News & Events Archive

June 2010 Market Commentary: The “Flash Crash” and “Fat Finger Trade”

June 7th, 2010

Despite strong economic data and reassuring market signals (more later) of a continuation of economic growth, investors are clearly nervous. This nervousness was particularly acute on May 6, when the widely followed Dow Jones Index (DJIA) intraday fell by close to 1,000 points (dubbed the “Flash Crash”), only to rebound within minutes. Initial reports pointed to a “Fat Finger Trade”, an inadvertent large sell order. The cause of the drop remains unknown (most trades during that brief moment have been cancelled) and an investigation is underway, but this event certainly added to an already nervous market.

The economic fear/nervousness in the market concerns Greece, a heavily indebted nation. Although a beautiful country, it is relatively small economically and estimates are it contributes approximately 2% to the European Union’s Gross Domestic Product (the value of goods/services produced annually). The European Union contributes approximately 20% to the world’s Gross Domestic Product so Greece’s contribution to world output is less than 1%. Therefore, the economic impact on global growth will be minimal but to the financial market it became a much larger issue. Investors jumped to the conclusion that Greece’s problem would morph into another “subprime” problem, whereby a small country would have a similar effect on the global economy/financial markets as the relatively small financial company, Lehman Brothers, did in 2008 when they filed for bankruptcy protection in September 2008 causing a panic in the financial markets. Although one can never rule out an event of that magnitude happening again, we do not feel it will.

May 2010 Market Commentary: "The Upcoming Mergers and Acquisitions Boom"

May 3rd, 2010

Mergers and Acquisition (M&A) activity in Canada and globally is recovering. Canada for example, saw the fourth quarter of 2009 as the third consecutive quarter of increasing activity, while globally, 2009 appears to have been the bottom of the cycle and 2010 looks like the start of a multi-year rebound.

April 2010 Market Commentary: "Canada: Praise and Challenges"

April 7th, 2010

We were planning on devoting this second sector praising Canada, as the world appears to have noticed how the prospects for Canada look excellent. There have been various economic and media reports praising Canada. The title of one report was “And The Winner Is…CANADA! The term “winner” is used in the context of winning the Academy Awards.

Come visit the 3Macs booth at this year's National Women's Show Montreal, April 9-11 2010 at the Palais des Congrès

March 26th, 2010

MacDougall, MacDougall & MacTier Inc. is pleased to partake in this years' National Women's Show to be held from April 9th to April 11th 2010 at the Palais des Congrès in Montreal.

Please click on the link below to get your 2 for 1 admission coupon:

2 for 1 Admission: 2010 National Women's Show


For general information about the show, please click on the link below:

2010 National Women's Show - Palais des Congrès Montréal

Montreal Gazette article delves into 3Macs' "fascinating story"

March 23rd, 2010

Peter Hadekel's article which was published in The Montreal Gazette, tells the 3Macs story of perseverance and focus on customer needs, which has enabled the firm to claim a 160 year-history of independence and success. We are proud to share a little piece of our history with you. For the complete article, please select link below:

Peter Hadekel-Investment Firm has Fascinating Story

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MacDougall, MacDougall & MacTier Inc. invites clients and friends to join us at two scheduled events to celebrate the Firm's history "Staying Connected".

The events will take place on Thursday, March 25th 2010 as follows:
 

• As part of the Atwater Library "Lunchtime Series", on Thursday, March 25th at 12:30 p.m. Michael Harrison will talk about the book he co-authored with James Ferrabee, entitled “Staying Connected” – How MacDougall Family Traditions Built a Business over 160 Years.

• The Nicholas Hoare Book Store invites you to attend a book signing and reception on Thursday, March 25th from 6:00 to 8:00 p.m. to celebrate the publication of Michael Harrison & James Ferrabee’s new book “Staying Connected” – How MacDougall Family Traditions Built a Business over 160 Years.

Admission to both events is free; all clients and friends of "3Macs" are warmly welcome.

March 2010 Market Commentary: "Budget deficits and inflation. Do deficits lead to inflation?"

March 4th, 2010

One of the lingering effects of the past recession is large government budget deficits (spending exceeding revenue collection) that have been created. Investors are concerned that budget deficits ultimately lead to higher inflation, as governments may resort to “printing” more money to pay for these deficits. We have reviewed the economic literature and the answer appears to lie with the independence or lack of independence between a country’s central bank and its elected government.

In the developed world with independent central banks (U.S., Canada) there is little evidence that budget deficits lead to higher inflation, but in some developing countries with less independent central banks running persistent deficits do appear to lead to higher inflation.

Running a government’s financial affairs is similar to running a household. As in any household, it must pay for its bills. Households have three ways to pay for their spending. They can work to earn income, live off the income generated from their assets (interest/dividends or rental income) or they can sell some of their assets. Should household spending exceed their earnings they will need to borrow the difference, likely from a financial institution. Governments have this same option of borrowing when spending exceeds revenue (tax collection or asset sales) by issuing bonds. Bonds are nothing more than a promise to pay in the future the borrowed money. In general, governments issue bonds to the public. Financing budget deficits, in this manner as is currently being done by Canada and the U.S., is not inflationary as the money the government has to spend by issuing bonds to the public is money the bond purchasers (the public via mutual funds and/or pension funds) no longer have to spend, so this financing of the deficit merely shifts spending from the private sector to the public sector. There has been no “new money” that has been created.

Please see the complete commentary attached below:

February 2010 - Market Commentary: "From Hope to Growth"

February 8th, 2010

Even the most bearish of economists will acknowledge economic growth has returned. Early in 2009, investors were in a state of hoping for growth. In the final months of the year, this hope became a reality as economic expansion, although tepid in many parts of the world, returned.

January 2010 - Market Commentary: "2010 Outlook and Themes"

January 7th, 2010

Economy: Our view for 2010 is the world will continue to recover from a very deep recession and financial crisis and although there are many challenges facing the global economy, (large deficits, high unemployment rates are but two examples) the challenges, in our view, will not be as difficult as the financial crisis we have just emerged from.