debt

Wednesday July 12, 2017

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Wednesday July 12, 2017

Bank of Canada may hike interest rate for 1st time in 7 years

After almost a decade of warnings that never came to pass, it appears as though the Bank of Canada is ramping up to hike its benchmark interest rate — possibly as soon as next week.

July 16, 2015

On July 12, Canada’s central bank will announce its latest decision on where to place its trend-setting interest rate, which has an impact on the rates that Canadian borrowers and savers get for their bank accounts, mortgages and other products.

Eight times a year, the bank’s board of governors meets to assess the latest economic indicators and decide whether Canada’s economy needs a shot in the arm from a rate cut, or a pump of the brakes by way of a hike.

And for the first time in 54 such meetings, it’s looking like the latter is in order.

It’s not like there haven’t been warning signs. By the time Stephen Poloz was named to replace Mark Carney atop the bank in 2013, the central bank had already been on the sidelines for more than two years, its benchmark interest rate set at one per cent.

May 13, 2010

But even as the bank kept loans cheap coming out of the financial crisis, the messaging from the top came early and often that Canadians should be forewarned — rates have to go up eventually.

As far back as 2014 Poloz warned Canadians that rates would rise “soon” — before oil’s plunge in 2015 caused the bank to lose its nerve. Instead, the central bank moved in the opposite direction, cutting rates twice that year to bring its rate to 0.5 per cent, where it currently sits.

At the time, those hikes were described as a temporary measure to help a Canadian economy that had been waylaid by an oil price that lost more than 70 per cent of its value in a matter of months. But in recent weeks the bank has started leaving clear signals that despite oil still being in the $40-per-barrel range, those temporary conditions are over and it’s time for a return to normalcy. (Source: CBC News) 

 

SaveSave

Thursday September 15, 2016

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator Ð Thursday September 15, 2016 Canada Post needs 'transformational changes' to be viable, task force finds A task force studying the national mail carrier says Canada Post isn't financially self-sustainable under its current structure. And it says transformational changes are needed to prevent taxpayers from having to prop it up. The four-member panel issued a discussion paper Monday that suggests a number of ways the letter carrier can turn its business model around, including distributing legalized marijuana and cutting back on door-to-door delivery in favour of community mailboxes Ñ an initiative launched by the Conservative government in 2013 but scrapped by the current Liberal government. The report also suggested charging fees to those who opt to have mail delivered directly to their door.ÊÊ A House of Commons committee has scheduled cross-country hearings this month to hear Canadians' views of what they want from the postal service. The ideas contained in the discussion paper are meant as a launching pad for those public consultations. The task force says a significant decline in letter mail deliveries is sapping revenues at Canada Post, a loss that has yet to be made up from its growing parcel and ad mail businesses. Canada Post applauded the task force findings, saying it reaffirms the challenges faced by the Crown corporation. (Source: CBC News) http://www.cbc.ca/news/business/canada-post-task-force-report-1.3759321 Canada, Parliament, dinosaur, Canada post, relic, debt, propped up, subsidy, debt

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday September 15, 2016

Canada Post needs ‘transformational changes’ to be viable, task force finds

A task force studying the national mail carrier says Canada Post isn’t financially self-sustainable under its current structure.

Thursday, December 12, 2013And it says transformational changes are needed to prevent taxpayers from having to prop it up.

The four-member panel issued a discussion paper Monday that suggests a number of ways the letter carrier can turn its business model around, including distributing legalized marijuana and cutting back on door-to-door delivery in favour of community mailboxes — an initiative launched by the Conservative government in 2013 but scrapped by the current Liberal government.

The report also suggested charging fees to those who opt to have mail delivered directly to their door.

A House of Commons committee has scheduled cross-country hearings this month to hear Canadians’ views of what they want from the postal service. The ideas contained in the discussion paper are meant as a launching pad for those public consultations.

The task force says a significant decline in letter mail deliveries is sapping revenues at Canada Post, a loss that has yet to be made up from its growing parcel and ad mail businesses.

Canada Post applauded the task force findings, saying it reaffirms the challenges faced by the Crown corporation. (Source: CBC News)

 

Wednesday April 6, 2016

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator Ð Wednesday April 6, 2016 Panama Papers: Document leak exposes global corruption, secrets of the rich The financial secrets of heads of state, athletes, billionaires and drug lords have been exposed in the latest Ñ and biggest ever Ñ leak of records from an offshore tax haven. The leak includes 11.5 million confidential documents shedding light on the assets and murky fiscal dealings of everyone from the prime ministers of Iceland and Pakistan to soccer player Leo Messi, movie star Jackie Chan and associates of Russian President Vladimir Putin. The records, dating as far back as 1977, come from a little-known but highly influential Panama-based law firm called Mossack Fonseca, which has 500 staff working in 40-plus countries. The firm is one of the world's top creators of shell companies Ñ corporate structures that can be used to hide ownership of assets. German newspaper SŸddeutsche Zeitung obtained the files from a source and shared them with global media partners, including CBC News and the Toronto Star, through the Washington-based International Consortium of Investigative Journalists. CBC News will be exploring more of what's in the documents, including Canadian connections, in a series of stories this week. "These findings show how deeply ingrained harmful practices and criminality are in the offshore world," said Gabriel Zucman, an economist at the University of California at Berkeley and author of The Hidden Wealth of Nations: The Scourge of Tax Havens. Zucman, who was briefed on the media partners' investigation, said the release of the leaked documents should prompt governments to seek "concrete sanctions" against jurisdictions and institutions that peddle offshore secrecy. While offshore accounts are not in themselves illegal, the leaked records show they are often used to shield illicit dealings. In a written response to questions from the media consortium, Mossack Fonseca said it "do

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Wednesday April 6, 2016

Panama Papers: Document leak exposes global corruption, secrets of the rich

The financial secrets of heads of state, athletes, billionaires and drug lords have been exposed in the latest — and biggest ever — leak of records from an offshore tax haven.

The leak includes 11.5 million confidential documents shedding light on the assets and murky fiscal dealings of everyone from the prime ministers of Iceland and Pakistan to soccer player Leo Messi, movie star Jackie Chan and associates of Russian President Vladimir Putin.

The records, dating as far back as 1977, come from a little-known but highly influential Panama-based law firm called Mossack Fonseca, which has 500 staff working in 40-plus countries. The firm is one of the world’s top creators of shell companies — corporate structures that can be used to hide ownership of assets.

German newspaper Süddeutsche Zeitung obtained the files from a source and shared them with global media partners, including CBC News and the Toronto Star, through the Washington-based International Consortium of Investigative Journalists.

CBC News will be exploring more of what’s in the documents, including Canadian connections, in a series of stories this week.

“These findings show how deeply ingrained harmful practices and criminality are in the offshore world,” said Gabriel Zucman, an economist at the University of California at Berkeley and author of The Hidden Wealth of Nations: The Scourge of Tax Havens.

Zucman, who was briefed on the media partners’ investigation, said the release of the leaked documents should prompt governments to seek “concrete sanctions” against jurisdictions and institutions that peddle offshore secrecy.

While offshore accounts are not in themselves illegal, the leaked records show they are often used to shield illicit dealings.

In a written response to questions from the media consortium, Mossack Fonseca said it “does not foster or promote illegal acts.”

“Your allegations that we provide shareholders with structures supposedly designed to hide the identity of the real owners are completely unsupported and false,” the firm said. (Source: CBC News)

 

Thursday March 24, 2016

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator - Thursday March 24, 2016 Canada government tries to fend off critics worried about deficits Canada's government on Wednesday sought to deflect criticism that it had condemned the country to years of budget deficits, saying it could balance the books within five years if efforts to boost the economy succeed. The ruling Liberals on Tuesday projected a C$29.4 billion ($22.3 billion) deficit for fiscal 2016-17, nearly three times larger than what they promised during last year's election campaign. The Liberals, who say the spending will help boost growth, gave no target date for returning to balance, with the budget still expected to show a deficit of C$14.3 billion in 2020-21. Opposition politicians and influential media commentators said they feared Canada would face a long string of shortfalls of the kind it has not seen in two decades. This could cause problems for Prime Minister Justin Trudeau. "We're hoping to increase the growth rates," Trudeau told CBC Radio on Wednesday. If the government can stimulate the economy, "we get to balance in the coming five years," he said. "There is a track to that if we increase the growth in the economy." Trudeau faces no immediate political threat, since he only took power last November and is sitting high in the polls. But the longer the deficits last, the greater the potential political risk. (Source: Reuters) http://ca.reuters.com/article/domesticNews/idCAKCN0WP1R2 Canada, Justin Trudeau, Bill Morneau, growth, economy, budget, debt, spending, government

Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday March 24, 2016

Canada government tries to fend off critics worried about deficits

Canada’s government on Wednesday sought to deflect criticism that it had condemned the country to years of budget deficits, saying it could balance the books within five years if efforts to boost the economy succeed.

The ruling Liberals on Tuesday projected a C$29.4 billion ($22.3 billion) deficit for fiscal 2016-17, nearly three times larger than what they promised during last year’s election campaign.

The Liberals, who say the spending will help boost growth, gave no target date for returning to balance, with the budget still expected to show a deficit of C$14.3 billion in 2020-21.

Opposition politicians and influential media commentators said they feared Canada would face a long string of shortfalls of the kind it has not seen in two decades. This could cause problems for Prime Minister Justin Trudeau.

“We’re hoping to increase the growth rates,” Trudeau told CBC Radio on Wednesday.

If the government can stimulate the economy, “we get to balance in the coming five years,” he said. “There is a track to that if we increase the growth in the economy.”

Trudeau faces no immediate political threat, since he only took power last November and is sitting high in the polls.

But the longer the deficits last, the greater the potential political risk.  (Source: Reuters)

 

Thursday July 16, 2015

Thursday July 16, 2015Editorial cartoon by Graeme MacKay, The Hamilton Spectator – Thursday July 16, 2015

Bank of Canada cuts interest rate, lowers economic outlook

The Bank of Canada reduced its benchmark interest rate for a second time this year as the damage from lower oil prices shrank the economy in the first half and leaves a full recovery almost two years away.

Gross domestic product probably “contracted modestly” in the first half of 2015, policy makers said, without calling it a recession, which is typically defined as two straight quarters of negative growth. Output will recover this quarter as non-energy exports rebound from a decline the bank called “puzzling.”

The central bank lowered the benchmark rate on overnight loans between commercial banks to 0.5 per cent from 0.75 per cent, where it had been since a cut in January. The first-half contraction led to a “marked increase in excess capacity,” the bank
said.

Policy makers at the bank said output probably shrank at a 0.5 per cent annualized pace in the second quarter, compared with an April prediction of a 1.8 per cent expansion. The economy registered a 0.6 per cent contraction between January and March.

Historically low interest rates have already pushed consumer debt-loads and home prices to record highs, while failing to trigger lasting investment and export gains.

For the housing market, where the cheapest mortgages in decades have led to record consumer debt burdens, the bank reiterated its view there’s no bubble. “The Bank continues to anticipate a constructive evolution in the housing market,” its economic forecast paper said, with a moderation in housing in 2015, followed by stabilization in 2016 and 2017.  (Source: Hamilton Spectator)