Some experts Speculate that the actual sticking point within the negotiations just isn’t wages, but protection against automation. The ILA barred its members from working on automated ships that docked in U.S. ports. As a result, American ports have gotten increasingly more inefficient, rank not only behind ports in China but additionally in Colombo, Sri Lanka. (The Container Port Performance Index is compiled annually by the World Bank and S&P Global Market Intelligence.)
For reference, the best rated port in Canada is Halifax, ranked 108th on the earth. The efficiency of Halifax’s ports was far behind not only Sri Lanka, but additionally economic metropolises akin to Tripoli in Lebanon. To further make clear the Canadian context, Montreal is ranked 348th and Vancouver is ranked 356th, which is just ahead of Benghazi, Libya.
Something tells me that negotiating $300,000 a yr for longshoremen is not going to assist those North American efficiency numbers. The higher the salaries, the more attractive automation strategies turn out to be. Of course there can be a reckoning sooner or later. Meanwhile, in no less than yet another major presidential news cycle, longshoremen will have the option to attain big wage gains while holding the general economy hostage.
Why utilities are not any longer “boring.”
As income-focused Canadian investors increasingly place less value on high-yield savings accounts and guaranteed investment certificates (GICs), the dividend yields of reliable North American utility stocks may look more attractive. Considering how quickly rates of interest are expected to fall, it’s clear that there is a rush of investors rushing toward utility stocks.
The iShares US Utilities ETF (IDU/NYSE) is up greater than 30% year-to-date, and the iShares S&P/TSX Capped Utilities Index ETF (XUT/TSX) is up about 15% year-to-date. (Check out MoneyDown’s ETF screener for Canadian investors.)
Most often, utilities (particularly those in sectors regulated by federal and native governments) are perceived as “boring.” Sure, profits are reliable, but when the federal government determines how much to pay for electricity or natural gas, an organization’s profit margins are difficult to vary. The dividend income is reliable. But that’s actually the entire sales task in a nutshell.
Recently, nonetheless, utilities have been getting some traction attributable to AI’s power needs and possible AI-powered efficiencies shining press. Falling rates of interest mean annual interest costs are falling (utilities often need to borrow plenty of money to finish large projects). Meanwhile, Canadian investors are pouring in in search of secure money flow. Utilities stocks make up about 4% of the S&P/TSX Composite Index. The largest utilities – akin to Fortis, Emera, Hydro-One and Brookfield Infrastructure – are amongst Canada’s largest firms.
Some of those income-focused investors who like utility stocks can also be fascinated by two recent exchange-traded funds (ETFs) that JP Morgan Asset Management Canada just launched. The JPMorgan US Equity Premium Income Active ETF (JEPI/TSX) and the JPMorgan Nasdaq Equity Premium Income Active ETF (JEPQ) use options strategies to “juice” the returns already generated by higher dividend-yielding stocks.
