Economics

Canadian Practical Measures COVID-19 & Economic Crisis

Recommendations for the federal government of Canada in lieu of corona virus pandemic and economic crisis. Will they listen? I don’t know.

  1. Permit the purchase and sale of unused RRSP contribution room.
  2. Permit the direct tax deductibility of net capital losses up to a maximum of $25,000 per year.
  3. Rewrite usery laws prohibiting lenders from charging more that a seven per cent differential from the Bank of Canada overnight rate.
  4. Reassess affordability of Canada Child Benefit program.
  5. Expropriate treaty land deemed necessary for commercial development from which fair negotiations have failed.
  6. Proclaim jurisdiction over tide water ports with constitutional amendment if required.
  7. Assign able bodied unemployed men to environmental remediation projects.
  8. Improve service channels to Canadians via CRA and Service Canada.
  9. Impose and enforce director liability for environmental negligence.
  10. Responsibly incentivize investors interested in the development of our natural resources.

If any reader finds this list appropriate, do feel free to copy the items into a letter addressed to any Canadian politician you deem open minded.  

Economics

Banking Credit Specifics Amidst COVID-19

You’ll notice that your governments are speaking in code much of the time when it comes to addressing the financial impact, consequences to your household, and detail pertaining to your access to credit facilities in the context of COVID-19. Your Prime Minister is once again scheduled to address the nation at 11:30am EST. We’ll see if he get his “head of his a@s” and starts speaking in terms of your household cheque book.

While the Bank of Canada rate has been reduced over the past decade, margins between the “overnight rate”, “prim rate” and “retail lending” has widened. That’s right…the banking system has done very well because you my fellow Canadian has been too happy to pay interest in the wide margins. 

This crisis has hit while you are highly leveraged meaning that many more of you will now be faced with bankruptcy unless your government starts REGULATING THE BANKING SECTOR in terms that assist you in managing your debt. The board of directors of your chartered banks won’t be too warm to that idea especially in lieu of their confounding argument that masses of Canadians hold chartered bank stock in their registered investments.      

From what I can see so far, your government is going to be floating more “paper” in order to free up credit. The term “paper” refers to securities which may take the form of derivative contracts. Oh ya…you remember those – the ones that produced the financial crisis of ’08 / ’09 (mortgage backed securities). Of course your government will also be referring to the “purchase of bonds” which is code for creating new money out of thin air with a charge to your grandchildren’s future.

Lifes Lessons, Philosophy

The Cyber Medium of Control

This is what’s on my mind today as I receive emails pertaining to COVID-19 from those compelled to exhibit their interpretation of this virus in the context of their platform / agenda / business relationship with you / notion of how think you now need to operate in the context of their interpretation of the public health message. 

Everybody’s got an opinion and they have needed to learn how to type in order to convey it through the internet. Thanks god I took typing class in grade 9 with all the girls while my friends took shop as their elective. What were they thinking?

Anyway….I’m amused by superfluous posts and reposts of value driven dogma which percolates occasionally on internet threads. Suddenly an audience is illuminated through a key stroke when the more difficult gesture would be a letter to a member of parliament (yes, I have written them in case you wonder).

Then there’s the internet companies who literally dictate terms and then await the fall out. I guess Apple app developers receive automated bots for feedback on why their apps disqualify for hosting. I’ve had a copyright claim on youtube within the first 30 seconds of upload. They couldn’t have possible got through the full 1:58 in order to fully digest the material.  I’ll be at their mercy with my 28 subscribers having uploaded to “private” never intending to monetize the video.

 Then there’s the government with its tax collection and system of correspondence now pretty much dictating communication through the internet as opposed to a live person. If you really want to talk to somebody, you’ll have to navigate the phone auto attendant just to find the queue to wait in for 30 minutes. Your music will certainly be interrupted frequently with messages of education hoping you’ll  find some nugget of information thereby reducing the probability of being redundant when you finally get through to talk to that agent. This agent will need to provide you their agent ID number. Have your pen handy for those 30 minutes ‘cause they spout it off quickly hoping you’ll not catch it thereby potentially not being liable for the conversation.

You get the drift. We have all these phones now but folks don’t want to talk on them for anything relevant to their business or professional life. Email or text only please – I’m now conversation inept having been raised behind a computer screen. 

One must ask, are we now more efficient? I suggest yes at times and no oftentimes. Nobody wants to be controlled but they do want balanced reciprocation. People know when they are being controlled and they will resent it. When communication is compromised – so is the relationship.

Economics, Lifes Lessons

Newsy Week Eh

From the stand point of the stock market, this is a lesson that so many folks needed to learn. Your investment advisors are simply people with vulnerabilities like the rest of us. The buy and hold mantra has cost you money. You must put attention on your own investments and you must actively manage your portfolio with input from financial people who know more than you. You must be the torch bearer of your own financial destiny. You must be in a mode of “continuous learning”. What about locked in accounts and government pensions you ask. Well, you are at the mercy of portfolio managers but you still have access to your accounts with a right to know what you own.

So….how do I find the time to manage my own investments? You fit it in. You stop succumbing to the bosses request for overtime. You put boundaries around your schedule. You stop being a pushover when it comes to your calendar. This might mean helping your spouse understand that that second vacation within a calendar year goes bye bye.  Boo hoo! What would you rather have  – an earlier with compounded accelerated rate of return and an earlier retirement or that second vacation just because your kids get a spring break?

Now that I’m on a roll ‘cause I put this together having just returned from an empty gym ‘cause of the psychology behind avoiding sweat boxes now that we’re dealing with this corona virus, I expound further.  Have you seen the chart on the Dow 30? The thing has been going straight up for years. Did you not think that it was overdue for a major correction in response to some kind of Black Swan event? Hell….I simply took a look at the incompetence of governments in running budgets given deficits and debts and on that basis alone considered the market over heated. Have you not perceived the weakness currently in our North American political leaders??  There’s another factor right there in and of itself worthy of shorting the market or running for the hills. 

Economics, Politics

Era of Non-Confidence

If you feel like you’re being hosed. You are. We’re in an era of non-confidence and nobody wants to own it because the exclamation lacks personal power. You hate ceding your power and I don’t blame you.  Ideally, you pick your choice worthy battles. You fight them thereby appeasing your conscience while incidentally assuming that bigger fights with more moving parts will be handled effectively by those in higher power structures. Here’s the thing…..the credibility of those higher power structures has been eroded. The affect is not necessarily apparent on the surface but once you get behind the doors of a broke household or board room…..the scene may look more vivid.

Whether it be a deceitful president of the United States, a government authority overstepping its jurisdiction, a tepid minded Prime Minister, protesters impeding commercial activity, a police department being indifferent, a legal system operating atrociously slow, a tax system redistributing wealth, or an electoral system exercising regional disparity, people in my opinion are feeling more powerless now than in the past. This is my sense. What are the implications of this? Not much happens in the beginning. Fringe movements rise up and energies fade. It’s not until groups in large numbers feeling similarly aggrieved amass that any traction takes hold.

Insular leaders living in a vacuum clueless of what’s being discussed at the supper table is a phenomenon of the day. The election of Donald Trump should not have been a surprise for elitist liberals but indeed this pompous bunch had their worst nightmare come true. The wide swath of political blue painted across the map of the Canadian prairies in 2019 should not have come as a surprise. Elitists again were caught off guard. 

People expect competent leadership with commercial interest playing a vital part in decision making. People expect merit based pay. People expect entrepreneurial risk to be rewarded. People expect their tax dollars to be spent wisely. People expect the responsible development of resources within environmental guidelines along with the permitting process to be reasonable. These are not difficult concepts but the intransigence at every turn by figures of authority mixed with a political landscape of deceit and unreasonable demands by First Nations people are more than just getting on the nerves of ambitious Canadians.