December 7, 2015 Newsletter

Dear Friends,

Tangents:

Hanukkah  (Hebrew “consecration”) began at sunset yesterday.  The Jewish Festival of Light commemorates the purification and rededication of the Temple at Jerusalem in 165 BC  by Judas Maccabeus after its pollution  by the Syrians.  It begins on the 25^th day of Kislev and lasts eight days.  Candles are lit on an eight-branched candlestick or menorah and oily potato pancakes – latkes – traditionally eaten.   The oil is more important than the potato – the recounting of the miracle of one night’s oil lasting eight nights in the temple over 2,000 years ago. 

This is a great recipe for latkes, with mashed potato replacing the traditional grated potato:

MASHED POTATO LATKES WITH DILL AND SHALLOTS

3 large baking potatoes (2 –  2 ½ lbs)
1 cup minced shallots
½ cup coconut or vegetable oil
¼ cup freshly chopped dill
¼ cup freshly chopped parsley
1 large egg
1 teaspoon salt, or to taste
Ground black pepper to taste
1 cup bread crumbs, more as needed

1. Heat oven to 400 degrees, pierce potatoes with a fork and place directly on rack.  Bake for 1 hour or until a knife easily pierces potatoes.  Meanwhile, sauté shallots in 1 tbsp or so of coconut oil until tender.  Add dill and parsley and set aside.
2. Peel potatoes; cut in several pieces and put in a medium bowl; use a potato masher or ricer to break them up.  Mix in egg, shallots and herbs, and season with salt and pepper to taste.  Refrigerate for 2 hours or up to overnight.
3. Taking about ½ cup of filling at a time, form 10 patties about ¼ inch thick and 3 inches in diameter.  Pour bread crumbs into a wide bowl or plate, and coat the latkes in  the crumbs on both sides.
4. Heat a nonstick frying pan and add a thin film of oil, about 1/8 inch deep.  When hot, slide in pancakes and cook over medium heat for about 3-5 minutes on one side, pressing down to gently flatten.  Flip latkes and cook for 3-5 more minutes, or until crisp and deeply golden.  You can make them in advance, placing parchment paper between each layer of patties and reheating in a 350-degree oven for about 10 minutes or until heated through.

Time: 1 hour and 15 minutes, plus 2 hours or overnight in the refrigerator.

Yield: 10 latkes.

This Day in History:

On Dec. 7, 1941, Japanese warplanes attacked the home base of the U.S. Pacific fleet at Pearl Harbor in Hawaii, drawing the United States into World War II. More than 2,300 Americans were killed.

PHOTOS OF THE DAY

Italy’s Mount Etna, Europe’s tallest and most active volcano, spews lava as it erupts on the southern island of Sicily, Italy, Monday. Antonio Parrinello/Reuters

Dr. Hiroya Sugano of Japan (l.) and Japanese American Yoshie Tanabe, who was 10-years-old and living in Hawaii when the attack on Pearl Harbor happened, put their hands into the hand print of the recovered canteen of a US B29 bomber pilot that crashed in Japan during World War Two, during the “Blackened Canteen” ceremony aboard the USS Arizona Memorial honoring the 74th anniversary of the attack on Pearl Harbor at the World War II Valor in the Pacific National Monument in Honolulu, Hawaii, Sunday. Hugh Gentry/Reuters

Market Closes for December 7^th, 2015

International Markets

Bonds

Currencies

Commodities

Market Commentary:

Canada

By Dani Burger

     (Bloomberg) — Canadian stocks tumbled the most in two months as crude oil sank to a six-year low and iron ore slumped below $40 a metric ton to lead declines in the resource-rich benchmark index.

     Energy shares dropped 5.4 percent to the group’s lowest level since March 2009, as crude extended losses below $38 a barrel in New York. The Organization of Petroleum Exporting Countries effectively abandoned its production target on Friday, fueling speculation a record global glut will continue. Raw- materials producers lost 3.3 percent on weakening demand in China and rising low-cost supply from the world’s top miners. Commodities producers make up about 30 percent of the Canadian benchmark.

     The Standard & Poor’s/TSX Composite Index fell 315.94 points, or 2.4 percent, to 13,042.83 at 4 p.m. in Toronto, the most in two months. The gauge has declined for two consecutive weeks and has now lost 11 percent this year.

     A volatility gauge for 60 of the largest, most liquid Canadian stocks jumped 9.7 percent after falling for three consecutive weeks.

     The Bloomberg Commodity Index, a basket of prices for natural resources from copper to oil and gold, dropped 2.7 percent.

     Hudbay Minerals Inc., First Quantum Minerals Ltd. and Teck Resources Ltd. sank at least 9.4 percent. Paramount Resources Ltd. tumbled 22 percent, its biggest drop in 28 years. Penn West Petroleum Ltd. and Baytex Energy Corp. fell at least 17 percent. Energy companies have fallen 28 percent this year.

     Canadian airlines jumped on the cheaper oil prices. Air Canada gained 2.6 percent, it’s biggest gain since Nov. 6, while WestJet Airlines Ltd. gained 0.9 percent. Macquarie Research also raised WestJet to the equivalent of buy from neutral.

     Among the S&P/TSX’s best performers, ProMetic Life Sciences Inc. rose 6.6 percent. The biopharmaceutical company said its trial for a coagulation disorder drug met safety metrics, while patients showed an immediate therapeutic response.

US

By Joseph Ciolli

     (Bloomberg) — U.S. stocks retreated as tumbling oil prices weighed on energy and raw-material companies, sparking a selloff after equities posted their biggest one-day gain in three months.

     Chevron Corp. and Exxon Mobil Corp. fell more than 2.6 percent as energy producers in the Standard & Poor’s 500 Index slumped for a fourth day. Keurig Green Mountain Inc. surged 72 percent after agreeing to be acquired by a JAB Holding Co.-led investor group for about $13.9 billion in cash. Airlines rallied for a second session amid crude’s drop.

     The S&P 500 fell 0.7 percent to 2,077.07 at 4 p.m. in New York, trimming an earlier drop of as much as 1.2 percent, after jumping 2.1 percent on Friday. The Dow Jones Industrial Average lost 117.12 points, or 0.7 percent, to 17,730.51. The Nasdaq Composite Index declined 0.8 percent. About 7.4 billion shares traded hands on U.S. exchanges, 4.8 percent above the three- month average.

     “Equity markets have basically treaded water this year as economic data has been fairly weak, particularly as it relates to the global scene,” said Kevin Caron, a market strategist and portfolio manager who helps oversee $170 billion at Stifel Nicolaus & Co. in Florham Park, New Jersey. “As we come into this period of time where the Fed is going to begin raising interest rates, we continue to be confronted with slow global growth, which is going to continue to be a challenge.”

     Crude prices extended losses after falling 2.7 percent Friday amid speculation a record global glut will be prolonged as the Organization of Petroleum Exporting Countries effectively abandoned its long-time strategy of limiting production to control prices. West Texas Intermediate futures fell 5.8 percent Monday to $37.65 a barrel, the lowest close since February 2009.

     Oil’s plunge of more than 40 percent in the past year has hampered recoveries in the U.S. and Europe as capital spending has waned and inflation has remained below central-bank targets.

     U.S. stocks are coming off their most volatile week since the summer as investors were faced with releases from the Labor Department, the European Central Bank and speeches by Federal Reserve Chair Janet Yellen. The S&P 500’s rally on Friday left it little changed for a second straight week after a report showed U.S. employers added more jobs than forecast in November, increasing speculation that the economy is strong enough to withstand higher borrowing costs — something that Yellen has signaled.

     Traders are pricing in a 78 percent chance of liftoff before the Fed’s interest-rate decision on Dec. 16. Investors will have little data this week to assess the strength of the economy. Reports on retail sales, a measure of producer prices and the University of Michigan’s preliminary consumer sentiment index are due, though not until the end of the week.

     “Weak oil is the story today,” said Stephen Carl, principal and head equity trader at Williams Capital Group LP. “The lack of economic numbers today is compounding the effect of energy losses. The Fed rate hike is imminent, and people are trying to square up heading into year-end.”

     The selloff in equities today extended a stretch of whipsaw trading to a fifth day. The main U.S. equity index moved at least 1 percent in the previous four days, the longest stretch since August, kicking off what is usually the second-best month of the year. The S&P 500 has not had back-to-back gains in more than a month.

     The Chicago Board Options Exchange Volatility Index rose 7 percent Monday to 15.84, after its steepest drop in more than two years Friday. The measure of market turbulence known as the VIX has declined for three consecutive weeks and four of the past five.                       

     Seven of the S&P 500’s 10 main industries dropped, with energy losing 3.7 percent, the most in more than three months. Raw-materials shares were down 1.8 percent, their largest slide in three weeks. Phone companies, utilities and consumer staples advanced.

     Consol Energy Inc. and Williams Cos. lost more than 13 percent to lead the drop in energy, with Williams down the most in seven years. ConocoPhillips and Schlumberger Ltd. lost at least 2.5 percent. The energy group rallied 22 percent from an almost four-year low in August to a three-month high on Nov. 3. Since then, the sector is down 13 percent.

     Copper miner Freeport-McMoRan Inc. sank 7.9 percent, the biggest drop in more than two months, to lead the slide among raw-materials. Dow Chemical Co. and Nucor Corp. fell more than 1.9 percent. U.S. Steel Corp. decreased 8.8 percent to a 24-year low, as iron ore sank on rising low-cost supply from the world’s top miners and weakening demand in China. Mining-equipment makers Joy Global Inc. and Caterpillar Inc. declined more than 2.3 percent, with Joy at its lowest since 2004.

     Financial companies in the S&P 500 slipped 0.9 percent. Comerica Inc. was the sector’s biggest decliner, falling 4.4 percent, while Zions Bancorporation and Regions Financial Corp. lost more than 2.2 percent. Meanwhile, the 10-year U.S. Treasury note’s yield decreased 1.6 percent, extending its two-day decline to 3.4 percent. The KBW Bank Index dropped 1.3 percent.

     Staples Inc. lost 14 percent, its biggest decline since March 2014, to lead consumer discretionary companies in the benchmark lower. The retailer will face a challenge by U.S. antitrust officials, who said for the second time in 20 years that the office supply chain’s proposed takeover of Office Depot Inc. will squelch competition and should be blocked. Office Depot plunged 16 percent.

     Chipotle Mexican Grill Inc. fell 1.7 percent, and earlier as much as 8.2 percent after rescinding its 2016 forecast in the wake of an E. coli outbreak. Among other consumer shares, Netflix Inc. and Macy’s Inc. declined more than 1.9 percent.

     Airlines rallied for a second day amid speculation that the drop in crude will help boost profitability. A Bloomberg index of U.S. airlines added 2.2 percent after a 3.9 percent climb Friday. JetBlue Airways Corp., Delta Air Lines Inc. and United Continental Holdings Inc. advanced more than 2.6 percent.

     Food retailers were also one of the market’s few bright spots Monday. Whole Foods Market Inc. gained 4 percent, the most in two months. Kroger Co. rose 2.2 percent to a record for a third straight day, while Wal-Mart Stores Inc. climbed 1.4 percent to lead the Dow.

     Gunmaker Smith & Wesson Holding Corp. surged 7.6 percent to its highest level since October 2007, amid speculation that gun enthusiasts will purchase more pistols and rifles as calls for restrictions increase. The company is scheduled to report quarterly results on Tuesday.

Have a wonderful evening everyone.

Be magnificent!

Meditation is movement without any motive, without words, and the activity of thought.

It must be something that is not deliberately set about.

Only then is it a movement within the infinite, measureless to man, without a goal, without an end,

without a beginning.  And that has a strange action in daily life, because all life is one,

and then becomes sacred.

Krishnamurti

As ever,

Carolann

Work while you have the light.  You are responsible for the talent

that has been entrusted to you.

                                        -Henri-Frederic Amiel, 1821-1881

Carolann Steinhoff, B.Sc., CFP®, CIM, CIWM

Portfolio Manager &

Senior Vice-President

Queensbury Securities Inc.,

St. Andrew’s Square,

Suite 340A, 730 View St.,

Victoria, B.C. V8W 3Y7