Terry Sawchuk on The Steve Gruber Show: The Risks of Demand Destruction

Jan 24, 2022 | In the News

Any information discussed in this article is for educational purposes only. It is not meant to be any kind of recommendation or financial advice. The information contained in this video is intended for informational purposes only. Any opinions are those of Terry Sawchuk and not necessarily those of JW Cole Financial, Inc. or JW Cole Advisors, Inc.

Securities offered through J.W. Cole Financial, Inc. (JWC) Member FINRA/SIPC. Advisory services offered through J.W. Cole Advisors, Inc. (JWCA). Sawchuk Wealth and JWC/JWCA are unaffiliated entities.

Starting Saturday, January 22, any non-U.S. citizen needs proof of COVID-19 vaccination to enter the country, with Canada already imposing the same rules for foreign travelers as well. While this may not seem like it could greatly affect investors, it does force truck drivers carrying and delivering goods across the border to be vaccinated, which is certainly something to be wary of. To learn more about how this new policy may impact the economy and market, the Steve Gruber Show turned to Terry Sawchuk, founder and chairman of Sawchuk Wealth, for insight.

“This falls into the category of play stupid games, win stupid prizes,” says Sawchuk. “In Michigan, we import twice what we export, and we already had supply chain issues. What’s interesting about the automotive industry is that even though volumes are down because of the chips, profits are way up. I know people who own dealerships that made more money than any other year they have been in business.”

According to Sawchuk, our current inflationary environment has created higher profits, but the main concern investors need to pay attention to is the possibility of demand disruption. “If we get to demand disruption because demand gets too high, energy prices get too high, then you have a problem because you have rising prices and falling demand, which is a much more difficult problem to fix,” he cautions.

One major side effect that could occur if demand falls, and one that investors are starting to witness already, is volatility for the stock market. “One of the most concerning things that we are seeing technically is that the NASDAQ just broke below its 200-day moving average, and it didn’t even do that in the height of the pandemic,” says Sawchuk. While this could simply be caused by profit-taking or market rotations, Sawchuk believes that this is just the start of turbulence for the NASDAQ.

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Click here to watch the entire segment.

 

Any information discussed in this article is for educational purposes only. It is not meant to be any kind of recommendation or financial advice. The information contained in this video is intended for informational purposes only. Any opinions are those of Terry Sawchuk and not necessarily those of JW Cole Financial, Inc. or JW Cole Advisors, Inc.

Securities offered through J.W. Cole Financial, Inc. (JWC) Member FINRA/SIPC. Advisory services offered through J.W. Cole Advisors, Inc. (JWCA). Sawchuk Wealth and JWC/JWCA are unaffiliated entities.