I’m not sure that the Sikh, the Muslim, the single low income mother, or the senior on a fixed income get much civic pride out of the Calgary Flames Eric. You’re a hockey fan and I believe someone who has earned a livelihood in one form or another from the good ‘ol hockey game with an apparent bias toward a new rink when this city already has one. The demographics in this city are changing and the aforementioned groups don’t jump like city councillors at some bargaining tactic by Ken King. The utilization of tax money for special interest groups has been with us for far too long and the appetite for tolerating this form of “extortion” has evaporated! Nenshi’s notion of tax money for the public benefit of all is a credible principle of which this proposal breaches. No teary eyed victim like threat from spokespersons of multimillionaire owners are going to trump the spirit of fairness owed to taxpayers.
There appears to be some sorrow among the laid off Sears employees who “feel” betrayed by a company in trouble. I have news for all employees. You have a “job” and you serve at the pleasure of your employer. By pure definition, if you decide to take a “job” you are giving up some of your autonomy. If you should so choose to have a portion of your pay handled by a private pension plan, what gives you the right to think that there is no “risk” in having a third party manage those funds or to think that the company will be financially fit to make ongoing company contributions on your behalf? In socialized Canada we are fed this line that you are marginalized if “self employed”. I have news for those who believe that your company will be there for you. You are one bad relationship or two bad performance reviews from the exit sign and if you think you have “job security” think again in the context of a financial system teetering on the brink. If you worked at Sears and have witnessed a steady decline in retail traffic over a period of years, you should have taken a look at the competition or at the least upgraded in the evening with some career changing course work. Now is not the time to be looking to a bankruptcy trustee for answers or the CBC for sympathy. There is nothing more defeatist and sad than the state of a workplace in decline with hangers on sinking with the ship believing that the company will throw a life vest last minute in the form of a “severance”.
This is a company that never revitalized in the face of competition. Clerks were indifferent, the computerized check out system was antiquated, and the “Arnold Palmer” brand was mediocre. The company did nothing special to make customers feel welcome. It’s becoming a real blight on the urban landscape with all these empty big box spaces. Bezos over at Amazon has been a big winner and I commend him for creating a web portal that is easy and convenient with an excellent “search bar”. Over at Amazon, you can travel the shopping neighborhood with a click of a mouse and let someone else take care of the logistics otherwise associated with parking, ambivalent pedestrians in mall parking lots, and service levels deserving of the pay grade. How many clerks have given you the blank stare once questioned about pitiful inventories in the most popular of sizes? These mall lease rates are going to start looking pretty hefty once ecommerce and competitive on line pricing increases market presence even more. Last question – how many folks have you witnessed at your local mall hands free of merchandise filling the food court rather than the tills of starving merchants?
As part of my financial education, I took a course called “macroeconomics”. The discipline was certainly more interesting than its cousin “microeconomics” because macroeconomics dealt with topics such as the money supply in association with fractional reserve banking, central banks, interest rate policy, inflation, gross domestic product, international trade, and government fiscal policy. To this day I recall one moment sitting in class when my professor referenced the financial transaction evident when a new dollar bill is created. The banking elite make reference to “open market operations”. In Canada, if the “Bank of Canada” feels compelled to stimulate the economy, it does so by purchasing government denominated securities (treasury bills, bonds) in the open market. Consequently, the seller deposits its cheque thereby increasing the capacity for the seller’s bank to lend against the increase in its “reserves”. Money becomes available to a qualified debtor. The scariest part of this transaction is skimmed over by academics. Where did the Bank of Canada get the money to purchase these securities on the open market? You guessed it – the Bank of Canada pulled it from its printing press. What compliance formula did the Bank of Canada need to adhere prior to firing up the press? Well, none. That’s right, none. It used to be the case prior to 1928 in Canada that new money could only be created with a proportionate increase in gold reserves (gold standard). In 1991, the Canadian government enacted legislation abolishing any responsibility of Chartered Banks to hold cash reserves. Hence; in the event of a sudden loss of confidence in the Canadian dollar, a wide swing in inflation / deflation, a material reduction in a debtor’s ability to repay loans, those first patrons to the ATM win.
Modern economic theory has aligned to the sentiment of D.H. Robertson from Cambridge University who in 1948 stated, “The value of a yellow metal, originally chosen as money because it tickled the fancy of savages, is clearly a chancy and irrelevant thing on which to base the value of our money and the stability of our industrial system.” Today, three particular economic doomsayers, namely Jim Rickards, Peter Schiff, and Martin Armstrong have gone on record to refute the sentiment of Mr. Robertson in lieu of our current monetary system’s weakness.
When you first embarked upon your career, you may have stumbled, adjusted, retooled, and re-evaluated. Then you found your path. If you are a highly capitalized business in Canada burdened with plant and equipment and a claim that jobs will be lost in the face of market forces, you get teary eyed and whine to governments for bail outs. This is becoming endemic to the Canadian corporate psyche. If you have business operations in Quebec – then governments not only wipe your tears with oodles of cash but roll out the red carpet in a direct line to the treasury.
Your governments get themselves into trouble because they cannot balance a cheque book. Then they think in order to keep the funds flowing, they’ll need to “invest” in the plumbing that keeps the cash flowing. They’ve got it wrong. Capitalism is the driver of economic success. Taxpayers expect services related to the common good and not targeted bail outs for losers irrespective of international trade agreements and barriers.
In a capitalist environment while facing international trade pressure, manufacturers curtail production until the environment once again turns friendly. Those involved in the industry have every opportunity during a down turn in a land fostering freedom to redirect their energies just like every other Canadian is expected to do during times of career / job pressure.
I expect more of my governments handling my tax money and I bet you do too.
The Star this morning has reported on the plight of immigrants working through temp agencies. It should be no surprise that take home pay for such workers are a pittance when factoring in day care costs, taxes and the “pimp”. I have a client who introduced me to this label which I actually find quite fitting. Ryerson University will be reporting on these “middle men” in an upcoming report. When I lived in Vancouver for a time, I was registered with about five agencies. I’d get on the phone in the morning to see what was happening and mostly get the cold shoulder. One particular agency was responsible for the majority of my hours. One occasion led to a respectable full time job where I was able to make an impact. In fact, this position launched my “reworked career”. This should be what “temping” is all about. A worker should be in transition while pursuing a focused primary career goal. It should not be a way of life.
In Canada, we pay too much income tax. Employers are also burdened by payroll taxes which tempt them to temp out situations which arise in their business as opposed to binding themselves to legacy like costs. It makes business sense. It also reduces the burden placed on an “HR department”. Unfortunately, socialist government models impede the capitalist instinct. Workers are less inclined to promote themselves directly to employers and employers are less inclined to make commitments to workers. Ryerson will be releasing a “study” but I can espouse with confidence that one doesn’t need a PHD in economics to deduct the street level ramifications of the market condition for temps. When business can’t compete with public sector salaries and pension plans, it will look to the market for ways and means to obtain non-payroll help. Alternatively, it will close up shop or find a more business friendly jurisdiction.
Even if you’ve studied macroeconomics 101 back in the day, you may not have heard the term. Keynesian theorists bread from state sponsored academia are not oriented to hypothesize that investments can go wrong and can be counter-productive to a long term economic benefit. Today China faces the financial effect of amortizing vacant industrial complexes financed through non-transparent means as eloquently described by Jim Rickards in his book “The Death of Money”. Mr. Rickards claims that this phenomenon is not in and of itself a financial risk of devastating proportions to the Chinese banking sector but when matched up with other elitist transgressions in stimulating economic growth, perilous conditions have become beset. Mr. Rickards goes on to exemplify the flight of capital out of China by those instinctive purveyors of wealth who have concluded that all is not well in the Chinese banking system.
Apparently, it’s not only the western world which endorses the free flowing off balance sheet derivative market but the Chinese have become adept at putting it to work in helping Chinese savers acquire better returns than the near zero bank rate offered today. In spite of the 2008 financial crisis, Gobalresearch.ca now reports that the notional outstanding derivative book is twenty per cent higher now than it was back in 2008 and that Goldman Sachs alone carried $48 trillion dollars in derivatives at the end of 2013. The mortgage variety of derivatives were largely the cause of the 2008 financial crisis.
Mar 3, 09
Jaw dropping aberrations from capitalist norms have inundated the pysche of politicians, regulators, and market analysts alike whom have been examining economic excess. Who would have thought – other than legendary Richard Russel (founder of Dow Theory) that the indexes would see these levels today? On second thought, I guess that Ian Gordon has been talking this up for a good while along with Jim Willie and Doug Casey. I know – good chance you’ve never heard of them because they were all considered unworthy of attention due to some screws being loose. Funny what unfolds away from the fold. The only mantra that hasn’t yet come to fruition for these mavericks of market musings is skyrocketing junior gold share prices and consistent four figure bullion. Obviously still a developing story.
Oct 6, 2007
Amaaazing. Oshawa couple are stunned that they are going to be losing their $70,000 per year jobs at the GM plant. Yes each. $70,000 each for unskilled assembly line labor work. How often have the smothering legacy costs of GM been reported in the financial news over the past two years? Too many to count on fingers and toes for certain but all of a sudden the McAuliffe’s are surprsised. Trish says, “but when you have based your life and your plans on having a certain income, it feels like the rug has been pulled out from under you.” Well, earth to Trish – we live in a global economy where capitalism has won out. You probably should have started retraining twenty years ago with the launch of the NAFTA free trade deal. Consider yourself lucky that your overpaid menial work has lasted this long. I suggest that you stand up straight, look into the mirror and start taking responsibility for your families welfare in the context of the global economic reality instead of laying blame at the feet of some entity that you thought was going to look after you throughout your adult years. Countries outside North America have simply done a better job at building cars more efficiently, more cost effectively, and with more sensitivity to the market place. Guess what Trish – capitalism produces winners and losers. GM is losing and must make decisions to adjust back to the winners circle. Had you spent some time and energy observing the trends in your industry, you may have forecasted your plight. It is people in your precise demographic that don’t seem to have enough “time” to examine a home business. Well perhaps, now you are better positioned. Unfortunately, you could have transitioned yourself nicely while still in the employ of GM.