Thursday, June 9, 2016

Canada's housing hotbed of denial

Writing about Canada's housing situation is always a frustrating experience for me. For years many of us, sceptical of Canada's debt-fuelled "recovery", have said Canada's housing situation is absolutely insane. Cheap loans have been allowing us to limp along on the back of what we're likely to discover is a bunch of fake wealth we conjured up out of thin air.

Bank Of Canada Warns Of "Higher Possilbity" Of Housing Downturn, Sees Vancouver, Toronto Prices Unsustainable

Governments terrified of popping foreign-buyer housing bubble: Don Pittis

It's ironic isn't it, that the bank of Canada is only now warning that Toronto and Vancouver are "unsustainable" since other overheated parts of Canada - like Calgary - are already "un-sustaining"? Even this admittance by the Bank of Canada is a better sounding understatement than the true situation. The Bank of Canada, along with the federal government, has manufactured this situation and for years they have been using this artificial asset bubble to "prove" the recovery is real.

A few years ago I wrote some commentary titled 'The magic of minimum wage and inflation hocus pocus'. It is without a doubt one of the most important things I've written about the state of our economy and the belief in economic fixes that attempt to fix the unsustainable within that same unsustainable box. A significant portion of the piece is spent on housing, in which I show that the author of the work I was commenting on actually believed that devaluing your purchasing power to create the illusion of rising equity was a "good thing" because it supposedly fought off "evil deflation". How so-called "economists" are blind to the unsustainable and inevitably deflationary nature of that arrangement I'll never know, yet here we are. The rabbit is out of the hat now.

Back in September of last year I caught a little-noticed article.

Canadian banks helping clients bend rules to move money out of China
Some Canadian banks allow wealthy Asian investors to skirt Chinese law by helping them bring in large amounts of money that is often used to buy real estate in Vancouver. 
Financial institutions in the area have flagged more than 8,200 suspicious transactions since January, 2012, the year China began cracking down on citizens they suspect of corruption. 
Ninety-six per cent of those transactions were also facilitated by the banks, however, even though the vast majority of that business involved suspected money laundering, according to FinTRAC, the federal agency responsible for tracking money laundering. 
These findings, obtained by The Globe and Mail through an Access To Information Request, come as a debate rages over the source of foreign investment and Vancouver’s soaring luxury housing markets. A recent study by Macdonald Realty said 70 per cent of clients who paid more than $3-million for Vancouver houses last year were from China.
This housing situation didn't happen by accident, the government and the banks have been relying on foreign currency to prevent it from collapsing in the first place. It's been obvious as day with millennials moving home and wages stagnating that there was a disconnect between reality and the housing market. It was clear with Canadian household debt hitting ever increasing highs and constant low interest rates to "spur borrowing" that this would be the result. All those who have been saying "don't worry" for the last 3 years as they drank the economic koolaid should be ashamed of themselves; if they call themselves an economist? resign. This situation couldn't have been more obvious for those not mesmerised by the belief in infinite growth or easily fooled by non-sensical "there's no bubble" propaganda.

"The Whole Shebang Is Broke" - The Only Thing That's Growing Is Debt

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Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.

Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.

Tuesday, June 7, 2016

"Cancellation fees and jobs", "empty words and double standards"

Central to the international human rights system is the essential principle of universality. States are committed to fulfill their obligations to promote universal respect for and the observance and protection of all human rights for all. The international system does not declare that the rights of individuals and peoples matter more or less because of where they live, or that there should be more or less international level concern about human rights protection in certain countries over others. From the adoption of the Universal Declaration of Human Rights in 1948 to the advent of the Universal Periodic Review 60 years later, in 2008, universality has been fundamental to international human rights protection. An important dimension to the principle of universality is that Canada’s implementation of human rights should be measured against its capacity and history: whether it is progressing, regressing or stagnant, and in light of what should be reasonably expected of a country with such an abundance of resources and wealth.
From "Empty Words and Double Standards: Canada's Failure to Respect and Uphold International Human Rights" / Amnesty International
 I've been observing an exchange on Progressive Bloggers that I can't help but interject on. The subject matter covered in the last volley is of particular interest to me as I don't particularly feel that either has provided a true analysis. Montreal Simon's is written in partisanship, and Mound of Sound's in haste - while also failing to correctly identify the issue.

Rather than quote and comment on those posts though I'm instead going to comment on the source material they are both commenting on.

Canada would face multi-billion dollar penalty if it cancelled armoured vehicle sale to Saudis

The focus here will be on the issues with Simon's post as Mound's entire take was based on a statement I'm assuming he either misread, or misunderstood, and which is actually attributed to John Baird - Montreal Simon explains this aspect within his own response so I won't explore that further.

The reason I call his post written in partisanship is that he deliberately omits certain quotes and re-frames the Liberals actual position as "getting screwed".
When Harper announced the $14.8-billion sale in 2014, he and land systems officials touted the 3,000 jobs to be created — mostly in London, Ont. — and the importance of Canada working with Saudi Arabia, a key regional security ally in the Middle East. 
The Liberals did not oppose the sale during last year’s federal election, with a campaigning Trudeau at one point calling it a commercial contract for a bunch of “jeeps.” 
Once in power, foreign affairs minister Dion signed off on export permits in April to approve the shipment of the LAVs based on an assessment the Saudis would not use them against its civilian population but would use them to defend Canada’s common security interests with the desert kingdom.
Here is another one missing from Simon's post:
On Thursday in the Commons the NDP demanded to know why the government would not create a committee to oversee arms exports to guard against human rights abuses
Pam Goldsmith-Jones, Dion’s parliamentary secretary, said “the government takes every opportunity to raise critical issues with senior Saudi officials with respect to humanitarian issues, consular issues, and human rights, as the minister did in his visit to the region last week.” 
Asked later how the government intends to monitor whether the LAVs would end up being used by Yemeni military forces against civilians, she said, “We’re watching that situation very closely. Of course, as you know, with regard to our permit process, monitoring the human rights situation is of utmost importance, so that’s all I can tell you at this time.
My personal favourite:
In fairness to the Liberals,” Baird said, “this was successfully negotiated by General Dynamics Land Systems under the previous Conservative government and you shouldn’t blame the Liberal government for that. Contracts should be sacrosanct, and the new government is honouring that and it’s the right thing to do.” 
Fast’s and Baird’s views are in sharp contrast to the position taken by the Conservatives’ current foreign affairs critic, Tony Clement, who said information now available about Saudi Arabia’s actions in Yemen wasn’t available at the time the deal was struck. He said the deal should be shelved.
And there it is, the false left/right paradigm and continuity of government wrapped up in a simple two paragraphs. As I wrote yesterday:
It's how the system manipulates the public: a politician comes in, makes many unpopular changes then a popular one comes in and doesn't change much at all and simply utilizes the changes passed by the previous government. The anger about those changes leaves with the previous political party but the changes themselves? Those remain.
And there is Baird telling you to do exactly that, while the "opposition" takes on their role pretending to give a shit as with nearly every other major issue we never see change on.

Ironically just today the Saudi-led coalition has been removed from the blacklist, "pending review":
Following a complaint by Saudi Arabia, however, U.N. Secretary-General Ban Ki-moon agreed to a joint review by the world body and the coalition of the cases cited in the annual report of states and armed groups that violate children's rights in war. 
"Pending the conclusions of the joint review, the secretary-general removes the listing of the coalition in the report's annex," Ban's spokesman Stephane Dujarric said in a statement. 
But Saudi Arabia's U.N. ambassador, Abdallah Al-Mouallimi, said the removal of the coalition from the blacklist was "irreversible and unconditional." 
"We were wrongly placed on the list," he told reporters. "We know that this removal is final." 
Mouallimi, who described the removal as a vindication, earlier on Monday said the figures in the U.N. report were "wildly exaggerated" and that "the most up-to-date equipment in precision targeting" is used. 
Saudi Arabia had not been consulted prior to the publication of this year's report, Mouallimi added. 
Coalition spokesman Brigadier General Ahmed al-Asseri said in a statement sent to Reuters late on Sunday that the U.N. had not based enough of its report on information supplied by the Saudi-backed Yemeni government. 
The Saudi-led coalition began a military campaign in Yemen in March last year with the aim of preventing Iran-allied Houthi rebels and forces loyal to Yemen's ex-President Ali Abdullah Saleh from taking power.
Yes, you read that right, the U.N. "had not based enough of its report on information supplied by the Saudi-backed Yemeni government". And we're supposed to believe that Canada "is watching the situation very closely"? That we take "every opportunity to raise critical issues with senior Saudi officials with respect to humanitarian issues, consular issues, and human rights"? If you believe that I have a bridge to sell you.

Deals always have cancellation fees. Considering Canada spent 1 billion dollars beating it's own citizens, I think we can probably afford a "multi-billion" cancellation fee, don't you? To ensure we are not involved in the oppression? This is of course if that fee can actually be enforced. I'm sure if Canada is actually "watching things closely" it wouldn't be hard to fight the legal ramifications at the WTO or whatever secret corporate court would handle it. If we actually had any interest in doing so, anyway. We don't.
So who's he to pretend he's a great defender of human rights? Why would he twist my words? When he's the one who is siding with the Saudis by suggesting that we should pay them billions so they can buy armoured cars from another country.

So we could lose $20 billion dollars, and throw thousands of Canadian workers into the street, for nothing.
First of all, the deal is only worth $14.3 billion. The cancellation fee is cited at "multi-billion" - probably less than the value of the deal. Second, the Saudi's don't need our billions - in fact they are trying to dump their reserves in preparation for a new monetary system that is not based on the USD. This deal is just one of many that the Saudi's, the Russians, and the Chinese are carrying out sending their stored U.S. debt back to the west where it came from and getting real material and assets in return. Third, it's not "for nothing" - if not for at the very least Canada and Canadians having a legitimately clean conscious about our involvement.

As I've been writing about over the past year, the Saudi's along with the Russians, and the Chinese are all moving away from trade with the U.S. dollar. Canada is working to establish itself in this new alliance. "Screwing the Liberals?", no, this about serious things - not the political circus. Governments everywhere love to talk about human rights, meanwhile the neoliberal agenda works to eradicate them and turn everyone into a debt slave in a new world of feudalism as the industrial age and the control system of a taste of luxury disintegrate due to limits to growth taking hold. We're up against very powerful forces here and they don't play the same political bullshit we do.

The Amnesty report on Canada is named perfectly "empty words and double standards". The Canadian public gets all in a huffypuff that a journalist was "berated" by a Chinese ambassador here on a business trip representing the very same alliance our Saudi deal is connected to and yet when our government that claims to "uphold the value of human rights" has a real chance and window to actually make a difference all it takes is the mention of some debt based fiat currency and some jobs to change our tune, even though "money and power" is where most human rights violations stem from anyway.

"Empty words and double standards", indeed.



Click here to recommend this post on progressivebloggers.ca and help other people find this information.

Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.

Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.

Friday, June 3, 2016

Struggles of a non-partisan

The posts I write in the next few years aren't going to be very popular. I'm ok with that. I didn't create this blog to be popular in fact quite the opposite: I made it to make you think and self-contemplate. I often compare politics to a team sport where the team you play for is more important than the issues being dealt with. The internet is a sea of meaningless terminology that passes for political discourse.

"Oh those libtards, they something something blanket statement"

"Oh those dippers, they something something blanket statement"

"oh those RWNJs, they something something blanket statement"

"Leftists do this", "Righties do that". Everyone points at each other and nothing serious really gets done. The changes that do occur are superficial and are more meant to drive immediate public perception rather than effect real lasting beneficial change for the population as a whole.

Perhaps a tweet to demonstrate:
Engineered. What an excellent choice of description, it's what I'd call it myself. But not to make "Stephen Harper's balls ache", but to portray the perception of "change" when little has actually changed at all. Here is an example:

Public being misled about Canadian special forces in Iraq, says Ambrose
“Is the Prime Minister finally prepared to admit that Canada’s mission in Iraq is combat?” Ambrose added. 
But Trudeau maintained that the “mission in Iraq is support and assist. It is focused on training. It is not a direct combat mission. It is not a combat mission, it is focused on empowering local troops to counter ISIL.” 
The interesting part is that when this issue came up in the fall of 2014 and early 2015 when the Conservatives were in power, they insisted the same mission was also training….not combat.
Even the article couldn't help but note how interesting it is that the tables seem to have turned. Or maybe it's that the party in power isn't really different at all. That there is an agenda at play that extends beyond party ideology. The government and opposition pretend to be at odds with each other, pretend to be opponents, but in reality the differences are minor, and superficial. Those good old "people issues" while the issues of importance to the state and banking sectors continue unabated.
I found this tweet of the "fancyness" of the parliamentary gallery having both Coke (red) and Pepsi (blue) in the same ice bucket an apt metaphor for the sham we call a democracy. Out here in the consumer world it's Coke or Pepsi, The difference between the two? minimal. There is a difference, and people have their preference and each establishment (district) has their preference, but ultimately what is it? Cola. Coke Cola, or Pepsi Cola, but it's always gunna be Cola. The mental construct of the brand is so much bigger and more prevalent than the product.

Stephen Harper is doing just fine. I can assure you he isn't losing any sleep over the reign of the Liberals. His time as a lackey of the banks' agenda simply provided a springboard for the real power he will now have as a member of whatever international corporations he decided to join. You know, the type of global businesses that collude with governments to create trade bills we sign on to like the T.P.P. A TPP Trudeau fully supports, of course.

And how about C51?
Public Safety Minister Ralph Goodale said in November that finding the right balance between national security and individual rights is critical. 
"We recognize that it's an urgent matter," he told reporters then. "Canadians are expecting to see those proposals quickly but the principle is clear… that balance between making sure Canadians are safe and making sure their civil rights and the values of Canadians are properly protected." 
Since then, the government has appointed Liberal MP David McGuinty to study how other countries, such as the United States and Britain, oversee the activities of their intelligence agencies and to make recommendations for a Canadian system.
Oh good, the U.S. and Britain! Excellent models don't you think?

Hidden Microphones Exposed As Part of Government Surveillance Program In The Bay Area
Governments Turn to Commercial Spyware to Intimidate Dissidents

Like, do people not remember that it was the U.S. and U.K. and the Snowden revelations that have created the heightened concern about intelligence agencies going way beyond what they should be able to in the first place? But creating an oppressive surveillance state is again another one of those agendas that transcends the party line.

When it comes to the Saudi arms deal even the CBC can't help but note how similar the current and previous governments are:
Well. If further proof was needed that the sunny new regime in Ottawa is perfectly capable of behaving just like the un-sunny previous regime, we now have it, in a memo that was stamped "Secret," then rather inconveniently laid bare in the Federal Court of Canada. 
The document, signed by Foreign Affairs Minister St├ęphane Dion, is a gem of hair-splitting, parsing, wilful blindness and justification for selling billions worth of fighting vehicles and weaponry to Saudi Arabia, one of the most oppressive regimes on Earth.
Again, another important state and banking issue that continues right along with the old agenda.

Even Jodie Emery is realizing the Trudeau government isn't going to be the legalization utopia she had dreamed of.
Yet prior to the election Mark Emery just didn't want to hear it (and as you can see Press for Truth totally nailed the scam that is marijuana legalization):


Coke, or Pepsi. Red, or Blue. The same, or the same.

If Harper was our Bush, Trudeau is our Obama. We think "change" is finally here, but it's Harper that implemented the "change". It's how the system manipulates the public: a politician comes in, makes many unpopular changes then a popular one comes in and doesn't change much at all and simply utilizes the changes passed by the previous government. The anger about those changes leaves with the previous political party but the changes themselves? Those remain.
In the meantime, CSIS director Michel Coulombe told a Senate committee two months ago that the spy agency has used the new powers granted under C-51 about two dozen times. And he told senators he expected they would use those powers again. 
But for what, and how many times, he wouldn't say. Protecting national security remains, for now, beyond the scope of parliamentary oversight.

Click here to recommend this post on progressivebloggers.ca and help other people find this information.

Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.

Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.

Thursday, June 2, 2016

The "growth funk" and feelings of security

I put my dog down yesterday. Humble Pie. It was quite possibly one of the hardest moments of my life. My dog was a free dog, she never had a leash she never had a collar, she stayed by my side of her own free will. She trusted me, that I would keep her safe right up to the very moment I nodded and the vet put her to sleep for good.

I took her to her favourite park before going to the vet. She died on her favourite blanket, in her favourite position, cuddled in my arms thinking she was safe.

Humble Pie
She wasn't.

Whether this was the right decision at the right time is a question that is going to haunt me for a long time. The timing was due to other aspects of my life, combined with her already being quite old. I feel selfish, I feel like I betrayed her and her trust and I should have tried harder. But most of all I wish I could have asked how she felt, warned her it was coming, anything. I couldn't, it was my decision and mine alone. It's the feeling of betrayal which is haunting me most of all. But what else could I do? The worst part is I think even if I could have warned her, I wouldn't have, for her sense of security. It's been a very conflicting day as I battle with the different point of views that insist on infiltrating my head.

The feeling of security is a powerful influence on life. In the moment of her death she felt totally secure, not afraid, and then it just happened. She never saw it coming. The feeling of security (and insecurity) however is also an excellent tool of manipulation.

It's a constant theme in movies, agents working above the law to protect the public from unknown evils, governments being aware of events and not providing a warning to their people. Usually in some form to keep the public "safe" from certain chaos if the stupid peasants found out. Mass manipulation of this sort is often portrayed as for the good of the people. Much as ultimately the involuntary betrayal of Humble's trust was for the good of her (I hope anyway) and my desire for her to not die in fear, pain, or alone.

The status-quo wields the weapons of security, and insecurity quite effectively. The feeling of security is inherently anti-change while the feeling of insecurity is inherently pro-change. Feeding the population a balance of the two can produce any desired results. Using the feeling of security Humble Pie had no desire to change her situation, despite being in a strange place with a strange person at the most dangerous moment of her life yet the slightest feeling of insecurity throughout her life would send her skittering away even though it was all mostly harmless.

False security is a blinder, and Canadians are chalk full of false security.

I had an interesting Twitter exchange today about the Chinese diplomat "berating" our poor journalist for asking about human rights violations. An interesting choice of words isn't it? "berates"?

I found one thing the diplomat said to be very interesting:
"Other people don't know better than the Chinese people about the human rights condition in China and it is the Chinese people who are in the best situation, in the best position to have a say about China's human rights situation," he continued. 
"So I would like to suggest to you that please don't ask questions in such an irresponsible manner. We welcome goodwill suggestions but we reject groundless or unwarranted accusations."
We over here look at such statements likely with disbelief, because we know the Chinese indoctrinate their people with propaganda in fact our media ensures we know it. However I think it's also probably safe to say that many Canadians would believe the statement if it were said about us. Even if we were called out on human rights abuses, we know better, because we're Canadian. Surely us being Canadian must mean we are in the best situation, the best position, to have a say about Canada's human rights situation. But where are the journalists asking about it at every opportunity?

And round and round it goes. Of course if it didn't happen on your T.V. it didn't happen, did it? Do you really believe the Chinese are being indoctrinated with pro-nationalist crap and you aren't? What do you hear more about China's abuses? Or Canada's? From who? Now go read China's news.

Every country does it, the world does it, and why? The feeling of security. Not security from the terrorist boogymen but security of self, of purpose, of that feeling that you're the "good guy", that you're right and they're wrong.

What's funny is the diplomat is totally correct, it was irresponsible to ask, Canadians just don't understand why. We see that as some sign of journalistic freedom, while the Chinese view it as a form of disrespect. He was here because we want to do business with the Chinese. As I warned in my piece "Canada may be preparing to decouple from the USD":
These nations we are aligning with however do not cherish democracy as we do. We will be a minority in this new alliance, and of this we should be wary.
We want in with them, not the other way around. But it makes for a great drum-beating headline as Canadians are once again fed the false security of the supposed international concern Canada has for human rights. It makes us feel good and feeling good is essential to maintaining control and a feeling of trust, even if the actions being taken are knowingly harmful and against our best interests.

Take the Flint water crisis, for example, it has all the trademarks. The government not warning the people, the false sense of security in the idea that the U.S. is an "advanced nation" so something like that couldn't possibly be happening, and yet.. there it is. It is happening, and will continue to happen, and if you think that's the only one you're still lying to yourself.

The government knowing about the ultimate non-viability of oilsands and not warning Albertans is another example. Hell it seems half the population still thinks theres a boom coming any day now. Instead it was pushed and pushed as the future for short term gain and even today is pushing a belief system to keep Canadians invested in a failed endeavour:
"Barring an economic collapse, therefore, Canada will have to reconsider its planned oil and gas production growth and demand real emissions reductions from the oil and gas sector in order to have any hope of meeting its ... commitment," Hughes writes. 
Alex Ferguson, a vice-president of the Canadian Association of Petroleum Producers, said technological change in the oilsands is likely to prove Hughes's assumptions wrong. 
"You're going to see something in the next three, four, five years or so in terms of proving some of that out," he said. "We, collectively, need to make a conscious bet that technology is going to help us in this challenge."
Yes. Instead of prepare for the inevitable what we should do instead is make a "collective conscious bet" on the future. And if we lose that bet? Well, no one really knows, do they? By the way how are those tailings reclamations coming? Got any new ones besides the fake one you just moved the tailings out of to "prove" you could reclaim one? Of course as I've discussed in previous posts what they are just glossing over is that most of these "innovations" translate to automation as well. The belief that the oilsands will come roaring back to life is wrapped in the security that the jobs will return with them. They won't - but hey I give them an 'E for effort' coming up with their excuses why not..
In fact if global growth doesn't return, oil demand won't either which brings me to my next article of interest on another topic that is wrapped in a false security with statements like "best recovery in the G7" or "Strong regulated banks": The absolute gong show the global economy has become.
I caught an interesting sponsored article in the Financial Times, which closes with something quite profound. That the FT would publish it, sponsored or not, is quite interesting unto itself. This isn't ZeroHedge but the FT and the second question I couldn't help but ask was, who is this for? It was written by an investment firm BlackRock but I'm finding it difficult to find a clear reason why they would pay for it to be published.
As central banks exhaust their ammunition, some countries are turning to debt-driven fiscal stimulus. Canada’s own stimulus program may help boost the domestic economy, says Aubrey Basdeo, managing director and head of fixed income at BlackRock Canada. On the other hand, it may lead to unintended consequences, including rising interest rates and an overvalued currency. (RF: Which also means an undervalued USD relative to the countries they would import from (read more))
Central bank monetary policy has helped drive asset prices higher with the help of interest rate cuts and quantitative easing since the financial crisis,” he says. “But the effectiveness of these policies may be starting to wane and the ability of global central banks to respond to the next downturn appears limited.” 
Interest rate cuts could lose their effectiveness if borrowers become accustomed to a low-interest-rate landscape because there’s no rush to borrow or invest. Low rates also make savers poorer, reducing consumer demand. 
“Negative interest rate policies by the likes of the Bank of Japan and the European Central Bank that are targeted at depreciating currencies may also be close to hitting a limit,” says Basdeo. “It may make sense to weaken your currency if you’re an exporting nation seeking growth, but when everyone else moves in the same way, it starts to lose its efficacy.”
Just a note, notice that his reasoning for why consumers won't borrow even more is that they're "accustomed" to a low-interest rate environment yet also admits it makes savers poorer. Well, if you're not a borrower, and you're not a saver, what are you? Admitting that the emergency low interest environment isn't working is because consumers are tapped is a media no-no. They will talk about one, or the other, but never both at the same time which is absurd isn't it being that clearly your capacity to borrow more and more is obviously directly associated to your ability to service that debt.  Anyway, moving on...
One policy option is a mix of broader credit easing by central banks, combined with either government spending on infrastructure projects and/or tax rebates. However, many governments are wary of deficits.
“When you come out of a debt binge like the one preceding the financial crisis, the last thing you want to do is go on another binge,” says Basdeo. 
Governments and consumers have reduced debt loads since the financial crisis. Corporations, however, have borrowed heavily. Yet instead of investing in new plants and equipment to improve productivity and spur growth, they have leveraged inexpensive debt to buy back stock and pay dividends to investors. (RF: aka "the recovery")
Basdeo says the world will be looking carefully at the Canadian government’s gambit to rack up a stimulus debt of $113 billion over the next five years, most of it earmarked for infrastructure spending. Australia has also pulled the trigger on a A$37-billion stimulus program and a rate cut. 
“If Canadian and Australian fiscal stimulus boosts economic growth and bolsters consumer and corporate spending, then other countries may adopt similar fiscal approaches,” he says. 
The downside risk? When governments spend, interest rates could rise. That would increase capital flows into the country, pushing up currency values. 
“For a small, open economy dependent on trade, this scenario would be particularly negative to Canada when we are trying to boost our economy through manufacturing exports that benefit from a lower loonie,” says Basdeo. 
Japan, the poster child for deficit infrastructure spending, also offers a note of caution. After more than 20 years, the policy has resulted in little growth. 
The growth funk miring most major developed economies remains a headwind to future growth in Canada, Basdeo adds. 
“As a result, the Canadian deficit experiment may lack the punch on its own that would sustain it as a model for others to follow,” he says. “Rather than wait to see if it works, the optimum solution is likely a coordinated, comprehensive global policy response which relaxes excessive dependence on central bank policy and begins a renewed effort to achieve good growth via deficit spending.”
The "growth funk". Cute, isn't it? And despite no modern economics reason for it we continue to believe infinite growth is possible. The last paragraph is the kicker: "the optimum solution is likely a coordinated, comprehensive global policy response which relaxes excessive dependence on central bank policy and begins a renewed effort to achieve good growth via deficit spending". He is calling for the start of a centralized global economic system, which naturally is going to be presented as the "solution" to the problem governments and central banks are knowingly creating, the prosperity they are stealing from the future with not one ounce of evidence it can be paid back. We're doubling down on the bet that the future will be incredibly larger than the present when the evidence suggests everything but, and those in charge know this. There will be no warning.

The attempts by governments to push people more and more into debt to prevent the credit markets from deflating are becoming ever more aggressive. Take this interesting quote about the recent gas tax hike in Newfoundland:
People will have to make other arrangements to ensure they are carrying a bit more cash or extend their credit or ensure they have enough on their Visa to pay for gasoline,” said Dan McTeague, a senior petroleum analyst at GasBuddy.com. “Newfoundland is now home to the most expensive gasoline in North America and likely the Western Hemisphere.”
As I've pointed out before, even the "feminist" Justin Trudeau is well aware how this system works:
I opened my campaign last month with the argument that, if the Liberal Party is to become a positive force for change in Canada, we need to give voice to the aspirations of our middle class. 
Personal income for middle-class Canadians has stagnated for more than a generation. This deeply troubling development is masked by a rise in family income, due to the entry of a new generation of well-educated, hard-working women into the workforce. While this phenomenon is overwhelmingly positive, we must be clear-eyed in understanding that it is a one-time benefit.
It all sounds great until you reach that last line. A "one time benefit", just as new suckers entering into a ponzi are a "one time benefit". His article went on to say:
So, we’re left with the vexing question: where will the next wave of growth for the middle class come from?
The "next wave of growth". As in what new suckers will we find to keep the unsustainable "disturbing trend" of wage stagnation and a consumer economy going. His article went on to describe how Canada's economic future resided in China, and emerging markets. The same China Canada's journalist insulted by raising the issue of human rights on a business trip. We just don't get it, democracy is a game and our new business partners -- which we are relying on for the "next wave of growth", despite the fact all indicators show that China will likely not be the source of growth we'd hoped -- aren't playing it. Nor do they need to.

Our own concern for "human rights" is absolute bullshit as our government sells Saudi Arabia military equipment who was just added to a U.N. blacklist for killing children in their war on Yemen while making excuses for that human rights record. And who can blame us, we need that "next wave of growth" don't we? There's good money to be had.

And how about our TFW's where in a recent article the program was described as "worse than slavery"?
Hundreds of those workers have been sent home from Canada in similar circumstances, a practice known as "medical repatriation." 
"It's worse than slavery — they dispose of them," Barrett told Go Public.
Where's the outrage, huh?

Meanwhile the global game continues. Russia and Saudi Arabia dumped $50 billion in U.S. assets last year and it doesn't look like they're going to slow down. The OECD, knowing that the jig is up on growth, is now preparing people for feudalism saying "don't worry about the wage gap, worry about jobs". Which shouldn't surprise anyone as western corporations fight fiercely against any sort of increase in wages.

But nevermind. Back to your regularly scheduled feeling of security.



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Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.

Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.

Wednesday, March 16, 2016

Open letter to 'Albertans First'

I've been observing your movement mature for some time now George Clark. I'm not writing for the purpose of focusing on the miss-spelling of coup d'etat, or to talk about your sign. I want to address your position, and reasoning, regarding Alberta's current issues as frankly I think you're putting the blame in the wrong place and are simply wasting the government's time, and depleting reserves, in your efforts. I deeply care about Alberta's future, I've been writing on the culmination of numerous issues for nearly 6 years many of which cross-over with your hasty, and incorrect, observations.

The movement you have created is contributing heavily to what is becoming an increasingly divisive, and toxic, political climate with few if any actual solutions to the real problems which as hard as it may be for you to hear have existed and have been building for quite some time. Not because of "the Liberals", or "the leftists", or whatever blanket label you want to throw around as though there are only two strict sets of rules for political ideologies to follow but because Alberta's perceived prosperity was always assuredly time limited and I intend to show you these issues exist across the political spectrum. While you may admit that the PCAA made many mistakes contributing to Alberta's situation your movement did not choose to exist while those mistakes were being made. I have been vocal for a long time, George, no one was listening.

To demonstrate what I mean by this here is a post I made prior to the election of the NDP. As you can see it discusses what I viewed as some of the upcoming problems Alberta would be facing (Canada too, really) such as abandoned oil& gas wells skyrocketing and an interesting quote from Jim Prentice, a Stephen Harper favourite where he called what we can see today is essentially an imploding labour market "an opportunity" for oil & gas companies to take advantage of favourable conditions.

I've been following this descent from grace for some time, George, for instance here is one of my favourite links few Albertans ever want to seem to acknowledge, or address, from 2012, discussing a memo about the soaring costs of oilsands development:
A confidential government memorandum obtained by CBC News warns that soaring costs of developing the Alberta oilsands could put the brakes on the massive project, stalling one of the main engines of the Canadian economy. 
The booming oilsands industry supports tens of thousands of Canadian jobs, and pumps billions of dollars a year into the national economy. 
The memo written by Mark Corey, one of the highest-ranking officials in the federal Department of Natural Resources, warns that if the current trend of spiralling labour and other costs continues, investors may start to turn off the tap on the massive amounts of money needed to develop the oilsands. 
"Although current crude prices promote oilsands development, ever-increasing capital and operating costs could make this price insufficient to support oilsands development at forecast levels," Corey writes. 
Cost increases are currently "the biggest risk to investment in the sector," and could jeopardize the viability of some projects, he says. 
Rising labour costs 
The memo estimates that operating and capital costs to extract a barrel of oil from the tar-like sands have both more than doubled over the past decade. 
It blames a chronic shortage of workers and resulting sky-high labour costs as the main cause of increased operating expenses. 
Corey's memo reflects a growing concern inside government over the future of the oilsands, and specifically the massive amount of capital investment that will be needed to fuel their continued development. 
Natural Resources Minister Joe Oliver recently estimated the oilsands would need $650 billion in capital investments in the next decade alone — almost five times what's been spent there over the past 50 years. 
The memo written in April this year was obtained under the Access to Information Act and appears to have been prepared for Natural Resources Minister Joe Oliver. 
The document pre-dates the Harper government's current review of foreign takeovers of two Canadian energy companies. 
It nonetheless bolsters the contention of many in industry and government that Canada can hardly afford to turn away foreign investment in the oilsands.
In the latter half of 2014 I caught this article from the Financial Post titled 'Cost-cutting fever grips oil sands players as economics called into question' and as you'll see in the article itself was published before the collapse in oil price:
Canadian oil companies are ruthlessly enforcing capital discipline as project costs creep up and shareholders pressure management to focus only on the most profitable ventures. 
Suncor Energy Inc. announced a billion-dollar cut for the rest of the year even though the company raised its oil price forecast. 
Others such as Athabasca Oil Corp., PennWest Exploration Ltd., Talisman Energy Inc. and Sunshine Oil Sands Ltd. are also cutting back due to a mix of internal corporate issues and project uncertainty. Cenovus Energy Inc. is also facing cost pressures at its Foster Creek oil sands facility. 
“Given that the low-bearing fruit have already been developed, the next wave of oil sands project are coming from areas where geology might not be as uniform,” said Dinara Millington, senior vice president at the Canadian Energy Research Institute.
The NDP government is not making the situation worse, George, you just didn't realize how bad the situation already was. With oil at $100 and a PC government the industry was still barely turning a profit. I've seen a lot of statements from you that say things like "we were doing fine when oil was $10 barrel", read those articles and you will understand why.

I don't disagree with every single one of your positions on specific issues particularly in regards to the Carbon Tax (from a certain point of view which can be found here). Nor do I disagree with some of your points on wind turbines (in fact I believe environmentalists have some hard truths to account for). But what I do disagree with is your whole movement sat on their hands when "times were good" while the prior governments gambled on the futures market and called that a budget or "action plan", whichever you prefer. Where were you then?

Your clear bias against the NDP government and the very disproportional amount of blame you've laid at their feet is irresponsible, uninformed, and regardless of the political football outcome will not solve Alberta's problems because it does not address them. Simply saying "no carbon tax" doesn't address the myriad of other issues actually creating the problems you're complaining about - the carbon tax not being one of them. If you're truly concerned about Albertans, their futures, their jobs, and their prosperity then you will be honest with yourself about our situation and put your political views aside. There is no easy way out of this situation, and we're in for many years of pain if we ever recover at all.

The industry and governments bought by the industry intentionally lied to Albertans George. They knew, and they didn't tell you. Increasingly they are looking at automation, and there will be no more 4000 man camps, did they tell you that? Is that because of the NDP too? No, it's because the oilsands are expensive to produce and the profits for foreign owners mean more than your job, your house, your future, George.

This is why people like me have been screaming for years for the PCAA government to do anything, raise royalties, enforce environmental regulations, anything, to protect our future and the prosperity of our children and you know what George? No one listened.

Click here to recommend this post on progressivebloggers.ca and help other people find this information.

Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.

Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.

Thursday, February 25, 2016

The great deflation and what comes next

I haven't written anything since the election on October 19th. I felt it pointless, Canadians were too obsessed with false victories in the political spectrum. "Defeating Harper" and the sort even though really the public has just once again been manipulated into doing exactly what was desired as I wrote about during the federal election breakdown 4 part series last year. Such as it is the honey moon has worn off and no amount of fancy public relations can hide the effects of the great deflation, and new bosses that look a lot more like the old bosses each and every day.

Look around folks, just.. look around.

The world is sinking into chaos.

Here at home Canadians are bickering about pipelines and other useless drivel as the elephant in the room goes unmentioned. The "west vs east" divisive lines I don't think have ever been so prominent in my life time. In many extreme "right-wing" circles there's even been talk of separation; silly of course but still, it's new. Or old, depending how you look at it. Articles like "It's raining schadenfreude on Calgary and Alberta" actually exist. The more the economic situation deteriorates, the worse the baseless finger pointing will become.

"It's the NDP". "It was the Conservatives". "It was Justin, and his hair".

You all need to just stop and think for a minute.. just what is it you expect to happen?

Look elsewhere in the world, it's not just here. Divisive fault lines are showing up everywhere. The "European Union" is falling apart as their already horrid ponzi-conomy has just been laden with the additional cost of refugees courtesy of NATO's war in Syria. China is escalating it's direct challenge to the U.S. in the South China Sea. Russia. The Middle East. And surrounding all of this conflict is intense divisions. You want to understand how divide and conquer works? You're witnessing it.

The great deflation is going to be a very trying time for a lot of people. Here is a portion of what I wrote early last year on the great deflation:
The majority of the world economy is now supported by near zero, zero, or negative interest rates. Seven years on from the peak-oil induced "great recession" central banks are finally out of ammo. Inevitably this situation can not last forever and with the Saudi's pushing the collapse in oil price the stage has been set, and in fact the play is already in the first act, for deflationary spiral the world has never seen the likes of before because the world has never seen a fiat asset bubble of this size before.

The expected benefit economists are expecting from lower oil and gas prices are not going to materialize as the middle class which is the primary driver of this trend has been crushed by unaffordable consumption and debt accumulation. The easiest path for this excess wealth to take is towards paying down debt which in itself is inherently deflationary and will only contribute further to the deflationary spiral we've entered. 
The artificial deflation of oil is having a direct effect on the outlook for oil related employment and income which both Canada and the U.S. have been completely reliant on for wealth generation. The entire myth of the current "U.S. recovery" which Canadian economists are banking on is essentially based on the economic performance of the shale oil industry prior to the collapse in price (you'll remember the latest U.S. recovery narrative was originally about the boom of shale oil) which is no longer valid. Without the high incomes oil related jobs provide the unaffordable asset bubbles become completely unbalanced. This is why the Bank of Canada is citing mitigating the effect of low oil prices (lower inflation) as the reason for lowering interest rates while effectively ignoring the increase in inflation high oil prices represent. They are selectively interpreting the situation to service their own needs of maintaining the credit markets. 
No amount of low interest or free currency can ever hope to make up for the loss in energy bounty as a result of peak oil and the focus on low EROI energy production though as currency is not wealth itself but the representation of wealth, it has an end of life and this is where C51 becomes very important for the status-quo.
It's now one year later, was I right?

The divisive environment in Canada is being driven, and I believe purposely fomented, on a false pretence; that if only we will build pipelines, if only people will stop talking badly about the oilsands, if only, the Canadian economy will come roaring back to life. That the job losses will stop, and the jobs return. It keeps the focus, and the arguments, and the finger pointing around a single topic: pipelines, and not say the more important topic we should be talking about: are the oilsands even viable to produce at any price?

This oil price collapse really couldn't have come at a better time for Alberta's oil companies who prior to the collapse, when they were even projecting oil to go higher, were already planning cuts to labour and investment. Companies have been looking at automation as a solution to the labour problem the oilsands have created for years. Of course readers of this blog should know all about 'the labour problem'. Despite the heartfelt rhetoric of guys like Doug Suttles who says the layoffs are the worst he's seen (and I also presume ever responsible for) the unspoken and it seems long forgotten reality here is that the layoffs and drying up of investment in the oilsands were already happening anyway.

Low oil prices has simply provided an excuse to speed up this process and not take the blame. What little blame has been remaining and not directed at the Saudi's has been kindly redirected towards the new NDP government by the always helpful and awfully plentiful "grass roots" movements that for some reason always seem to have ties back to industry.

The blame game has left very few people talking about the very real problems Alberta and subsequently all of Canada is and is about to be facing. Take for instance the massive expense of cleaning abandoned oil and gas wells which I was discussing in my Alberta Election post which have now come to the forefront among many other issues. Enbridge has set a long term plan to move away from oilsands all together.

It should be noted that all around the world the oil situation isn't exactly good. The deal to "freeze production" between the Sauds and Russians should be of particular interest for those who understand the geopolitical game at foot here. As I wrote last year an informed Twitter follower informed me that the Saudi's were not working against the Russians, but were working with them. This new deal, which is not a deal I should point out between the Saud's and so-called 'Saudi-America', continues to fit the grand story of global divestment out of the USD. Divestment which is becoming so noticable that even the National Post wrote something about it.
It is a chilling statement from an expert on both gold and China. But he is speaking the truth: In a G2 world (the United States and China), he who is the piper calls the tune, and China holds a US$2-trillion mortgage on the United States and is not happy. This country, along with others that lend money to the United States, such as Saudi Arabia, will determine the value of the U. S. dollar and gold. And they have spoken. They are not buying more U. S. treasuries and are buying gold as a new asset class. China announced that it was doing so quietly, and recent reports are that the Saudis and others have been buying bullion and hocked gold jewellery from around the world. 
The only way is up for gold prices because the United States, which backstops the International Monetary Fund, the world's lender of last resort, has had to become its own lender of last resort. 
Washington has cranked up the printing presses in an unprecedented way, replicating the behaviour of its spendthrift corporations and consumers. This year's budget is US$3.5-trillion, bigger than any in history. 
And as Ing points out, the "bi" in this bipolar global economy is China. Beijing has not only started to hoard gold but has continued to talk up a new reserve currency concept to replace the U. S. dollar. The only reason the Chinese and others don't dump U. S. dollars is because it would be like shooting themselves in the foot. 
Inflation, on top of excessive money supply dilution, will (unless mitigated by growth or stoppage) reduce the dollar's value. Ing estimates that the printing of money to bail out banks, autos and the U. S. economy will create a catch-up in gold bullion prices: "Gold should be US$9,000 an ounce to cover the [current and projected] U. S. monetary base," he says. 
China has become the world's fifth-biggest gold hoarder, in addition to being the world's biggest gold producer (through its government-owned mining companies). I also suspect that China is behind the political sabotage in Mongolia, to its north, which has for five years prevented Ivanhoe Mines of Vancouver from producing gold and copper from its massive discovery. 
Clearly, China also has been dis-investing from the U. S. dollar by getting slowly into hard assets (stock, commodities or ore bodies), which I have written about. This concerns Washington, which is why Hilary Clinton, U. S. Secretary of State, made her first state "house call" in Beijing to make nice with America's first mortgagor. 
At that time, and publicly, too, China warned the United States about its dollar woes, while suggesting a basket of currencies to replace its pre-eminence. These scary pronouncements were followed by an announcement in Washington a few weeks ago that there would be a massive U. S. Treasury buyback of U. S. bonds. Put another way, the Chinese and others aren't buying anymore so the surpluses are being mopped up by putting more on the taxpayer tab. 
It is an irreversible trend that China and others will continue to disinvest and diversify out of U. S. dollars, and that inflation will further impair the U. S. dollar's value. That's because the U. S. monetary/economic rescue is simply Washington's version of the excesses and over-leveraging that led to the need for a rescue in the first place.
Speaking of gold, Canada just recently sold half it's reserves. Yes, that's right. Half. So whatever the government "deficit" is you're hearing about these days, add half our gold supply to it.

Are you starting to get the picture folks? This is not normal. This is not normal at all.

When the Saudi Minister says things like this:
“The producers of those high-cost barrels must find a way to lower their costs, borrow cash or liquidate,” the minister told a business audience in Houston during a speech at the IHS Ceraweek event on Tuesday. 
“It sounds harsh, and unfortunately it is, but it is the most efficient way to rebalance markets. Cutting low-cost production to subsidize higher cost supplies only delays an inevitable reckoning.”
You must understand what he is really doing: he is calling North American oil production out on it's bullshit. And worst still he shows the real target: the banks. Borrow more, he says. But he knows these oil companies can not borrow more, and that their hedges are now expiring, and that the defaults are about to start rolling in.

Peak oil.

I've seen a lot of people talking about peak oil lately. It's pretty amusing. Apparently we beat it. Because the world is producing excess oil apparently all the peak oil theory is junk. Nevermind that were producing much of it at a loss. Nevermind that for almost an entire decade now we've been talking about "the recovery". Nevermind that for the first time in modern economic history banks around the world are having to introduce negative interest rates which our own BoC has even discussed. Just never. Fucking. Mind.

Exxon Fails to Replace Oil, Gas Production for First Time in 22 Years
Exxon Mobil Corp. disclosed Friday that for the first time since 1994, it failed to find enough new oil and gas to replace what it produced last year.
Oil investment is weakest in 30 years
That will be the first time since 1986 that upstream investment has fallen for two consecutive years, the agency said, warning that the collapse could be storing up problems for consumers further down the track. 
"It is easy for consumers to be lulled into complacency by ample stocks and low prices today, but they should heed the writing on the wall: the historic investment cuts we are seeing raise the odds of unpleasant oil-security surprises in the not too distant future," said IEA Executive Director Fatih Birol on Monday.
So. Who can guess what comes next after the great deflation? Anyone? Bueller?

Once the defaults really get rolling and work their way thru the banking system all confidence in oilsands and shale production will be destroyed. The levels of investment weve seen will not be returning. Ever. EVER. I really want that to sink in. When I discussed Alberta's new permanent reality, I really did mean permanent.It will be when the damage is done that the Sauds, along with Russia, and their partner China will finally give North America exactly what we've been asking them for: they'll turn off the taps. And all hell will break loose. This is how they will put the final nail in the coffin of the U.S. dollar.

By turning off the taps the price of oil will rise very rapidly, lacking it's own production North America will be forced to buy foreign oil in whatever currency they choose. They will not be choosing the U.S. dollar. This will also be the start of true hyperinflation in the U.S. as the energy shortage quickly adds pressure to deflation and they are forced to print more and more currency (borrow it from private banks at interest that is) to simply get life's necessities.

It's not a pretty picture but unless the people all around the world stop pointing fingers, making baseless accusations, and petty demands and stop just long enough to realize we've all been had, these forecasts, like my previous ones, will quickly be upon us. Just look around.

China says 'really needs' South China Sea defenses in face of United States

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Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.

Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.

Monday, October 19, 2015

I do not care about niqabs and pot

I do not care about niqabs and pot,
Child tax credits worth a little or a lot,
Who said what when seventeen,
Or peed in a cup-how obscene.

I see through wars started for gain,
Pretending we care about people in pain.

The campaign managers must laugh into the night,
Watching partisans insult and fight.

Yet it doesn't really matter which party gets in,
The banks own it all and they always win.




Click here to recommend this post on progressivebloggers.ca and help other people find this information.

Richard Fantin is a self-taught software developer who has mostly throughout his career focused on financial applications and high frequency trading. He currently works for eQube gaming systems.

Nazayh Zanidean is a Project Coordinator for a mid-sized construction contractor in Calgary, Alberta. He enjoys writing as a hobby on topics that include foreign policy, international human rights, security and systemic media bias.