With grocery prices surging, amid the collapsing currency, the powers that be appear to have turned to their mainstream media puppets to initiate the 'mocking' propaganda of the banks against an increasingly fearful Canadian citizenry (especialy those under 35) who are hoarding cash.
With the Canadian people losing faith in their government's ability to save their corner of the world as their currency loses value by the day, it is perhaps unsurprising that the always supportive of the status quo media comes out with a somewhat mocking "cash hoaring on the sidelines is foolish" puff piece... (via Financial Post)
Cash positions have been rising since the 2008 recessions, so the recent increase comes on top of what Canadians were already sitting on in their portfolios.
The result is the largest hoarding of cash in Canadian history.
So, FinancialPost explains, if you are holding on to that cash out of fear rather than need, you should consider jumping back in and benefiting from what is essentially a 20 per cent discount on stock prices.
But what if you need cash right now, because you’ve just hit your retirement years, or you need to liquidate some of your registered education savings plans because your child will soon be starting a university or college program?
The short answer is that you should have planned ahead: You want to have a certain amount of cash in your portfolio to meet more immediate needs so you’re not cashing out your investments at the bottom of the market.
It appears Canadians are ignoring the "sage" advice of CIBC World Markets: "While holding cash can guard against short-term spikes in volatility, it’s certainly a long-term drag on portfolio returns," and moving to cash rather than have their capital destroyed by unwinding carry trades and deflating bubbles blown by their central bank overlords...
CIBC World Markets economists Benjamin Tal and Royce Mendes note that while they don't have a crystal ball for when markets will recover, but says that by the time they do, “it will be way too late” for Canadians on the sidelines to take advantage, because most recoveries happen in the early stages.
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There - do you get the message Canadians - pile all that cash into the stock market - fear is for losers.