In no time at all Canada's financial situation has quickly worsened. Naturally, though, everything is going according to plan:
Flaherty says falling revenues won't derail deficit plan
Yea, who needs revenue anyway?
Food banks struggle to keep up with increasing demand
See? Demand is soaring, business is live and well.
Of course, I am being facetious. Nothing has improved, we've in fact been in this situation the entire time we've been boasting about how amazing our own "recovery" appeared to be. The whole time however it's simply been a series of cheap parlor tricks and meaningless banking policy. As a great article on Europe I read today concluded:
Meanwhile, unemployment is rising and growth is contracting. Fixing rates was the easy part. It required a promise. Fixing the real economy is the hard part. It requires real money.Real money, in other words: real production. There will never be enough real production to clear off the accumulated debts however. (Real) GDP is closely tied to energy production - oil production - and even if we produced the Trillion or so remaining barrels of oil in a timely and cheap manor we (the planet) could never create enough wealth to repay the debts. But hey, why should that factor into our strategy?
Alberta will be Canada’s economic growth engine for next decade: CIBC report: Real GDP growth forecast to average 3.3% between 2012-2022
Currently, Alberta and Ottawa have a lot in common. Just as Flaherty claims that revenue isn't going to impact their financial plans - Alison Redford has the same opinion.
Speaking Wednesday at a conference of the province’s municipal politicians – whose cities and towns rely on the province for hundreds of millions in infrastructure transfers – Alison Redford said the growing deficit wouldn’t mean major changes to the current budget, suggesting the government is banking instead on trimming spending through “in-year savings” and waiting for a revenue rebound.Indeed, why plan budgets and expenses and information around what-is, when it could instead be planned around what you want it to be? Seems like sound advice from the so-called fiscally superior conservatives. So don't worry everyone, everything is ok. It's all going to plan.
Finance official questions link between cooling housing market, mortgage rules
I've been questioning the so-called link for some time on this blog. My opinion is that these rules had no effect at all and the collapsing markets are happening naturally despite the rules. again, it's all about confidence. As long as they can convince the population that everything is going according to plan the market will act as if that's the case. It's when people realize that there is a disconnect between what's being said and the in-your-face reality that the floodgates open.
Canadian economy stalls in August as surprising weakness hits most sectors
The only reason anyone would be "surprised" by this realization is that they were lulled into a false sense of security in Canada's "stable, secure, banking sector". Why is this collapsing? Europe's getting worse, China's getting worse, Japan's getting worse. The U.S.? Well they are spending trillions to hold their military positions, banking on expensive energy, spending billions to produce a minimal amount of jobs indenturing multiple generations in the process while their cities literally fall apart.
Cracks are starting to show all over the place and our politicians are gambling on the market and passing that off as "a plan". Today, even with Sandy, oil is only up to $86 / barrel. I don't know about you, but when someone tells me "falling revenue" isn't going to affect their financial plans, it tells me there is no plan - only a failed ideology.
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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.