Subsequent to the US Presidential election in early November 2016, I have become “uber cautious”. My rationale for becoming this way is that:
- Corporate debt levels are growing exponentially despite sputtering profit growth.
- High-yield debt with “thin compensation” relative to increasing risk of default.
- Political turmoil in various parts of the world appears to be escalating.
- Subprime auto-loan default rates in the US now match those seen just before the 2007-2009 recession.
- The number of retail outlets expected to close in 2017 will exceed that of 2008.
- Almost half of certain emerging-market debt (the sovereign and quasi-sovereign variety) is below investment grade.
- Canadians’ household debt (watch videos) at elevated levels.
- Consumer debt levels in the US rivals those just prior to the Financial Crisis in 2008.
- The quality of the leadership in Washington (not just at the Presidential level but his entire entourage). I suspect countless Americans who voted Trump into office held out hope that his “business prowess” would improve their lot. Had they read The Art of the Deal, a biography about Trump, they would have realized his “business prowess” is highly suspect. In my opinion, this man has few morals, is unethical, and is essentially a con artist. I recommend you listen to this 9 minute interview with The Art of the Deal ‘s “ghostwriter”.