Joke
No joke today. Hey Johnny, wanna buy a dead bird?
Stories
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ProgramI see that Todd has decided to do a bulletin even though its not his turn. You should be aware that you can’t second your own motion! Since President Elect Heidi suggested I do this bulletin. I have been thinking on what I could write about.. In the past few years there has been decent growth in new members in the club. I suspect many of the newer members don’t know me. Anyway, I thought I could share my past experiences of going through stock market downturns. I started in September 1981 for an investment firm that was eventually bought out by RBC . I retired a year ago Christmas so I am no longer a investment advisor. What I say here is not been approved by Rotary or RBC and should not be considered financial advice. Any advice should only be acted upon through an advisor that fully knows you and your risk tolerance. I take as mucho responsibility for what you do with this as your barber or hair dresser. I had two managers that worked through 1974 -75 bear market and they were early in their careers but felt it was the worst because of the length. Start of high inflation no growth and in Canada wage and price controls. In my case I think 1981 -82 was the worst. I watched the market go down relentlessly for a year. When it turned most were in disbelief including myself. The Dow Jones went from record lows to new highs in the span of 3 months and after that rarely a pause. Prior to that, the world was scared with 20+ interest rates and massive inflation and double digit unemployment. Real estate development companies went bankrupt along with some trust companies. The chartered banks were extended massively to the oil industry because every one knew that oil was going to $50. ( it didn’t). The National Energy Plan didn’t help. National Bank cut its dividend and every one else was frightened. 1987 crash hurt. It was quick and painful. IBM was $175 on Thursday and $100 by Monday night. I will never forget this as I had made an error on a option trade on the Friday that was not discovered until Monday Afternoon. To compound things when my manager and I went to fix the error we doubled it. Under normal circumstances the error might have been a cost of $100 or $200 but because of massive market moves was $3000 and then became $10000. It took forever to get to the weekend. That Friday night I watched a show that I regularly watched called Wall Street Week. Louis Rukeiser was the host. He started every show with a commentary. I am paraphrasing here but I got strange comfort from the words he said. “ The same people who loved you last week still love you today. Having said that Holy!!!!!! Expletive more expletive etc. In this case the stock market had no effect on the economy as nothing seem to change on Main Street. Markets had recovered by spring.( Don’t fight the Fed as there was massive intervention) The recession 91-92 was not kind to banks. A major trust company failed. Olympia and York a privately held company owned by the Reichnann’s became over extended in commercial real estate and left all our banks holding the bag. Campeau Corporation also failed and was also a major loan to National Bank. It was devastating enough for National to cut its dividend again. GST was introduced in Canada and the malls were empty. ( Not as much as today.) Prime Minister Kim Campbell said an election campaign is no time to discuss serious issues. So we haven’t since. If you thought the 90’s were a smooth ride then you have forgotten some self inflicted damage. The Charlottetown referendum was in 1992 . The Quebec referendum was in 1995. President Clinton was impeached by the House in 1998. All these events had investors frightened. To add to this Long Term Capital Management a major hedge fund needed to be bailed out to prevent a financial crisis in 1998.. The Teck Bubble ended in 2000-2001 . Earnings were either fake or manipulated during that period. There were many failures including Canada’s Nortel. This recession seemed to drag on forever. Markets were also concerned over the fact that Iraq had weapons of mass destruction. When the USA moved a half million troops to the border they became more concerned. Markets didn’t start going up until USA invaded Iraq in March of 2003. This time period was painful for clients in both depth and length of time. Give or take markets fell 50% in the USA. I don’t recall that I thought markets were scary but rather depressing. It was just relentlessly down for such a long period of time. I recall John Roth CEO of Nortel calling the upcoming quarter as “challenging.” I didn’t know at the time that was code for “ It’s a F!!!! Disaster out there!” I often told clients that 81-82 was the worst. 02-03 not much better and historically once in 25 years should be expected. Little did I know 2008-2009 would be just as bad if not worse? Most investors think of the tem risk and think of volatility. I don’t have my textbooks any more so I am going by memory here. Market Risk …. Basically price changes day to day. Corporate Risk or Financial Risk…. Something wrong with the company. Liquidity Risk … Might be not able to get a fair price if you need to sell in hurry. Currency Risk … price changes of currency effecting investment or earnings. Interest Rate Risk Changes in interest rates. Political Risk … change in politics either domestic or international Systematic Risk The whole system falls apart. I always thought that Systematic Risk was theoretical. I was wrong. Banks stopped trusting each other. Credit froze. Bond markets froze and went no bid. The movie” The Big Short”. does a reasonable good job of explaining. If you are looking for a laugh I urge you to Google John Bird and John Fortune and watch their take on the financial crisis. ( it won’t take you long about 10 minutes) Canada went relatively unscathed. Our banks all raised capital by issuing shares to shore up their balance sheets. They also issued Capital bonds paying between 9 %and 10% on these Capital Bonds. Clients were scared and markets acted in my opinion totally irrational. A major REIT had promised to build a office tower for two major companies and had a contract to pay rent for 20 years. The Reit however had not secured their financing for the building even though the rent was secure. They were forced to cut their dividend, give up a 1/3 of their company to a hedge fund and borrow part of the money at 10-12%. At that point the banks were willing to lend the final portion at around 8%. ( take your pick interest rate risk or systematic risk) This was also a time that a well known pension fund wanted to take BCE private. There was a major fight between bond holders and shareholders as bond holders were left out of the deal. It went through several courts to get to the Supreme Court far quicker than you can imagine. Lawyers always win. Equity share holders ultimately won the court battle but lost the war. Interest rate had risen and credit not as available as before.. A well known National Accounting Firm wrote an opinion that BCE would not be solvent if the deal went through. The deal was scuttled and I have yet to understand their rational. BCE is still here and very profitable. The Fed and the government did their part with monetary policy and fiscal stimulus. It took few waves of Quantity Easing,.often called QE to get the economy moving. Credit conditions remained poor for several months. There were regular meetings of G 7 or G8 where they discussed new regulations on the banks. Higher capital requirements were demanded and stress tests had to be done annually. Banks and Investment firms were told to reduce their bond holdings to reduce leverage in the system. There was no one thing that brought back confidence in the system. It was a slow process. It took a little over 4 years for S&P 500 to make new highs. Currently we have a medical crisis on our hands. The Fed and the Bank of Canada have lowered interest rates and both are actively working to keep liquidity in the credit system. Daily we hear from Trudeau who has thought up a new spending program. If we keep hearing from him daily I am not sure how we are going to afford it. Trump and his team are trying not to stand all together like they were a week ago. At best they maybe 4 feet apart. ( Why is the VP in the same room?) Canada and USA governments have been quick to react fiscally but slow to react medically. Perhaps this social distancing will slow or kill the COVID.19. I remain concerned that my golf season is in jeopardy. This too shall pass as uncomfortable as it may be. Every bear market is different but yet a lot similar. There will be some accidents that you won’t see coming. I am staying healthy and social distancing. I will be 65 later this year and remain optimistic based on both my parents longevity(my mom is 100 and my father died at 94) that I will see 4 or 5 more bear markets and likely 2 more real nasty ones. |
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Rotary Can-Am Bonspiel 2017 |
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Paris Breakfast Cycling ClubOpen Invitation:
Cycle Sunday morning on the rail trail from Cambridge to Paris, breakfast at either Two Rivers or New Paris Country Grill, then cycle back. Meet at the trailhead on the edge of town at 9am. May 8 through Sept 25, 2016. Round trip distance just over 40km. Surface is hard packed crushed stone, good for all except thin racing tires. Expect to be back before noon even if you pedal at a relaxed pace.
Email Mike Thomas to join up.
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NFL Fantasy Football - Cambridge PH Syndicate
The 2015/16 NFL season is now over, and we have our winners:
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Best Bites 2015 - The Wild West ! Best Bites 2015...Taste of the Region, Sept 13th, 2015
Shade's Mills Conservation Area, 405 Avenue Road, Cambridge, ON Best Bites is a partnership fundraiser benefiting Cambridge Memorial Hospital to purchase essential medical equipment. Come join us for a gourmet garden party where some of the area’s best chefs will create and serve up delectable samples from their menus. Also available for tasting is some wonderful wine and microbrewery selections. To purchase tickets: http://www.bestbitestickets.ca/
When:September 9th, 2012 Where: Shades Mill Conservation Area Time: 1-4pm Cost: 125.00 for individual ticket, or 10 for $100 each. |
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Rotary Classic Run 3-Club ContestSome of you are wondering how the 3-Club contest works. It's actually very simple. First, the Cambridge Rotary club that raises the most money per member wins. The president of that club will be fed and otherwise waited-on hand and foot at an upcoming event by the presidents of the two losing clubs.
 Fundraising is tracked online, and the quickest way to contribute is to go here and Give Now to sponsor Patrick. You will get a charitable receipt immediately by email. But while you are there, you can click to Join My Team. Once you have joined the team, you will have a personal link to share to get your own sponsors. All money raised by team members is added up, and you don't even need to go in the run. |
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May 24 Rotary Classic Run. Click below to sponsor or register to take part ! On Sunday, May 24, 2015, the three Rotary Clubs of Cambridge and the Cambridge Times will invite runners, joggers and walkers to show they care about children in Cambridge with special needs. Once again we will be asking individuals, schools, teams, businesses and industry to help us continue to support KidsAbility Centre for Child Development. Last year over four hundred people participated to make the day a huge success. The presentation of $40,000 to KidsAbility in Cambridge to assist in providing life-changing services and programs to over twelve hundred children showed, yet again, that this event is providing a significant boost to this essential community organization. Since 1999, the Cambridge Times Rotary Classic has helped raise $670,000 for KidsAbility. Rotarians estimate the total funds raised from this event since being established in 1987 is well over $1 million. Check out the web site for more information http://rotaryfunrun.ca/ |
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Oktoberfest 2013 |
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Thinking of Joining Rotary? ARE YOU THE MISSING PIECE ?
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Best Bites Las Vegas! 2012 - Last Week to GET THOSE TICKETS SOLD !!
Final Push for Ticket Sales !!
Don't forget, you can sell by phone. Attendees can pay online and get their tickets at the door. When:September 9th, 2012 Where: Shades Mill Conservation Area Time: 1-4pm Cost: 125.00 for individual ticket, or 10 for $100 each. |
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GSE Italy Blog - Follow the updates and pictures! |
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Rotarians in Africa 2011Follow what are Rotarians are up to in Africa! |
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Best Bites 'A Hollywood Affair' 2011 |
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Tree Planting at Dumfries Park
Cambridge Rotary Club (Preston-Hespeler) helped plant trees Sunday May 1st at Dumfries Park. |
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22nd Annual Rotary Curling Bonspiel |
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Cambridge Memorial Hospital Presents Club with Cheque
Cambridge Memorial Hospital Foundation presents The Rotary Club of Cambridge (Preston-Hespeler) a portion of the proceeds from their Best Bites fundraiser. |
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BarberShop Quartet |
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Oktoberfest 2010 |
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Rotary Is "This Close" to Achieving Its Goal of a Polio-free World |
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Kids Ability Foundation LOTTERY!
Kids Ability Foundation LOTTERY! Make a Difference and Win! Tickets can be Purchased at all Cambridge ScotiaBank Locations |
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2013 Rotary International Convention - Lisbon Portgual
How to registerRotarians may register for the RI convention online, by e-mail, fax or mail. Non-Rotarians will need to download the registration form. Find out more about deadlines and fees. Note: After 15 June 2013, you can only register on-site. |
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Oktoberfest - Cambridge Bavaria Haus
Come out and enjoy the 2nd annual Bavarian Festival located at the Newfoundland Club in Cambridge!
When: October 4th, 5th and 6th Where: 1500 Dunbar Rd. Cambridge On Time: 6pm - 2am Look forward to the best Beer, live music and Oktoberfest swag! |
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Another Successful Year for Rotary Roses!
Thanks to everyone who purchased Rotary Roses this year andThank you to all who donated their time to make this another successful event! The proceeds that were raised are going towards Rotary Projects and our friends at Kidsability.
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Fun Run 2012 |
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A Bit of History on The Whitney Board Walk
The Whitney Boardwalk is located in the wooded swamp area at the eastern end of Riverside Park. The boardwalk was constructed in 1982 by the Preston Hespeler Rotary Club, in memory of Charles Whitney, a past president (1932-1933) of the club. Click to read more....
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DISTRICT 7070/7080 CONFERENCE 2012
The Rotary Club of Richmond Hill is proud to invite Rotary Members to the 2012 District 7070/7080 Rotary Conference in Richmond Hill, Ontario on October 19-21, 2012 |
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Rotary Roses |
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OKTOBERFEST! |
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2002 GSE TEAM REPORT (Part 4)
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2002 GSE TEAM REPORT (Part 3)
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2002 GSE TEAM REPORT (Part 2) |
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2002 GSE TEAM REPORT (Part 1)/Larrygse.jpg)
In March/April 2002 the District 7080 Group Study Exchange team visited South Korea in District 3740. Larry Brokenshire of our club was the Team Leader and this is his report.
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E-MAIL ADDRESSES
Those who have not received their e-mailed bulletin have no e-mail address on record. Please e-mail it to: Bill Watson.
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