, to me,

A wonderful thing right now, because you're buying something that's finished in five years from now, and interest rates probably have stabilized, all our trade wars, everything is over. And the deals the developer makes you right now are extremely sweet, because the developer, say he has 400 units for sale, he needs by law to sell 240 of them.

but now you only sold 220. And the time, the window that he is allowed to sell it in is narrowing. He needs to sell 20 more units. And here, good old Victor and Ozzy walk in the showroom with cash in hand or willing or good credit rating. If you just had your TV repossessed, no, that's not it. You're in there now and he loves to look at you. And even words like stink bit music to the ears of developer because he rather has a stink bit than no bit. Mm-hmm.

Okay. So that's the pre-sale market. But how about just a residential house? Somebody wants to step up and buy a house. Well, pick your area, get a good quality local realtor, get him to send you every day the price declines. The boards publish every day new price listings that come down in price. And make offers because sales are down, way down.

Way down in single family homes too. But I said to you earlier, the statistics used to sell almost 15,000 four years ago in one year. Now we're selling 7,800. So a lot more product come on the market. Then we have all this overhang that I write about in the newsletter. We have a mortgage renewal issue.

A bash this year. So we have lots of things going on. Uncertainty reigns. Well, in that uncertainty is where you make the deals from it. You know, Victor, if I showed you a slide from 1970 to 2024, you would see the average price was $100,000 and now it's $2.2 million. Looks like a straight line. It wasn't.

It was very important to understand that the dips, that's when you should have been buying and maybe the highs you should have been selling just like in a stock market, only a lot much longer time horizon. And I would suggest to you that if you want a best price for your family, even if you want to

upsell. Let's say I have a million and a half home and I'm worried I'm only getting a million three fifty for it. Well, you were going to buy a two million dollar house. That's also 10 percent down. You only pay a million eight. You're actually better off. So don't be scared of the market, but do some research, get a good quality builder, good quality developer and make some offers.

In my markets, we have a thing about buyer's remorse. Somebody pays something and then five minutes later, oh my God, did I overpay for that? Did I really want it? You've probably heard me and Mike talking so many times. I say, you've got to try to get the timeframe of your analysis right.

you know, in sync with the timeframe of your trading. So you're saying something the same here. If you look at a chart going back 50 years, yeah, real estate looks like it's done nothing but go up. So, but there's been these ups and downs through that period of time.

So if you're again, if you're going to go out and let's say have Ozzy's idea that we're now into or getting into a buyer's market after three years of being in a, you know, a seller's market, your time frame has got to be, you know, either Ozzy, I guess this would apply to flippers as well as investors. What you're saying?

Well, that's the important distinction. You know, in my books, I was saying you're either an investor, you're a flipper or you're a shark.

And anybody buys a condo in Vancouver for a million five and rents it at 3,000 a month, by no measure is that an investment. You may hope to flip it to somebody else. You're a flipper. But if you're a shark, this is your market too. I mean, look, a shark looks at foreclosures or he sits in local court. Well, the first thing you do if you're a shark, get on all the national foreclosure lists. You can go to osbuzz.ca and Google my search engine and there's the list in there. You can buy lists. You can get also published lists of projects.

but people that are under foreclosure. Or you can sit in local court, which is probably the best thing to do is that if you're a shark and you benefit from somebody else's misery and that's your style,

Today is your market, right? If you're a flipper, you have to be extremely careful because I do not think that prices are on the way up. We will have a price adjustment. It always is the same thing that we have increase in listings, dramatically increase in listings. We have a downturn in sales. The result will be much more pressure on prices. So as a buyer, I should look around.

You know, in my market, we've got people that are going to be momentum traders. And you've obviously got momentum traders in your market. Those are the flippers. And then at the other end of the scale, we've got what we call value investors. Like that's the Warren Buffett's of the world. You know, when Warren Buffett buys a stock, he says he's buying it.

with the intention of holding it for the rest of his life. Okay. He's not looking to, you know, he's going to flip it out. The first bid he sees a little higher than what he paid for it. So again, maybe Ozzy, just to do a wrap up here, and I know people can get a lot more detail about things you should be doing. If you think this is a buyer's market on your website at Ozbuzz.ca, but maybe just give us a quick wrap as to what are the, the,

let's say the attitude or the timing or whatever that buyers should have in mind before they step in here.

In the pre-sale field in Kelowna, you can buy a pre-sale condo that was $724,000. It's just been reduced to $589,000. That's $436 a foot. I couldn't build a front door for that. Bosa has offered, and I think that sale may just be over now, but they were offering $43,000 on one development, $75,000 reduction on another.

A hundred and five thousand dollar deduction on another on the sea to sky. They were offering a two and a half percent mortgage. There's all sorts of deals out there that weren't in the marketplace before, even to the point of getting a new Tesla. You know, but you've got to haggle. You know, in life, you don't get what you deserve. You get what you negotiate. You've got to go out there, have a realtor that understands it.

Maybe look for that troubled owner and have some principles. You buy close to transit oriented developments and all of those principles that go. But don't be scared of the market. Don't rush and buy anything. Buy that deal of a lifetime. Don't rush, but look. Okay, folks. I got to tell you, as I said, just at the top of the show here, at the top of this interview with Ozzy, like 25 years ago, I remember sitting in the CKMW studio and Ozzy and I go back and forth talking about real estate.

Ozzy knows what he's talking about. He called the top of the market three years ago. Now he's saying to you in a general way, from his point of view, this is a buyer's market. It's time to go out there and start taking a look. Oz, thanks so much for being with us this morning, taking the time. And you know what? We'll talk to you again next week.

Well, thank you so much, Victor. And I've always been razzing my wife the last few weeks. And she razzed me last night. She says, look, she says, you're always making jokes about me because but you don't know anything about men and women. Here's all you need to know about men and women. Women are crazy and men are stupid. And the main reason women are crazy is that men are stupid.

Oh, my gosh. Okay, well, you'll be back next week, I guess, pending some kind of an investigation. Thanks, Oz. Thank you, Victor.

Well, folks, you heard Grant Longhurst on just earlier in the show with the shocking stat. And I'll tell you, that kind of rocked my world a little bit because I am one of those people over 60. And I'm concerned that there is such a division demographically in Canada. But Grant laid that out very clearly. Well, he's back now, you know, on the teamwork approach here. Grant filling in for Mike with his quote of the week. Grant, take it away.

Thanks, Victor. Our quote of the week comes from Yvan Blandon, who is the former commander of the Royal Canadian Air Force. This is from a LinkedIn post that he put out this past Tuesday.

Quote, I recommended to Prime Minister Harper the F-35 as the best choice for Canada in 2012, in 2014, and in 2022, the Canadian government, upon strong Royal Canadian Air Force recommendation, selected again the F-35 as the best fighter aircraft for Canada.

There is no question that the F-35 was the best choice for the decades-long Canadian defense concept based on strong NATO and NORAD alliances and like-minded democratic nations, coalitions, anchored by the United States, where we were comfortable in sharing intelligence, parts, weapons, research, personnel, training together, and fighting together. This reality has been shattered.

The like-mindedness of our most critical ally has disappeared. With other allies, we find ourselves today in a different reality. Reliance on a U.S. defense umbrella, a critical factor since the end of World War II for so many countries, is no longer guaranteed.

No affected country can afford to close its eyes and hope that 2026 or 2028 elections in the U.S. will bring everything back to normal and not happen again. The toothpaste cannot go back in the tube. He goes on to say, we have enjoyed for too long the illusion of our alliance's military security without delivering on our own promised defense investments.

We can only hope that, carried by the events that are much beyond our control, we have enough friends and time left to rebuild our military and transition peacefully to what this new world order is bringing.

Well, folks, welcome back. And this will be the final segment of the show. And I should have said this earlier. I just said I'm filling in for Mike. Mike's on vacation. He's healthy and wealthy and wise and all that sort of thing. And he's out having himself a well-deserved break, a getaway, I think bicycling around Portugal or something like that. Don't even get a picture of Mike wearing spandex in your mind. Don't do that.

To finish up the show, I've got Rob Levy on. And Rob's dad and I used to work together on the commodity brokerage business 100 years ago. And it's great to see Rob come along. And Rob and my son get along really well. Rob runs Border Gold now out in White Rock, while his dad is also enjoying a great retirement. Rob, how are you doing?

Rob, let's you and I just kind of kick around what we saw in the markets today, or this week, I should say. And I think we've got to start with gold, and you're trafficking a gold tummy.

What are you seeing out there? Well, don't take this as my bias, Victor. You know, as you said, being in the gold business, but it was the front page headline this week. And I almost do that Don Cox. Oh, no. And, you know, gold's on page one. But page 16 going to page one. It's now on page one because we're at all time record highs. The front month futures over thirty one hundred U.S. and watching that spot market.

Friday, almost kissing that 3,100 US the ounce number very closely. It's being the asset class, precious metals getting the bid in this market as I think that key word that everyone just keeps touching in on, uncertainty, people going into precious metals, going into gold. Yeah, what did I have? I think we're up, what are we up? $450 from the lows we made the first week of January. And we're nearly a double.

from where the market was in September of '22. And the reason I mentioned that was that in September, in 2022, the stock market, the S&P was down about 18% on the year in September and then turned and ran up to the highs that we had in this year. I think the stock market was up about 75 or 80%. Gold was up over 90% during that same period of time. So yeah, gold had a heck of a run.

And let's talk about why. Why is gold going up? Rob, what's your thought? My thought is where else do investors want to put their money right now? You've got this chaos, for lack of a better word. Maybe chaos is a little too extreme, but uncertainty in the markets. You know, S&P 500, that's negative on the year. So where can you go for a little safety when you have all this playing out at the moment where everyone's so hyper-focused on

these trade wars or trade rhetoric in that key April 2nd deadline next Wednesday. Uh, so it just seems sort of relentless week after week. So you go to the yellow metal for a little bit of safety. It's sort of become the de facto safe Haven. And to me, this is the main street, the wall street institutional investors, uh, joining a rally that, as you said, started back in 22, but was led by central banks and their massive purchases and accumulation of, uh,

the yellow metal, and it continues to have legs. So it's that little bit of lack of confidence in the markets right now. So where can you get a little bit of security? And to me, that's in gold. You know what I notice as a trader is how orderly

or persistent this rally in gold has been. In my blog last week, the whole piece was on gold. And I even went back and put up some daily charts of gold when it hit the all-time highs beginning like in 1979 and the run for the roses in January of 80. And that was following when the Russians invaded

Who was at that time? Afghanistan, you know, and this time when they invaded Ukraine was a different story. But at that period of time, it just went ballistic to the upside. And I remember, as I said, working with your dad in that period of time at Conti Commodity, we were upstairs in the Bank of Nova Scotia building and we went down to the basement or the

the mall level, there would be a couple of hundred people in a line to get into the counter at Scotia where they could buy gold bars. You know, it was just, and I remember thinking, man, this is, this has got to be the sign of a top. And that was when gold was about $450, you know, three weeks away from being $850. So yeah, the recent rally here has been almost like plodding along just

sort of a little higher every day. Exactly right. And it's been steady. And I mean, we deal directly with the Royal Canadian Mint. And to your point on that one, with this rally, what we've seen in this market, last year, we were talking about how investors were selling into the strength of the market, retail investors. And in the North American market, too, you talk about the ETF flows, and it was outflows. It wasn't inflows into ETFs. People

buying gold. It was actual selling. So, you know, even now when we get into this market, perhaps a little more orderly, but it's not rampant demand, especially in terms of you talking to the number of ounces that are flowing and you have $3,000 gold and you're 4,400 of the ounce Canadian record high prices. We're back to a place right now in the North American retail market where we're net buyers. People are buying precious metals again. But again,

As you said, compared to maybe, say, a couple of decades ago, it's not the chaos where everyone and their dog is lined up to buy precious metals right now either. Now, you mentioned ETFs. And for our listeners that might not be aware of this, there's an ETF for damn near anything you can think of, you know, and then a bunch of other things that are probably totally useless. But we've got a gold ETF here.

And in my mind, I always think that that gold ETF is probably the place where people who can't buy bullion for one reason or another. And for instance, if you're a pension fund and you kind of think gold's a good idea, but you're prohibited, you know, from going out and buying bricks of gold and storing them somewhere, you know, that maybe the the

The next two things you look at is buying shares of gold mining companies or buying the gold ETF. But the last couple of years, I saw there was net selling, certainly globally, on the ETFs while the gold market was going up. So what's with that? I mean, what do you think about the ETF?

Well, I think, you know, to the other point, it was the fact that gold was making all time highs. Some of those forecasts for gold, twenty five hundred at the time, twenty five hundred U.S. So, you know, here's gold touching on an all time record highs. And for the Wall Street analysts that are calling this market, you know, sort of knocking on where they expect this to go.

this precious metal or this gold price to be. So the fact that, yeah, gold prices are now trading higher, you know, now we've finally seen that little bit of a turnaround. You talk about global ETFs and again, starting to see inflows again, but it wasn't the story two years ago just because, you know, we had record high prices and the North American story was, you know, sell your gold, go out and buy stocks because he had an S&P that was on a tear in 2024.

Well, you say stocks. I mean, I do remember back in the old days before we had color television, you know, people would buy shares in gold mining companies because they gave you leverage to the price of gold. So if gold was going up, the shares would be going up even faster because their operating costs stayed the same and their bottom line was just growing exponentially. But that all changed. And I think a big part of that was country risk.

You know, you could be and we've seen it lately just in the last year or two where different countries around the world have made life very difficult, you know, for some mining companies, whether they're mining copper in Peru, in Panama or, you know, gold in West Africa. So but to come to the heart of the matter.

The gold mining companies were the most ahead of gold that they've ever been at the end of the little bull market we had between 2009 and 2011. And everything has changed since then. But back in 2011, central banks globally were selling.

about 500 tons of gold every year that they were declaring. Okay. And here in the last three years, the elephant in the room is the central banks buying on average, at least what they're telling us about a thousand tons of gold a year. And I think speculators are piggybacking on that. I mean, and I would too, if you knew you had some huge, huge guy behind you, you don't mind picking a fight with somebody.

No, I agree with you. It took a while because I think the damage that was done for investors who were in that space over the past decade and the fact that some of them were hurt pretty badly. But I think there is a precious metal story back again. And, you know, even when this market cools down a little bit, because I do think with gold, we have gone up so quickly, so fast, and we're sort of in peak intensity. Maybe I'm saying that with a little breath of

hope right now with what's going on in the market that we're at a sort of peak intensity right now and things will simmer down a little bit in April. But gold's got to cool off a little bit just because we've gone up so fast so quickly. But still, beyond that, there's still a role for precious metals and people question the longevity of the U.S. dollar as the world's safe haven. So does

Gold play more of that core role in your portfolio. And then to your point, you know, are there other ways to play that? And do mining stocks, again, become attractive for that type of investor? Because, say, you've got support, as you said, central banks buying a thousand metric tons a year, this sort of trend shift in the direction, the role of gold in a portfolio.

Well, you know, it is what it is, as they say. The gold market has been strong. I think it is because the central banks want physical gold. They don't want silver. I mean, compared, right now...

It takes about 90 ounces of silver to buy one ounce of gold. You know, back in 2011, when things were booming there, it took about 30 ounces of silver to buy an ounce of gold. The central banks don't want shares in a mining company. They want physical gold and they want to move it into their own vaults. And I think that's been the big story. And, you know, it was Martin Mirrenbill that really turned me on to this over the past couple of years.

where the traditional correlation between the US dollar and gold and interest rates in gold had broken down. And yet, you know, gold continued to go up and you had to say there has to be something else. And it's turned out the proverbial elephant in the room was these central banks buying so much gold.

Let's switch a bit. Staying with metal, we saw copper trade up to about $5.37, $5.40 this week. That was a new all-time high on the price of copper. I mean, the copper story is out there. Mike certainly been talking about it for the past few years. Did anything about copper catch your eye or did you see that?

Oh yeah. You know, particularly it was out of the FT and their copper mining conference. They were talking about this week, just the bullishness that's come back to that market. And it's,

It's the electrification story. So, I mean, that on its own, it seems to give a little excitement back around that market is my perspective. You know, to be a long term copper bull, there's just not the capacity in order to do it. And there's no there's no domestic supply. So, you know, if anything, supportive of the market, you know, I think it's that right there. And, you know, the takeaway that every major trading house calling for, you know, copper to take out.

Previous all-time record highs continue to see a bid in that market. What puzzles me about it is that story is so well-known. And just like all of a sudden here in the last six weeks, copper took off to the upside. And it looks like, and I'll tell you, this is like inside baseball a little bit, but it looks like the bidding is coming from outside.

North America. In other words, we're not seeing explosive volume on the New York market, the COMEX market. It's like the it's actually just shadowing what's happening in other parts of the world, whatever it's.

One more thing we got to get into before we do a wrap here is the stock market. I mean, we just were talking with Ryan earlier. He was saying his valuation models when the stock, when we started 2025, it was like off the charts. I said, you know, that was my gut instinct at the time. Things felt blah,

Like price for perfection, I think was the term I used. And, you know, in the last, what, since mid-February to the toward the end of March here, we've come off a good 10 percent, had a bit of a bounce last week. But I mean, this week, it's like the market's getting its feet held to the fire again.

It is. I agree with you. How we're ending the week, down a couple percent on the day. It just seems so hyper-focused on this trade war story and the economic uncertainty. Whether it's recession, now you hear people talking about the idea of stagflation in the U.S. market because there's going to be inflationary pressures from tariffs and the Fed won't be able to cut interest rates and interest rates are going to remain elevated. It's not necessarily a rosy picture for stocks in the market.

And then you pair that with sort of everything you hear in the financial media, rotation trade setting up. You know, now's a good time to sell your your winners and go to value in the market. So so maybe there's an Irvine story. But, you know, it seems everything short term is very negative. If you're looking out 12 months, 24 months, it's OK to be a stock investor. But in the near term right now, the message seems to me to be, you know, buckle up, know your risk.

Yeah, I think I was just taking a quick look at the charts here, and I think the S&P closed at its lowest weekly close in seven months this week. So it's been that sort of thing. And, of course, what a liberation day. That's the term, right, coming up on Tuesday. And, I mean, just between us, I was kind of flabbergasted.

picturing, you know, if you've got an angry guy and the only tool he has is a hammer, you know, the whole world looks like a nail. And when you're swinging a hammer around to try to make big changes with tariffs, you're bound to have unintended consequences, collateral damage, they used to call it. And I kind of think that's at the heart of what's

worrying the market. People call it uncertainty. Yeah, well, you can get more personal. That's uncertainty about what one guy is going to do with a rather blunt tool. I agree with you completely because for the uncertainty term, the devil's been in the details all along. And we have these big proclamations and headlines about putting barriers on trade. But then we understand how it plays out a little bit more and who's directly impacted and who's not. And perhaps the company-specific risks

that all factors out of it at the end of the day. So, yeah, you get the headline about how there's more barriers to trade between two nations, but then you find out, okay, well, this business is going to continue to operate in this manner because this is how they deal with it or they're not directly impacted because, you know, this trade barrier, this is their workaround. So it's just, it seems to, as you said, there's the hammer, but, you know, what's going to be missed or how do we pick up the pieces once we move past Liberation Day?

Well, let's do a wrap with the Canadian dollar. And I've been chronicling here with Mike for the past, I don't know, since...

It seems like May of last year, we started seeing a building and it became ultimately a massive speculative short position in the currency futures markets against the Canadian dollar. And yet here for the last, I'm going to say six weeks anyway, the Canadian dollar is virtually flatlined. Now, I've seen that massive speculative positioning size come off a little bit. And, you know,

when like you and I are talking, we're sharing these ideas and thinking it's, you know, but are we seeing anything that the market doesn't already know? So that's when I just go to the market and I say, well, I'll tell you what, if Canada's future looks so bleak,

How come the Canadian dollar is just going sideways here? And this is a market where people can freely come in there and express their opinion as long as they put up the money. And I'm saying here, and this is a bit of a devil's advocate, I suppose, that the currency markets are kind of ahead of us in terms of sniffing out what's going to happen. I just think it might be that this huge speculative short position is saying, hey,

You know, we've made some pretty good money. It doesn't look like the Canadian dollar is going any lower, even if I think it should. So maybe I should cover my short position, which means they have to come in and be buyers. And maybe that's why the Canadian dollar is flatlining, despite, you know, what we call mainstream media, you know, ripping their hair out over the terrible things that are happening because of Trump put all these tariffs in place.

And I'm in 100% agreement with you. The loonie is the indicator because I remember when we went through this exercise, you know, the first time at the beginning of February and trading opened Sunday night and the loonie went all the way to $1.48. And, you know, for reference, we're $1.42 and change $1.43 today. So to your point is if things are so bad, maybe the loonie should be telling us a bit more of a story at the moment, which it doesn't seem to be doing. Right.

Rob, we could wrap it up, but I've got to throw it back to you. Is there one more thing in front of mind for you? The only other story that I think I'm watching that's of interest right now is how this auto story plays out. And the reason being, you know, there's an interesting piece in the Financial Times, and it relates back to Mike's guest a couple of weeks ago, how we said we dealt China out of the chips industry. And look, they produced it on their own and they're playing catch up with the rest of the world.

You know, is there potential damage to be done to the manufacturing sector in North America that, you know, creates an open door for, say, Chinese EVs into the world market that may be to benefits them? I think, you know, that's the interesting thing to watch. That's the that's the the repercussions of this long term. I sort of look at with caution. So it makes me wonder how far he will actually go with potential damage to the U.S. and North American manufacturing base with autos.

A big one, but I'm throwing it in there. Well, no, that is huge. I mean, China is a country mile already the largest manufacturer of cars in the world. It's radio, so I can just make some wild guesses, but I think...

They make as many cars as the rest of the world put together. And it seems they make good cars at a good price. So, yeah, that's a great thing to keep an eye on. For sure, the world is changing. Markets are changing. And, folks, it's been fun doing the show here. I will be covering Money Talks here for the next two weeks while Michael continues to work his way around Portugal on a bicycle. Thanks for tuning in, and we'll see you again next week.

you