February 17, 2016

Diverging Housing Markets And BC Budget

Diverging Housing Markets Continue Data released earlier this week for January showed the stunning disparity in regional housing markets in Canada (see chart below). Vancouver remains the red-hot leader with year-over-year (y/y) price gains of 20.6% and home resales growth of an eye-popping 32.1%. In comparison, Toronto’s housing market seems almost tepid, with an annual…

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January 20, 2016

Bank Of Canada Does Not Cut Rates

In an evenly divided call by market analysts, the Bank of Canada maintained its target for the overnight rate at 1/2 percent. The Bank said that inflation prospects are largely as expected and that “the dynamics of the global economy are broadly as anticipated in the Bank’s October Monetary Policy Report (MPR).” Really?  Oil prices…

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January 15, 2016

Will The Bank of Canada Cut Rates Next Week?

Expectations of a Bank of Canada rate cut next week are mounting and for good reason. The Canadian economy is showing signs of considerable weakness and business investment plans have been cut. Oil prices continue to decline sharply and Iranian oil supply will be coming on stream shortly. Energy companies continue to slash payrolls and…

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January 8, 2016

U.S. Job Strength Vindicates Fed Rate Hike, But Canada Still Weak

Once again, the Canadian economy showed signs of struggle as the December jobs report showed gains only in Ontario, while jobs were flat or down in every other province. In marked contrast, payrolls in the U.S. rose more than projected as the unemployment rate remained at a low 5%. U.S. strength vindicated the Fed’s recent…

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December 16, 2015

The Fed Finally Did It – Hiked Rates

For the first time in nine years, the U.S. Federal Reserve hiked their key policy rate–the overnight federal funds rate–by one-quarter percentage point (25 basis points) to a range of 1/4 to 1/2 percent. The policy-making Federal Open Market Committee (FOMC) said that the stance of monetary policy remains accommodative, thereby supporting further improvement in…

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December 4, 2015

Canada Falters As U.S. Jobs Growth Assures Fed Rate Hike

Unfortunately, Statistics Canada had more bad news for us this morning–a weak November jobs report and a big decline in trade for October–both of which portend a marked slowdown in growth in the final quarter of this year. At the same time, the U.S. released a strong enough November employment report to assure that the…

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December 4, 2015

Government Should Not Tamper With Foreign Home Ownership In Canada

The Canada Mortgage and Housing Corporation (CMHC) yesterday released the results of its 2015 Survey of Foreign Ownership of Condos in Canada and the numbers were lower than previous surveys and anecdotal evidence have suggested. While this is the most comprehensive study to date, accurate numbers on foreign ownership are inherently illusive. Many foreign condo…

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December 2, 2015

Bank of Canada On Sidelines as Fed Rate Hike Looms

The Bank of Canada kept the key overnight interest rate unchanged at 0.5 percent as expected, as the Federal Reserve is poised to hike rates for the first time in nearly 10 years. The Bank’s decision did not, however, reflect complacency with the state of the Canadian economy, but rather a hand-off to the much…

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November 24, 2015

Taxing The Rich Is Counter-Productive

As politically popular as it is to spew “soak-the-rich” rhetoric during an election campaign, the reality is that it is a very inefficient way to raise revenues or to address income inequality. Indeed, it will actually shrink the economic pie. It provides a disincentive to entrepreneurial spirit and work effort and it will make it…

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November 20, 2015

Finance Minister Bill Morneau Economic Update

Finance Minister Bill Morneau said today that Canada’s budget is deeper in the red than we were told in the 2015 budget as the economy’s performance has disappointed. He also revised down the government’s outlook for the economy over the next year. According to the Minister, the federal books are short roughly $3 billion in…

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