Quote du Jour: Recession? What recession?

July 23, 2009 - Recession over, Bank of Canada says

Sept. 21, 2009 - Harper says recession over only in technical sense

Sept. 30, 2009 - ‘Okay, this is a shocker'

It's economic report card time again...

It was time for yet another episode of Steve's Dog & Pony Show today:

Speaking at the Southern Railway, Mechanical Shop & Administration Office, Harper used the announcement of his economic update to say that trying to force an "unnecessary and wasteful election in the middle of a global recession is not in the country's interests."

That's right, peasants. Only Steve is allowed to break his own election law to call unnecessary and wasteful elections during a recession. We should all know that by now.

Apparently unwilling to wait for the upcoming "fruit" that Action Plan Steve is waiting to harvest, Ignatieff huffed and puffed and threatened to blow the house down - again. But that won't be happening any time soon.

As expected, a loud yawn was heard all across the country.

Dogs, ponies, fruit... all in a day's work in Ottawa.
 

Harper's Economic Fearmongering

If there's an election this fall, we're all gonna die!

Or something like that...

Steve:

An election does nothing for the country than present a great risk that we could get off track.

Economists say a federal election unlikely to derail Canada's economic recovery

Bob Rae:

"There's an effort here on the part of the Conservatives to create an atmosphere of total instability," Rae said. "Well, we're not a banana republic. Mr. Harper's not a generalissimo yet. He has to get used to living in a constitutional democracy."

Steve:

The performance of Canada's economy has been significantly better than elsewhere.

The OECD:

Canada, which fought off recession much longer than its peers in the Group of Seven nations, will trail them down the road to recovery, according to new projections by the Organization for Economic Development and Co-operation.

All G7 economies save those of Canada, Britain and Italy will expand in the third quarter, the Paris-based OECD said Thursday.

Any questions?
 

Quote du Jour: Shovel-ready Baird

Comment by Nova Scotia Liberal MP Michael Savage in response to the Cons using John Baird as their bullying frontman during Question Period today to fend off opposition party complaints about the EI system:

"The only thing that's shovel-ready are the answers from this minister."

Ramen.

Caution: Flying bullshit

Conservative Talking Points Brought to you by the G&M

The Globe and Mail has published an e-mail, from Guy Giorno, Steve's chief of staff, to Con sockpuppets who need help selling the so-called economic update to the media and the public.

At least it's not 200 plus pages like the manual about how to destroy parliamentary committees. That's an improvement.

As I stated in a previous post, I listened to right-wing talk radio for a few hours on Saturday and there's no doubt that the message from on high was received.

Here are the talking points:

Mr. Giorno's message included very detailed scripts MPs are expected to follow while delivering radio interviews that include the following lines:

* We're not even two months removed from the last election, and a group of backroom politicians are going to pick who the Prime Minister is. Canadians didn't vote for this person. We don't even know who this person will be.
* Not a single voter voted for a Liberal-NDP coalition. Certainly not a single voter voted for the Liberals to form a coalition with the separatists in the Bloc.
* This is what bothers me the most. The Conservatives won the election. The Opposition keeps saying that the Conservatives have to respect the will of the voters that this is a minority and so on.
* …how about Liberals, NDP and Bloc respecting the will of the voters when they said "YOU LOSE".
* And what's this going to do to the economy. I'm sorry, I don't care how desperate the Liberals are — giving socialists (Jack Layton) and separatists (Gilles Duceppe) a veto over every decision in government — that is a recipe for total economic disaster.
* But how more phony could these guys be?
* I mean, I follow the news, virtually every single day you have Harper or Flaherty out there telegraphing exactly what they plan to do with the economy. And not once did you hear the Liberals, NDP or separatists talking about toppling the government in response.
* No — do you know what set this off. When Flaherty said he was going to take taxpayer-funded subsidies away from the opposition. Now there is a reason to try and overturn an election— because the Conservatives the audacity to say "Hey, it's a recession, maybe you should take your nose out of the trough."
* And I wish the media would be more clear on this point — the opposition aren't being singled out by this fact the Conservatives stand to lose the most money of all. The only difference is that Canadians are voluntarily giving money the Conservatives, so they don't need taxpayer handouts. The only reason the opposition would be hurt more is because nobody wants to donate to them. They should be putting their efforts towards fixing that problem.
* I don't want another election. But what I want even less is a surprise backroom Prime Minister whom I never even had the opportunity to vote for or against. What an insult to democracy.

I love the smell of desperation in the morning.

I wonder what those MPs will do now that their Dear Leader has backed off cutting the public financing of political parties. Quick! Someone needs to issue new talking points to the brainless ones pronto!
 

How to be a Boneheaded Conservative

(Yes, I realize that phrase includes a built-in redundancy.)

Now then...let's review the past couple of days to provide Conservatives and their supporters a lesson in how real boneheadedness operates in Ottawa.

1. Announce an "economic update" in the midst of a global financial crisis.
2. Provide absolutely no stimulus to Canada's economy even though we're headed for a "technical" recession with a "structural" deficit while continually reminding people that you did stuff last year.
3. Take advantage of the national stage to strip rights away from women (no pay equity for you! Does that include Con cabinet ministers?) and workers (don't even think about striking! An old Ralph Klein idea). And throw a few dollars at seniors temporarily hoping they'll be dead in a year and won't notice that they'll still be shafted down the line anyway if they actually do survive that long.
4. And for the final coup de grace (there had to be something bilingual in there somewhere), end public financing of political parties (knowing that your party mainly benefits from private donors while leaving the opposition parties basically bankrupt, ).
5. Stand back, give yourself a big pat on the back and say you really did something today to help the average Canadian who's melting down in financial turmoil.

But wait! That's not all.

When you get wind of the fact that the Liberals aren't going to play nice this time by rubber stamping your..."creativity", shall we call it?...and that there are rumblings afoot about the formation of a coalition government ready and willing to vote your Conservative butts out of office on Monday, simply cancel any and all votes scheduled for that day and whine about how the Liberals and NDP really can't take that coalition ball and run with it, knowing full well that it's a legal possibility.

Sweat.

Stutter.

Call your mom.

Call Karl Rove.

Use that old cartoon line, "Curses! Foiled again."

And wait.

Because you know this time, they mean business.

(Are you having fun yet? I know I sure am!)

Stay tuned next week for more Conservative boneheadedness. You know they just can't help themselves.
 

Flaherty Meets Reality

Flaherty - March 1, 2008:

"If you're going to make a new business investment in Canada, and you're concerned about taxes, the last place you will go is the province of Ontario."

Flaherty - today:

MISSISSAUGA — Ontario will for the first time collect from a federal program designed to shift wealth to Canada's poorest regions next year, an unpleasant reminder of the grim economic prospects facing the country's most populous province.

Premier Dalton McGuinty's government will receive $347-million in the fiscal year starting in March, federal Finance Minister Jim Flaherty announced at a meeting Monday with his provincial and territorial counterparts.

“It's sort of an odd feeling to see Ontario in such difficult straits,” Mr. Flaherty, a finance minister under former Ontario Premier Mike Harris, told reporters. “Regrettably, I expect Ontario will be in the equalization program for some time to come.”

Maybe if he'd actually listened to all of the opposition parties pounding on him day after day the last couple of years about the sorry state of the manufacturing sector in Canada, he wouldn't be experiencing whatever this "odd feeling" is today. (I suspect that feeling is actually indigestion from having to eat crow.)
 

The Italian Barber, The Gas Station Attendant, and Jim

As I was coming home on the bus on Wednesday - a long, long bus ride from the other end of the city where I had checked out yet another place to rent (that I won't be taking) - I was slightly nodding off as the bus stopped downtown during rush hour to pick up riders heading home from their work day.

The seat beside me was filled by a man who was probably somewhere in his 50s. Having spotted someone he knew who had just embarked, he called out to him, "Jim! I have a bus ticket for you."

As it turned out (as I snooped on their conversation which I couldn't help but overhear), Jim was apparently a client of the man next to me, who, bantering in his heavy Italian accent, was clearly identified as his barber. They chit chatted about this and that - Jim is off to Cancun next week for 5 days to get a house ready for his annual trip to Mexico where his 80 year old mother who lives in Winnipeg is scheduled to meet Jim's family over xmas. The Italian barber said he wasn't going anywhere and paused - informing Jim that he'd lost half of the money he'd invested in his RRSPs because of the economic meltdown. "It's bad, Jim. It's bad," he said. Jim sympathized and said that, as far as he was concerned, all anyone could do was to try to enjoy life in the moment, regardless of what's going on. That's the type of response I would probably have given but it wouldn't alleviate the Italian barber's long term concerns considering that he may now have to delay his retirement. It was a sad conversation.

Having done that stretch of my trip, I got off the bus to transfer to the one I needed to take to get home. That's where I met the 40ish, female gas station attendant. We talked as we stood and waited for the next bus. She informed me that the last bus ran out to her place at 4:40 pm. Because her stint that day had ended after that, she had to grab my bus and walk from 68 St to 84 St NE. I told her that I'd just spent 1 1/2 hours getting from Abbeydale to Bowness and the same amount of time getting back. (Yes, I've complained to Calgary Transit that they need to update their runs. Having lived here for over 20 years and having watched the city's population almost double in that time, the system's services are now horribly antiquated.) When the conversation turned to the economy, she told me bluntly that, "the Bible predicted all of this". Not being a Bible believer and being way too exhausted to even get into it, I just let the comment pass. I really wasn't in the mood to have a discussion with a Rapture Ready person. She'd found her way to cope with the crisis. Who was I to argue with her? I guess we all find comfort where we can.

Home, finally, I mentioned the trip highlights to my roommate who told me that her 40 year old boyfriend had decided to pull his money out of his RRSPs because they were losing money as well. I guess my poverty status (ie. not even having any money to invest in the first place because I'm on permanent disability) has left me immune to those kinds of concerns but it's painfully obvious that Stephen 'the fundamentals of the economy are solid' Harper has badly misjudged the impact of this crisis on average Canadians.

The Bank of Canada announced today that "the Canadian economy is on the razor's edge of recession". No doubt. Interest rates may be going down but so are oil prices (bad for Alberta's economy), the loonie, housing prices, and consumer confidence - which is at 1982 levels. Food and rent prices are still high and are probably expected to stay that way. Everyone I've met who has a room to rent has said that they need help with their bills.

I'm currently spending 60% of my income on rent and that doesn't look like it's going to change considering the few options I have available to me in this city - and that's for shared accommodation. And 7-8 servings of fruits and vegetables per day? Are you kidding me? So much for trying to be as healthy as possible while I fight my illnesses.

There's a reason times like this are called "depressions".

Don't worry about the banks though. They're getting direct help from the feds, even if the rest of us aren't.

Related:

Video interview: Chomsky on the economy
Wall Street's 'Disaster Capitalism for Dummies'
 

Canadian Election Watch - Day 32

Stephen Harper is confused. Following a quick little speech on Wednesday in BC, the press gave him more than one opportunity to explain the comments he made about the bargains to be had in the stock market in the midst of this crash. His response?

Harper defended his comments, saying it was obvious to anyone who saw the interview that he was "specifically talking about the fact that many Canadians have seen big losses in their portfolios in the last couple of weeks."

"I know that because, as I say, my mother is one of those people, and I hear about it every single day. And we know that people are worried ,and they have a right to be worried about what's going on in financial markets," Harper said in a campaign appearance in Victoria.

He then repeated it wasn't appropriate for a prime minister to "join in a wave of stock market panic and pessimism around the world," but rather to ensure the government prepares in advance and make long-term investments to protect Canadians' interests.

"We had a plan," he said. "We do not get caught up in market panic."

See, here's the deal, Steve. If you don't want people to panic, you tell them not to panic. You don't tell them, with a wink and a nudge, that now's the time to buy low so you can sell high later. First of all, that does absolutely nothing for seniors like your mother who don't have much later left and who can't afford to wait for the economic sun to start shining again (not to mention that it's doubly insulting to seniors who lost out because of the Cons' income trust flip flop).

Secondly, you are not the Prime Stockbroker. You are (for now, anyway) the Prime Minister. And, as one reporter pointed out during the Q&A period in BC, you are not the chair of the Bank of Canada. It's not your job to hint about possible rate cuts any more than it is your job to offer investment advice.

Who would vote for this guy considering that he doesn't even know what his job description entails?

Here in Alberta:

Alberta's Progressive Conservative premier wants to meet with his provincial counterparts to discuss the state of the Canadian economy, even though Stephen Harper called the same proposal by Liberal Leader Stéphane Dion "panicking."

This is how this is all rolling out: anything not proposed by Steve and his federal Cons is "panicking". Maybe he shouldn't send Flaherty to the G7 meeting in Washington on Friday. Surely that's "panicking" as well?

What's ironic about this stance is that Steve is fearmongering by claiming everyone else is panicking and that is causing more panic because, at the same time, the Cons aren't providing anything resembling a long-term, stable vision that makes sense. Instead, their platform is a piecemeal offering that isn't cohesive. There is no grand picture besides stay the course.

And, speaking of Flaherty, he disclosed on Wednesday that his department had warned "a couple" of Canadian banks last year "that their capitalization levels were on the brink of falling below accepted standards". He wouldn't reveal which banks were on the receving end though and we have no way of finding out so how can we even know 1) if that's true or 2) what happened?

Meanwhile, no word so far from Flaherty on the settlement reached between RBC Capital and the SEC.

RBC Capital Markets, the investment banking arm of Royal Bank of Canada, also neither admitted or denied wrongdoing. It said the buyback would cut into its fourth-quarter earnings by about $30 million on a pretax basis. That estimated loss includes the $9.8 million civil penalty the company agreed to pay to Cuomo's office and the North American Securities Administrators Association, which represents securities regulators in the 50 states and the District of Columbia.

The SEC, Cuomo's office and other state regulators have been conducting a wide-ranging investigation into banks' marketing of auction-rate securities. The regulators have alleged that the banks misled customers into believing auction-rate securities were safe, cash-like investments.

If you listen to Steve tell it though, Canadian banks are squeaky clean with basically no problems and that's the problem with people being lulled into a very false sense of security by all of this stay the course talk the Cons are trying to sell. We're not panicking. We just want the truth along with assurances that the next PM actually understand what his job is - and we certainly aren't getting that from Harper.
 

Quotes du Jour: The Canadian Economy

From the Toronto Star:

Today marked the end of a horrendous week for Canadian investors, who watched Toronto's benchmark index fall a total of 1,322.64 points or 11 per cent over five days of frantic trading.

And, if that isn't enough to prove that our economy is teetering, how about this news?

Investors pull billions from funds

Canadian investors, rattled by sinking stock markets and worried about the safety of their money market investments, yanked a whopping $4.6-billion from their mutual funds in September.

It marked the biggest month for net redemptions suffered by the domestic industry since the Investment Funds Institute of Canada began collecting data in 1990.
[...]
“A bubble has burst,” and investors fear that they are going to see a further deterioration of their savings, independent fund analyst Peter Loach said in an interview.

More on that bursting bubble:

Mortgage defaults on the increase

Real estate downturn hits homeowners and investors

Colette Derworiz, Calgary Herald
Published: Thursday, October 02, 2008

For years, bankruptcy trustees and credit counsellors in Calgary haven't had enough work.

But in the past couple of months, the workload has picked up as some Calgarians fall behind on their mounting debts and mortgage payments.

"We are seeing people now who are going into bankruptcy, walking away from properties that in the last . . . four years in Calgary has been very, very, very rare," said David Smith, a trustee in bankruptcy at Bromwich & Smith Inc. "Now it's becoming more common."

Here's further proof that all is not well in Texas North - the land of milk and honey oil.

So, what does Steve have to say about all of this?

Well...

OTTAWA (Reuters) - Canada's prime minister accused the United States on Friday of panicking over the financial crisis and tried to assure nervous voters ahead of the Oct 14 general election there that is no need to worry about Canada's economy.

Prime Minister Stephen Harper, whose opponents regularly accuse him of being too close to President George W. Bush, said his Conservative government had avoided the mistakes made in the United States.

"If we don't panic here, we stick on course, we keep taking additional actions, make sure everything we do is affordable, we will emerge from this as strong as ever," he told a televised news conference in Saint John, New Brunswick.

Why does that remind me of you-know-who's "stay the course"?

I guess that's all we can know about the Conservative party's platform considering the fact that they haven't even released one yet. (As Jack Layton asked Steve during the debate last nite, Where's your platform, Mr Harper? Under your sweater?).

Apparently, there is a platform on the way next week (from Bush...or John Howard...or maybe Karl Rove). Maybe they'll pull a Hank Paulson and only make it 3 pages long (exceptionally arrogant power grabs included).

But, as Don Martin reminds Canadians:

Of course, no platform promise comes with a guaranteed delivery. An analysis of the 2006 Conservative platform showed barely half their promises were kept and, as a party holding a major policy convention next month to chart its future, everything they propose now seems subject to change by party members.

As he writes, these platforms are "usually not worth the paper they're written on". True, but we still expect them to thoroughly outline their lies before each election anyway.

Meanwhile, Flaherty is out there right now lying. (Maybe that is their platform since it so obviously was the last time around.)

Flaherty says bailout needed in U.S., not in Canada

He said Canada's banks are well-capitalized and within their statutory requirements, and households are "in much better shape" than their American counterparts.

Speaking in London, Ontario, he said Canadians are able to afford their mortgages, and he repeated assurances by Bank of Canada Governor Mark Carney that there are few signs that banks are restricting credit to households and that there is no evidence that companies are facing unusual credit restrictions.

That's interesting, considering the Bank of Canada just pumped $12 billion into the system today.

In one swoop, Canada's central bank shoved another $12 billion into the country's financial system Friday, an increase of 150 per cent from previous injections.

The move means the Bank of Canada has boosted the extra dollars it has pumped into the Canadian economy from $8 billion to $20 billion.

"In light of persistent pressures in these markets, the bank announces additional steps to provide term liquidity through term purchase and resale agreements," said the central bank in a press release.

Then there's this: CIBC to use $1B Cerberus cash to stop mortgage writedowns. And this: Week ahead: Canada's labour market in for a body check.

You get the drift.

Pay no attention to the smiling man behind the sweater vest.

He and Flaherty - The Bubble Won't Burst Twins - don't want to be disturbed. They have an election to win.
 

Royal Bank Under Investigation

While Stephen Harper has been crossing the country trying to reassure Canadians that the fundamentals of our economy are solid, insisting as well that our financial institutions are "solid", US regulators have announced that the RBC is under investigation:

U.S. federal enforcement officials are turning their sights to the Royal Bank of Canada as they crack down on financial institutions amid mounting public anger over a plan to bail out banks exposed to the credit crisis at the expense of taxpayers, according to officials.

Canada's largest bank is at the top of the list for enforcement agents at the Securities Exchange Commission who are pursuing financial institutions implicated in the collapse of the $330-billion auction-rate securities market, according to two federal officials.

The collapse of the market in the spring left many Americans unable to access funds they believed would be there for them to pay for short-term needs like college tuition and medical expenses, according to the SEC.

The disclosure is the first time officials at the agency have acknowledged they are preparing a federal enforcement action against RBC, and follows a parallel probe being pursued by state authorities. The pending enforcement action would make RBC one of the first Canadian banks to be called to account for its role in the credit crisis.
[...]
An RBC executive said the bank was working with regulators, and indicated management at the bank's capital markets operations expected to reach a comprehensive settlement with U.S. authorities.

The bank faces an estimated payout of $1 billion based on precedent-setting agreements negotiated with other U.S. and international institutions by state and federal authorities to buy back securities held by individual customers, charities and small businesses, and to reimburse those clients for damages.

RBC is also the target of a class-action law suit from customers of the bank alleging there was mis-selling of the securities pursuant to "top down management directives", according to a filing submitted to in a U.S. District Court by law-firm Girard Gibbs.

Did newly-retired RBC Capital Markets chairman Chuck Winograd see this coming? Is that why he retired?

Ironically, the governor of the Bank of Canada gave a press conference this morning about the state of our economy standing in front of the RBC's logo. Carney, contradicting Sweater Vest Steve's assurances, warned that "any slowdown in the U.S. economy would have consequences for Canada". Well of course it will and, as he noted, it already has.

Related:

Slump will hurt Canada: TD
TSX sinks on commodities
Royal Bank makes bid to clear U.S probe
 

Flaherty's Mini-Budget

Poor People Suck.

Let's face it. It's time for Conservatives to be honest and come right out and say it. In fact, I think the Conservative party should just use that as their next campaign slogan.

And let me say this right off the bat too about Flaherty's neon green tie: Call the fashion police. there's been a violation. (And no, I don't care if some kid picked it out for him. It's still butt-ugly.)

Alrighty then, moving onto the business at hand - Flaherty gave what was supposed to be his "fall economic statement" today. What it turned out to be was a) a mini-budget and b) electioneering.

If you're too poor to pay income taxes (like me), here's your little gift: a 1% reduction in the GST on stuff you can't afford to buy in the first place but have to so you can survive. Big whoop.

If you're a big profitable corporation, you got a tax break too (albeit much, much more than the heathens - of course.)

If you're an average Joe or Jane, you got a mini-break. That'll get you a few extra apples at the grocery store.

If you're the Bloc or the NDP, you're voting against this nonsense when it's brought up in the Ways and Means committee this week.

If you're Stephane Dion of the Liberals, you're speaking against it (except for the corporate tax cuts) but you're not ready for an election because your party is wrapped up in internal scandals, so you're going to do a lot of bloviating about it but you'll still vote for it in the end.

If you're a voter, you won't be going to the polls for a federal election this year.

If you're the Conservatives, you just played another game of chicken with the Liberals and won.

If you want to look at the details, check out the Dept of Finance's site.

News related to the Poor People Suck Conservative philosophy: Alberta premier Stelmach vows to "eradicate homelessness" in 10 years. What could possibly be wrong with that, you ask?

1) Quick. Name one big city or Canadian province that's eradicated homelessness - especially one run governed by Conservatives. That's right - it's.not.gonna.happen.

2) 10 years? Like Liberal MLA Dave Taylor said in response to this announcement (paraphrasing): "We already know how to build houses. It shouldn't take 10 years to do that." And the kicker? This proposed "secretariat" won't even be formed til next spring and the government's not sure what powers it will have yet. That lost time counts against your "10 year" timeline, Eddie. I'll be doing the countdown (from whatever overpriced rental I'm living in because the waiting list for low-income housing in Calgary is always at least 2500+ people long and buying is absolutely out of the question.)

Let's get real here. My province and the feds have more than enough money to really help the poor. The fact is that they simply don't want to. They still believe in Reagan's trickle down economics. Apparently, none of them care that's there's been a drought down here in Povertyville for a helluva long time.
 

Friday Open Thread

I'm still having internet connection problems. It's been months now. Apparently, Shaw prefers to send out an endless stream of technicians who are only authorized to do one thing at a time. Now it seems they're finally going to replace the main line outside after another neighbour complained. Right. We'll see what that does.

Worst.customer.service.ever.

Anyway, here's a bit of news to chew on (and it will probably be the only thing I'll be able to post in the 2 minutes of internet connection time I'm being granted a few times a day until they get this thing fixed):

Loonie closes above parity

The Canadian dollar closed above parity Friday for the first time in almost 31 years, as the U.S. greenback continued its dramatic fall against major world currencies.

According to Bank of Canada data, the loonie closed at $1.0052 US, up two-thirds of a cent from Thursday's close.

I'd sure like to know when Canadians are going to start seeing the benefits that reality should be bringing to the retail sector, especially since we've been over-charged for things like books and magazines for years.

What's on your mind? Got any news you'd like to share?