DM Monthly Report – March 2018
A FLOOD OF CASH? Since markets bottomed in March 2009, the most prolific net buyer of stocks has been corporations retiring their own shares. In fact, US companies have bought back about $3.5tn worth since 2010 and, if the nearly $2tn in dividends paid over that time is included the corporate handout to shareholders has dwarfed even the Fed’s massive and much more publicized quantitative easing program. While some of this repurchasing was paid for with debt, as companies took advantage of record low interest rates to reconfigure their balance sheets, the lion’s share was funded with internally generated cash.
Click here to read more: DM-Monthly-Report-March-18
Provisus Monthly Insight – March 2018
STOCK SECTORS AFTER RATE HIKES – Last year the Bank of Canada (BOC) implemented its first interest rate hike since 2010 and many investors reached for their crystal balls to try and forecast the future. While rising rates tend to signal stronger economic conditions and inflationary pressures, they can also have a meaningful impact on stock market sector returns. Changing the overnight interest rate, which is the cost that depository institutions pay to borrow money, is how the BOC attempts to control inflation. When the BOC increases the overnight rate, it does not directly affect the stock market but it does have a ripple effect that can rock the market. However some sectors benefit from interest rate hikes and others do not.
Click here to read more: Monthly Insight – March 2018 – Stock Sectors after Rate Hikes
Update on Taxation Changes Affecting Private Corporations
Owners of private corporations should be concerned about proposed tax changes being explored by the Department of Finance. In the Federal Budget of March 2017, Finance expressed their concern that private corporations were being used by high income Canadians to obtain tax advantages that were not available to other Canadian tax payers. That concern led to the release of a consultation paper along with draft legislation last July. Finance asked for input from interested parties and stakeholders during a consultation period that ended in October 2017.
What happens now is anyone’s guess and most likely, we will probably have to wait until the Spring to find out. There were three specific tax planning strategies employed by private corporations that the department was most concerned with: Read more 
Why have a will when you have beneficiaries?
You give up some control when you just have beneficiaries and no will
Q: I am married. I have RRIF and LIRA and my spouse has RRSPs. We have joint cashable accounts too. We have appointed each other as beneficiaries for every account. I am told this arrangement takes longer to settle on death if there is no will. Why do I still need a will?
—Krish
Click to read the answer to this question on the MoneySense website.
