Category Archives: Economics

Wishful Thinking Versus Accountable Action

Words matter but action speaks volumes. There is enough apathy circulating with respect to the conduct of public officials that we could soon be reaching a point in time in first world countries when behavioural patterns lose respect for the public good. That my friends would not be good.    

In the U.S. federal game of politics, the public has become simple pawn in a game of power. Special interest groups of wealth rule the halls of congress. Within the era of the Trump administration, I deduct from four years of conduct that should a sitting senator / congressman (woman) have dared step out of line to vote with conscience, retribution would be in order. The political climate was not always like this. There was an era of progress in the U.S whereby respectful negotiation resulted in well crafted legislation. Trump was an overt liar with a warped sense of political strategy in feeding the public a mirage to suit his purpose. Oftentimes it worked. His ploy counted on naivety and ignorance of the U.S. populous and its orchestration hadn’t even ended with the casting of the last ballot in the 2020 election. It was pathetic demonstration of demagogy and the consequences have been real and deathly     

In Canada, Canadians elected a left leaning liberal. There’s no disguising the fact the Justin Trudeau is implementing his ideology of social policy which has much to do with spending money that his government doesn’t have. As I write this article, Canada is on a spending binge and financing it’s spending by printing money. They don’t like to tell it like it is over at the Bank of Canada. They like to tell you that they are “purchasing bonds” in order to stimulate the economy. Of course they print money to purchase the bonds thereby risking inflation.

So, if a politician is “whipped” into voting the party line instead of conscience, would this not represent a modified version of democracy? Whipping votes is nothing new. It’s been around for decades but the difference now versus then was that retribution was not necessarily assumed should a vote not fall in line.

What kind of damage has been inflicted on the moral compass of North America due to the Trump era? Canadians after all have watched it all unfold. Public finance is in shambles on both sides of the border. The question now is whether the debt burden is sustainable or whether there’s going to be collapses in currencies. Will the U.S. dollar lose its reserve currency status and if it does, how does the financial landscape unfold? Will precious metals and / or crypto currencies emerge as the only viable units of monetary value? Oh yes….it’s only once per year that the Bank of Canada does its assessment of the stability of our financial system. Perhaps, they should meet more often in the context of the meteoric rise in crypto.     

Editorials In Lock Down

Whenever I click an editorial on line and am prompted for a news subscription trial I come away thinking, “fat chance you’re going to get me to pay for this second rate opinion”. I harbour no ill will toward editorials in lock down and news outlets needing to fund their reason for being. I’ve just taken the opinion that since the internet company is taking a material payment from me monthly and I expose myself to the deluge of advertisements, I simply will not subscribe to one news outlet. Have you ever been frustrated by having cancelled a memberships with precise administrative protocol but then see the charge show up the following month? Exactly.

At the same time, it’s important to underscore the contribution which journalists make to society. Journalists ask questions which you don’t have time for because you are at work and tending to kids. Journalists serve you in that they isolate problems with government decision making which impact you. Journalists also expose injustices of humanity which would go otherwise unnoticed by those who can intervene.

There has been a new phrase coined recently – “fake news”. While there are degrees in quality of journalism largely because of the profit motive and stakeholder’s potential for bias, standards in journalism still exist and are being executed. To subjectively paint all journalists as compromised is simply irresponsible.

In fact, there has never been a larger role for journalists during this time in history when democracies are being administered more like “elected dictatorships” with ultra party partisanship and fear of voting ones’ conscience in elected houses as the new norm. Under these conditions in particular, the diligent reporter’s industrious efforts should be emboldened. In this light, I suggest to the journalism industry to lift your lock down of editorials for those of us suspicious of monthly credit card auto charges and appeal to us differently for your funding.   

Favre Speech Money And Lessons Learned

It’s a talking point I trumpet often with my clients. Your money is yours and you must know what you are doing with it and where it comes from. Somebody apparently forgot to share the message with Brett Favre.  He will now return 1.1 million dollars to the U.S. welfare system for money received for speeches that he did not give.

Investment advisors have been wrong often. Bankers are not investment professionals and typically don’t deploy investment analytics as they should in recommending investments. Nor, do they necessarily have a feel for the economic pulse.  Yes, they did not anticipate a “Black Swan” event in the context of a risky political environment. Portfolios have lost money and investors are assuaged with the mantra that they are in for the long term. 

It may be unfathomable to you that somebody can receive 1.1 million dollars and not know that it hit their account. I can actually believe it when the numbers get big and individuals don’t have the right financial professionals in place to question financial transactions. In fact, the accounting profession had lost its way ten years ago in the context of derivative books getting out of control while off balance sheet obligations went unscrutinized. When internal controls get loose during times such as these, temptations of the morally weak are incited. The environment right now is really interesting and I’m paying special attention. Governments are spending money like drunken sailors. The U.S. federal government just fired a watch dog responsible for overseeing disbursements from the federal treasury in the context of pandemic relief. There’s never been a more acute time in your living history to be educated in finance.     

Pandemic Reveals Canada’s Health Care Cracks

While Canadians turn to twitter and laude the public relations campaign by Alberta’s Chief Medical Officer, Deena Hinshaw, let me remind fellow Canadian regarding the disparity of pay between her, and care aides tending to the elderly.

You see, The Canadian Medical Association for decades has ensured that Canadian doctors hit the gravy train right out of school with automatic jobs because of ridiculously tight spots in medical schools. Entrance standards at medical school have been set artificially high in order to serve a market demand favouring doctors.  Having come to grips with the problem, the importation of doctors from abroad became necessary.

The Edmonton Journal reports that Canadian doctors earn $349,655 per year. Many care workers tending to the elderly have been earning minimum wage. Do you see a problem here? Okay. Who do you think has the bigger voice when negotiating pay? You guessed it. Doctors. Mostly, front line care aides don’t actually have representation.

The health care budget in Alberta is near the 45 per cent range. Think about that for a minute. You as the taxpayer are so interested in your public health care system that you are willing to spend $0.45 of your provincial tax dollar to fund public medicare – yet today your Prime Minister has announced that the salaries of these aides for the elderly are going to be need to be topped up and you guessed it….there will be not mention of where this new money will come from. 

Vancouver Teetering On Edge of Bankruptcy

Beneath The Beauty


Is Vancouver teetering on the edge of bankruptcy? Are you old enough to remember the federal immigration policy instituted by Brian Mulroney which encouraged capital investment from abroad via the immigration system? Come to Canada and invest a sum while guaranteeing to employee a few. This was the start of the of the real estate growth wave in Vancouver. The program was only loosely monitored and became the conduit for infusing money into the lower mainland thereby ousting those native born without ancestral ties access to the market.

The demographic of Vancouver changed dramatically in a short time frame and there was a definite cultural shift amidst a policy of “multiculturalism”. This was new vocabulary established partly to challenge the xenophobe while complementing robust immigration policy. When we look around at the cultural mosaic today in lieu of the government message, we see some success but greater failure. The greater failures were middle aged and older Asians not really making the strong effort to immerse along with a white contingent who was not overly welcoming. So, there was a contrast between the government’s ideal and the urban reality. When we look around today, we can give strong marks to the immigrants of millennial and younger generations for gravitating toward their own Canadian destiny.

The capital infusion into B.C.’s lower mainland didn’t stop with the economic immigrant. Banking regulation in Canada has been lax. Imported capital has not been scrutinized. Dirty money has been making its way into Canada for decades and politicians have turned a blind eye. Bankers liked it. Bank shareholders have liked it. It’s only been as recent as four years ago that money laundering activity at casinos in Vancouver became targeted by regulators.

These two sources of capital have been substantial in the real estate market in Vancouver. As of this writing during the COVID-19 pandemic, the City of Vancouver has suggested bankruptcy as an option in the context of 65 per cent of Vancouverites missing their April 1, 2020 property tax payment. Fifty-five per cent are projected to miss their May 1st 2020 payment. What’s the correlation between a hypothesized artificial rise in real estate valuation and the failure of the city to collect taxes amidst the COVID crisis? I suggest that the city’s budget and historic spending grew in tandem within the context of a property tax system built on a weak structure of property valuation and hence the house of cards is now teetering amidst a black swan.