thank you I'm Charlotte McLeod with investingnews.com and here today with me is Mike Larson editor-in-chief at money show thank you so much for joining me great to have you on again hey Greg glad to be here Charlotte yeah really good to be catching up with you and as a reminder for our audience our last conversation was a few weeks ago we were talking about money shows upcoming event in Toronto which is now going on as we speak that's where you're coming to us from so if you could start
by giving me kind of a look at what's going on at this show what is the crowd like what is sentiment feeling like how is it looking now on the floor sure absolutely you know it's funny when we talked a few weeks ago the market had just started correcting a little bit but we hadn't seen as much of a pullback as we are now seeing I think you've had some concerns about China you've had some concerns about you know are they or are they not done hiking interest rates whether that's here in Canada or in the
U.S there are some issues about is inflation cooked or not cooked so I think if I described the environment from the conversations with investors and listening to some of the keynote speakers it's cautious optimism you know generally speaking people are not bearish they are looking at again some of what's happening in the global stage particularly in China and the questions that raises about global demand they are cautious about that they are concerned you know even as stiff Macklin was
suggesting in a recent speech just this week in Calgary that maybe they've done enough the policy should be sufficiently restrained there's still some fear that okay they're saying that now but what happens later in the year or early next year are they going to have to unpause again like we've seen in the past so and there is some concern there's been a lot of talk about uh The Debt Service ratio in issues Canadians are having in terms of high debt levels then you layer on top of that the the dramatic increase in
interest rates um and really you know how that's going to impact the economy moving forward and also a lot of talk about housing affordability I mean you know with what's happened with mortgage rates uh you know and you still have a lot of demand a lot of immigration that's keeping demand up rousing but prices are just so unaffordable some of the rents that rent increases have really been been extraordinary and they've been noted by some speakers so there's a lot of that into the mix
um so again cautious optimism I think is how I'd sum it up I think a lot of people want to see is this just a correct section or is this the start of something more is this a soft Landing or is this the beginning of a recession as one speaker you know believes on his side so again that that's the real question where are we going a little bit a little bit sort of squishy Market sentiment here yeah okay really good to get an understanding of what people are talking about what questions people have and I
know that we're only part through part way through day one of this event I do want to ask you about some of your takeaways from the presentation so far I know you were looking forward to the David Rosenberg keynote he was talking about his recession road map I believe so tell me what you've been hearing some highlights for you yeah absolutely I mean David you know I had a chance to speak to him about a month and a half before the event and he was you know that was at a time again when the
markets were sort of a bullion uh there hadn't been a correction yet and I think some of his more cautious type messaging probably wasn't very well received or people said okay sure I'm not seeing it now we're seeing it right now we've seen a month and a half where the stock market has pulled back uh not just in Canada but in the US as well you've seen especially most recently some of the big Tech names the apples of the world get hit pretty hard so these are widely held
stocks they're Mega cap stocks that everybody owns and that is sort of you know I think probably giving a little bit more of the crowd saying okay I want to hear what David has to say I want to see if maybe you know this isn't going to be a soft Landing maybe a few steps down the road this is going to be a harder landing and that was generally his message he he believes the Canadian economy is already in recession he thinks the U.S is going to be there before too long talked a lot about the
inversion of various yield curve measures and what their research shows so he was definitely one of the more cautious speakers but also know the Benjamin tall from CIBC uh again talked about the the risk of the Bank of Canada going too far the real hope that they'll see what they've done already that they'll realize you know look we have a lot of tightenings that have already been done it takes a while to filter through the economy there was definitely a kind of a message you know I joked if
Tiff Macklin was was you know in the in the disguise in the back of the room a couple of our speakers would be very happy because he'd get the message to uh you know stop and just let the let the economy you know sort itself out so there was some of that I would be remiss though to point to if I didn't say that a lot of other speakers again were more optimistic there was you know a lot of talk of opportunities uh you know undervalued markets like Canada versus the US uh some of these foreign markets
that sure the news flow has not been great when you look out of China and other places but then again that's why stocks and some of these markets are super cheap that's why if the US dollar has stopped going up longer term obviously we had a rally in the last several weeks of the longer term maybe we're at a peak there that could allow some of these foreign markets to pick up and it's worth noting too things like Commodities oil has has had a nice run here as well so for an economy that's
sensitive to Commodities and materials like Canada's that's a little encouraging as well interesting to see the range of opinions that you're bringing for investors there and as I recall I believe the theme of the event is promise and pitfalls so it sounds like you're seeing both of those sides addressed here yeah absolutely I mean again you know I would not describe it as a super bearish environment I would not describe it as a super bullish environment either nor would I describe
sentiment that way it definitely is is more of an opportunistic approach an opportunistic comments for investors I think people are willing to to take on some risks they're willing to look at Opportunity uh but then again in a cautious sort of you know maybe I've got to look a couple steps down the road and not get too Overexposed mentality so I think that's generally the messaging um you know and I think that that's probably a pretty good act a pretty good summation of how what people are talking
about as well yeah and I think that fits with kind of the approach you were telling us about last time where you said you had shifted away from cautious and into a more be bold approach maybe moving away from some defensive Place into things that are more aggressive so I wanted to follow up with you on that and ask a little bit more about what that aggressive kind of approach might look like for investors who are interested in in doing that sure sure I'm more in the camp that this is uh just a correction
in a broader bull Trend I think this is you know more seasonal type uh situation I think it's a situation where we had a big run we need to digest it and that's what you're seeing here um so I you know if I talk about my personal stance I haven't really abandoned that be bold I haven't flipped back to the be boring kind of stance that I had uh from mid 2021 through the end of 2022. in other words I still think you want to be positioned in sectors that are more offensive in nature so your Industrials your
materials your technology your energy for example uh unless you know less overweighted like I used to recommend in things like consumer staples and utilities so when you you talk about what does that actually mean be bold or be boring it's really a sector split right I mean some sectors are offensive some do better in economic expansions or soft Landings other sectors do better in hard Landings or recessions uh and so on and I I am not in that hard Landing Camp so I think that that is probably still
the way to go I think there you know clearly things like Precious Metals give you some insurance value and especially if the dollar has topped out which I do believe happened last fall uh gold silver you know obviously has a place in your portfolio and I think a bigger place now than it would have a year ago so I think that's the sector I'm optimistic on and and I do share the optimism on energy as well I think that you know there's a continued push from some parts of the globe to make sure
that supplies don't get too loose that uh you know if there are some demand concerns coming from Asia or China for example uh the producers are seeing that they don't want to just open the TAPS in the Middle East and so on so I think that you're going to see that market which had a our performance in 2022 and had been underperforming earlier this year might be one that picks up the Baton and kind of runs with it into year-end and early next year as well right and when you mention energy are
you talking about oil and gas or are you looking at energy more broadly because there's a lot of things that can play into that sure I think oil and gas and and other sectors sub sectors like refining exploration even renewable energy if you're if you're smart about it I mean there are some sort of fly-by-night companies in that space that that you know they tell a great story but there's not much meat on the bones but I think if you're selective uh and you really dig into what those
companies are doing you can find some some opportunities there as well so in general I think there's a lot in energy that will probably work again as we head into the back half or close out the back after this year and roll into 2024. right so you've got some options there if you want to look at energy so I also did want to follow up on gold we have an audience that's very interested in gold and you mentioned last time you're bullish on gold you're talking about that a little right now but it's one
that we've been waiting for a little bit I think is what you had said previously and so for you I think what I was taking away was that we need to see people kind of acknowledge that the FED is done with its rate hikes then maybe we see that top out in the US dollar that's happening then we see gold start to move so I wanted to check in with you a little bit more on the price trajectory for gold which is tricky but everybody always wants to know you know where is it going sure sure I mean you've I think
you've got the sequencing of events that has to happen you know you're pretty much dead on there uh I do think that you know the dollar again the big run that we had last year in the dollar predicate on the idea of fed aggressive hiking until Kingdom Come that's over with you know we've seen the dollar even with the recent rally over the last several weeks it's still nowhere near its highs in terms of the dollar Index um do you have some currencies that trades against like the Chinese Yuan
which is obviously you know falling apart it came in the Chinese economic situation I think overall if you're at the end of the FED hiking cycle which I believe we are and if there is a potential for the FED to start reversing some of those hikes next year which I think there is um it is a more bullish environment for gold you're not going to have that that sort of deadly combination for Contra dollar fangs like a surging dollar and surging interest rates I mean that you know there isn't a worse climate for
investing in things like Precious Metals than that and it's amazing that even despite that gold ended up basically flatlining in 2022. if you remove those those governors on the system those things that were holding it back uh which I believe were in the process of doing and you could have a much more positive finish to this year and again rolling into 2024 it's one of those asset classes I'm pretty optimistic about you know run and slap a dollar Target on it um I just you know I would
say I reiterate a bullish call it has been to some degree you know Waiting for Godot but I think that ultimately investors who are willing to be patient are going to be rewarded right I think that makes a lot of sense and I want to talk also about how to approach school because I was thinking about this I want to see your thoughts as well so cool of course it has its Safe Haven appeal which kind of fits into that boring mentality that we were talking about but you can also be bold with gold by going into socks especially
on the smaller cap side so for you how how would you be approaching gold how might investors want to look at that sure I think you're going to need to see um you know for the more I guess the mining type companies are smaller the Juniors and so on that are more out on the risk or I mean you know when General Credit concerns and questions are there are some questions about how that is going to evolve you tend to see those riskier parts of even the precious metals asset class not perform as well
and I think that's been one of the things holding those smaller smaller cap names back I think that ultimately again if you do have a move in the underlying metal and you do have this soft Landing narrative more broadly accepted that's going to be something that will uh you know will ultimately help even those company it's not just the big Mega caps that that big money can buy quickly but also some of the mid cap and smaller cap names that you know tend to follow later if a bull market really does uh really
does get underway yeah I think that's interesting that you mentioned that this can gold can do well even in this soft Landing scenario because I think people tend to think we need that hard landing and kind of more of a crisis situation for gold to do well but but you see it actually doing well even if we get the soft landed yeah I think you know gold as a crisis insurance or chaos insurance I used to call it asset yeah you could you can get big moves in short term uh from things like that A Bank blows up a credit
Market goes Haywire something happens that's where you get these big short-term spikes in Gold that tend to not hold for the longer term but I think ultimately for the longer term helps an asset last light gold is the bigger picture of things the interest rate trends the currency you know relative uh trades there whether it's the dollar or some of these other currencies so that again those big picture sort of slow moving things or what you want to see if you're an investor in the longer term
for gold I mean you can catch a 100 200 Spike if there's a blow up in the credit Market but a lot of times once you know somebody swoops in a bank gets bought a central bank like backstop something you tend to lose some of that I would rather have a longer term bull market powered by some of those big macro trends that again I think are going to be more favorable heading into next year okay yes that makes a lot of sense and as we're finishing up so we've talked about energy we've talked about gold we
have an audience that's pretty focused on Commodities so I wonder if there's any other areas of the resource sector that you think are poised to perform well as we head toward the end of 2023 sure I mean I'm not an expert and if you look at some of these Niche areas like uranium that are kind of tied to what's happening in the broader energy Market I mean obviously that that uh material that commodity has done very well um there are things that are tied to sort of battery metals and so on I think
there is clearly a longer term bulk case to be made for that again although more of a generalist and a specialist I don't have you know great insights into those sub sectors but I would say I think given what's happening overseas concern about China's economic growth and so on well you know your your base metals are probably going to struggle more than your your precious metals are simply because again so much of that demand historically has come from China and it's almost like there's an algorithm
written that you know bad Chinese news equals cell copper and things like that uh so you you know you may see some of that impact in markets but overall again if we if the Soft Landing narrative does gain traction and even in some of those growthier parts of the commodity Market all right yeah I guess it is called Dr copper for a reason there all right this is really great thank you so much for giving us a little preview of what's going on at the money Show event in Toronto I'll let you go uh but before I
do any final thoughts that you would share with our audience sure again you know I think that cautious optimism that cautious bullishness is probably a pretty good place to be once we get through this seasonal period of weakness and head into you know the last quarter fourth quarter of this year and especially rolling into 2024. I think there's a lot of reasons to um to be essentially stick with that be bold philosophy because I think it is going to work for investors all right well thank you so much for
coming on to talk once again I'm Charlotte McLeod with investingnews.com and this is Mike Larson with money show thank you thank you for watching if you like this video make sure you subscribe to our Channel we'd also love to hear your thoughts so leave us a comment below we'll see you next time [Music]
thank you I'm Charlotte McLeod with investingnews.com and here today with me is Mike Larson editor-in-chief at money show thank you so much for joining me great to have you on again hey Greg glad to be here Charlotte yeah really good to be catching up with you and as a reminder for our audience our last conversation was a few weeks ago we were talking about money shows upcoming event in Toronto which is now going on as we speak that's where you're coming to us from so if you could start
by giving me kind of a look at what's going on at this show what is the crowd like what is sentiment feeling like how is it looking now on the floor sure absolutely you know it's funny when we talked a few weeks ago the market had just started correcting a little bit but we hadn't seen as much of a pullback as we are now seeing I think you've had some concerns about China you've had some concerns about you know are they or are they not done hiking interest rates whether that's here in Canada or in the
U.S there are some issues about is inflation cooked or not cooked so I think if I described the environment from the conversations with investors and listening to some of the keynote speakers it's cautious optimism you know generally speaking people are not bearish they are looking at again some of what's happening in the global stage particularly in China and the questions that raises about global demand they are cautious about that they are concerned you know even as stiff Macklin was
suggesting in a recent speech just this week in Calgary that maybe they've done enough the policy should be sufficiently restrained there's still some fear that okay they're saying that now but what happens later in the year or early next year are they going to have to unpause again like we've seen in the past so and there is some concern there's been a lot of talk about uh The Debt Service ratio in issues Canadians are having in terms of high debt levels then you layer on top of that the the dramatic increase in
interest rates um and really you know how that's going to impact the economy moving forward and also a lot of talk about housing affordability I mean you know with what's happened with mortgage rates uh you know and you still have a lot of demand a lot of immigration that's keeping demand up rousing but prices are just so unaffordable some of the rents that rent increases have really been been extraordinary and they've been noted by some speakers so there's a lot of that into the mix
um so again cautious optimism I think is how I'd sum it up I think a lot of people want to see is this just a correct section or is this the start of something more is this a soft Landing or is this the beginning of a recession as one speaker you know believes on his side so again that that's the real question where are we going a little bit a little bit sort of squishy Market sentiment here yeah okay really good to get an understanding of what people are talking about what questions people have and I
know that we're only part through part way through day one of this event I do want to ask you about some of your takeaways from the presentation so far I know you were looking forward to the David Rosenberg keynote he was talking about his recession road map I believe so tell me what you've been hearing some highlights for you yeah absolutely I mean David you know I had a chance to speak to him about a month and a half before the event and he was you know that was at a time again when the
markets were sort of a bullion uh there hadn't been a correction yet and I think some of his more cautious type messaging probably wasn't very well received or people said okay sure I'm not seeing it now we're seeing it right now we've seen a month and a half where the stock market has pulled back uh not just in Canada but in the US as well you've seen especially most recently some of the big Tech names the apples of the world get hit pretty hard so these are widely held
stocks they're Mega cap stocks that everybody owns and that is sort of you know I think probably giving a little bit more of the crowd saying okay I want to hear what David has to say I want to see if maybe you know this isn't going to be a soft Landing maybe a few steps down the road this is going to be a harder landing and that was generally his message he he believes the Canadian economy is already in recession he thinks the U.S is going to be there before too long talked a lot about the
inversion of various yield curve measures and what their research shows so he was definitely one of the more cautious speakers but also know the Benjamin tall from CIBC uh again talked about the the risk of the Bank of Canada going too far the real hope that they'll see what they've done already that they'll realize you know look we have a lot of tightenings that have already been done it takes a while to filter through the economy there was definitely a kind of a message you know I joked if
Tiff Macklin was was you know in the in the disguise in the back of the room a couple of our speakers would be very happy because he'd get the message to uh you know stop and just let the let the economy you know sort itself out so there was some of that I would be remiss though to point to if I didn't say that a lot of other speakers again were more optimistic there was you know a lot of talk of opportunities uh you know undervalued markets like Canada versus the US uh some of these foreign markets
that sure the news flow has not been great when you look out of China and other places but then again that's why stocks and some of these markets are super cheap that's why if the US dollar has stopped going up longer term obviously we had a rally in the last several weeks of the longer term maybe we're at a peak there that could allow some of these foreign markets to pick up and it's worth noting too things like Commodities oil has has had a nice run here as well so for an economy that's
sensitive to Commodities and materials like Canada's that's a little encouraging as well interesting to see the range of opinions that you're bringing for investors there and as I recall I believe the theme of the event is promise and pitfalls so it sounds like you're seeing both of those sides addressed here yeah absolutely I mean again you know I would not describe it as a super bearish environment I would not describe it as a super bullish environment either nor would I describe
sentiment that way it definitely is is more of an opportunistic approach an opportunistic comments for investors I think people are willing to to take on some risks they're willing to look at Opportunity uh but then again in a cautious sort of you know maybe I've got to look a couple steps down the road and not get too Overexposed mentality so I think that's generally the messaging um you know and I think that that's probably a pretty good act a pretty good summation of how what people are talking
about as well yeah and I think that fits with kind of the approach you were telling us about last time where you said you had shifted away from cautious and into a more be bold approach maybe moving away from some defensive Place into things that are more aggressive so I wanted to follow up with you on that and ask a little bit more about what that aggressive kind of approach might look like for investors who are interested in in doing that sure sure I'm more in the camp that this is uh just a correction
in a broader bull Trend I think this is you know more seasonal type uh situation I think it's a situation where we had a big run we need to digest it and that's what you're seeing here um so I you know if I talk about my personal stance I haven't really abandoned that be bold I haven't flipped back to the be boring kind of stance that I had uh from mid 2021 through the end of 2022. in other words I still think you want to be positioned in sectors that are more offensive in nature so your Industrials your
materials your technology your energy for example uh unless you know less overweighted like I used to recommend in things like consumer staples and utilities so when you you talk about what does that actually mean be bold or be boring it's really a sector split right I mean some sectors are offensive some do better in economic expansions or soft Landings other sectors do better in hard Landings or recessions uh and so on and I I am not in that hard Landing Camp so I think that that is probably still
the way to go I think there you know clearly things like Precious Metals give you some insurance value and especially if the dollar has topped out which I do believe happened last fall uh gold silver you know obviously has a place in your portfolio and I think a bigger place now than it would have a year ago so I think that's the sector I'm optimistic on and and I do share the optimism on energy as well I think that you know there's a continued push from some parts of the globe to make sure
that supplies don't get too loose that uh you know if there are some demand concerns coming from Asia or China for example uh the producers are seeing that they don't want to just open the TAPS in the Middle East and so on so I think that you're going to see that market which had a our performance in 2022 and had been underperforming earlier this year might be one that picks up the Baton and kind of runs with it into year-end and early next year as well right and when you mention energy are
you talking about oil and gas or are you looking at energy more broadly because there's a lot of things that can play into that sure I think oil and gas and and other sectors sub sectors like refining exploration even renewable energy if you're if you're smart about it I mean there are some sort of fly-by-night companies in that space that that you know they tell a great story but there's not much meat on the bones but I think if you're selective uh and you really dig into what those
companies are doing you can find some some opportunities there as well so in general I think there's a lot in energy that will probably work again as we head into the back half or close out the back after this year and roll into 2024. right so you've got some options there if you want to look at energy so I also did want to follow up on gold we have an audience that's very interested in gold and you mentioned last time you're bullish on gold you're talking about that a little right now but it's one
that we've been waiting for a little bit I think is what you had said previously and so for you I think what I was taking away was that we need to see people kind of acknowledge that the FED is done with its rate hikes then maybe we see that top out in the US dollar that's happening then we see gold start to move so I wanted to check in with you a little bit more on the price trajectory for gold which is tricky but everybody always wants to know you know where is it going sure sure I mean you've I think
you've got the sequencing of events that has to happen you know you're pretty much dead on there uh I do think that you know the dollar again the big run that we had last year in the dollar predicate on the idea of fed aggressive hiking until Kingdom Come that's over with you know we've seen the dollar even with the recent rally over the last several weeks it's still nowhere near its highs in terms of the dollar Index um do you have some currencies that trades against like the Chinese Yuan
which is obviously you know falling apart it came in the Chinese economic situation I think overall if you're at the end of the FED hiking cycle which I believe we are and if there is a potential for the FED to start reversing some of those hikes next year which I think there is um it is a more bullish environment for gold you're not going to have that that sort of deadly combination for Contra dollar fangs like a surging dollar and surging interest rates I mean that you know there isn't a worse climate for
investing in things like Precious Metals than that and it's amazing that even despite that gold ended up basically flatlining in 2022. if you remove those those governors on the system those things that were holding it back uh which I believe were in the process of doing and you could have a much more positive finish to this year and again rolling into 2024 it's one of those asset classes I'm pretty optimistic about you know run and slap a dollar Target on it um I just you know I would
say I reiterate a bullish call it has been to some degree you know Waiting for Godot but I think that ultimately investors who are willing to be patient are going to be rewarded right I think that makes a lot of sense and I want to talk also about how to approach school because I was thinking about this I want to see your thoughts as well so cool of course it has its Safe Haven appeal which kind of fits into that boring mentality that we were talking about but you can also be bold with gold by going into socks especially
on the smaller cap side so for you how how would you be approaching gold how might investors want to look at that sure I think you're going to need to see um you know for the more I guess the mining type companies are smaller the Juniors and so on that are more out on the risk or I mean you know when General Credit concerns and questions are there are some questions about how that is going to evolve you tend to see those riskier parts of even the precious metals asset class not perform as well
and I think that's been one of the things holding those smaller smaller cap names back I think that ultimately again if you do have a move in the underlying metal and you do have this soft Landing narrative more broadly accepted that's going to be something that will uh you know will ultimately help even those company it's not just the big Mega caps that that big money can buy quickly but also some of the mid cap and smaller cap names that you know tend to follow later if a bull market really does uh really
does get underway yeah I think that's interesting that you mentioned that this can gold can do well even in this soft Landing scenario because I think people tend to think we need that hard landing and kind of more of a crisis situation for gold to do well but but you see it actually doing well even if we get the soft landed yeah I think you know gold as a crisis insurance or chaos insurance I used to call it asset yeah you could you can get big moves in short term uh from things like that A Bank blows up a credit
Market goes Haywire something happens that's where you get these big short-term spikes in Gold that tend to not hold for the longer term but I think ultimately for the longer term helps an asset last light gold is the bigger picture of things the interest rate trends the currency you know relative uh trades there whether it's the dollar or some of these other currencies so that again those big picture sort of slow moving things or what you want to see if you're an investor in the longer term
for gold I mean you can catch a 100 200 Spike if there's a blow up in the credit Market but a lot of times once you know somebody swoops in a bank gets bought a central bank like backstop something you tend to lose some of that I would rather have a longer term bull market powered by some of those big macro trends that again I think are going to be more favorable heading into next year okay yes that makes a lot of sense and as we're finishing up so we've talked about energy we've talked about gold we
have an audience that's pretty focused on Commodities so I wonder if there's any other areas of the resource sector that you think are poised to perfo rm well as we head toward the end of 2023 sure I mean I'm not an expert and if you look at some of these Niche areas like uranium that are kind of tied to what's happening in the broader energy Market I mean obviously that that uh material that commodity has done very well um there are things that are tied to sort of battery metals and so on I think
there is clearly a longer term bulk case to be made for that again although more of a generalist and a specialist I don't have you know great insights into those sub sectors but I would say I think given what's happening overseas concern about China's economic growth and so on well you know your your base metals are probably going to struggle more than your your precious metals are simply because again so much of that demand historically has come from China and it's almost like there's an algorithm
written that you know bad Chinese news equals cell copper and things like that uh so you you know you may see some of that impact in markets but overall again if we if the Soft Landing narrative does gain traction and even in some of those growthier parts of the commodity Market all right yeah I guess it is called Dr copper for a reason there all right this is really great thank you so much for giving us a little preview of what's going on at the money Show event in Toronto I'll let you go uh but before I
do any final thoughts that you would share with our audience sure again you know I think that cautious optimism that cautious bullishness is probably a pretty good place to be once we get through this seasonal period of weakness and head into you know the last quarter fourth quarter of this year and especially rolling into 2024. I think there's a lot of reasons to um to be essentially stick with that be bold philosophy because I think it is going to work for investors all right well thank you so much for
coming on to talk once again I'm Charlotte McLeod with investingnews.com and this is Mike Larson with money show thank you thank you for watching if you like this video make sure you subscribe to our Channel we'd also love to hear your thoughts so leave us a comment below we'll see you next time [Music]
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