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Eighteenth century economist Robert Malthus was a big reason economics became known as 'the dismal science.' Mr. Malthus believed that because the population grew exponentially, and food supply increased mathematically, that without war or plagues much of the world would eventually starve to death. The global population has increased by about 700 per cent since Mr. Malthus' death in 1834 and yet agricultural science has allowed for majority of the world to be fed.

The Peak Oil thesis – that the planet would soon run out of oil – always struck me as Malthusian, ignoring the potential for the technological gains we've seen in solar and wind power, and the spread of electric vehicles.

Popular Mechanics recently outlined a scientific discovery – the result of a laboratory accident – which could be the biggest energy-related advancement in decades. Using nanotechnology, chemists at Oak Ridge National Laboratory in Tennessee were able to convert carbon dioxide into ethanol using cheap materials and very little energy – the process worked at room temperature.

It will be years, unfortunately, before we know whether the experiment can result in widespread applications, or whether it was some kind of non-repeatable fluke, or the result of a mistake. But it's also true that if it does work, and it's scaleable, it will be a momentous example of disruptive technology.

The primary problem with alternative power now is its inconsistency. Solar power, for instance, doesn't work at night. Excess energy created during daylight hours has to be stored in batteries that are largely inefficient.

A system whereby excess energy created by solar power can be converted to ethanol, the ethanol burned to create power when solar energy unavailable, and the CO2 from this combustion recaptured to be turned back into ethanol, would create a different world.

Again, such a system is still a dream that -- in even in a best case scenario -- will take a long time to be realized. The odds at this point are that it will never be realized at all. Just considering the possibilities, however, provides a good example of the sea changes that technology can create. In the solar-to-ethanol example, the importance of industrial batteries declines precipitously. The economic, business and investing effects for the oil industry and energy-producing countries would be so large as to be almost incomprehensible.

Even if it doesn't occur in the energy sector, investors can expect technology to re-configure major segments of the economy in the decades ahead. Keeping an open mind, and realizing the changes at early stages, will be important skills for investors.

-- Scott Barlow

Three big numbers to note

$60.45 (U.S.)  The all-time high Microsoft hit on Friday after posting a strong earnings report.

14,939.04 Friday's close of S&P/TSX composite index. The exchange is at its highest level in 16 months.

74% The chance traders are now pricing in that the Fed will raise rates in December, up from 64 per cent two weeks ago, according to CME Group's FedWatch Tool.

Stocks to ponder

Algonquin Power & Utilities As the dividend investor with The Globe and Mail's Strategy Lab series, one of John Heinzl's ongoing frustrations is that he's limited to 12 securities in his model portfolio. Unfortunately, this means he has to leave out some great companies. Case in point: Algonquin Power & Utilities Corp. He already has two utilities – Fortis Inc. and Canadian Utilities Ltd. – in his Strategy Lab portfolio, and adding a third would be overkill. But he says he has held Algonquin personally for several years and been pleased with its performance. And analysts say the Oakville, Ont.-based company has a bright future thanks to its growing utility and power operations.

Diversified Royalty Corp. This stock has a 8.9 per cent yield and six unanimous 'buy' calls by analysts, writes Jennifer Dowty. Diversified Royalty is a multi-royalty corporation with three royalty streams from Franworks, Sutton, and Mr. Lube. Franworks operates pub restaurants under the banners Original Joe's, State & Main, and Elephant & Castle, Sutton is a residential real estate brokerage operator, and Mr. Lube is an auto service provider. Last month, management announced the sale of its Franworks rights to Cara Operations Ltd. for $90-million. Its second-quarter results were in-line with expectations. The average one-year target price is $3.36, which implies there is 34 per cent upside potential in the share price over the next 12 months.

Pembina Pipeline Corp. This defensive stock has a 4.6 per cent yield, writes Jennifer Dowty. Ths stock is on the positive breakouts list, showing that it has price momentum. In addition to the stellar 37 per cent increase year-to-date in the share price, analysts are forecasting further upside of up to 21 per cent with limited downside risk anticipated. In August, the company reported better-than-expected second quarter results and management see growth ahead with the projects is has underway already. Since the start of this year, 17 firms have issued research reports, of which 12 are 'buy' recommendations and five are 'hold' recommendations.

Labrador Iron Ore Royalty Corp. This stock has a 7 per cent yield, is up 42 per cent in 2016 and forecasts see further upside, writes Jennifer Dowty. This stock is narrowly missing the positive breakouts list and its share price has been trading sideways for the past two years. While this stock offers investors a high dividend yield, there is commodity price risk that can make the share price very volatile at times so investors need to have a high risk tolerance. Labrador Iron Ore Royalty has a 15.1-per-cent interest in Iron Ore Company of Canada (IOC), and receives a 7 per cent royalty and a 10 cent per tonne commission on its iron ore produced by IOC. Its latest earnings report in August came in much lower than expected, but management's outlook was positive, expecting prices to stabilize later this year.  The average one-year target price is $15.17, which implies 11 per cent upside potential over the next 12 months.

Park Lawn Corp. Investors could see renewed life in this death-care company now that it has graduated to the Toronto Stock Exchange and amid growing demand for its services among an aging baby boomer population, writes Brenda Bouw. Shares of Toronto-based Park Lawn, Canada's only publicly listed death care provider, have risen by about 40 per cent over the past year. Stock in the company, which owns and operates cemeteries, crematoriums and funeral homes in Canada and the U.S., hit a record high of $17.40 this week. Park Lawn graduated to TSX from the TSX Venture exchange on Wednesday, which analysts say should give it more exposure to a broader range of investors.

The Rundown

Here's how to know when you should be selling a stock
There are two important sides to successful, profitable portfolio management. One key component is identifying and investing in fundamentally strong companies. But equally, if not more important at times, is knowing when to sell a security. Unfortunately, this is the part of the investment process investors get wrong most often, writes Jennifer Dowty.

Bearish on the loonie
Current trends not only suggest that the loonie should be headed lower, there's a plausible scenario where the domestic currency might re-test the January lows below 70 cents (U.S.), writes Scott Barlow.

On the lookout for dividend growth? Try these ETFs
When you're looking for a dividend stock, a high yield may seem attractive but don't stop there. The key to ongoing growth in a dividend-oriented portfolio is to choose companies with a history of regular increases in their payouts, writes Gordon Pape. He has recommended several such companies in previous columns but some people prefer one-stop shopping. So here are two ETFs that focus exclusively on companies that have increased their dividends at least once a year over a lengthy period: SPDR S&P Dividend ETF (SDY-N) and the iShares S&P/TSX Canadian Dividend Aristocrats Index ETF (CDZ-T).

Money managers showed resilience in third-quarter's 'whiff of rising rates'
The market did an about-face in the third quarter, reversing the fortunes of the winners and losers of the first half and scrambling the opportunities for a trio of money managers trying to generate profits in support of children with disabilities as part of the Holland Bloorview Investor Challenge, writes Tim Shufelt. The first half of the year was dominated by crude oil, from the winter crash in energy prices to the subsequent swift recovery. The third quarter, however, saw the prospect of rising interest rates and bond yields come back to the fore, as rate-sensitive stocks sold off in favour of cyclical sectors.

Investors crave low-fee funds. Maybe they shouldn't
Money managers are facing a revolution. Their business was built on fat margins, yet suddenly they've found a new religion, writes Tim Kiladze The new gospel: low fees, by any means necessary. It all makes sense. Many investment managers have failed to prove their worth over the long term – particularly hedge funds, which made hundreds of millions, even billions, of dollars in good markets, yet rarely suffered along with their clients during bad times. It's also hard to justify lofty management fees when yields have plummeted,driven low by rock bottom interest rates. But amid the rush to sing from a new hymn book, hardly anyone is stopping to ask whether low fees are always the best approach. Craig Bodenstab is among the few who questions the new orthodoxy. His Bermuda-based firm, Orbis Investment Management, manages roughly $30-billion (U.S.) for 150 institutions globally, including some Canadian shops. Its compensation model is atypical: One option is for clients to pay performance fees when the fund does well, and for Orbis to refund money when the fund misses its benchmarks.

These stocks could benefit from an immigration boom in Canada
Real estate and consumer stocks could eventually benefit from a sharp increase in immigration levels being recommended to Canada's Finance Minister. The Globe and Mail reported on Wednesday that an advisory committee wants to see a 50-per-cent increase in immigration to 450,000 people annually over five years. That includes making it easier for highly skilled and entrepreneurial foreigners to enter the country. The increase could lead to a meaningful boost in spending on everyday items such as groceries, gas, clothing, furniture and housing, and in turn benefit the handful of Canadian companies that offer these products and services.

Robo-advisers offer a glimmer of optimism on long-term returns
Looking for respite from the pervasive sense of gloom about investment returns in the years to come? Try a robo-adviser. On average, eight of Canada's robo-advisers are suggesting investors expect an annualized after-fee return of 5.9 per cent from a balanced portfolio. The average for conservative portfolios is expected to be 4.3 per cent, while aggressive portfolios are expected to deliver 7.2 per cent. These figures were collected as part of the fact-finding that went into the compilation of the second annual Globe and Mail Robo-Adviser Guide. Each of the 11 firms included in the survey was asked to provide return expectations. Eight supplied this information. Robos are too new to have generated a meaningful track record of investment returns. But we can at least look at what these firms believe to be achievable by building portfolios primarily with low-cost exchange-traded funds. Expectations vary a fair bit between firms, but the averages reflect a degree of optimism about what's ahead.

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What's up in the days ahead

Gordon Pape tells us why he's seeking income in True North REIT, we'll hear about the investment case for Hudson's Bay Co. (hint: it's Bay Day time on its real estate assets), and George Athanassakos outlines the three key principles value investing. And in this week's Globe Investor, Rob Carrick gives a smart, detailed breakdown of how to set up a Registered Education Savings Plan using low-cost ETFs.

Click here to see the Globe Investor earnings and economic news calendar.

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Compiled by Gillian Livingston and Darcy Keith

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