November 2009

[Ally]

Recession will way on Economy for Years, Renowned Economist says

Canada has survived The Great Recession, but its effects will weigh on this country`s fortunes for years to come, says Ed Safarian, one of Canada`s most highly regarded economists and the author of a seminal text on how this country endured the Great Depression.

"This is going to be a period of no growth and false recoveries that don`t last," says Safarian, professor emeritus of business economics at the University of Toronto`s Rotman School of Management. His classic text, The Canadian Economy in the Great Depression, is now being published for the third time with insights into the current financial crisis.

"We`re not going to come roaring out of this," says Safarian, 85, who was appointed a member of the Order of Canada in 2005.

The "green shoots" optimism of recent months would wither in the face of Safarian`s assessment. Anyone hoping the errors of the past won`t be repeated would be sorely disappointed.

While the effects of the global financial crisis were more muted in Canada, Safarian worries that growth here will be constrained for several years by large amounts of excess manufacturing capacity and bloated unemployment rolls.

Compared with the 20-per-cent-plus unemployment rate of the Depression`s Dirty Thirties, today`s 8.6 per cent rate is marginal, Safarian said.

Read the full article here.

 

[Ally]

B.C. better start finding Carbon Credits at Home

For the last year I`ve been on an admittedly geeky quest during my vacations. I have criss-crossed the planet, hunting down the million-dollar deals involving what many think will be a commodity as big, or bigger, than either oil or gold.

I`ve been carbon-credit hunting.

My exploration through the carbon world, which has turned into an hourlong film Carbon Hunters, took me from Mumbai to Washington, D.C., from Manila to London, and a few places in between. It slowly dawned on me that this isn`t a crazy fad -- it`s a multi-billion-dollar industry.

One of the revelatory moments happened right here in B.C., in Clayoquot Sound.

I was on the tiny island that is the home of Shawn Atleo, national chief of the Assembly of First Nations. As the grey sky emptied on the rain forest, Atleo told me something few people know.

A few years ago an oil company -- energy companies have been some of the earliest players in the carbon credit game -- approached him. They wanted the Ahousat First Nation to set aside a vast track of forestry.

Read the full article here.

 

[Ally]

Dim Employment prospects lower Consumers` moods

The mood of Canadian consumers -- and especially of B.C. consumers -- deteriorated this month as concern over employment prospects eroded confidence, according to a Conference Board of Canada survey.

The Ottawa-based think-tank said Thursday its monthly consumer confidence index fell in November for the second consecutive month. The index lost 5.7 points to a reading of 79.

Regionally, the biggest drop in confidence was in British Columbia, where the index plunged what the board called "an astonishing 13 points." Ontario also saw a significant drop, down 10.3 points.

"The outlook for future job creation remains a significant detractor to consumer confidence," the board said. "This month`s results highlight just how fragile the perception of an economic recovery is at this time."

When asked if their financial situation was better now than six months ago, 13.9 per cent of respondents said yes. That`s down one point from October and up 0.6 points from the beginning of the year. More than a quarter of respondents -- 25.6 per cent -- said they are financially worse off than six months ago, up 1.8 points from the previous month and 0.8 points higher than in January.

Read the full article here.

 

[Ally]

Top Ten Tips for Year-End Tax Planning

While taxes for the year 2009 aren`t due to the end of April 2010, only one full month remains to take certain actions that will minimize those tax liabilities. CIBC`s tax and estate planning guru Jamie Golombek has issued a report summarizing his top ten yearend tax planning tips.

"It`s important to review your overall tax-planning strategy with a professional now and ensure you`re making the most of any opportunities available to you, especially as a result of new savings and inves tment vehicles, credits and policy changes that came into effect for the first time in 2009," says Golombek, whose formal title is Managing Director of Tax and Estate Planning.

Golombek became well known for his tax expertise during a 12-year career with Invesco Trimark, where he held a similar role providing tax guidance for mutual fund sales people. The text is lightly edited: ï Tax-loss selling This is the practice of selling investments in an accrued loss position at year-end to offset capital gains realized this year or in the previous three years. To realize losses on public securities, trades must be made on or before December 24 th or the trade will not settle until 2010 and the loss won`t be available until next year.

- Advice for homeowners and prospective homeowners 2009 brought significant tax changes for homeowners, prospective homeowners and even homeowners who renovated their home, cottage or condo.

Canadians should be aware of changes made to the federal Home Buyers` Plan (HBP) and consider their eligibility for the new non-refundable First- Time Home Buyer`s Tax Credit (HBTC). Those considering home renovations have until the end of January 2010 to complete the work to qualify for the temporary Home Renovation Tax Credit (HRTC).

Read the full article here.

 

[Ally]

Dubai`s $60B Debt Freeze shakes Market

HONG KONG (AP) – The fallout from Dubai`s debt crisis rippled across the globe Friday, raising concerns of another wave of financial turmoil and showing how vulnerable the world economy remains despite signs of recovery.

As global stock, commodity and currency markets went into a tailspin, the possible spillover effects from Dubai surfaced from London to South Korea, with banks big and small drawing concern for any losses they could suffer as a result of their exposure to the massively debt-laden emirate.

A year after the global slump derailed Dubai`s explosive growth, the city-state`s main investment arm, Dubai World, revealed this week it was asking for at least a six-month delay on paying back its $60 billion debt. Major credit agencies responded by slashing debt ratings on Dubai`s state companies, saying they might consider the plan a default.

In recent years, Dubai has expanded with ambitious, eye-catching projects like the Gulf`s palm-shaped islands and the world`s tallest skyscraper in hopes of becoming a tourist friendly and cosmopolitan Middle Eastern metropolis. In the process, however, the state-backed networks nicknamed Dubai Inc. have racked up $80 billion in red ink, and the emirate may now need another bailout from its oil-rich neighbor Abu Dhabi, the capital of the United Arab Emirates.

Following a rout in Europe, Asia`s stock markets tumbled Friday while the dollar hit a fresh 14-year low against the yen as investors piled into currencies perceived as safer. Crude oil at one point fell more than 6 percent.

Read the full article here.