David Rosenberg: Equities In Secular Bear Market, Canadian Corporate Bonds Are A Good Investment (Video)

David Rosenberg, former Chief North American Economist at Merrill Lynch who is now Chief Economist and Strategist at Gluskin Sheff, was featured on Consuelo Mack's WealthTrack show on 11/26/2010. Rosenberg believes we are entering a period of price stability (zero inflation) as ongoing debt de-leveraging, excess capacity and high unemployment converge with strong reflationary policies by the Fed. However, there is still a chance we could experience outright deflation, he said. Rosenberg thinks equities are in a structural bear market.
"The story is that in the secular primary uptrend in the stock market, sell-offs are opportunities to get in the better price. Now, we’re in a secular bear market where it’s different, and it means you are going to get rallies, but these are rallies that you rent. You don’t own them." (source)
He didn't completely write off equities though. He said he'd still be 20% allocated toward equities but only in safe sectors like utilities, staples, health care and stable industries that "spin off an income stream". He is taking the other side of the bond bubble trade! He favors high quality corporate bonds backed by strong balance sheets. During the interview he recommended high quality Canadian corporate bonds which would benefit from a lower U.S. Dollar (USD/CAD). He was also bullish on gold for a variety of reasons. Watch the video after the jump.

David Rosenberg was on Bloomberg TV with Tom Keene on 12/6/2010 talking about the employment report. Temp positions dominated the November report. He thinks local Government jobs are set to decline and sees a secular rise in personal savings (click image for link).

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