August 2022 Pricing Commentary The positive stock market momentum during the month of July carried into August with considerable optimism. For instance: financial services, large capitalization American technology shares, industrials, and health care stocks enabled the various North American indices to reach new summer highs by mid August. By the fourth week in August, however, common share prices started to slip with growing fears of a Federal Reserve 75 basis point interest rate increase and the short, but biting, hawkish monetary comments of Fed Reserve Chairman Jay Powell at the Jackson Hole Symposium on August 26th. The seriousness of Powell’s statement enervated investors’ market commitment and both the equity and bond markets tumbled and sold off to month end. Interestingly, while the primary Federal Reserve motivator is the reduction of inflation, we have witnessed, especially in the greater Toronto area, a sharp decline in gasoline prices, a major inflation component. From the June 2022 high of about $2.30 a litre gasoline prices at the pump have fallen to $1.50 a litre. This is the lowest price in seven months. If the price declines further or even stabilizes at these levels this occurrence could positively impact inflation statistics and soften the North American monetary authorities serious battle to beat down inflation towards their 2% target. Despite lower prices, a number of our ABC stock holdings did return positive results for this period including: Algonquin Power, Becton Dickinson, Brookfield Infrastructure Partners, Emera, Meta Platforms, TD Bank, Waste Connections, and Waste Management. It should be noted that we are committed to these securities and our equity portfolios, in particular, as we approach 2023. Now entering the last four months of 2022, we expect: gradually lower monthly inflation reports and greater clarity with respect to interest rates and inflation; moderating weakness in North American GDP growth and stable employment data; respectable corporate earnings results; and more mergers and acquisitions and share buybacks due to relatively low equity prices, albeit, with rising borrowing costs and quantitative tightening. In summation, we remain optimistic with regard to equities and expect stock selection to remain paramount as an eventual business recovery and a peaking of inflation and interest rates takes hold in 2023. Irwin A. Michael, President I.A. Michael Investment Counsel Ltd.