The Trump presidential victory was no doubt a surprise to most, but what was even more unexpected was the reaction from investors.

Heading into the election, the general view wasthat Clinton would be better for stocks than Trump.A Wall Street Journal survey of economists foundthat only 14% believed Trump’s policies would begood for growth. We received numerous calls fromworried clients wondering if they should raise cashjust in case the unthinkable happened and Trumpwon.

Indeed, as the results rolled in on election night,and it became increasingly clear that Trump would take the White House, investors reacted asanticipated – stocks plunged in overseas trading,and the futures markets pointed to a drubbing onNorth American stock exchanges the next day.

But when morning came, stocks were up. The narrative for the markets turned decidedly positive,with investors and the media focused on Trump’spro-business policies: lower taxes for corporationsand individuals; a tax holiday for companies to repatriate stranded overseas profits; reduced businessregulation; and $1 trillion in spending on infrastructure.In the five trading days after the election, U.S. stocksexceeded the returns of all other major markets,with the S&P 500 Index up 3.0% in Canadian dollarterms.

The most encouraging outcome from the election is the likelihood that Washington will overcomegridlock and finally be in a position to use fiscal policy in a meaningful way to address structuralchallenges, as Congress and the president-elect are aligned along party lines.

We have long argued that the world needs morefiscal policy and less monetary policy to get to ahealthier state. The use of ultra-low interest rates tostimulate growth has been increasingly ineffective

and has also had the unintended consequence of fueling inequality and social unrest. Low interest rates promote higher asset prices, which disproportionately benefit the rich since they own most of these assets.

Still, as happy as we are to see the transition frommonetary policy to fiscal policy, there are reasons totemper our enthusiasm. Tax cuts and big spendingplans mean large deficits, and we can’t help butwonder if the U.S. government should be savingmore of its fiscal muscle for a rainy day. Moreover,the proposed tax reductions will benefit the richmore than lower income earners, and widen thegap between the haves and the have-nots. Similarly,Trump’s plan to impose import duties on goodsfrom China and Mexico will put upward pressureon consumer prices, which will disproportionatelyhurt lower income households.

There is hope that our concerns won’t become reality,as Trump has shown that he can moderate his position on divisive matters. After all, he’s alreadybackpedaled on plans to deport illegal immigrantsand completely repeal the Affordable Care Act.

Nonetheless, there are so many unknowns thatpredictions are likely as reliable as a typical BCweather forecast – cloudy with sunny periods anda chance of rain. While it’s okay to wish for sunshine,it’s still best to protect portfolios under an umbrellaof high-quality securities and ample diversification.

Happy Holidays,

MURRAY LEITH, CFA

Executive Vice President and Director, Investment Research

@murrayleith

Cloudy with Sunny Periods and aChance of Rain

ODLUMBROWN.COM

ODLUMBROWNREPORT

12 2016

INSIDE THIS ISSUE

Page 1Cloudy with Sunny Periods and aChance of Rain

Page 2Year-End Tax Tips and Deadlines

Page 4Odlum Brown in the Community

Odlum Brown LimitedSuite 1100 - 250 Howe Street

Vancouver BC V6C 3S9

Main 604 669 1600Toll Free 1 888 886 3586

Kelowna 250 861 5700Victoria 250 952 7777Chilliwack 604 858 2455Courtenay 250 703 0637

Email information@odlumbrown.com

Odlum Brown Limited

@Odlum_Brown

Odlum Brown Community

2

Year-End Tax Tips and DeadlinesWith December upon us, here are a number of tax considerations and deadlines to remember for the 2016 tax year.

Payments, Expenses and Other Transactions1. Tax-Loss SellingTax-loss selling entails selling investments with unrealized capital losses before year-end to offset capital gains realized during the year. Any remaining unused capital losses can be carried over to offset capital gainsfrom the three preceding years or in any future year. While this strategy may be advantageous from a tax perspective, do not let the “tax tail wag the investment dog.”

Place your trades before the holidays. To ensure that your capital losses can be reported in the 2016 tax year,trades on Canadian securities exchanges must be placed no later than December 23, 2016, as trades typicallytake three business days to settle. Different dates may apply to foreign exchanges.

Beware of “superficial loss” rules. The capital loss on an investment will be denied if you buy an identical investment during the period that begins 30 days before and ends 30 days after the sale settlement date andyou still own that investment at the end of the period. These rules also apply if the identical investment is purchased by or transferred to your RRSP, RRIF, TFSA, spouse or a company controlled by you or your spouse.

If you are caught by the superficial loss rules, the denied loss amount is added to the adjusted cost base of theidentical investment purchased, in essence deferring the loss until the ultimate year of disposition.

2. Carrying ChargesInvestment-related expenses, such as fees to manage non-registered accounts and charges and interest paid on money borrowed for most investment purposes (other than in registered accounts), must be paid byDecember 31 to be deductible in 2016.

Contributions to Registered Plans3. Registered Retirement Savings Plans (RRSPs)The maximum RRSP contribution limit for 2016 is $25,370. Check your 2015 Notice of Assessment from theCRA to find your RRSP deduction limit (also known as “contribution room”) for 2016. If you have a considerableamount of contribution room or if you expect to be in a higher tax bracket in the near future, consider makingthe maximum contribution this year, but claim the deduction over multiple years, depending on your expectedtaxable income.

ODLUM BROWN FINANCIAL SERVICES LIMITED

Item Deadline Notes

Tax Installments December 15 To avoid interest and penalties

Tax-Loss Selling December 23 To reduce net taxable capital gains

Charitable Donations December 31 To receive credit against 2016 taxes

Carrying Charges December 31 To deduct from 2016 income

Medical Expenses December 31 To deduct from 2016 income

Contributions Deadline* Notes

RRSP March 1, 2017 To deduct from 2016 income

If you turn 71 in 2016:

• Final RRSP Contribution December 30 To deduct from 2016 income

• Convert to RRIF or Annuity December 30 To comply with legislation

RESP December 30 To receive 2016 Canada Education Savings Grants

RDSP December 30 To receive 2016 Registered Disability Savings Grants & Bonds

TFSA – See note 7 regarding withdrawals

DON‘T MISS THE 2016 DEADLINES!

Season’s Greetings!

On behalf of all of us at Odlum Brown

Limited, we wish our clients, friends

and partners all the best for a wonderful

holiday season and a happy and

prosperous new year.

3

4. RRSP Contributions After Age 71Although you can no longer contribute to your own RRSP after December 31* of the year in which you turn 71,you can contribute to a spousal RRSP if you still have contribution room and your spouse or common-law partneris not older than 71 in the year of contribution.

5. Registered Education Savings Plans (RESPs)The federal government provides annual Canada Education Savings Grants (CESGs) of up to $500 with a lifetime CESG limit of $7,200 per beneficiary. Subject to the restriction outlined in the following paragraph,beneficiaries aged 17 or younger who have unused CESG carry-forward room may receive up to a maximumannual CESG of $1,000 if the account subscriber contributes $5,000 per year or more.

If your child turned 15 in 2016 and you have not contributed a minimum of $2,000 or at least $100 per year inany four years to date, December 30 is your last chance to contribute $2,000 or more to an RESP in order to beeligible for the CESG in 2016 through 2018 (ages 15-17).

6. Registered Disability Savings Plans (RDSPs)RDSPs are tax-deferred savings plans to help provide long-term savings for individuals who are eligible for thedisability tax credit. Lifetime contributions of up to $200,000 can be made until the beneficiary turns 59. Thereare no annual contribution limits and the contributions are not tax deductible.

The federal government provides assistance in the form of Canada Disability Savings Grants (CDSGs) andBonds (CDSBs) until the beneficiary turns 49:

• CDSGs of up to $3,500 per year with a lifetime limit of $70,000 are provided on a matching basis, based on the contribution amount and the beneficiary’s family income.

• CDSBs of up to $1,000 per year with a lifetime limit of $20,000 are provided to low-income beneficiaries. No contributions are required to receive the bond.

RDSP holders may wish to contribute to an RDSP by December 30 to receive government assistance for thecurrent year. Any unused CDSG and CDSB room, however, can be carried forward for up to 10 years.

7. Tax-Free Savings Accounts (TFSAs)There is no deadline for TFSA contributions as any unused contribution room is carried forward from one yearto the next. However, withdrawals in any given year do not increase TFSA contribution room until the followingcalendar year. Therefore, if you are planning to make a withdrawal in the near future, consider making it byDecember 30, 2016, to be able to re-contribute the withdrawn amount in 2017.

When TFSAs were introduced in 2009, the annual contribution limit was set at $5,000, indexed to inflation in$500 increments. In 2013, the annual limit increased to $5,500 and was further increased to $10,000 in 2015. For2016 and 2017, the annual limit has reverted to $5,500. Therefore, if you have not made any TFSA contributions todate, you could contribute up to a maximum of $52,000 in 2017.

* Note: In 2016, December 31 falls on a Saturday; therefore, the deadline for contributions is December 30.

KARISA SCHAITEL, CPA, CA, CMA, CFP

Financial & Tax Planner, Odlum Brown Financial Services Limited

Odlum Brown Financial Services Limited is a wholly-owned subsidiary of Odlum Brown Limited, offering life insurance products, retirement, estate and financial planning exclusively to Odlum Brown clients.

Coming Soon!New Annual Reports

In January 2017, clients will receive a

new Annual Report package in addition

to regular Client Account Statements.

Part of an industry-wide initiative called

the Client Relationship Model (CRM2),

these new reports are designed to

provide clients with more details on

their investment accounts’ performance

and costs over the past year.

At Odlum Brown Limited, we have

always been committed to providing

clear and complete information and to

delivering a full-service experience. We

hope that our clients will find these new

Annual Reports helpful.

4

DISCLAIMER & DISCLOSURE

Odlum Brown Limited is an independent, full-service investment firm focused on providing professional investment advice and objective research. We respect

your right to be informed of relationships with the issuers orstrategies referred to in this report which might reasonablybe expected to indicate potential conflicts of interest with respect to the securities or any investment strategies discussed or recommended in this report. We do not act as amarket maker in any securities and do not provide investmentbanking or advisory services to, or hold significant positionsin, the issuers covered by our research. Analysts and their associates may, from time to time, hold securities of issuersdiscussed or recommended in this report because they per-sonally have the conviction to follow their own research, but wehave implemented internal policies that impose restrictionson when and how an Analyst may buy or sell securities theycover and any such interest will be disclosed in our report inaccordance with regulatory policy. Our Analysts receive nodirect compensation based on revenue from investmentbanking services. We describe our research policies in greaterdetail, including a description of our rating system and howwe disseminate our research, on the Odlum Brown Limitedwebsite at odlumbrown.com.

This report has been prepared by Odlum Brown Limited andis intended only for persons resident and located in all theprovinces and territories of Canada, where Odlum BrownLimited's services and products may lawfully be offered forsale, and therein only to clients of Odlum Brown Limited. Thisreport is not intended for distribution to, or use by, any personor entity in any jurisdiction or country including the UnitedStates, where such distribution or use would be contrary to law or regulation or which would subject Odlum BrownLimited to any registration requirement within such jurisdictionor country. As no regard has been made as to the specific investment objectives, financial situation, and other particularcircumstances of any person who may receive this report,clients should seek the advice of a registered investment advisor and other professional advisors, as applicable, regardingthe appropriateness of investing in any securities or any investment strategies discussed or recommended in this report.

This report is for information purposes only and is neither a solicitation for the purchase of securities nor an offer of securities. The information contained in this report has beencompiled from sources we believe to be reliable, however, wemake no guarantee, representation or warranty, expressed orimplied, as to such information’s accuracy or completeness.All opinions and estimates contained in this report, whetheror not our own, are based on assumptions we believe to bereasonable as of the date of the report and are subject tochange without notice.

Please note that, as at the date of this report, the ResearchAnalyst responsible for the recommendations herein, associatesof such Analyst and/or other individuals directly involved inthe preparation of this report may hold securities of the issuer(s) referred to directly or through derivatives.

No part of this publication may be reproduced without the express written consent of Odlum Brown Limited. Odlum BrownLimited is a Member-Canadian Investor Protection Fund.

Odlum Brown Limited respects your time and your privacy. If you no longer wish us to retain and use your personal information preferring to have your name removed from ourmailing list, please let us know. For more information on ourPrivacy Policy please visit our website at odlumbrown.com.

Pandora’s Vox and Espiritu – West Vancouver

For the third year, Odlum Brown is pleased to be the Presenting Sponsor of Pandora’s Vox & Espiritu’s holidayconcert Only Joy Aloud! at the Kay Meek Centre on Friday, December 2, at 8 PM and Saturday, December 3, at2 PM and 7:30 PM.

A dazzling array of song and dance to warm the heart and lift the spirit awaits those fortunate to attend.

Visit pandorasvox.ca for ticket information.

Joyful Voice Community Choir – Vancouver

For the ninth year, Odlum Brown is proud to be the Presenting Sponsor of Joyful Voice Community Choir’sChristmas concerts at St. Paul’s Anglican Church on Monday, December 12, and Tuesday, December 13, at7:30 PM.

The choir will perform 14 pieces for the concerts, representing a diverse array of genres and styles. Tickets arecomplimentary, but must be booked in advance.

Visit joyfulvoice.ca for ticket information.

Early Music Vancouver

For the 13th consecutive year, Odlum Brown is proud to support Early Music Vancouver’s Festive Cantatas –J.S. Bach Magnificat at the Chan Centre for the Performing Arts at UBC on Sunday, December 18, at 3 PM.

Alexander Weimann leads five internationally renowned soloists, a full baroque orchestra, three trumpets andtimpani in a performance of the original version of J.S. Bach’s Magnificat. Written for Christmas Vespers in1723, this version includes four rarely heard and delightful inserts that illuminate the Nativity story.

Visit earlymusic.bc.ca for ticket information.

Odlum Brown in the CommunityWe are pleased to support arts and culture in our communities, including these performances for the festive season: