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Canada & Obama





misterXY
l heard obama is really going to screw our, Canada, economy too hell, can anyone list why? l heard steel, taking outsourcing out, so on..... l hope it's not true. Sad
deanhills
misterXY wrote:
l heard obama is really going to screw our, Canada, economy too hell, can anyone list why? l heard steel, taking outsourcing out, so on..... l hope it's not true. Sad


Where did you get that notion from? Canada is a valuable friend of the US, has an abundance of energy and other resources that the US needs, it would be in the interest of both to strengthen the trade links they already have with one another. I think the only real area of tension right now has to do with the border, and it is an age old one. The US would like increased security on the border with Canada, and that of course will impact the flow of goods and services in a negative way. Obama is due to visit Canada perhaps later in the month, so the media will no doubt highlight all the issues of contention between the countries, and of course there are a number that exist. Think the only part I do not like is that Canada has a very weak leader right now, and I really hope with the new elections that we can say bye bye to him.
misterXY
deanhills wrote:
misterXY wrote:
l heard obama is really going to screw our, Canada, economy too hell, can anyone list why? l heard steel, taking outsourcing out, so on..... l hope it's not true. Sad


Where did you get that notion from? Canada is a valuable friend of the US, has an abundance of energy and other resources that the US needs, it would be in the interest of both to strengthen the trade links they already have with one another. I think the only real area of tension right now has to do with the border, and it is an age old one. The US would like increased security on the border with Canada, and that of course will impact the flow of goods and services in a negative way. Obama is due to visit Canada perhaps later in the month, so the media will no doubt highlight all the issues of contention between the countries, and of course there are a number that exist. Think the only part I do not like is that Canada has a very weak leader right now, and I really hope with the new elections that we can say bye bye to him.

Harper can't do much due too minority government, so what can you do? He actually lowered taxes, increase military funding that was desperately needed and the healthcare in NB has gotten better a bit.
deanhills
misterXY wrote:
deanhills wrote:
misterXY wrote:
l heard obama is really going to screw our, Canada, economy too hell, can anyone list why? l heard steel, taking outsourcing out, so on..... l hope it's not true. Sad


Where did you get that notion from? Canada is a valuable friend of the US, has an abundance of energy and other resources that the US needs, it would be in the interest of both to strengthen the trade links they already have with one another. I think the only real area of tension right now has to do with the border, and it is an age old one. The US would like increased security on the border with Canada, and that of course will impact the flow of goods and services in a negative way. Obama is due to visit Canada perhaps later in the month, so the media will no doubt highlight all the issues of contention between the countries, and of course there are a number that exist. Think the only part I do not like is that Canada has a very weak leader right now, and I really hope with the new elections that we can say bye bye to him.

Harper can't do much due too minority government, so what can you do? He actually lowered taxes, increase military funding that was desperately needed and the healthcare in NB has gotten better a bit.

Well it is probably up to us then to ensure a majority government next time round? Think we need it, especially since we are going to go for tough times now.
misterXY
deanhills wrote:
misterXY wrote:
deanhills wrote:
misterXY wrote:
l heard obama is really going to screw our, Canada, economy too hell, can anyone list why? l heard steel, taking outsourcing out, so on..... l hope it's not true. Sad


Where did you get that notion from? Canada is a valuable friend of the US, has an abundance of energy and other resources that the US needs, it would be in the interest of both to strengthen the trade links they already have with one another. I think the only real area of tension right now has to do with the border, and it is an age old one. The US would like increased security on the border with Canada, and that of course will impact the flow of goods and services in a negative way. Obama is due to visit Canada perhaps later in the month, so the media will no doubt highlight all the issues of contention between the countries, and of course there are a number that exist. Think the only part I do not like is that Canada has a very weak leader right now, and I really hope with the new elections that we can say bye bye to him.

Harper can't do much due too minority government, so what can you do? He actually lowered taxes, increase military funding that was desperately needed and the healthcare in NB has gotten better a bit.

Well it is probably up to us then to ensure a majority government next time round? Think we need it, especially since we are going to go for tough times now.

Well l don't do anything outside my local region in the past few months, so anything goes up in my local market and stuff, that's the only thing l'm worried, plus my dickhole landlord
LumberJack
The only thing that Canada has going for it, is that the government cannot do very much. They will just make things worse, the whole lot of them...

It is really up to the USA to bring everyone out of the recession, the global economy cannot recover until the US economy does...
deanhills
LumberJack wrote:
The only thing that Canada has going for it, is that the government cannot do very much. They will just make things worse, the whole lot of them...

It is really up to the USA to bring everyone out of the recession, the global economy cannot recover until the US economy does...


I learned two things yesterday that made me realize that this thinking is there because all of our news on TV is dominated by news of the US economy. So the perception by implication is that all the Banks of the world were responsible for credit bubbles in their countries and that is not true. Some were better managed with much more stringent rules.

My sister from South Africa wrote to me about all the spare cash she had and not knowing what to do with it. The Banks in South Africa are in excellent health as they are structured completely different and with STRINGENT rules, and were not involved in the international banking loan crisis that seems to be restricted to the US, Canada, UK and Europe and other countries who followed their large banks' template of easy credit. The second thing that happened was an interview with a leading banker of Bangladesh that said just that. Bangladesh banking is OK as they were not involved with the US, UK and European Banks which are in this crisis.

Have you thought about how much our news these days is dominated by US recession news? As well as UK and Europe recession news? Dubai in the UAE has some of these problems too, as they took enormous loans for gigantic development of Dubai, but looks as though the Emirate of Abu Dhabi is going to bale them out.

I think it is important for the global economy for the US and all the other countries of the developed world to recover, as of course this has had a serious affect on ALL countries' stocks and shares, including South Africa nd Bangladesh. But not all of the Banks in the world did what the US Banks did. Some maintained stringent rules for loans and lending. And ran their banks successfully.
kody
The big reason Obama might be terrible for the Canadian economy is that he and the democrats are very protectionist. "Buy America" acts and the like try to prevent any business from going outside of their country. Especially because of the current recession, this becomes a huge fear for Canada since we're each other's #1 trade partner.
deanhills
kody wrote:
The big reason Obama might be terrible for the Canadian economy is that he and the democrats are very protectionist. "Buy America" acts and the like try to prevent any business from going outside of their country. Especially because of the current recession, this becomes a huge fear for Canada since we're each other's #1 trade partner.


Can you cite examples of Obama protectionist action viz a viz Canada? I have not seen anything like that. Certainly noises have been made, typical political talk that we have heard many times before. But I have not seen any protectionist action. Have you seen any?
kody
deanhills wrote:
kody wrote:
The big reason Obama might be terrible for the Canadian economy is that he and the democrats are very protectionist. "Buy America" acts and the like try to prevent any business from going outside of their country. Especially because of the current recession, this becomes a huge fear for Canada since we're each other's #1 trade partner.


Can you cite examples of Obama protectionist action viz a viz Canada? I have not seen anything like that. Certainly noises have been made, typical political talk that we have heard many times before. But I have not seen any protectionist action. Have you seen any?


Look in to the "Buy America" act. Our company is facing it right now.
deanhills
kody wrote:
deanhills wrote:
kody wrote:
The big reason Obama might be terrible for the Canadian economy is that he and the democrats are very protectionist. "Buy America" acts and the like try to prevent any business from going outside of their country. Especially because of the current recession, this becomes a huge fear for Canada since we're each other's #1 trade partner.


Can you cite examples of Obama protectionist action viz a viz Canada? I have not seen anything like that. Certainly noises have been made, typical political talk that we have heard many times before. But I have not seen any protectionist action. Have you seen any?


Look in to the "Buy America" act. Our company is facing it right now.


I had a look and it would appear that the US will honour its current trade agreements including those existing ones it currently has with Canada and other international countries, but would favour "Buy America" agreements for new contracts. So it is not really as bad as it sounds. Its protection is as it has been in the past and probably written in to allow for future contracts and look good for the Obama's budget. it was apparently part of Obama's election campaign as well:

http://money.cnn.com/2009/02/05/news/economy/buy_america_provisions/index.htm
LumberJack
Deanhills, there is no banking crisis in Canada....
deanhills
LumberJack wrote:
Deanhills, there is no banking crisis in Canada....

Thanks I stand corrected LumberJack. Should we then rephrase it to "no banking crisis in Canada .... YET?" Canada is lagging the US?

Or dare we hope for a total exception and no banking crisis at all? There is no credit bubble in Canada, everyone has been living within their means?

http://blog.communitylend.com/2008/10/05/stock-markets-suggests-us-banking-crisis-does-not-appear-to-be-mirrored-in-canada/

I'm not hoping for a recession in Canada and am happy things are doing well, but since it is so totally against the trend (i.e. what happens to the US financially always repeats in Canada), I am a wee little sceptical about this. I'm hoping for the exception though.
LumberJack
So far it is just a global recession, our banks are fine. Mortgages, by law, must carry insurance, it is really business as usual. I am not saying we aren't hurting economically here, I am saying our Banks are fine so far.

Here are there latest results:

http://www.theglobeandmail.com/servlet/story/LAC.20090304.RBANKS04/TPStory/Business
deanhills
LumberJack wrote:
So far it is just a global recession, our banks are fine. Mortgages, by law, must carry insurance, it is really business as usual. I am not saying we aren't hurting economically here, I am saying our Banks are fine so far.

Here are there latest results:

http://www.theglobeandmail.com/servlet/story/LAC.20090304.RBANKS04/TPStory/Business


I do not understand it. The UK, Europe, Japan and the US share the same banking crisis, some less, some more. Are you telling me that the Germans and Swiss for example were less savvy in how they manage their banks than Canada was? Something does not compute here.

OK, I now have it. Canada is thinking of expanding into the US - positive PR:
http://www.law.com/jsp/law/international/LawArticleIntl.jsp?id=1202426876104

12-billion lost is not that much if you compare it with the US losses, but perhaps there should be an overall banking comparison as Canadian banking compares as a small percentage of that in the US. Refer comparison in Wikipedia:
Quote:
In real terms Canadian banks are much smaller. In 2003 the three largest banks in America had assets equal to the entire 67 banks (only 14 domestic) operating in Canada. The largest Canadian bank has 1300 branches while in the U.S. the four largest banks have over 2000 branches each.

So if you look at 12-billion dollars lost against the above backdrop, maybe it is just a little bit minimized?

Quote:
Canada's banks have traditionally been fierce competitors internationally, though today America's largest banks have a more significant presence overseas. In part the history of this situation is rooted in Canada's smaller market. For Canadian banks international exchange was always a central concern. For American banks domestic banking was paramount. In the 1920s in the American economic centre of New York Canadian banks dominated the international banking sector due to greater expertise and focus. Thus Canadian banks came to have far wider spread networks. Much of the banking system in the West Indies is controlled by the Canadian banks. Canadian banks also have far more of a presence in the United States than American firms do in Canada. In part this is because American firms cannot buy Canadian banks, but Canadian banks have, at times, been able to buy American ones. Since the large Canadian banks already operated nationwide chains of a thousand or more branches, they find it relatively easy to integrate smaller chains of American banks into their systems.

In recent years this advantage has disappeared as American banks have also grown substantially in size and today have many branches, and the large American banks are now operating over 2000 branches each. In fact, the ten largest banks in North America today are all U.S.-based. Overseas, American banks have a larger presence than Canadian banks. Only Royal Bank of Canada's RBC Capital Markets division has a global scale that even approaches that of the U.S. investment banks.

Until recently, Canadian banks had historically been far less strictly regulated than their American counterparts. Canadian banks had, until the Gramm-Leach-Bliley Act in 1999, been freer to participate in the financial planning and insurance industries than their American counterparts. In the 1980s and 1990's, the large Canadian banks acquired almost all significant trust and brokerage companies in Canada. They also started their own mutual fund and insurance businesses. As a result, Canadian banks broadened out to become supermarkets of financial services, a trend that has started later in the U.S. market. The average U.S. bank is a domestic banking operation. The large Canadian banks are financial conglomerates, with large domestic Canadian banking operations.

Bank regulation in the United States is highly fragmented compared to Canada which has only OSFI as the bank regulator (although credit unions are provincially regulated). In the U.S., a bank's primary regulator could be the Federal Reserve Board, the Office of the Comptroller of the Currency, the Office of Thrift Supervision, or any one of 50 state regulatory bodies, depending on the charter of the bank. And within the Federal Reserve Board, there are 12 districts with 12 different regulatory staffing groups. The U.S. is also one of the most highly regulated banking environments in the world; however, many of the regulations are not safety and soundness related, but are instead focused on privacy, disclosure, fraud prevention, anti-money laundering, anti-terrorism, anti-usury lending, and promoting lending to lower-income segments. Even individual cities enact their own financial regulation laws (for example, for usury lending). Canadian banks had not faced laws against usury, or interest guarantees on deposits. Return on equity for Canadian banks were generally comparable to U.S. banks (with return on assets lower, but with Canadian banks using more leverage to compensate).

Credit unions in Canada are tax-paying entities, while they have been tax-exempt in the U.S. However, as restrictions on the size of credit unions in the U.S. have eased, the American Bankers Association has been lobbying to have credit unions taxed to level the playing field.



For US and Canadian economies compared refer:
http://en.wikipedia.org/wiki/Canadian_and_American_economies_compared
LumberJack
Keep in mind Dean, Canada is only 32 million peeps (State of California), but our country is the 2nd largest in the world. We cannot afford to be risky with anything here, or we will go the way of Iceland.

Our banks have really, just kept to the fundamental rules of banking, and really did not deviate from them. I believe it is illegal for our banks to be leveraged more than 25 times. Furthermore, a lot of risky mortgages in Canada are required by law, to have insurance to protect the bank. This helps protect our banking system. A lot of the "creative mortgages" that are around in the US and Europe are illegal here (eg. Low interest the first few years, and then a much larger interest rate, or getting your mortgage in JPY... sweet jesus!).

Here are some links that may help you out.

http://www.canadabanks.net/default.aspx?article=Mortgage+Insurance+in+Canada

http://www.newsweek.com/id/183670
deanhills
LumberJack wrote:
Keep in mind Dean, Canada is only 32 million peeps (State of California), but our country is the 2nd largest in the world. We cannot afford to be risky with anything here, or we will go the way of Iceland.

Our banks have really, just kept to the fundamental rules of banking, and really did not deviate from them. I believe it is illegal for our banks to be leveraged more than 25 times. Furthermore, a lot of risky mortgages in Canada are required by law, to have insurance to protect the bank. This helps protect our banking system. A lot of the "creative mortgages" that are around in the US and Europe are illegal here (eg. Low interest the first few years, and then a much larger interest rate, or getting your mortgage in JPY... sweet jesus!).

Here are some links that may help you out.

http://www.canadabanks.net/default.aspx?article=Mortgage+Insurance+in+Canada

http://www.newsweek.com/id/183670


Thanks LumberJack, I'm happy Canadians are happy they are doing OK. Hope it will be long-lasting as a positive attitude is obviously beneficial for the economy. Maybe the economy has changed with regard to Canada's dependence on the US for its financial health. There used to be a theory that when the US sneezes, Canada catches a cold. Equally politicians were talking about the "new economy" before disaster struck in the US and UK. And then they learned it was still the same.
LumberJack
deanhills wrote:

There used to be a theory that when the US sneezes, Canada catches a cold.


That is still the case, were still in a recession Smile
deanhills
LumberJack wrote:
deanhills wrote:

There used to be a theory that when the US sneezes, Canada catches a cold.


That is still the case, were still in a recession Smile

OK, I get it. Canada is in a recession but its Banks are OK! Which means this recession is not a recession that has to do with credit card spending? It is a natural downturn in economic activity?
LumberJack
deanhills wrote:
LumberJack wrote:
deanhills wrote:

There used to be a theory that when the US sneezes, Canada catches a cold.


That is still the case, were still in a recession Smile

OK, I get it. Canada is in a recession but its Banks are OK! Which means this recession is not a recession that has to do with credit card spending? It is a natural downturn in economic activity?


Our banks are indeed alright so far, our economy is not due to the world wide recession (I would not say natural, but caused by the world wide credit crisis and real estate problems in the US)
deanhills
LumberJack wrote:
Our banks are indeed alright so far, our economy is not due to the world wide recession (I would not say natural, but caused by the world wide credit crisis and real estate problems in the US)

Still does not quite compute for me, but I guess time will tell on this one, as it always does in the end when people have the luxury of retrospect wisdom Smile
LumberJack
Doesn't compute? You can have a recession with solvent banks Very Happy
deanhills
LumberJack wrote:
Doesn't compute? You can have a recession with solvent banks Very Happy

The part that does not compute for me is that the US is in dire straights and Canada NOT. We're not talking about a slight crisis here, we are talking about something of enormous proportions. I cannot believe it. Toronto and New York are almost linked with an umbilical cord ..... totally does not make sense to me. d'oh!
LumberJack
deanhills wrote:
LumberJack wrote:
Doesn't compute? You can have a recession with solvent banks Very Happy

The part that does not compute for me is that the US is in dire straights and Canada NOT. We're not talking about a slight crisis here, we are talking about something of enormous proportions. I cannot believe it. Toronto and New York are almost linked with an umbilical cord ..... totally does not make sense to me. d'oh!


Well, we do have less problems than you do. Our federal government has been posting budget surplus' for about the last decade. Our housing market has not collapsed (prices are however declining). There is not the massive layoffs and huge surges in unemployment.

US trade is a significant portion of our GDP, however over the past few years we have decreased our dependency on exporting to you. If this recession drags on for a long time, then I think Canada's economy will continue to deteriorate. If the recession intensifies around the world, or if we fall into a depression, then we will have a lot more problems.

Canada just made different decisions than the US for a lot of things.
deanhills
LumberJack wrote:
Canada just made different decisions than the US for a lot of things.
I made a little analysis earlier in the evening of military spending and the US is spending almost four times per head more on military projects than Canada does. It has an enormous war bill. Wonder whether that could have something to do with it as well?

http://www.frihost.com/forums/vt-103138.html

Like explain this to me, seeing that you are an economist and I am in total agony here. How can Citi Bank show profits in the billions, when they have received bail-out money in the last quarter? Or have they not received bail-out money, and if not, what happened to the bail-out package of last year? Didn't Bush vote a special package too in the last quarter?

Have you read CitiBank's balance sheet and income statement? Is it possible that they reported the "bail-out" nationalisation as an investment in the bank? I'm confused! Help me out here! Brick wall
blacktshirtnews
its because of the recession the united states was able to breach its contract with Canada for its steal. now the united sates is able to buy more steal from companies closer to home. Canadian steal companies then do not have as high of a demand. the recession is affecting Canada in that way but because the united states broke the contract Canada can then say, alright because you broke the contract where not going to export (EX.) our lumber to you because we need that for our economy because our steal companies are failing.

this is what I've come to understand is happening
deanhills
blacktshirtnews wrote:
its because of the recession the united states was able to breach its contract with Canada for its steal. now the united sates is able to buy more steal from companies closer to home. Canadian steal companies then do not have as high of a demand. the recession is affecting Canada in that way but because the united states broke the contract Canada can then say, alright because you broke the contract where not going to export (EX.) our lumber to you because we need that for our economy because our steal companies are failing.

this is what I've come to understand is happening
I believe the breaching is on both sides, not only US. This has been going on for decades. Lawyers must be profiting quite a bit with the suing and cross-suing all the time. Plenty of political games all the time.
LumberJack
deanhills wrote:
LumberJack wrote:
Canada just made different decisions than the US for a lot of things.
I made a little analysis earlier in the evening of military spending and the US is spending almost four times per head more on military projects than Canada does. It has an enormous war bill. Wonder whether that could have something to do with it as well?

http://www.frihost.com/forums/vt-103138.html

Like explain this to me, seeing that you are an economist and I am in total agony here. How can Citi Bank show profits in the billions, when they have received bail-out money in the last quarter? Or have they not received bail-out money, and if not, what happened to the bail-out package of last year? Didn't Bush vote a special package too in the last quarter?

Have you read CitiBank's balance sheet and income statement? Is it possible that they reported the "bail-out" nationalisation as an investment in the bank? I'm confused! Help me out here! Brick wall


FASB changed the accounting rules due to the recession, so all the banks are able to refrain from continuing to take markdowns on their assets, and in some cases, write them back up. When they do this, they can bring it through the income statement onto the balance sheet.

Someone has made the decision to fix the recession through changing accounting rules. You cannot fix a recession by changing accounting rules. This will catch up with us....
deanhills
LumberJack wrote:
Someone has made the decision to fix the recession through changing accounting rules. You cannot fix a recession by changing accounting rules. This will catch up with us....
Agreed LumberJack and thanks for this sober insight. For me there is so much of nonsense going on out there, bottomline is to keep the Banks making huge profits in a recession. Through desperate measures. Ably aided and abetted by Governments. All of it so absurd and perplexing. I don't like to listen to the news any more, as I feel like one of the idiots that we are being treated as by our Governments.
gandalfthegrey
Canadians love Barack Obama.

I think Obama's protectionist measures will be aimed at all other countries except Canada.
deanhills
gandalfthegrey wrote:
Canadians love Barack Obama.

I think Obama's protectionist measures will be aimed at all other countries except Canada.
I'm sure there has to be a few exceptions. Sentiment can change any day as well. Today's love may easily turn into tomorrow's indifference.
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