Juno News - May 19, 2022


Half of Canadians are $200 away from insolvency


Episode Stats

Length

4 minutes

Words per Minute

188.5164

Word Count

881

Sentence Count

56


Summary


Transcript

00:00:00.000 we've been talking about this a little bit, but you give financial advice to families.
00:00:04.680 You know, that statistic I mentioned earlier about 49% of Canadians were within $200
00:00:08.560 of being unable to pay their monthly bills. Like what can, what can everyday Canadians do at this
00:00:15.240 point? What's your advice to like a young family that's looking to buy a house or a young family
00:00:20.160 looking to save up or, you know, just manage to get through whatever it is that we're about to
00:00:26.780 get through? What advice would you give to them? It's difficult because first of all, it's if
00:00:31.920 somebody is a low income, that's who gets impacted. We knew that, excuse me, going in. And as we were
00:00:36.980 alluding to earlier, that level of what's considered, you know, full impact of the inflation in a
00:00:41.700 difficult way, changing your lifestyle has moved way up the income scale. Now we're about half of
00:00:46.480 Canadians are impacted in a way that is changing their lives. It's really tough for them because
00:00:52.160 the structural problems that we've got are real. Keep in mind, even a year from now,
00:00:59.400 if oil, say oil's at, let's make an easy number for us, $100 today. And that's way up, obviously,
00:01:05.820 from sort of the $60 range, just going back four or five months and way more than a year ago.
00:01:12.360 But a year from now, let's say oil's at $115. Well, the inflation will be reported as $5 increase
00:01:20.200 on the $110. You know, it's compared to the previous year. So when we get all these lofty
00:01:27.380 prices, inflation rate will probably go down. We're not going to keep going up at 40% a year
00:01:32.460 on something, you know, so they're really stuck in this. The one thing they're also measuring,
00:01:38.100 and I want people to understand this, what you're measuring is those paper things called dollars
00:01:42.520 don't buy you as much. That's what we're really measuring. Inevitable consequence. When you produce
00:01:47.680 a lot of something, usually the price goes down. So we produced, you know, hundreds of
00:01:53.240 billions of dollars. No wonder the value of them, the purchasing power went down. And that's what's
00:01:59.220 happened. So their money doesn't buy as much. And, you know, we were chatting before, where I'm just
00:02:05.780 saying, it's really interesting revelation for people that we say, hey, the Canadian dollar is 78
00:02:10.940 cents against the US dollar. I'm going, who cares? I don't eat US dollars. I don't live in a US dollar.
00:02:18.740 That's not the relevant measure of your currency. It's what it can buy. And we know it's going to buy
00:02:24.800 a heck of a lot less food coming up in the next year. You know, it's, you know, if you're wanting
00:02:29.420 to buy lumber for a deck, you know, you're building whatever it is, it doesn't buy as much stuff.
00:02:34.220 And so if you're just at that 200, you know, like you're breaking even, and that's a significant
00:02:40.280 number. When someone says I'm within, you know, inflation rates at 6%, keep in mind what that
00:02:45.400 actually means to people. It means if you're the average Canadian, you probably have to spend about
00:02:50.960 $4,000 more for the same stuff you bought a year ago, if that keeps going at that, say, 6% rate.
00:02:58.280 And then wait a second, that's after tax dollars. So I got to make like $5,500, pay $1,500 in income
00:03:06.980 tax. Oh, now I've got that $4,000 left over. That's the challenge. And there's no easy way,
00:03:12.180 easy. There's no way out. Actually, people's lifestyles are going to change. When you have
00:03:17.000 extra money, you know, so you're an investor. My advice has been since February, 2020, buy commodities,
00:03:23.400 buy stuff. Why? Because, and you can see, it's been a great call, by the way. It's just,
00:03:29.760 that's the way it is. Because it's the stuff that's getting, compared to our dollars, getting
00:03:35.500 worth more and more and more. And I still believe that. I'm still a big fan of oil as an investment,
00:03:41.820 Canadian oil, because we still undervalue it. But it's not just that. If we're going to do the EV
00:03:46.320 revolution, and I believe we are politically, well, you need a lot more copper. I mean,
00:03:50.640 we're not in the ballpark of, and I saw the Globe and Mail just put in an article a day or two ago,
00:03:56.060 and I was laughing. I said, I've been talking about this for two years. Where's your lithium?
00:03:59.960 Where's your cobalt? Where's your copper? Where's your nickel? You know, that's how you get electric
00:04:05.360 vehicles. You need lithium for batteries, you know, or wind turbines. We're not, we're not even in the
00:04:11.320 ballpark of discussing how do you increase the production? How do we obtain those minerals and
00:04:16.240 metals? And yeah, it's, so I still like the switch into those material things to protect my purchasing
00:04:24.540 power of the dollar. And I'll give you one last example, just to, I'm not, I don't want to confuse
00:04:29.520 people. Let's say you were lucky to have $10,000 and you had it two years ago. Would you rather have
00:04:34.440 10,000 worth of oil starting two years ago or 10,000 worth of dollars start two years ago? Be way better
00:04:39.800 ahead with oil.