The Canadian Dollar (aka the Loonie) seems to be making a bit of a comeback from being below 70 cents U.S., however, it is not due to anything good in Canada as much as it is the U.S. economy being in the doldrums instead. It has pushed the Loonie to above 73 cents, which means for those folks heading south, your vacation might be a little bit cheaper. Gas continues to be almost 70 cents a litre in Ottawa (by late evening, not that there is any price-fixing going on), so if you are driving south, might be cheap too.

RBS 6 Nations Trophy

RBS 6 Nations Championship Trophy

Yes, RRSP season has started, however there does not seem to be the normal push from the banks, maybe the TFSA has finally taking some of the wind out of the RRSP sails? Maybe as the month passes we will get more hype going on.

If it is RRSP season, that must mean it is also Tax Time too. This year my last pay stub was actually quite close to my T-4 so my tax planning last month was actually quite close. Already have my copy of Quicktax, but it keeps telling me not to submit yet, they haven’t got everything ready for E-filing just yet? Interesting.

This weekend there is a sporting spectacle known world-wide for great drama and excitement. I am speaking (of course) of the 6 Nations Rugby Tournament, that starts on Saturday morning. There is some other game that has something to do with Owls and such, in San Francisco on Sunday night as well, that evidently (if you are attending) you will be surveilled (very closely). Yes, I believe Mrs. C8j will simply be swapping out the newspaper around my chair, as I do not think I will be moving all weekend (except to possibly stir the chili ).

My Writings for Week Ending February 5th

With all of us old folk talking about retirement, is there any concern about the collective knowledge of an entire generation walking out the door? In my case, think of all the Fortran, Pascal and C programming info my employer might be losing? Maybe that is why they keep asking when I am leaving?

Financial Knowledge Draining Away

One of the main things I learned from the original Karate Kid was the importance of balance, and if you are tired of RRSP Season (the way I am) then maybe just view it as RRSP Rebalancing Season

RRSP Rebalance Season

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A poke by Dilbert (and Scott Adams) at all my stock picking friends out there.

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RRSP Rebalance Season

I have given up ranting about how the whole concept of “RRSP Season” is idiotic (you should be putting money in your RRSPs (if you that is how you want to save) all year long, not just in February), so if we assume that you still might want to put money into your RRSP now, maybe now is the best time to do a Rebalance of your Couch Potato RRSP Portfolio?

Mr Miyagi

Find Balance in Investing and in Life (and don’t stock pick)

Wait a minute, if you have a Couch Potato Portfolio, aren’t you supposed to just leave it alone, once your money is in there? Yes and No, is the short answer to that question. When you first put your money into your portfolio you made a decision about how you wanted your money to be allocated in the portfolio. There are many great examples of portfolios, but let’s go with a basic one:

Canadian Equities  25%
US Equities  25%
International Equities 25%
Canadian Bonds 15%
Cash  10%

Let us not get hung up on how the portfolio is set up initially, however, given a year has now passed since you set up your RRSP Portfolio (since this is RRSP Rebalancing season), and we have a look at the portfolio and are aghast to see the following percentages of our total portfolio:

Canadian Equities  15%
US Equities  35%
International Equities 33%
Canadian Bonds 10%
Cash  7%

Now that is an out of balance portfolio. As with Karate (in the words of Mr. Miyagi), in investing, balance is everything so here is a portfolio in dire need of rebalancing. What do I mean by rebalancing? Simple get your portfolio back to being close to what your initial allocations were (when you set it up, see the first list).

How can this be done?

  1. Cash out all of the funds, pool the money and restart the portfolio with our initial allocations. This is drastic, and fraught with costs, not a good way to find balance.
  2. Sell off enough of the US Equities and International Equities funds and spread the funds between the remaining members of the portfolio to find balance. This works well, and the Canadian Capitalist has an excellent spreadsheet on how to to help you do that. This way you find balance.
  3. Bring in external money and rebalance using that, and hence the thematic premise, of Rebalancing Season! If you have extra money to put into your portfolio, take advantage of this and rebalance your portfolio, without having to do too many sell orders! Balance is restored.

Remember in Investing always try to find Balance  ⚖, it is the key to a tranquil investing life. Enjoy the festive RRSP Rebalancing Season.


Financial Knowledge Draining Away

I was reading a very interesting article in the Bloomberg Businessweek† “Chowing Down on Boomers’ Brains“, which talks about the huge loss of “tribal knowledge” with the retirement of the Baby Boomers from the workforce, and it has me wondering just how well our Banks are going to deal with this “brain drain” from their ranks? Evidently some very large firms in the states (GE, GM and others) have this as a major risk in the near future.

As an example in my little part of the Government, about 25% of our department is going to retire this year. This might be an extreme example, but how we are going to keep all that “tribal knowledge” or “industrial memory” is not clear to me (as most folks are not being hounded to do “brain dumps” of what they know).


Collective Knowledge Wandering off Into the Sunset

What does this have to do with banks, you might ask? The banks and government have 1 common stream, they both have very nice Pensions for their employees (in most cases), so in most cases folks who can retire, will retire (i.e. will not keep working because they can’t afford to retire).

If you want a concrete example of the danger of “brain drain due to retirement”, you need only look at the infamous Y2K fracas, where banks had to pay an exorbitant amount of money to “contractors” to repair COBOL code that could not deal with the concept of a year having more than 2 digits.

Is this going to happen again? I don’t know, but I just wonder how much “collective knowledge” in the banks (about day to day business, information technology and other operational areas) is simply wandering off into the sunset of retirement? I guess we will find out when we see how many folks are hired back on contract to maintain antiquated but essential systems. Another interesting angle to this discussion is that the CRA is a government agency and is most likely suffering the same issues with retirements as well? Maybe they will forget how to tax us? (OK, maybe that one is a stretch).

Can the banks plug the brain drain? Let us hope they are thinking about that.

† – Note that while Bloomberg Businessweek is an expensive magazine to buy and read, it is available from the Ottawa Public Library (for free) using the Zinio application, keep that in mind.

Photo by satit_srihin. Published on 31 January 2016 at


If you were feeling optimistic about life and such, remember the Doomsday Clock is still set at 3 minutes to Midnight (where Midnight is the Big Casino for humanity). The Bulletin of Atomic Scientists site many things that are going on in the world that should have us worried, but surprisingly the sales of bomb shelters has not increased (unless you count some of the Condos in Toronto?). Sounds like the explosion of the Housing Bubble is not the only Big Bang we should worry about?


Cannabis a Cash Crop ?
Cannabis leaf” by Oren neu dag

Evidently RBC has some explaining to do as they seem to have sent out incorrect RRSP receipts to the wrong customers, which is an interesting double negative. Not only was the information incorrect on the receipt, it was sent to the wrong person with information from other folks (Social Insurance Numbers and the like)? That is what I call getting it as wrong as possible, but, I am confident there are worse examples.

Will legalized marijuana sales become a cash crop for our government? A lot of folks think so, but I am skeptical. The amount of money folks seem to think legalized pot will create are optimistic, but I will be pleasantly buzzed if the prognostications are correct. Pass the Doritos please.

My Writings for Week Ending January 29th

Winterlude has come to Ottawa, so of course everything has started melting (keeping with the Ottawa tradition). We should just rename Winter, Winterlude and we could save a fortune on snow removal.

Marijuana may not be a huge cash crop, but Cauliflower sure seems to be a wallet buster these days in terms of prices, as we saw in Food Prices up 4.1% for 2015

Food Prices up 4.1% For 2015 in Canada

Was I really making up this whole Bimodal Financial Planning thing? Kind of, I was mostly stealing a concept that is being espoused by the Gartner group for Information Technology groups, but I feel it might catch on in the financial world was well.

Bimodal Financial Planning

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Are you following this version of Stats Canada? You should:

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Bimodal Financial Planning

The importance of Bimodal Financial Planning strategies cannot be discounted for any person or family wanting to succeed in the current economic environment. Ensuring you are taking care of your day-to-day financial life and planning for your future, ensures a strong Bimodal Financial Plan.

Doesn’t that sound exciting and fun? What do I mean by a Bimodal Financial Plan ? If you asked that question, give yourself a gold star🌟, as the first time I heard it, I thought they were talking about Bipolar psychological problems, but no, folks meant Bimodal.

In mathematical terms Bimodal is simply:

Adjective: having or involving two modes, in particular (of a statistical distribution) having two maxima.

What the heck does that have to do with financial planning? Well, right now, I am making this stuff up, however the term Bimodal is the new Buzzword where I work in terms of IT (computer stuff) quoted by Gartner (the folks who create these lovely concepts). For them the definition of Bimodal becomes more literal:

Having two modes of operation (typically in computers: (1) Day to Day Support (2) Long-term evolution and planning.

Doesn’t that fit into financial planning like a hand in glove? Everyone is always taking care of the day-to-day bill paying and making sure they stay out of debt, and most of us also are planning for our Long-Term financial self, hence the most excellent new financial term Bimodal Financial Planning.

Bimodal Financial Planning

Bimodal Financial Planning Graphics

Stripping away the jargon part of this, it is actually a sound idea for planning your financial life:

  1. Take care of today’s problems financially, in terms of paying off bills and debts.
  2. Plan for your future including: Emergency Funds, Vacation Funds and ultimately Retirement Planning

If any folks are dealing with financial advisors or planners, ask them about what their Bimodal Financial Planning Solutions to plan your financial future, see how they react to that catch-phrase. See if they start using it themselves without asking for an explanation about it (that is a bad sign, they should ask for what you mean by that, before they start using it in conversation).

Never let anyone use a term (especially a financial term) that you don’t understand without asking for an explanation. If they can’t explain it to your satisfaction, it is either (1) too complicated and shouldn’t be used or (2) the person you are talking to is bluffing their way through things (and that is very bad as well).


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