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10 of the Best Canadian Stocks to Buy in September & Hold Forever

If you’re looking for some of the best Canadian stocks to buy in 2021, you’ve definitely come to the right article. And, the fact that you’re looking for the top Canadian stocks shows you believe there is value right here at home. Canadian stocks and…

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If you're looking for some of the best Canadian stocks to buy in 2021, you've definitely come to the right article.

And, the fact that you're looking for the top Canadian stocks shows you believe there is value right here at home.

Canadian stocks and the Toronto Stock Exchange in general have had a poor reputation in terms of returns. Many investors looking to learn how to buy stocks in Canada skip the Canadian markets and head down south for more growth.

But, there's money to be made when it comes to Canadian stocks and the Canadian stock market, especially in the environment we're heading into, that being a re-opening of the economy and rising interest rates.

We know how to identify the best stocks in Canada

In fact, I've achieved annualized returns of over 22.76% over the last five years since I swapped my strategy to specifically target Canadian growth stocks.

Proof? Here's a snapshot of my returns pulled directly from Qtrade. Which by the way, is in my opinion the best brokerage platform in the country (you can read my Qtrade review here.)

But don't fret, the 10 top Canadian stocks listed below aren't slouches, and they have some potential to post outsized returns.

10. Agnico Eagle Mines (TSE:AEM)

Agnico Eagle Mines

It's been a long time since a Canadian stock in the material sector has been featured so prominently on this list of top stocks.

With the possibility of inflation coming and interest rates increasing, Canadian investors would be crazy to leave their portfolios without any exposure to gold.

As we can see in recent times, gold is making a comeback, and the rising price of gold miner shares is providing some stability to Canadian's portfolios.

There are a few things I look for in particular when I'm looking at a long term gold play. The first one is mining jurisdictions.

Are there opportunities to make more with smaller, more speculative mining companies? Absolutely.

In fact, we relayed both Leagold Mining and Semafo to Premium members back in 2019, and both companies were scooped up via acquisitions, resulting in some nice returns.

However, for a long term play we want gold companies that mine in safe jurisdictions, where there is relatively little risk of political or regulatory interference.

Agnico Eagle Mines (TSE:AEM) fits that bill. The company primarily operates in Canada, Finland, and Mexico and owns 50% of the Canadian Malartic mine.

In 2020, the company produced 1.74 million ounces of gold, which at the current gold price of $1800/oz~ would equal $3.12 billion USD in revenue.

Agnico has issued guidance that gold production will increase by 300,000 ounces in 2021.

The company is the second largest gold producer in the country with a market cap of $17.6 billion, behind only Barrick Gold.

The company used to be a single mine producer, but has expanded at a rapid rate since the financial crisis of 2008, adding more than 5 mines to its portfolio.

Additionally, through further developments the company plans for a 25% increase in production by 2022.

Agnico has also just achieved Canadian Dividend Aristocrat status, with a 5 year dividend growth streak after its most recent increase in the fall.

Over the past 5 years, Agnico has grown its dividend at a pace of 34.34% annually, and its most recent increase more than doubled this rate as it pumped its dividend up by 75%.

Its yield is small at 1.93%, but with significant cash flow generation in the company's future, I expect its dividend growth rates to increase.

Agnico Eagle Mines 5 year performance vs TSX

TSE:AEM Vs TSX

9. Pollard Banknote (TSE:PBL)

Pollard

The lottery is a great business, but unfortunately the government benefits the most.

Pollard Banknote (TSE:PBL) provides investors one way to participate in the lottery business, while also getting a piece of the growing “iLottery” space.

Pollard Banknote is the number 2 producer of instant lottery tickets in the world. This is the core of Pollard’s business, and it’s a very good business.

The business has high barriers to entry as there are regulations about importing lottery tickets, so Pollard is likely to hold on to its competitive position.

Pollard has grown its instant lottery ticket revenues at a 9% compound annual growth rate since 2012.

The most exciting part about Pollard is its 50% ownership in NeoPollard Interactive.

This is a 50-50 joint venture with NeoGames that is focused solely on the iLottery space, giving states the ability to operate lotteries on the internet.

This is a very new industry, but it is growing rapidly and NeoPollard Interactive is the most successful operator in the industry.

Just 8 states offer instant lotteries on the internet, and NeoPollard operates three of them. And the iLotteries in NeoPollard states have much better higher penetration, indicating that NeoPollard is better than its competitors.

We think it’s inevitable at this point that eventually every jurisdiction that runs lotteries now will add iLottery and given NeoPollard’s success so far, I expect NeoPollard is going to win a lot of business as states and countries legalize it.

The growth in Pollard’s base instant lottery ticket printing business, and its new iLottery business, will ensure the company keeps up its excellent growth.

Over the last 5 years, Pollard has grown revenue 13.7% annually, and it has grown its bottom line even faster, with earnings per share growth of 28.8% per year.

Growth was slower in 2020 because of COVID-19 lockdowns, but analysts expect growth to accelerate again in 2021. Analysts are estimating that Pollard’s revenue will grow 13.3% and earnings per share to grow 7.3%.

But that should just be the beginning. If iLottery takes off like we think it will, Pollard is going to grow into a much larger company.

Even though iLottery is just starting, Pollard Banknote has already proven to be a fantastic investment for shareholders. A $10,000 investment in Polalrd when it went public in 2005 would be worth over $91,400 today.

Over the last year the stock price is up 261% as investors are catching on to the potential of its iLottery business.

Pollard pays a modest dividend, with the yield currently 0.29%. But Pollard does look like it will be growing its dividend.

The company raised its dividend by 33% in 2019, and as earnings grow and the iLottery business matures, I expect the dividend will grow a lot as well.

Bottom line is there is an opportunity to invest in Pollard at the start of a revolutionary growth story, all while Pollard’s core business continues to produce profits.

Pollard Banknote 5 year performance vs TSX

TSE:PBL Vs TSX Index

8. Goeasy Ltd (TSE:GSY)

Goeasy Ltd

Over the last half decade, there's been somewhat of an emergence in a particular niche industry in the financial sector, and that is alternative lenders. One of the best Canadian stocks in that niche? Goeasy Ltd (TSE:GSY).

Goeasy Ltd is a small-cap Canadian stock that provides non-prime leasing and lending services through its easyhome and easyfinancial divisions.

The company has issued $5 billion in loans since its inception.

It also continually works to increase Canadian borrower's credit scores, with 60% of customers increasing their credit scores less than 12 months after borrowing.

The company provides loans for a wide variety of products including furniture, electronics, and appliances. Goeasy has become an attractive alternative for Canadians due to strict lending restrictions placed on Canada's major financial institutions.

A lot of investors view Goeasy's business model as predatory. If something doesn't adhere to your principles, don't invest in it.

Much like tobacco or alcohol, some investors aren't willing to support companies with such products. But you can't deny that what Goeasy is doing is working, and it's working well.

Since 2001, Goeasy has grown revenue at a 12.8% compound annual growth rate. In fact, the company has never had a year since 2001 where revenue was flat or lower than the year before.

If we look towards recent years, from 2015 to 2020 the company doubled revenue, confirming the fact that alternative lenders are catching on in a big way.

Even more impressive is the company's earnings, as net income since 2001 has grown at a pace of 31% annually. To grow net income at a compound annual rate of more than 30% over 2 decades just highlights how strong this company has been.

That's exactly why a $10,000 investment in Goeasy Ltd in 2001 would be worth over $1 million today.

The company is also growing its dividend at one of the fastest rates in the country. The company has a 39.8% 5 year annual dividend growth rate and has raised dividends for 5 consecutive years, including the most recent increase of 47%!

Overall if you're looking for a growth play in the financial sector, I don't think there is a better option than Goeasy Ltd. 

Despite a global pandemic, the stock has still provided excellent returns to current investors, and has provided significant returns to Premium Members when we highlighted it in 2018.

We used to have the stock higher on this list, but its run up in price has caused us to drop it down a bit. But make no mistake about it, this is one of the best stocks on the TSX Index today.

Goeasy ltd 5 year performance vs TSX

TSE:GSY Vs TSX

7. TFI International (TSE:TFII)

TFI International

TFI International (TSE:TFII) is a stock we covered extensively at Stocktrades Premium, especially during the peak of the COVID-19 pandemic, and the company has more than tripled off those lows.

TFI International is a trucking and logistics company. The company operates in four segments: Package and Courier, Less-Than-Truckload, Truckload, and Logistics. Along with 31,000 employees, it has over 500 terminals across North America.

The company has operations in the United States and Canada, and following its recent acquisition of UPS’s Less-Than-Truckload freight business, the bulk of its revenue, almost 75%, will come from the US.

So why were we extremely bullish on TFI during the pandemic over at Stocktrades Premium, and why are we still bullish on them despite the huge price increase in 2020 and 2021?

While mass panic selling was occurring, TFI International's stock was not immune to the sell off. The stock quickly plummeted in March, hitting the $24 range. Fast-forward a year and the stock is currently trading 365% above those levels.

With the strong financial position the company was in, it went on the hunt for struggling companies, and ended up purchasing Gusgo Transport, Fleetway Transport, CCC Transportation, APPS Transport, Keith Hall & Sons, assets of CT Transportation, the dry bulk assets of Grammer Logistics, and assets of MCT Transportation, DLS Worldwide, and the aforementioned UPS Freight business.

Yes, it’s a lot, CEO Alain Bedard was very busy putting capital to work. TFI took advantage of the situation and bought assets at discounted rates, highlighting the ability of its management.

Although the company has struggled to increase its top line over the last 5 years (5.6% annual revenue growth) its become much more efficient and as a result its bottom line has improved. Earnings over the last 5 years have increased at a 21.5% clip annually.

The UPS Freight acquisition is transformational for the company. As mentioned, TFI International will now be more weighted towards business in the US, as opposed to the past when most revenue came from in Canada.

When TFI International purchased UPS Freight, it was roughly breakeven, with margins around 1%. Management has guided they think they will improve margins to 10%, which will provide a lot of earnings growth to go along with the revenue growth. Analysts estimate earnings per share will grow 21.8% in 2021 and 25.2% in 2022.

This growth in profits should allow TFI International to continue growing its dividend. The company has a 9 year dividend growth streak and has raised dividends at a 10.3% clip annually over the last 5 years after the most recent 11.5% increase in the fourth quarter.

It only yields around 1.05%, but with the dividend making up only 24.5% of trailing earnings, it should have plenty of room to grow.

The company used to be #3 on this list, but we've reduced it due to a huge run up in price. However, it's still a great long term option for Canadians.

TFI International 5 year performance vs TSX

TSE:TFII Vs TSX 5 YEar

6. Shopify (TSE:SHOP)

Shopify Logo

A list of top Canadian stocks wouldn't be complete without the top performing Canadian stock in recent memory, Shopify (TSE:SHOP).

Shopify was lower on this list, however due to a dip in price, it's now becoming fairly attractive again.

Shopify offers an e-commerce platform primarily to small and medium businesses globally. They operate in two primary segments, subscription solutions and merchant solutions.

Subscription solutions allow merchants to conduct business through Shopify's tools, while merchant solutions help businesses become more efficient via Shopify Payments, Shopify Shipping, and Shopify Capital.

Since the company's IPO in 2015, Shopify has returned over 4100% to investors. The company has been labeled "overvalued" by analysts and investors throughout its history, but despite this it simply fails to disappoint.

Over the last 5 years, Shopify has achieved revenue growth of 70.1% annually. This type of revenue growth from a company the size of Shopify is extremely rare.

Now, the company is seeing slowing growth as over the last 3 years revenue growth sits around 65.1% annually, but this is still a company that is growing at a rapid pace.

Make no mistake however, the company is expensive. Trading at over 48 times sales and 18 times book value, you're paying a premium for continued growth even after the recent pullback.

Overall, the company is expensive, and could face significant volatility moving forward in terms of price, especially if the company were to post a large earnings miss. It will need to keep up with expected growth rates in order to maintain its share price, and this isn't an investment for the defensive investor.

If you don't have a quick trigger finger in terms of selling stocks, in my opinion there will be few investors who are disappointed 5-7 years down the road if they bought Shopify even at these levels.

The company is still growing rapidly and has a large cash balance to reinvest in its business.

The stock was one of the first recommendations over at Stocktrades Premium, and members who bought when we highlighted the stock are now sitting on returns in excess of 700%.

Shopify 5 year performance vs TSX

TSE:SHOP 5 Year Returns Vs TSX

5. Nuvei (TSE:NVEI)

Nuvei Logo

Going off the board with this pick, Nuvei (TSE:NVEI) is one of Canada’s newest IPOs.

The company went public in August and its share price has performed quite well.

As of writing, Nuvei’s share price is up by ~86% in just over eight months of trading. Not a bad return for those who got in early.

Is the jump in price justified? When compared to the valuations that peers commanded, we felt that the company’s IPO pricing did not do the company justice.

As we discussed with Premium members, there was a price disconnect which offered an attractive risk to reward opportunity.

Prior to listing, Nuvei was the largest privately held fin-tech company in the country. The company provides payment-processing technology for merchants.

Their suite of products serves both online and in-store transactions and counts Stripe, Paypal, Fiserv, Lightspeed POS, Global Payments, Shift4 Payments and WorldPay among its competitors.

On a trailing twelve-month basis, Nuvei generated US$339M in revenue and US$43B in gross transaction value (GTV). Nuvei grew revenue by 64% in fiscal 2019 and over 50% in 2020.

Since going public, the company has attracted plenty of attention. There are 13 analysts covering the company – 11 rate it a “buy” or “outperform” and 2 rate it a “hold”.

Although the company is not yet profitable, the expectation is for the company to turn a profit next year. They also expect 29% revenue growth in 2021.

It is important to note, that newly listed companies carry additional risk. They have less public history for investors to look at to asses the business model.

Can it meet lofty estimates?

New listings are particularly vulnerable to performance as compared to expectations. Given this, IPOs such as Nuvei are most appropriate for investors with a higher risk profile.

Performance of Nuvei Vs TSX since its IPO

TSE:NVEI vs TSX Index 5 Year

4. Telus (TSE:T)

Telus dividend

There is limited 5G plays here in Canada. We're often forced to head down south to the American markets if we want exposure to high-growth 5G opportunities.

While Telus (TSE:T) doesn't exactly boast world beating future potential, the stock is the best telecom stock to own in the country today in terms of both 5G exposure and overall growth.

Telus is part of the Big 3 telecom companies here in Canada, and is the stock you want to buy if you want exposure to a more pure-play telecom company.

Unlike Rogers Communications and BCE, Telus doesn't have a media division and instead has invested in business models that drive higher margins like telehealth and security.

This should allow Telus to not only grow its dividend, which is the best dividend in the telecom sector, but should also allow it to drive top and bottom line growth.

The last 5 years have not been favorable to Canadian telecoms in terms of growth. In fact, Telus has only grown revenue by 3.7% annually over the last 5 years and earnings have remained relatively flat.

However, the environment has completely changed for these companies. Telecom infrastructure is difficult to construct and extremely costly.

On one hand, this is a huge benefit to a company like Telus. Unless they're willing to share towers, it creates a barrier to entry that is almost impenetrable. 

On the other hand however, it makes development of new infrastructure extremely expensive, and telecom companies often carry a large amount of debt to do so.

When interest rates are high, we can expect these companies to struggle. However, now that we are in a low interest rate environment, this bodes well.

Even if rates were to increase, they'd likely still be well below levels we've witnessed in quite some time.

Analysts are predicting double digit revenue growth for the company in 2021, which can be compared to shrinking revenue growth expected from both Rogers Communications (-3.4%) and BCE Inc (-0.8%).

Telus 5 year performance vs TSX

TSE:T Vs TSX Index 5 Year

3. Parkland Fuels (TSE:PKI)

parkland fuel dividend

Parkland Fuels (TSE:PKI) is one of Canada's largest and one of North America's fastest independent marketers of fuel and petroleum products. Parkland serves motorists, businesses, consumers, as well as wholesalers across Canada and the United States.

The company’s growth is primarily driven through acquisitions, evident by its purchase of Chevron Canada’s downstream fuel business making them the sole distributor for Chevron branded fuels.

Another positive from the company's acquisition heavy strategy is the fact that a variety of brands allows it to distribute its products to a wide range of markets across North America.

Parkland has had some impressive growth rates over the last 5 years, averaging revenue growth of 20.9% annually. Over that same timeframe, the company has also grown earnings at clip of 20.3%.

Considering the company pays a healthy dividend, I think it would be a mistake for Canadians not to capitalize on the stock still being down from pre-COVID levels. This is a company that could benefit significantly from the inevitable reopening.

The company is a Canadian Dividend Aristocrat having raised dividends for 7 straight years and pays its dividend on a monthly basis, making it even more attractive to Canadian investors wanting a steady income stream.

Analysts expect marginally shrinking revenue in 2021, coming in at -2.7%. This is a far cry from the company's historical averages of 20% annual growth, but we're ok with this.

As long as the company can maintain its dividend and continue to be in a strong position to grow moving forward, we'll be patient and let it recover from this unprecedented pandemic.

Parkland Fuel 5 year performance vs TSX

TSE:PKI Vs TSX 5 Year

2. Brookfield Renewable Partners (TSE:BEP-UN)

Brookfield Renewable Partners

Brookfield Renewable Energy Partners (TSE:BEP.UN) is a pure-play renewable energy company here in Canada, and has been one of the fastest growing companies in the sector by a longshot over the last half decade.

Brookfield Renewables has over 21,000 MW of capacity and nearly 5300 facilities across four continents.

Over the long run, Brookfield looks to give shareholders annual returns of 12-15%. 

This is a lofty goal, but one that the company has easily achieved over the last half decade.

In fact, over the last 5 years, Brookfield Renewables share price is up roughly 200%. And this is including its huge correction as of late as renewables have taken a hit.

Its acquisition of Terraform Energy back in March of 2020 made it the largest pure-play renewable energy company in the world, and if you're looking for a company to give you exposure to the renewable sector, Brookfield is in our opinion, best in class.

The shift away from fossil fuels and into renewable forms of energy generation is a shift that is still very much in its infancy, but is one we feel is inevitable.

We're not saying oil is going to disappear overnight. We're not that extreme.

In fact, we still feel that there will be many uses for oil extending well into the future. Energy generation may just not be one of them.

In terms of dividend, the company currently yields 3.58% and the dividend is well covered by funds from operations.

Brookfield has stated it plans to grow the dividend anywhere from 5-9% annually over the next 5 years, which is actually an uptick in dividend growth compared to its previous 5 years.

Make no mistake about it though, Brookfield, due to its size and popularity, is one of the most expensive renewable energy plays in the country right now.

If you're looking to take a position, it's important you understand that there is likely to be significant swings in the company's share price. The pullback since the start of the year is probably a great time to buy this renewable energy leader.

Brookfield Renewable 5 year performance vs TSX

TSE:BEP.UN Vs TSX

1. Royal Bank of Canada (TSE:RY)

Royal Bank dividend

Considering this list is primarily made for growth stocks, it did feel somewhat weird including The Royal Bank of Canada (TSE:RY).

However, this Canadian bank stock is simply too good right now to not be included on a list of the best stocks to buy in Canada.

Royal Bank is a global enterprise with operations in Canada, the United States, and as we'll see the importance of later, 40 other countries.

It is a well diversified bank, with personal, commercial, wealth management, insurance, corporate, and capital market services.

The company is Canada's most valuable brand, and has been for the last half decade. RBC currently sits at Canada's second largest company in terms of market capitalization, falling just behind another stock on this list, Shopify.

On average over the last 5 years the company has grown revenue by 6% and earnings by 3% on an annual basis.

With a dividend yield in the 3.5% range and an 8 year dividend growth streak, it's one of the best dividend payers in the country.

A very interesting note: RBC paid out more in dividends in 2019 than Shopify had total revenue, despite Shopify being the larger company market cap wise.

The Canadian banking industry is one of the strongest investment sectors in the world, highlighted by the fact that no Big 5 financial institution cut their dividend during the 2008 financial crisis, and no Big 5 institution has done so yet during the COVID-19 era.

Regulatory agencies asked the banks to preserve liquidity and not raise the dividend in 2020 as a preventative measure to both clients and shareholders. It's rare that I'd consider no dividend growth a good thing, but in the situation we're in, I'll take it.

It’s expected the banks will be allowed to raise their dividends again this year.

Royal Bank knocked earnings out of the park during a global pandemic, and as a result has caught the attentions of a lot of investors. The stock has fully recovered from the COVID-19 downturn and is now back at all time highs.

Why has Royal Bank fared better than most? Well, this is primarily due to the fact it has the most global exposure out of any of the other banks.

This has allowed it to be exposed to a multitude of economies at different stages of recovery. Compare this to a bank like Toronto Dominion, who almost has all of its revenue exclusively in Canada and the United States.

Moving forward, in my opinion the Royal Bank is simply a must have in the majority of Canadian's investment portfolios.

Royal Bank 5 year performance vs TSX

TSE:RY Vs TSX Index

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Economics

China Coal Prices Soar To Record As Winter Freeze Spreads Across The Country

China Coal Prices Soar To Record As Winter Freeze Spreads Across The Country

One week ago we discussed why the "worst case" scenario for China’s property crisis is gradually emerging; to this we can now add that China’s worst case energy…

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China Coal Prices Soar To Record As Winter Freeze Spreads Across The Country

One week ago we discussed why the "worst case" scenario for China's property crisis is gradually emerging; to this we can now add that China's worst case energy crisis scenario is also about to be unleashed as cold weather swept into much of the country and power plants scrambled to stock up on coal, sending prices of the fuel to record highs.

Electricity demand to heat homes and offices is expected to soar this week as strong cold winds move down from northern China, according to Reuters with forecasters predicting average temperatures in some central and eastern regions could fall by as much as 16 degrees Celsius in the next 2-3 days.

Shortages of coal, high fuel prices and booming post-pandemic industrial demand have sparked widespread power shortages in the world's second-largest economy. Rationing has already been in place in at least 17 of mainland China's more than 30 regions since September, forcing some factories to suspend production and further disrupting already broken supply chains.

On Friday, the most-active January Zhengzhou thermal coal futures closed at a record high of 2,226 per tonne early. The contract has risen almost 200% year to date.

China's three northeastern provinces of Jilin, Heilongjiang and Liaoning - also among the worst hit by the power shortages last month - as well as several regions in northern China including Inner Mongolia and Gansu have started winter heating, which is mainly fuelled by coal, to cope with the colder-than-normal weather.

Meanwhile, even though Beijing has taken a slew of measures to contain coal price rises including raising domestic coal output and cutting power to power-hungry industries and some factories during periods of peak demand, so far all measures have failed with coal surging by 40% in just the past three days. Beijing has also repeatedly assured users that energy supplies will be secured for the winter heating season, and went so far as to order energy firms to "secure supplies at all costs." Well, the energy firms heard it, because on that day, thermal coal closed at 1,436 yuan. Two weeks later it is some 800 yuan higher.

Unfortunately for Beijing, the power shortages are expected to continue into early next year, with analysts and traders forecasting a 12% drop in industrial power consumption in the fourth quarter as coal supplies fall short and local governments give priority to residential users.

Earlier this week, we reported that China undertook its boldest step in a decades-long power sector reform when it allowed coal-fired power prices to fluctuate by up to 20% from base levels from Oct. 15, enabling power plants to pass on more of the high costs of generation to commercial and industrial end-users. read more

Steel, aluminium, cement and chemical producers are expected to face higher and more volatile power costs under the new policy, pressuring profit margins.

Meanwhile, the latest Chinese "data" on Thursday showed factory-gate inflation in September hit a record high; but since thermal coal is the one commodity that correlates the closest to PPI, absent a sharp drop in coal prices in the next few weeks, expect the next PPI print to be far higher. Meanwhile as the power crisis leads to further shutdowns in domestic production, some banks - such as Nomura - have gone so far to predict that China's GDP is set to shrink in coming quarters.

China, which laughably aims to be "carbon neutral" by 2060 even as its president announced he will skip the COP26 UN Climate Change Conference in Glasgow, has been "trying" to reduce its reliance on polluting coal power in favor of cleaner wind, solar and hydro. But coal remains the source for some 70% of China's electricity needs.

Of course, China is not the only nation struggling with power supplies, which has led to fuel shortages and blackouts in many European countries. and threatens to send US heating bills up as much as 50% this winter. he crisis has highlighted the difficulty in cutting the global economy's dependency on fossil fuels as world leaders seek to revive efforts to tackle climate change at talks next month in Glasgow.

China will strive to achieve carbon peaks by 2030, Vice Premier Han Zheng said in a video message at the Russian Energy Week International Forum, according to state-run news agency Xinhua late on Thursday. He also said that China and Russia are important forces leading the energy transition and they should cooperate and ensure smooth progress of major oil and gas pipeline and nuclear power projects.

Translation: Russia better save that nat gas and not ship it to Europe as China will soon be needed even BCF Russia an provide. As for China

 

Tyler Durden Fri, 10/15/2021 - 22:50

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Government

Distraction As Policy While Our Economic Rome Burns

Distraction As Policy While Our Economic Rome Burns

Authored by Matthew Piepenberg via GoldSwitzerland.com,

Desperation and distraction are masquerading as economic policy. Below we see how and why…and at what cost…

COVID: The Great..

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Distraction As Policy While Our Economic Rome Burns

Authored by Matthew Piepenberg via GoldSwitzerland.com,

Desperation and distraction are masquerading as economic policy. Below we see how and why...and at what cost...

COVID: The Great Economic and Political Hall-Pass

If every time I stole a cookie from the jar in front of my mom (age 8), or drove dad’s car (sometimes into a tree) without permission (age 16), failed a dorm-room inspection (age 17), broke a lawnmower for driving over a fence post (each year) or forgot a key anniversary (eh-hmm), it would have been so convenient to have a universal “hall pass” to excuse what is/was otherwise just plain stupid behavior.

Luckily for the grown children running our global financial system into the ground, the COVID pandemic is becoming precisely that: “A global hall pass for excusing decades of stupid.”

As we’ve written many times, inexcusably high debt levels, tanking growth data, struggling work force figures, embarrassing wealth disparity and insider market rigging between Wall Street and DC was well in play long before COVID made the headlines.

But now, the architects of such “pre-COVID stupid” have the current COVID narrative to justify and excuse even, well… more stupid.

The Latest Jobs Report “Explained” …

Take, for example, the latest job reports data from those DC-based creative writers at that comic-book publication otherwise known as the Bureau of Labor Statistics (BLS).

Known for years on Wall Street as mathematical magicians capable of turning 12% inflation into a 2% CPI lie, that same BLS is operating yet again to fib away the latest (and otherwise telling) jobs data.

The September jobs report was the second consecutive and disappointing report from the BLS, which they were quick to blame on “pandemic-related staffing fluctuations.”

Hmmm. That’s a nice phrase, no? “Pandemic-related staffing fluctuations.”

But the real description boils down to something more PRAVDA-like under the new Biden Vaccine Mandate, namely: “Obey or we take your job away.”

Needless to say, not everyone is obeying.

Since 2020, employment in local government education is down by 310,000; in state government education, employment is down by 194,000 jobs, and in private education the numbers are down by 172,000.

Ouch.

Why such “staffing fluctuations”?

The answer is simple: Many educated folks in the education sector don’t like being mandated to inject a vaccine into their bodies which by all reports from vaccinated infection rates, is no vaccine at all, but a debatable form of treatment at best.

Thankfully for all of us, I’m not interested in debating the hard vaccine data here, as folks like me should not be proffering unwanted medical expertise, which I clearly lack.

No one, myself included, really knows everything about mutating virology, but I’d wager to say that many of us are more mathematically dubious than Fauci is medically honest…

Jefferson (and History) Ignored

For followers of American history and markets, however, certain ideals and facts are easier to track despite distraction-as-policy tactics.

We are reminded, for example, of how passionately Thomas Jefferson warned us circa 1776 that a private central bank would eventually destroy our nation, and that only an educated population could save it.

Sadly, the new President is taking the inverse approach: Firing teachers and propping bankers.

Fast-forward some 240+ years from our founding fathers to our semi-conscious Biden, and we discover a nation wherein a private central bank effectively finances our national debt while the teachers, students and institutions charged with making citizens wiser, educated and free now find themselves locked out of their offices, classrooms and lecterns.

Seems a little upside down, no?

Red or blue, most of us can agree than nothing coming out of the White House in recent memory remotely resembles the vision or freedom-driven intellect of founding fathers like Jefferson, despite his known flaws.

Instead, we have seen red and blue administrations whose grasp on coherency, let alone math, history, economics or even Afghan geography is questionable at best.

Biden’s Response

And what does Biden (or his “advisors”) have to say about the recent and scary numbers within a gutted and “locked-out” educational labor force?

Well, you’ll have to see it to believe it..

Really? Really? Really?

That’s right folks.

The President of the United States, home to the world’s reserve currency and former beacon of global freedom, is telling Americans not to worry about the slow death of genuinely informed dissent (as well as educational access and jobs) or the attempted popularizing of otherwise tyrannical mandates, but to focus instead on the vaccine rates at United Airlines?

Yes. Really.

The leader of the free world is boastfully telling us that the “bigger story” is a fully vaccinated United Airlines (who were forced to choose between a jab or job), so why worry about the problems in that silly ol’ educational sector or outdated Bill of Rights?

Playing with Minnows While Ignoring Whales

Where ever one stands on the understandably divisive vaccine issue, how can anyone compare a private airline’s vaccine rate to a national education, civil liberty and employment crisis?

Why are politicians, Davos dragons, statisticians, media bobble-heads and central bankers focusing our/your attention more on a virus with a case fatality rate of less than 0.5% than they are on openly addressing whale-sized issues like unsustainable debt, rising inflation, embarrassing labor inequality, a dying currency or even more declining GDP?

Deliberate and Desperate Distraction as Policy

Well, history tells us why.

As anyone not banned from a classroom knows, the history of desperate leaders seeking to distract, censor and control the masses in times of a self-inflicted and debt-induced cycle of internal economic rot is long and distinguished.

As Biden doubles down on the bad (yet deliberately distracting) hand of what was hoped to be an optically humanitarian policy of vaccine mandates, the masses are getting restless as well as fired…

Solution?

Criminalize the non-consenting as anti-vaccine, anti-science or anti-American “flat-earthers” while denying open discussion on such otherwise relevant topics as basic math, constitutional law, calm science or individual rights…

Meanwhile, those who won’t tow Biden’s increasingly incoherent mandate (or Don Lemmon’s always coherent ignorance) are losing jobs and/or forced to prioritize (in a Jeffersonian way) individual liberty over financial security.

Ben Franklin, of course, said those who surrender liberties for security deserve neither.

In such a polarized backdrop, everyone, pro or anti-vaccine, loses.

Informed, open and calm debate has been replaced by a contradictory, censored, sanctimonious and hysterical autocracy from prompt-readers to political puppets.

So much for leading the free world… Let me remind Biden to consider the words of another founding father, Thomas Paine:

“I have always strenuously supported the right of every man to his own opinion, however different that opinion might be to mine. He who denies to another this right, makes a slave of himself to his present opinion, because he precludes himself the right of changing it.”

As someone who studied and practiced constitutional law, worked within a rigged Wall Street and read nearly every book I could find on America’s founding fathers, I can say without hyperbole that I no longer recognize the country (or values) of my birth nation.

As Franklin also noted, “All democracies eventually die; usually by suicide.”

Hmmm.

But let’s get off my high-horse and back to those job reports…

Conviction vs. Employment

As Bloomberg recently noted, the result of these “pandemic-related staffing fluctuations” is a bit alarming.

The following critical industries are witnessing the following job-loss percentages: Nursing and Residential Care (-1.26%); Local Government Education (-1.83%); Community Care for the Elderly (-2.20%) and lodging (-2.25%).

But thank goodness that despite a deliberate weaning of nurses, teachers and elderly care experts, United Airlines is nearly fully vaccinated and our Motion Picture Industry (universally known for its astounding political and financial wisdom) is seeing a +4.21% job increase.

Awe, but as Johny Mellencamp would say, “Aint that America?”

Now instead of more employed and free-thinking nurses, teachers and students allowed to gather, speak and think freely at their own campus or clinic, we can be glad that jobs in Hollywood, like DC, are growing to keep us living on more fantasy rather than actual, informed and hard-earned knowledge.

Oh, and the Economy…

But rather than just rant otherwise rhetorical sarcasm, let’s get back to those other barbaric (and soon-to-be empty) old-school disciplines like economics…

Biden’s mandates are more than just evidence of distraction as policy and constitutional interpretation/usurpation, they have direct impacts on our financial lives outside of the deliberately exaggerated vaccine debacle/debate.

Let’s go down the list of what economics taught us years ago, when we were allowed to enter a classroom:

  1. Stagflation Ahead.

As more and more folks are locked out of work, the entitlement costs for these “un-American” free-thinkers will rise, placing greater inflationary pressures upon a deliberately constrained rather than open economy.

Rising inflation + slowing economic activity = stagflation.

Prepare for this, as that’s what’s coming.

Inflation, by the way, is an invisible tax on those who can afford it the least. Thanks again Powell et al for shafting the middle class…

  1. A Divided States of America

A country which once revered open rather than censored debate, investigative rather than complicit journalism, and respected rather than polarized differences of opinion, is becoming increasingly factionalized, divided and angry.

Jab or no jab, I fully respect both views. Can’t we all do the same without a “mandate”?

Like Thomas Paine, I hope so, because as Thomas Jefferson warned, we face far greater economic and political threats ahead than COVID.

Rather than accountability, transparency and cooperation, leadership today is defined by fantasy and magic, from magical money created at the Fed to magical employment and CPI data downplayed at the BLS.

Such left or right fantasy-as-policy is as old as history—it’s darker side, that is. Just ask Lenin, Castro, Nixon or Greenspan.

Whenever backed into a debt corner of their own design, leaders employ a familiar combo of boogeyman and salvation narratives to divert the masses away from the slow-drip erosion of their personal liberties, dying currencies and debt-driven stagnation.

This distraction-as-policy is happening right now. The rise of the COVID narrative in 2020 is more than a coincidence. It’s a conveniently exploited opportunity for political and financial opportunists.

  1. More Centralized Controls and Fake Markets

With debt levels far beyond the Pale of productivity levels (i.e., embarrassing debt to GDP ratios), the U.S. and other developed economies are mathematically and factually unable to ever grow their way out of the debt hole they have been digging us into for years.

Period. Full stop.

If I know this, and if you know this, well…they certainly know this too in DC.

The only difference is that these policy makers, like most kids caught with a hand in the cookie jar, are incapable of admitting fault.

Instead, today’s “leadership” can blame their economic and policy failures (and self-preservation rather than “service” instincts) on something else—i.e., “COVID did it.”

But as we’ve voiced elsewhere, the debt time bomb, growth declines, social unrest, wealth disparity and failing political credibilities in play today were already a major problem BEFORE COVID.

Now, as then, the empirical data objectively confirms that tanking manufacturing data, jobs growth, economic productivity, broken supply chains, scary transport numbers and political mistrust can never service the over $28.5T in public debt sitting on Uncle Sam’s bar-tab.

As a natural result, we can therefore expect far more “accommodation” (i.e., monetary expansion) from the Fed, and far more “Fiscal Stimulus” (i.e., deficit spending) from our comical legislature ahead.

Stated otherwise: Get ready for more real debt, fake money, centralized controls and hidden wealth destruction.

Zombie Stocks, Bonds and Bankers: Too Big to Fail 2.0

Sadly, one of the only forms of income which Uncle Sam enjoys today is the capital gains receipts from a bloated, rigged and artificially Fed-supported stock market.

This means we can anticipate more “stimulus” for a zombie, crack-up-boomed market well past its natural expiration date.

The same is true of for government IOU’s.  No one wants our bonds. 2020 saw $500B in foreign outflows rather than inflows for US Treasuries.

So, who will pay Uncle Sam’s bar tab now?

Easy:  Uncle Fed at the Eccles Building down the avenue from a Treasury Department now led by a former Fed Chairwoman.

One really can’t make this crazy up. It’s all that real, that rigged and that true.

The U.S. debt crisis is now being “solved” by a circular loop of a Wall Street and a White House children tossing their hot potatoes of bad debt (MBS and sovereign) around until they are bought with money created out of thin air by the Fed.

And yet despite such insider support, rigged markets and “accommodated” securities, even the rising tax receipts from these bloated markets are not enough to cover the interest expense on Uncle Sam’s bar tab.

In short, US Treasury bonds and stocks are openly supported Frankenstein-assets kept alive by a central bank and White House cabal (sorry, Mr. Jefferson…) who blame every problem (and justify every expenditure) on a virus rather than confess to the cancerous reality of over 20+ years of their open and obvious mismanagement of a rigged banking and distorted financial system.

But rather than account for such sins, we can expect a bigger bail-out rather than an honest confession…

In 2008, for example, the response from DC and NYC to bankers gone mad was to declare bankrupt banks as “Too Big to Fail.”

Fast-forward some 13 years later and that same toxic duo of bankers and politicos have now effectively telegraphed that bankrupt government bonds and private stocks are also “too big to fail.”

That ought to anger an informed population. But instead, we are fighting about masks, vaccine shaming and Prince Harry’s sensitive upbringing.

So far, the distraction-as-policy technique seems to be working in favor of the foxes guarding our financial henhouse.

Signal More Currency-Debasing “Miracle Solutions”

Which brings us right back to a harsh but increasingly undeniable yet ironic reality.

If objectively broken bonds, stocks and financial regimes are too big to fail, then the only way to “save” them is with more mouse-click-created currencies which are too debased to succeed.

As precious metal and other long-term, real-asset investors long ago understood, currency expansion is just another name for currency debasement.

In other words, eventually, all that “system saving” new money simply drowns the system it was allegedly designed to save in ever more debased dollars.

Again, it’s just that tragic and just that simple.

Yes: More monetary and debt expansion can buy time and rising markets.

But those markets are measured in currencies which time has equally taught us lose their value with each passing second.

And the only ones paying for that time are you and I–with dollars, euros, yen and pesos whose purchasing power and inherent value are tanking faster than the credibility of the folks who brought us to this historical and debt-driven turning point.

Stated bluntly: The financial and political leadership of the last 20+ years has placed the global financial system into a debt corner for which there is no exit other than deliberate inflation (and hence currency debasement).

This foreseeable disaster, however, is now conveniently blamed on a current pandemic rather than a grotesque history of equally grotesque mismanagement by policy markets who have confused debt with prosperity and double-speak with accountability.

Wouldn’t it be nice if such economic topics were making at least as many headlines as the latest infection rates?

Meanwhile, the mainstream media pursues plays chess with context-empty headlines, bogus job data and ignored debt bombs as our economic Rome (and currencies) burns silently around us all.

Tyler Durden Sat, 10/16/2021 - 10:30

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Huge Dock Worker Protests In Italy, Fears Of Disruption, As Covid ‘Green Pass’ Takes Effect

Huge Dock Worker Protests In Italy, Fears Of Disruption, As Covid ‘Green Pass’ Takes Effect

Following Israel across the Mediterranean being the first country in the world to implement an internal Covid passport allowing only vaccinated citize

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Huge Dock Worker Protests In Italy, Fears Of Disruption, As Covid 'Green Pass' Takes Effect

Following Israel across the Mediterranean being the first country in the world to implement an internal Covid passport allowing only vaccinated citizens to engage in all public activity, Italy on Friday implemented its own 'Green Pass' in the strictest and first such move for Europe

The fully mandatory for every Italian citizen health pass "allows" entry into work spaces or activities like going to restaurants and bars, based on one of the following three conditions that must be met: 

  • proof of at least one dose of Covid-19 vaccine

  • or proof of recent recovery from an infection

  • or a negative test within the past 48 hours

Via AFP

It's already being recognized in multiple media reports as among "the world's strictest anti-COVID measures" for workers. First approved by Italian Prime Minister Mario Draghi's cabinet a month ago, it has now become mandatory on Oct.15.

Protests have been quick to pop up across various parts of the country, particularly as workers who don't comply can be fined 1,500 euros ($1,760); and alternately workers can be forced to take unpaid leave for refusing the jab. CNN notes that it triggered "protests at key ports and fears of disruption" on Friday, detailing further:

The largest demonstrations were at the major northeastern port of Trieste, where labor groups had threatened to block operations and around 6,000 protesters, some chanting and carrying flares, gathered outside the gates.

    Around 40% of Trieste's port workers are not vaccinated, said Stefano Puzzer, a local trade union official, a far higher proportion than in the general Italian population.

    Workers at the large port of Trieste have effectively blocked access to the key transport hub...

    As The Hill notes, anyone wishing to travel to Italy anytime soon will have to obtain the green pass: "The pass is already required in Italy for both tourists and nationals to enter museums, theatres, gyms and indoor restaurants, as well as to board trains, buses and domestic flights."

    The prime minister had earlier promoted the pass as a way to ensure no more lockdowns in already hard hit Italy, which has had an estimated 130,000 Covid-related deaths since the start of the pandemic.

    Meanwhile, the requirement of what's essentially a domestic Covid passport is practically catching on in other parts of Europe as well, with it already being required to enter certain hospitality settings in German and Greece, for example. Some towns in Germany have reportedly begun requiring vaccination proof just to enter stores. So likely the Italy model will soon be enacted in Western Europe as well.

    Tyler Durden Sat, 10/16/2021 - 07:35

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