The world of investing is fixated on the future. Every day, colleagues, co-workers, advisors and investors ask me what is going to happen next. Where are the markets headed? What\u2019s the outlook for 2010? The price of oil? Gold?
Of course, I don\u2019t have a crystal ball. As the portfolio manager of Templeton International Stock Fund, all I can do is consider the facts I have at my disposal, take history into account, consider the outcomes and make some calculated decisions as to what the future may hold.
And when I take a hard look at the world of finance today, I am optimistic. No doubt there are some speed bumps ahead, but I think the traumatic events of a year ago that shook global markets are receding. Slowly, Canada\u2019s economy is taking baby steps out of the recession.
Our economy grew by 0.1% in June, the first monthly increase since July 2008, Statistics Canada reported at the end of August. The data support the Bank of Canada<\/b>\u2019s recent assertions that the country has already started to climb out of the sharpest downturn in decades.
To the surprise of many economists, our economy is creating jobs. In August, there were 27,100 new jobs in Canada. The private sector appears to have turned the corner, adding 49,200 workers after 11 months of shedding jobs. These figures include thousands of self-employed workers. Although some economists may consider these numbers to be inconsequential, I believe they are a positive reflection of our entrepreneurial spirit when times are tough.
Confidence is returning. The Conference Board of Canada<\/b> reports the consumer confidence index rose by 2.5 points in September, its seventh gain in a row.
Our business leaders are more optimistic. A recent survey by the Canadian Institute of Chartered Accountants<\/b> found 28% of executive-level accountants believe the economy will perform better in the next 12 months. That\u2019s up from the tiny 4% recorded earlier this year.
Make no mistake \u2014 I have some nagging concerns about the global economy. U.S. government spending must be curtailed. The U.S. debt has doubled in just the past nine years, and will double again to US$20.8 trillion by 2019. This level of debt is simply not sustainable; taxes must increase or spending must be cut. Government spending has fuelled much of the U.S. recovery. U.S. consumers are tentatively opening their pocketbooks, but we need to see this confidence accelerate.
It\u2019s a confusing and complicated world, and I expect many inves-tors are anxious. They have seen the value of their investment portfolios rise dramatically in recent years, suddenly collapse last fall, then partially recover in 2009. Now, more than ever, they are looking to their advisors for some guidance and hand-holding.
Although we don\u2019t know what the future holds, we do know what tools we offer. The Investment Funds Institute of Canada<\/b> has a list of attributes of what makes a good financial advisor. It\u2019s a great checklist to assess your skill set:
> Big-Picture Thinking. <\/b> The advisor has a deep understanding of the client\u2019s complete financial situation and long-term goals.
> A Long-Term Focus. <\/b>The advi-sor looks beyond the market\u2019s short-term noise and provides advice that he or she believes will benefit the client over the long term.
> Partnership. <\/b>Together, the advisor and the client build and execute a financial plan. Advisor loyalty is, foremost, to the client.
> Goal-Setting. <\/b> Advisors require their clients to articulate their personal priorities and to set life goals.
> Voice Of Reason. <\/b>The advisor must persuade clients from making overly aggressive or overly conservative investments that risk their long-term goals.
When times are tough, many investors need to know they are on the right track. It\u2019s important to re-enforce some tried-and-true lessons and investing themes that all of us take for granted when financial markets are strong.\tIE<\/b>
Don Reed is president and CEO of Toronto-based Franklin Templeton Investments Corp. <\/b> <\/i><\/p>\n","protected":false},"excerpt":{"rendered":"
It\u2019s important to reinforce some tried-and-true investing lessons<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[3013,3017],"tags":[2403],"yst_prominent_words":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/320607"}],"collection":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/comments?post=320607"}],"version-history":[{"count":1,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/320607\/revisions"}],"predecessor-version":[{"id":368750,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/320607\/revisions\/368750"}],"wp:attachment":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/media?parent=320607"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/categories?post=320607"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/tags?post=320607"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/yst_prominent_words?post=320607"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}