Leverage

So tomorrow I talk to a bunch of cops, which probably means I shouldn’t arrive on my Harley while I simultaneously text and post blog comments. Actually it’s a conference of chiefs of police, and my job is to tell them about the future. I will wear body armour.

Reality is, public finances suck right now. Just as house lusty couples have mortgaged up their future to have GC-tops & SS today, whether they can afford them or not, so too have governments lived way beyond their means. The two are about to collide.

A few dozen people who work for the federal Industry Department had a crappy day yesterday when they lost their jobs. At least they have company. Seven hundred more are being fired at Public Works. More went at the organization which runs our museums. And more at Environment Canada.

In fact the federal public service is about to shrink by 11,000 people a year as the feds implement an austerity and downsizing program few people knew existed. No retiring workers will be replaced. Soon whole programs will be cut. Departments will be slimmed. Ottawa real estate will meet the Cookie Monster, aka Tony Clement. When asked if more people were about to be trashed he said: “I would say there are more layoffs coming, yes.”

But this is not just the feds. Every province but one (okay, okay… the first one to tell me which gets a book) is running a budget deficit. Some, like the $19-billion bottomless pit in Ontario, will be almost impossible to contain, unless health care is nailed and taxes goosed.

Cities? Forget it. Vancouver is a basket case, thanks to some recent sporting event. And Toronto is sinking faster than modesty at the Gay Pride parade. Debt there soared 20% last year and now stands at $4.4 billion. To pay the interest on that takes $400 million a year in tax revenues, which is more than the fire department costs. And every year, the debt rises more.

Imagine. Every Torontonian coughing up a double land transfer tax, per-garbage-bag levies and a car tax, while watching the province’s debt rising by almost $20 billion a year and the feds spending $40.5 billion more than they take in. It’s unprecedented. Never before in history – even during the Depression – did virtually every government in the country pee away more money than it took in.

This is called leverage. It’s when you need to borrow to get what you want because you can’t afford it. It’s a fundamental principal of real estate ownership these days, and also a reason why the cops won’t like what I have to tell them. Because leverage can’t last.

Take Greece. Those ouzo-swillers have been living on leverage since Aristotle was a rock star, and the results are in. Interest rates soared, bonds crashed, banks are wobbling, the government’s under siege and a national debt default (at some point, inevitable) will wipe away pensions and public services.

Too much leverage is why some US cities don’t answer most 9-1-1 calls anymore and teachers are being laid off. Beleaguered taxpayers simply hit the wall and are unable to finance governments which need money just to pay the interest on old debt, while they accumulate new debt. We’re not there yet, but we’re on the path. Every leader knows it, and now that H has his majority he’s determined not to go into history as they guy who left the cupboard bare and sold off the copper plumbing.

This is why deleveraging is coming. It’ll happen through austerity, cutbacks and layoffs. The stimulus spending that kept recession from becoming depression will end. Civil service (and corporate) pensions will be under review, then attack. Government will of necessity become smaller and meaner, and not necessarily without a measure of public support – since the alternative is endlessly higher taxes.

Of course, taxes will go up anyway. It’s one good reason you might want to stop stuffing your RRSP. The odds are in future personal tax rate increases mean you pay more money in tax on withdrawals than you ever saved on contributions.

For house hornies, this is not cool. With deleveraging comes less economic growth. With public sector layoffs and pension revisions come downward pressure on private sector wages and benefits. This is not what a nation needs where half of us, effectively, have no savings and household debt’s endemic. Thousands of young fools with no money bought houses since 2008 convinced they could borrow big because economic recovery would bring rising prices to wipe away their debt. Surprise.

And I haven’t mentioned European debt, a stagnant America, unreliable China, a nuke-oil crisis or the threat posed by Canuck fans.

Which brings me back to the cops. We might be needing more of them.

249 comments ↓

#1 Hashnugs Inthebong on 06.27.11 at 9:30 pm

Is Armondo Montelongo this generations Tom Vu? I saw an infomercial about attending his get rich scheme and making 100K in 6 weeks.

#2 mf on 06.27.11 at 9:33 pm

Sask.

#3 2or3orsometimes7 on 06.27.11 at 9:33 pm

Newfoundland!
?

#4 defunker on 06.27.11 at 9:35 pm

Alberta

#5 bono on 06.27.11 at 9:36 pm

is it alberta?

#6 downtown t.o on 06.27.11 at 9:36 pm

Sasketchewan ! Haha didn’t spell it right .

#7 Fires, floods and debt...oh my on 06.27.11 at 9:36 pm

BAZINGA!!!

too easy………..

hahaha

#8 Controller on 06.27.11 at 9:37 pm

I can say Saskatchewan without starting to stutter.
That’s my guess.

#9 Bailing in BC on 06.27.11 at 9:38 pm

What the heck!

First?

#10 William on 06.27.11 at 9:38 pm

Is the province Saskatchewan?

#11 North43 on 06.27.11 at 9:39 pm

I’ll guess Alberta.

#12 Medic on 06.27.11 at 9:40 pm

Newfoundland

#13 b on 06.27.11 at 9:40 pm

first, yes! teacher lay-off really scares me, they are safe jobs with steady income, May i please have a book.thanks

#14 Qazmer on 06.27.11 at 9:40 pm

Saskatchewan lol

#15 2deep on 06.27.11 at 9:40 pm

Only province not running a deficit is Saskatchewan. Technically that is debatable as it is based on hiding debt in the crowns and the possibility of royalties drying up in a hurry.

#16 Ayn Rand on 06.27.11 at 9:41 pm

Nova Scotia??

#17 Medic on 06.27.11 at 9:42 pm

No..
Nova Scotia

#18 oneworld on 06.27.11 at 9:42 pm

Saskatchewan

#19 TurnerNation on 06.27.11 at 9:42 pm

Is PEI the answer for province with no defecit?

#20 Rob on 06.27.11 at 9:43 pm

Newfoundland

#21 Stevermt on 06.27.11 at 9:44 pm

#134 disciple on 6.27.11
.ok …whoa , wait a minute space cowboy…technically speaking you don’t believe in peak credit and debt ok fine…

Conventional oil is in decline because we happen to live on a sphere that despite your wishing or praying is finite. Peak oil is not an “Idea”
that someone just made up…please google Hubbert curve, die-off.com and Life after the oil crash,this might help you get up to speed here on planet Earth.

Where do you suppose the powers that be are hiding the extra oil ??When you make statements like that you’re just not credible anymore. Magical thinking will not rescue us from this reality.

I suggest you educate yourself, all knowing sage, about
peak oil and resources and the ramifications of our civilization having to live on less of them.

Now fly off to your other planet(s), where I’m sure there is infinite everything…sky’s the limit !!

#22 Siddelly on 06.27.11 at 9:44 pm

Newfoundland has offshore oil riches so thats my guess!

#23 Bryan A. on 06.27.11 at 9:45 pm

Nova Scotia!

#24 Derp derp on 06.27.11 at 9:45 pm

First? Derp!

#25 TS on 06.27.11 at 9:45 pm

Newfoundland has no Provincial deficit

#26 Jay Bay on 06.27.11 at 9:45 pm

Quebec is it’s own country in their minds so they must be doing better then the other provinces…

#27 Calgary Illusion on 06.27.11 at 9:45 pm

NFLD

#28 Sasquatch on 06.27.11 at 9:46 pm

Too bad that when we need more cops, we will probably see less of them. Here Here to tough times most of the way around.

#29 Shy Blawg Dawg on 06.27.11 at 9:46 pm

Yeah – my crappy day was Monday of last week – looks like good-bye PWGSC.

How about a guess of Saskatchewan – hope I am right, I need the book now! Send Tuesday please, strike is over.

#30 anonymous on 06.27.11 at 9:47 pm

It is Alberta.

#31 John Doe on 06.27.11 at 9:47 pm

Alberta

#32 Luke Siragusa on 06.27.11 at 9:47 pm

Well we may need much more than cops. But if a protracted contraction is to define the next economic era, what we need will place second to what we can afford. Which will be less and less.

#33 Alex on 06.27.11 at 9:47 pm

Alberta.

#34 Stevermt on 06.27.11 at 9:47 pm

ummmm… Saskatchewan?

#35 neweastyorker on 06.27.11 at 9:48 pm

All of the provinces are indebted up to their necks but I’ll place my bet on Nova Scotia.

#36 LH on 06.27.11 at 9:48 pm

Cops are a good idea, until you realize we’re paying for OT-goosed final salary based pensions from age 50-80+, easily longer than their working careers! Charles Ponzi would be proud.

#37 Tazmania on 06.27.11 at 9:49 pm

Alberta with all the oil must be doing better than the rest of the country.

#38 my 2 cents on 06.27.11 at 9:50 pm

Abolish the Senate if Canada wants to save (big) money!!

#39 Mark on 06.27.11 at 9:50 pm

Alberta is the province!

#40 The InvestorsFriend (Shawn Allen) on 06.27.11 at 9:51 pm

POLICE GOLD-PLATED PENSIONS

Just for fun, but mostly to cause people to turn green with envy and to post vicious but amusing comments, ask the police about their pensions.

About the minimum age to retire with full unreduced pensions. Get them to show you the Gold plating on the pensions and then tell us about it. Take pictures if the Gold Plating.

Scare the police by telling them their pensions are not 100% safe. Tell them of their future which will include working as Commissionaires until they are 90 or becoming Wal-Mart greeters when young people renege on their pensions. In other words, lie.

#41 Skatch, natch. on 06.27.11 at 9:51 pm

Hey Garth!

I believe Saskatchewan is the only province not running a deficit.

#42 Lvl 85 Orc Warrior on 06.27.11 at 9:51 pm

Is it Alberta?

For the Warchief!

#43 Debt Free in Van on 06.27.11 at 9:51 pm

Geez … and all that’s coming from someone who doesn’t consider himself a doomer. Scary times ahead! Glad we took your advice and took our gains from real estate a month ago and are now renting. With storm clouds on the horizon, a quarter mil in the bank and NO debt feels a lot better than a leaky old condo over our heads and a few hundred grand owing on the mortgage!

#44 my 2 cents on 06.27.11 at 9:52 pm

For a start: Abolish the Senate if Canada wants to save (big) money!!

#45 G MacDonald on 06.27.11 at 9:52 pm

Me thinks the only province running a surplus is SK. Good enough for a book?

#46 PocoLoco on 06.27.11 at 9:52 pm

I’ll guess the province of Saskatchewan isn’t running a deficit this year… yet.

#47 Brett on 06.27.11 at 9:53 pm

Saskatchewan???

#48 early mid life crisis on 06.27.11 at 9:55 pm

@12 from yesterday- So will all the backlog HAM be admitted, or will the new rules limit them as well?

#49 roger on 06.27.11 at 9:56 pm

B.C

#50 Bobby on 06.27.11 at 9:57 pm

I say Saskatchewan

#51 JMS on 06.27.11 at 9:58 pm

And…….. that would be Saskatchwan. Until commodities hit the wall, that is.

#52 Dan on 06.27.11 at 9:59 pm

Quebec

#53 BBCoq on 06.27.11 at 9:59 pm

Saskatchewan? It is different there!!! Just kidding of course

#54 Squeeks on 06.27.11 at 10:00 pm

Newfoundland & Labrador has a budget surplus.

#55 SuperPL on 06.27.11 at 10:00 pm

Nova Scotia is not in deficit :)

#56 Joe on 06.27.11 at 10:01 pm

Great blog tonight, Garth. Now please excuse me while I go change my pants.

#57 John on 06.27.11 at 10:01 pm

Saskatechwan?

It certainly isn’t BC, Alberta, Ontario or Quebec…

#58 Abitibidoug on 06.27.11 at 10:02 pm

The province not running a deficit, is it Alberta?

#59 Phil on 06.27.11 at 10:02 pm

Newfoundland

#60 Jen on 06.27.11 at 10:02 pm

” Every province but one (okay, okay… the first one to tell me which gets a book) is running a budget deficit.”

Okay, Garth. I don’t often post, but promise of a free book is just too much for me to resist…. Saskatchewan.

#61 The InvestorsFriend (Shawn Allen) on 06.27.11 at 10:03 pm

POLICE GOLD-PLATED PENSIONS

Just for fun, but mostly to cause people to turn green with envy and to post vicious but amusing comments, ask the police about their pensions.

About the minimum age to retire with full unreduced pensions. Get them to show you the Gold plating on the pensions and then tell us about it. Take pictures of the Gold Plating.

Scare the police by telling them their pensions are not 100% safe. Tell them of their future which will include working as Commissionaires until they are 90 or becoming Wal-Mart greeters when young people renege on their pensions. In other words, lie (or would this be true?).

#62 cool on 06.27.11 at 10:05 pm

in Cricket parlance, today’s blog is a sixer.

#63 John on 06.27.11 at 10:05 pm

Great, I spelled Saskatchewan incorrectly and I look like an idiot. I don’t deserve a book.

Maybe an e-book though. 50% of the price.

#64 Neil on 06.27.11 at 10:07 pm

Probably 25th in the list, but I’ll risk being part of all the other garbage posts that want to win a book. Alberta has got to be the only province not running a deficit.

#65 Kim 1 on 06.27.11 at 10:07 pm

Leverage … I am laughin cause I know all the guys will probally look at this picture … more than once. LOL!

#66 tomohawk on 06.27.11 at 10:08 pm

I’ll guess Alberta.

#67 koots roots on 06.27.11 at 10:08 pm

Alberta

#68 TheProf on 06.27.11 at 10:08 pm

Saskatchewan’s running a balanced budget
Alberta has a surplus

#69 TheProf on 06.27.11 at 10:09 pm

Saskatchewan’s running a balanced budget

#70 Squeeks on 06.27.11 at 10:09 pm

Whoops! Sorry. I meant Nova Scotia: http://www.cbc.ca/news/canada/nova-scotia/story/2011/04/04/ns-budget-surplus.html

#71 Left coast dbags on 06.27.11 at 10:09 pm

Sask.?

#72 MO on 06.27.11 at 10:09 pm

The middle class is dead.
http://www.planbeconomics.com/2011/05/07/end-of-the-middle-class-some-sobering-facts/

Retirement is dead.
http://www.planbeconomics.com/2011/06/27/is-retirement-a-dead-dream/

We’re in a hole and deleveraging is just digging it deeper.

#73 Guy_in_Regina on 06.27.11 at 10:09 pm

Sask is not running a deficit!!

#74 JohnnyBGood on 06.27.11 at 10:10 pm

Saskatchewan

#75 drawstring on 06.27.11 at 10:10 pm

oh dear, more cops? must we?

#76 Cash is King on 06.27.11 at 10:14 pm

Which brings me back to the cops. We might be needing more of them.

But who will protect us from the overpaid cops?

#77 wd on 06.27.11 at 10:14 pm

Alberta Garth

#78 prairie gal on 06.27.11 at 10:15 pm

Saskatchewan

#79 hank on 06.27.11 at 10:16 pm

must be Saskatchewan for the budget surplus.

#80 nonplused on 06.27.11 at 10:17 pm

Saskatchewan claims they do not have a deficit, but they don’t do their accounting the same as most other provinces and they raided their rainy day fund.

I already have Money Road so give the book to number 2 if it isn’t gone already.

#81 P F Murphy on 06.27.11 at 10:17 pm

“With public sector layoffs and pension revisions come downward pressure on private sector wages and benefits” This is the implosion of our economy under Harper. Fewer jobs, less money, less consumption of everything, leading to less production leading to more layoffs and fewer jobs for which there is more competition and lower wages.Ya know you’re right. More ammo, must put more ammo on the list and some sheets of 1/4 inch steel for the bunker might be handy as well!

#82 Garth4king on 06.27.11 at 10:17 pm

My guess is “Alberta”

#83 2deep on 06.27.11 at 10:17 pm

Trick question. Saskatchewan and Newfoundland are both running a surplus.

#84 Joe on 06.27.11 at 10:20 pm

saskatchewan is the province in surplus

#85 JohnnyBGood on 06.27.11 at 10:21 pm

#13 MO

Deleveraging does not make the hole deeper; it’s the first step in climbing out of it.

#86 nonplused on 06.27.11 at 10:27 pm

Here’s a deficit map of Canada:

http://www.cbc.ca/news/business/story/2010/04/29/f-provincial-deficits.html

Nunavut has a small surplus!

Ontario is so screwed. Alberta is not far behind. Be good to see the back side of farmer Ed as he leaves. Don’t let the door hit your arse on the way out Ed!

#87 Lisa on 06.27.11 at 10:31 pm

Manitoba.

#88 Kim 1 on 06.27.11 at 10:35 pm

All this debt, increased taxes, no pension, roits… hell all this makes me wanna to marry a cop.

#89 PocoLoco on 06.27.11 at 10:40 pm

… of course YT and NF also projected surplus budgets for 2011-12! Just sayin’ (canadaonline.about.com)

#90 Siddelly on 06.27.11 at 10:41 pm

….and Labrador

#3 The InvestorsFriend (Shawn Allen)

While you are quizzing the cops, try and get them to tell you what percentage of their payroll goes to overtime in big riotous cities. After working four 12 hour days, how many are taking crowd patrol postings on movie shoots or extra night shifts on concerts, sports events etc. Sleepy guys with loaded guns will sometimes make mistakes, like blowing through red lights in hot pursuit without lights or sirens, taking out innocent victims.

#91 Steve on 06.27.11 at 10:41 pm

Is it… Saskatchewan which has the surplus?

#92 PocoLoco on 06.27.11 at 10:41 pm

… of course Yukon and NFLD also projected surplus budgets for 2011-12! Just sayin’ (canadaonline.about.com)

#93 vatoDETH on 06.27.11 at 10:42 pm

YUKON!!!
http://policymonitor.ca/economy/yukons-2011-2012-budget/

#94 Captom on 06.27.11 at 10:44 pm

Newfoundland.

#95 Kurt on 06.27.11 at 10:46 pm

Definately not Alberta. We are running big deficits. My guess in Manitoba.

#96 Captom on 06.27.11 at 10:46 pm

Newfoundland is in budget surplus.

#97 NO FUN VANCOUVER on 06.27.11 at 10:47 pm

Newfoundland, but I have yopu book

#98 NO FUN VANCOUVER on 06.27.11 at 10:49 pm

Newfoundland, but I have your bookg

#99 TaxHaven on 06.27.11 at 10:49 pm

Cutbacks. Downsizing of government. That’s nice.

But the current bunch are just as big-government-socialist as the Liberals or the NDP. And neocon/theocon authoritarian ‘tough-on-crime’ nuts to boot.

Where are the cuts to the CBSA, to FinTrac, to the RCMP and to the CRA? You can be very sure they’ll be keep THEM well-funded…

#100 T.O. Bubble Boy on 06.28.11 at 6:37 am

Couldn’t a lot of F and Harper’s problems be taken care of by putting the GST back to where it was (7%)?

That, and cutting defense spending would solve 100% of the deficit problem.

just saying.

#101 T.O. Bubble Boy on 06.28.11 at 6:45 am

Not that it will save the housing market, but look for sub-3.5% 5-yr fixed mortgages soon:

http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2011/06/5-year-yield-touches-2.html

#102 Utopia on 06.28.11 at 7:19 am

Pretty good blog post today Garth. Of course, you are correct that all levels of government are facing debt burdens that cannot be sustained indefinitely. Add in private debt and we have one Mother of a burden to carry.

As real growth will remain anemic for quite some time, the various levels of government should be resisting taking on new debt obligations while giving themselves plenty of room to pay down old obligations.

That means holding the line of public sector wage growth and the expansion of existing social programs including health care. Not so easy when there are growing demands. That is when all the screaming and belly aching usually begins. Nobody wants to give anything up……and even fewer want to contribute more through new taxes.

Just look at BC’s battle with implementing GST as an example of the level of anger that increased taxation brings. Unfortunately we can’t have it both ways.

Some Provinces may be being a little too optimistic in how fast they can cut deficits and debt as well. I would stretch out the time frame myself. It is realistic to anticipate a very long period of slow or low growth in the economy given how much debt needs to be paid down versus the level of real economic activity combined with slowing growth elsewhere.

I have no doubt it can be done but there will surely be sacrifices along the way in services for all levels of government. As major debtors, we do not have the luxury to live well beyond our means in this kind of environment. Most Canadians seem to understand fortunately. My biggest worry leading up to election day was that the Liberals or NDP and Bloc might actually end up in a position to launch the country into a massive new round of expansion in the area of pensions, social spending and carbon taxes.

Not that I don’t agree these are important priorities, just that we simply cannot afford them right now. Thank goodness they were not successful and that voters recognized the danger in time.

#103 House on 06.28.11 at 7:24 am

I thought private individuals having body armour was illegal. We had a charge laid in a drug arrest. Who knew!

I wonder what a country where no one receives an education except those who can afford private schooling looks like. Is there an example somewhere in the “third world”?

The rest of your “points” are foolishness.

#104 detalumis on 06.28.11 at 7:25 am

Think you are wrong “for a change”. “With public sector layoffs and pension revisions come downward pressure on private sector wages and benefits”. It is actually the reverse, private sector outsourcing, pension revisions and cuts to benefits have triggered the downward pressure on the public sector.

All you have to do is look at countries with vast disparities in wealth where we get a lot of our professionals from say the Philippines or India. In those countries you will see that nurses, teachers, police are not all that well paid at all. You can’t support an army of 100K workers on the backs of people holding service jobs or temporary contracts.

I was downsized from a big bank in IT which outsourced to India, my gross income dropped by 50% but I noticed that my net is almost the same. I pay 5K taxes now instead of 30K, live on dividends and contract work and I am now using more services than I pay for. The country cannot handle a huge number of people like myself who don’t pay our freight along with an army of retired people who get a whack of sweet freebies and tax deals. This on top of the elephant in the room a health care budget that is set to consume 70% of Ontario’s entire revenue in 10 years. Sooner or later it all collapses like a deck of cards. Interesting times coming indeed.

#105 Walter on 06.28.11 at 7:26 am

Alberta has no debt.

#106 HouseBuster on 06.28.11 at 7:26 am

Can’t the gov’t just go to the computer terminal and create money out of nowhere to pay for all of this?

#107 Utopia on 06.28.11 at 7:26 am

Toronto’s debt grew 20% in a single year? That is truly astonishing. It is a rare day I pay much attention to the big smoke but seriously,…they are doing something very wrong in that city. There just is not an excuse for that level of over-run. Let’s hope the new Mayor can get the situation under control quickly.

#108 MR. Lee on 06.28.11 at 7:28 am

Good points Mr. Turner.

Already in Alberta we hear more and more the idea of installing a sales tax. I am sure that after the next provinical election this will become a reality. Far too long Canadians have been chanting the mantra of how different things are here. I am confident that soon we as a nation will realize just how simular we are to otehr western nations in terms of economic challenges.

#109 TurnerNation on 06.28.11 at 7:28 am

Over in the Reichland (where they’ve accomplished what failed in 1945, the total take-over of all countries by the “banksters”), rates set to rise due to inflation:

Inflation Accelerated in Three German States as ECB Prepares to Raise Rate
By Jana Randow and Christian Vits – Jun 28, 2011 8:00 AM ET .

European Central Bank’s 2 percent limit every month since December and policy makers have signaled they’re ready to raise interest rates further in July.

.Inflation in the German states of North Rhine-Westphalia, Baden-Wuerttemberg and Hesse accelerated in June, led by higher energy costs.

In Baden-Wuerttemberg, the inflation rate rose to 2.3 percent from 2.2 percent in May, while increasing to 2.5 percent from 2.3 percent in North Rhine-Westphalia and to 2.1 percent from 2 percent in Hesse, the states’ statistics offices said today. Inflation held steady in Bavaria, Brandenburg and Saxony. The Federal Statistics Office in Wiesbaden will release German inflation, based on data from six states, later today.

Inflation in the 17-nation euro region has breached the European Central Bank’s 2 percent limit every month since December and President Jean-Claude Trichet today called for strong vigilance on price threats, indicating a July increase in the benchmark interest rate

http://www.bloomberg.com/news/2011-06-28/german-state-of-hesse-says-inflation-quickened-on-energy-costs.html

#110 Rick Danger on 06.28.11 at 7:35 am

“Of course, taxes will go up anyway. It’s one good reason you might want to stop stuffing your RRSP” – Garth

Really? considering whats coming, what happened to buy low? or is this this info for the near retiring….?

That question makes absolutely no sense. — Garth

#111 not 1st on 06.28.11 at 7:36 am

Didn’t we just have to go through an austerity program by the liberals back in the 90s when the IMF was lurking around canada? So a mere 15 years later and here we are again? Great. They should find every Keynesian on the planet and horse whip them.

But at least we recognize its coming. Poor old U.S.A is still in denial that it can spend its way out.

Watch out for a nasty stock market fall too. The traders are pumping this thing for one last go at the carcass. There is no economic recovery or corporate profits. U.S. companies are holding several trillion in off balance sheet debt including that economic stalwart General Electric which has 600 billion in debt, nearly the size of Canada’s public debt. There are scary time bombs like that all over the economy.

#112 Love this Blog on 06.28.11 at 7:39 am

I tried to post this yesterday, but it wouldn’t accept!! That shattering setback should be worth a book!!
Anyways, enjoy:

http://www.youtube.com/watch?v=XZSAjLXgezk

#113 infernalmachine on 06.28.11 at 7:49 am

@91

Yes, putting the gst back would certainly help solve the feds’ “problems”

However, it is in the Conservatives’ interest to have a country that appears to be broke – people are much more amenable to cutbacks in government and selling off of public assets if we seem hard up. And every time I think I must be a conspiracy nut for thinking this way, it happens again somewhere in the world.

Sigh.

#114 Industrial Guy on 06.28.11 at 7:58 am

Saskatchewan didn’t have a deficit in 2010- 2011 … BUT …. It’s kinda funny accounting that hot them to this ….

1. They dipped into their “Rainy Day Fund” $194 million dollars to cover a projected deficit ….

2. Magically a $623 million dollar projected deficit disapeared …

Colin Craig, provincial director for the Canadian Taxpayers Federation, conceded that the Saskatchewan budget really isn’t balanced. “It’s not quite a balanced budget. They’re taking $194 million from the rainy day fund and they’re going to use that give them a small surplus this year.”

So, the correct answer to your Question is NONE of Canada’s Provinces actually have a balanced budget…..

#115 Mr Buyer on 06.28.11 at 8:01 am

#91 T.O. Bubble Boy…cutting defense spending. Well that might be okay for the very short term (especially huge ticket foreign made items) until we can get the infrastructure up and going to manufacture our own hardware (no, I do not want Canada to go into the arms biz, just make our own stuff). I really think we need to require two years of service from all males (basic indoctrination, infantry craft, equipment familiarization, survival training and marksmanship and go with a slightly smaller standing career army with force multiplying weaponry made in Canada). We are the second largest country in the world with a population smaller than that that lives in and around Tokyo (more people visit one resort lake in Japan each year than live in all of Canada). Peace through strength or servitude those seem to have been the choices to date. We do not necessarily have to outright win, just mangle an aggressor so badly that they are vulnerable to other aggressors. PLEASE EXCUSE SPELLING GAFFS AND GRAMMAR MISCUES THAT SURELY EXIST IN THIS POST BUT I CAN NOT SEE UNTIL I PRESS SUBMIT FOR SOME REASON.

#116 Tallguy on 06.28.11 at 8:04 am

It is Manitoba

#117 Tom from Mississauga on 06.28.11 at 8:06 am

The Manitoba Jets?

#118 MikeT on 06.28.11 at 8:08 am

it must be Quebec – with all those huge transfer payments, how is it possible to have a deficit? { sarcasm off}

#119 Renting in leaside on 06.28.11 at 8:08 am

Metal heads, Squirrel stew, collapse of the Roman Empire…

Take two Prozac and call me in the morning…

#120 Mr Buyer on 06.28.11 at 8:10 am

#100 T.O. Bubble Boy…I must be on crack, I thought I copied and pasted your comment not #91′s comment (sorry #91 Steve)

#121 MikeT on 06.28.11 at 8:19 am

@65 Kim:
sigh… after reading your post, I just had to scroll up and look at the pic again.

#122 gtotha on 06.28.11 at 8:22 am

Garth, thank you for today’s photo. I’ll give it a 10/10.

#123 Soylent Green is People on 06.28.11 at 8:22 am

Speaking of police chiefs, here’s a link re Vancouver:

Whitelaw said he emailed the Vancouver Police Department on June 1, 2011, with 15 points identified in the 1994 report and pitched himself as a consultant.

He didn’t get a reply.

The 1994 B.C. Police Commission report was never released publicly. Reporters who have asked for it since have been told to submit a freedom of information request with the City of Vancouver.

Chu has been stung by criticism that his force should have been better prepared for a potential riot.

http://calgary.ctv.ca/servlet/an/local/CTVNews/20110621/vancouver-police-lashes-out-bob-whitelaw-110621/20110621/?hub=CalgaryHome

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#124 Kim 1 on 06.28.11 at 8:22 am

Nunavut! I win!

#125 Soylent Green is People on 06.28.11 at 8:26 am

An investigator who examined the 1994 riots in Vancouver says key recommendations went unheeded by local police. Bob Whitelaw told CTV News that many of the 100 recommendations he helped draft were blatantly disregarded.

Those suggestions include a no-parking zone in the downtown core, something that could have prevented frustrated people from taking their aggression out on parked cars. Whitelaw also recommended that fans should have been quickly dispersed and reminded they have to get out of the downtown zone.

“The police, in many ways, as they did in ’94, seemed to be standing around, not taking any pro-action,” he said.

http://www.ctvbc.ctv.ca/servlet/an/local/CTVNews/20110616/bc_police_fire_riot_update_110616/20110616/?hub=BritishColumbiaHome

#126 Kim 1 on 06.28.11 at 8:29 am

The blog crashed last nite just when I was puttin in my answer. Nunavut. Right?

#127 MadMan on 06.28.11 at 8:34 am

Governments will avoid laying off cops by all means necessary, but you can bet their nice pensions will be under attack when austerity rolls around.

By the way #27 LH ~ police overtime is not pensionable and it’s a lot cheaper just to pay OT than it is to hire more bodies. So expect more burnt-out cops working overtime shifts when times get tougher. That’s not good for anyone…

#128 Shane on 06.28.11 at 8:37 am

Garth, Quebec?

Shane

#129 Timing is Everything on 06.28.11 at 8:51 am

Which brings me back to the cops. We might be needing more of them. – Garth

I don’t dislike cops, not at all. But I always feel better when they’re not around.

#130 The American on 06.28.11 at 8:52 am

Saskatchewan is the answer. All other Canadian provinces are running a deficit as of today.

#131 cxcroney on 06.28.11 at 8:55 am

Needing more cops! That is what I said the Harper plan for more prisons was all about. A leader with true vision, not since Trudeau.

#132 T.O. Bubble Boy on 06.28.11 at 8:58 am

WOW – parts of Vancouver have fallen off a cliff when it comes to RE sales.

Check this out from Larry at yattermatters:
In his May/June snapshot there were 138 sales — down from April/May’s 359 (-62%).

#133 LJ on 06.28.11 at 8:59 am

Is that a trick question?

According to TD economics, both Saskatchewan and Newfoundland/Labrador will be running in surplus next year (source):

http://www.td.com/economics/budgets/sk11.pdf

http://www.td.com/economics/budgets/nl11.pdf

Alberta, for all its oil riches and rich oil barons will be running an estimated 3.4 Billion in the hole, with teacher layoffs:

http://www.td.com/economics/budgets/ab11.pdf

#134 Kevin on 06.28.11 at 9:02 am

I still don’t understand where the sudden need for all this job-slashing and program-killing came from. It was just a few years ago that we enjoyed a string of surpluses. Then a couple years of deficit “stimulus” spending, and a GST cut. Now suddenly we need to lay off tens of thousands of people? Why can’t we simply STOP the stimulus spending (already done, no?) that caused the deficit in the first place, and nudge the GST back up to 7%? Why wouldn’t that put us back into surplus, where we were a couple years ago? Maybe a little attrition to trim the payroll a little, but no need for pink slips. I don’t get it. Can someone explain it to me?

The budget was in surplus in 2005 when Mr. Harper came to power. Cutting the GST by 2% reduced revenues by $14 billion a year, and when the recession further crashed tax intake, the deficit swelled, especially as stimulus spending started. In addition, the Conservatives have increased program spending and the size of the civil service every year since gaining power in January of 2006. The result: $40 in deficit, a rising federal debt and now the inevitable deleveraging. Perhaps Mr. Harper should have been more conservative. — Garth

#135 Derek on 06.28.11 at 9:07 am

The Yukon is not a province.

#136 Rich Renter on 06.28.11 at 9:20 am

I’ve been washing and rinsing my RSP contributions with my TFSA.

#137 poco on 06.28.11 at 9:27 am

#36LH

Cops are a good idea, until you realize we’re paying for OT-goosed final salary based pensions from age 50-80+, easily longer than their working careers! Charles Ponzi would be proud.
______________________________________________
Sorry to burst your bubble, but overtime earned is not factered into any pension

#138 Anna on 06.28.11 at 9:27 am

“Beleaguered taxpayers simply hit the wall and are unable to finance governments which need money just to pay the interest on old debt, while they accumulate new debt.” – who the governments are paying interest to? Aren’t they the ones who create money in the first place? Why would they borrow from themselves and charge interest to themselves?

Government debt is sold to investors, to whom interest is owed. — Garth

#139 Tim on 06.28.11 at 9:34 am

nice pics, careful Garth, you might get tasered, but rest assured, there will be a full inquiry and nothing whatsoever will happen to the Cops, as they have full immunity

#140 Tim on 06.28.11 at 9:39 am

How can we afford more cops? THey have a better pension than anyone!

#141 despeculated on 06.28.11 at 9:41 am

H had to leverage to keep the minority in power. Keep the Libs and Dips happy… Now we’ll see conservative hack and slash… enjoy the overshoot.

#142 BM on 06.28.11 at 9:52 am

Saskatchewan

#143 Stevermt on 06.28.11 at 9:52 am

The cops here in the Hammer just got their huge raise over 3 yrs..Now they can sit pretty and catch traffic violators to collect all those taxes to pay those salaries !!
they’re certainly not focusing on the real criminals !!
(ok my rant is over.I feel better..just got a nice ticket a couple of months ago..still stings ! :)

#144 Kevin on 06.28.11 at 9:58 am

For all who said Saskatchewan, take a look here.
http://www.finance.gov.sk.ca/budget2011-12/2011-12GreenSheet.pdf

Looks like a surplus and we are told it is a surplus and
Government Public Debt is going down in Saskatchewan.
But Total Public Debt is going UP in Saskatchewan.

Regardless of what kind of debt it is, it eventually has to be paid back. And if total public debt is going up, that means that down the road, there is more money going back to Government to pay the debt from your pocket, no matter what account it is in.

So if you picked Saskatchewan, you could be right or you could be wrong, it just depends on how you like your numbers massaged.

#145 greg on 06.28.11 at 10:08 am

I am Curious as to what they plan to do when the baby boomers retire? if we are slashing jobs like this are we closing our door to immigration? i doubt it. you cant have it both ways Mr.Harper, either we are an aging population that needs skilled workers from abroad or our unemployment is starting to creep up and we slow down immigration, atleast till things turn around if they ever do. I know immigrants start small businesses but i think a lot of it has to do with the government able to tax more people , keep that ponzi scheme CPP and other government spending going. I dont see the rush to pay off the debt when the world is sinking and our national debt isnt a huge problem. every man woman and child owes about 70,000 towards the canadian federal debt, in the states its around 500,000 depending on what you believe their real national debt is at. I remember in the boom they brought cops over from great britain as there was a shortage, seems like every time i get pulled over i am being talked to in a cockney accent. Seems like the government cant plan further then the next election. 4 year plans work great for politicians not for the average canadian who wasnt born with a silver spoon in their mouth and actually work for a living. Tell the Queen she can have her police officers back and we dont want her read headed Nazi Grandson here either. http://www.telegraph.co.uk/news/uknews/theroyalfamily/8601657/Make-Prince-Harry-our-king-say-Canadian-monarchists.html

#146 Devore on 06.28.11 at 10:14 am

#114 Industrial Guy

1. They dipped into their “Rainy Day Fund” $194 million dollars to cover a projected deficit ….

2. Magically a $623 million dollar projected deficit disapeared ….

Didn’t Paul Martin borrow $54B from the EI fund surplus to balance his budget, that was never paid back? It’s all just accounting gimmicks, much like Clinton’s US balanced budget was.

#147 Mr. Plow on 06.28.11 at 10:15 am

#101 T.O. Bubble Boy

I thought the housing market was being propped up by cheap credit? So how would low rates not help the market?

I get so confused coming here, so many contradictions.

#148 Mr. Plow on 06.28.11 at 10:16 am

My vote for a book is the province of Toronto!

#149 greg on 06.28.11 at 10:47 am

“China Eyes Canada’s Oil Sand” any one see this article? china wants to invest Billions into Canada’s oil industry, mean while the U.S. is telling us we must be careful in dealing with the chinese. What a joke, does anyone remember obama calling us out saying we have dirty oil. and all those add campaigns across the states saying dont travel to alberta cause of the oil sands. now they are telling us we should be cautious in selling it to china cause they want it to themselves. these people are a joke. It isnt the cleanest way of extracting oil but neither is dropping bombs. using water to get to the oil as opposed to blood. http://www.huffingtonpost.com/2011/06/27/china-canada-oil-sands-alberta-tar_n_885032.html

#150 Kitchener1 on 06.28.11 at 10:51 am

The reality is (as a early 30′s gen x’er) I will have to pay much more taxes (as % of income) and have much lower purchasing power with my dollars then the boomers did. This is true for everyone 30′s and under.

The boomers are going to retire, which means they will be going from a consumption to survival mindset. Bad news for a services sector economy. The economy tracks the boomers fortunes, as they go, goes the economy.

To bad about the layoffs in govt, but it has to happen, there is no viable option. The govt(s)- all levels are drowning in debt, and this is right now, before the mass wave of boomer retire. There is only so much tax that people can pay before they decide to opt out of the system and not take the extra overtime shift or start their small business on the side etc..

Police forces will be cut too, they might be the last thing that gets cut but they will not escape the austerity slashes coming. Not even healthcare was safe when Harris was premier of Ontario, now youve got Harper as PM.

#151 C ROCK on 06.28.11 at 10:52 am

Yukon.

Thank you

#152 Abitibidoug on 06.28.11 at 11:02 am

My first comment is, with all these cutbacks in both the public and private sector, where’s this labour shortage all the self proclaimed “experts” said would occur when the baby boomers retire? if you call that a labour shortage, I’ve got some shares in Nortel or Bre-X I’ll sell you for the dirt cheap bargain price of $100 each.

My second comment is, with all these cutbacks coming, has anyone even considered Bob Rae’s idea (not really his idea, it’s been done elsewhere successfully) of reducing hours like was done with the social contract? In this day in age where hardly a minute goes by where someone isn’t complaining of how the pace of life is faster and and we’re more in a hurry than ever before, wouldn’t it make sense to turn some of those productivity gains of the last 100 years or so into more liesure time? Such an arrangement would not only keep people employed, but reduce stress levels. With more free time, it would give people more time to get outside and exercise, leading to better health and reduce some of the burden on our already stressed health care system. Not only that but, God forbid, it would give people more time to socialize and spend time with friends and family. It would also reduce the already too high burden on social programs like unemployment insurance and welfare. How could that be a bad thing?

By suggesting reducing work hours to save jobs, am I being too radical, and thinking too far outside the box for most people to comprehend?

#153 wes_coast on 06.28.11 at 11:05 am

I wonder if the USSR felt the same when they realized that welfare states don’t last …….

#154 UVZ on 06.28.11 at 11:13 am

It is logical to anticipate increases in unrest, violence and crime in a population with record high credit debt loads, structural unemployment and austerity measures in place.

To me the ubiquitous payday loan outlets in strip malls are leading indicators of trouble. A business model like that would have been a joke 25 years ago. Another joke back then would have been debt counseling billboards on buses.

One needs to remember that dealing with the anger of the victims of credit debt is like treating symptoms of a disease – not its cure.

#155 Mean Gene on 06.28.11 at 11:22 am

What no donut jokes in the comments today, I am disappointed.

#156 Uncle Scrooge on 06.28.11 at 11:26 am

Garth, please don’t ask your audience questions with a one word answer. The wheel on my mouse is a bit wonky and can’t take the incessant scrolling.

#157 Bobo on 06.28.11 at 11:29 am

It’s a trick question. Sasky and NL are both projecting surpluses this year. Oops.

#158 Kurt on 06.28.11 at 11:39 am

Perhaps Mr. Harper should have been more conservative. — Garth

Aaagghh! Yes, yes, yes! For some reason the politically ignorant who also go to the poles think that just because something is branded “conservative”, you’ll actually see prudence! Politics and truth rarely cross paths, and when they do the politics always wins (does the word “dooced” mean anything to my fellow dogs?)

#159 Mr. Lahey on 06.28.11 at 11:42 am

Randy, the economic shit hawks are gathering momentum and even the trailers in the park won’t be spared. It’s gonna get real ugly Randy…

#160 CrowdedElevatorfartz on 06.28.11 at 11:45 am

Garth’s comment…

“The budget was in surplus in 2005 when Mr. Harper came to power. Cutting the GST by 2% reduced revenues by $14 billion a year, and when the recession further crashed tax intake, the deficit swelled, especially as stimulus spending started. In addition, the Conservatives have increased program spending and the size of the civil service every year since gaining power in January of 2006. The result: $40 in deficit, a rising federal debt and now the inevitable deleveraging.

Perhaps Mr. Harper should have been more conservative. — Garth

Thank You.

My flatulence boils when I think of the wasted years that we , as taxpayers, watched the ‘debt clock” stop counting UP and started counting Down.
The only reason i voted Liberal in the 90′s was due to their fiscal responsibility.
The boomer retirement silver tsunami approaching is going to be a huge fiscal boot in the teeth of every pensioner( govt or private).
The whining CUPW strikers at Canuckda Post( Great. mountains of junk mail about to cascade through the mail slot. Cant wait.) legislated back to work are a shining example of all that is wrong with public workers.
Public Works. Where sloth and incompetance is tolerated, protected and rewarded.
Enjoy your public sector jobs for now people cause its ALL coming to an end.
The private sector can do your job faster, cheaper and with far less staff. (why do we need 10 city workers leaning on shovels watching one machine work? Fire ALL of them and hire 2 workers to lean on a “goon spoon” and watch the machine dig)

Bring on the cuts! Far to overdue.

#161 Nick on 06.28.11 at 11:47 am

The “Quebec lives off the money sent their way by Ottawa” meme is a myth. But it’s fun to perpetuate that myth, so bigots do it.

#162 Bruce on 06.28.11 at 11:53 am

Hi SMOKING MAN,

YLO down 31% since you bought. Ouch. I hope your amazing poker and propert price forecasting skills make up for your terrible investing decisions. Or are you just full of ****? I think we all know the answer

#163 Nicholas P on 06.28.11 at 11:56 am

Nova Scotia

#164 garrulous squirrel on 06.28.11 at 11:57 am

It’s a fact that government is the only ‘investor’ involved in the issuance of debt. They print it with a keystroke and purchase it back at the same time. There are no ‘investors’ buying Canadian debt……this situation has been outed long ago. We the taxpayers are the only ‘investors’.

The idea that we should think of hiring more police is very scary. The incompetant hiring and screening practices of the national and local police forces has been under scrutiny for years. The bar has been lowered to the detriment of citizen safety. Talk to the auditor general about that.

Currently more citizens die at the hands of police in Canada in a year than Canadian soldiers are killed by the Taliban in the battles of Afghanistan and the ‘police actions’ around the world. Statistically it is much more dangerous to walk the streets of a Canadian city than the streets of Khandahar.

Having pointed that out, I was surprised to watch the Rat-Couver police show surprising restraint in their actions during the riots. It was the national police and the members from a outlying municioality who engaged in the violence and baton swinging….if you watch the video carefully and note the badges.

#165 disciple on 06.28.11 at 11:57 am

#152 Abitibidoug…..Shhhhhh…hush now…. We don’t want to give people any ideas…or time to form their own…they must continue to function in a state of contented indentured servitude…

Ideas are very dangerous…we must stifle and control all ideas by making it politically incorrect (thought police) to discuss anything that does not conform. Didn’t you get your “free” education?

#166 City Slicker on 06.28.11 at 11:59 am

So what’s the concesus is Alberta in deficit? I remember not long ago they were sending us cheques from the Millenium Fund, or something like that, for our provinces prospertiy. Wonder how many bought houses during those days that will be feeling the pinch with all that seems to be coming.

#167 TK on 06.28.11 at 11:59 am

Actually we will be moving from Okanagan to NS next month.

#168 Williston Geo on 06.28.11 at 12:04 pm

Answer: none of the above. Sk is losing just under a million dollars/day in revenues from shut in oil wells in the South East. Combine that with poor drilling activity,falling oil price, major flooding, & labour unrest, no way they break even this year.

#169 not asian on 06.28.11 at 12:14 pm

“In fact the federal public service is about to shrink by 11,000 people a year”

Excuse my ignorance – but does anybody know how many people are employed by the federal public service? What percentage does 11,000 represent? This is throughout Canada, so how many jobs per province would be lost, or per city?

There are about 420,000 federal public servants. Since taking office Mr. Harper increased the payroll by 39,000. — Garth

#170 LB on 06.28.11 at 12:18 pm

Let’s be clear. The “stimulus spending” was the bailouts of the corporate and financial sectors (including CMHC), by governments globally with unfettered access to tax revenue. THIS was the cause of the current deficits worldwide, including Canada’s.

Globally, citizens are now being asked to pay for these bailouts with layoffs, services,benefits and pension cuts, along with increased taxes.

To protect governments from their own people while attempting to implement these policies, an increased (and well paid) police state results.

To make governments accountable when they’ve not been representative of the majority contributing to the communal resources, but have instead directed them to benefit only an elite few, resistance in order to effect the necessary change begins, as it aways has.

It is what we are now witnessing in Europe and elsewhere, and is what we, too, will experience and should prepare for by being what is advocated on this contrarian site. That is: become liquid, flexible and self-sufficient.

#171 The InvestorsFriend on 06.28.11 at 12:21 pm

Number 155, Mean Gene, I’ll bet you “dollars to donuts” that Police have one of the best pensions around.

#172 JSS on 06.28.11 at 12:24 pm

Are these fed government ‘workers’ or fed government ‘positions’ that are being axed?

It is possible that 11,000 unfilled jobs can be cut, along with severance packages given to those with the 85-point factor, and getting rid of contract workers, without any permanent staff being cut.

Please clarify.

#173 disciple on 06.28.11 at 12:25 pm

Speaking of thought police, and police, in general…let’s take a look at the etymology.

The term derives from the same root as policy. A “police officer” is a “policy enforcer”. Only corporate bodies have “policies”. A government of the people have laws.

I have mentioned before that all three levels of government in Canada are CORPORATIONS, with stock that trades on the international exchanges. Their unadvertised policy is NOT to serve you, but to leverage your HUMAN RESOURCE to benefit their shareholders.

That is the reason that police enforcement or policy enforcement officers are given top priority in terms of remuneration in such a corporate system of governance. Criminals? What are they? They just help to spread the mental mayhem that serves to further manipulate your fears and increases the power of the thought police. REAL policemen and policewomen are not welcomed in the uniform. Too bad.

I will leave it up to you to discover who the real shareholders in your Corporate Governments are…because I assure you that your “vote” is meaningless.

#174 nonplused on 06.28.11 at 12:40 pm

Garth, are you writing for the Globe under a pseudonym?

http://www.theglobeandmail.com/news/politics/budget/personal-finance/why-renting-can-be-the-right-choice-for-aging-boomers/article2077874/

#175 Roial1 on 06.28.11 at 12:43 pm

152 Abitibidoug on 06.28.11 at 11:02 am

By suggesting reducing work hours to save jobs, am I being too radical, and thinking too far outside the box for most people to comprehend?

Simple answer, YES!
Why?
The mega rich WILL NOT give up one penny of their super wealth and that is what would have to happen to take any weight off of the working classes.

Take a look at history.
When have the PTB ever really given a flying F–K for the pee-ons.
In all of recorded history, only the Romans gave any kind of “out” for the working and or slave class.
And that only came about after the slave revolt led by Sparticus.

The accumulation of wealth is addictive and not a breakable habit. Those who have it are lifers and the only thing to stop them is death.

The mega rich are in a struggle just like the “Firsters” here. They can not give it up till they are at the top of the “Richest” list.
People can litteraly starve in the streets before these ones even notice. (If they do)

A drug is a drug, is a drug. And as Garth says,This will not end well.

#176 Ret on 06.28.11 at 12:55 pm

Most people would see government debt as simple arithmetic. Tax revenues minus expenses and the net is reported as a debt or surplus.

Read up on Meredith Whitney. She claims that state and municipal governments consistently under report debt in the US by not reporting all of the future liabilities of pensions and health care costs that are contractually earned by government workers every year that they work. Up to 75% of state debt is off the balance sheet!

All those police, fire, teachers, nurses and other government workers are collectively racking up billion dollar pension and health care credits each and every year that are lurking as unreported debt. The costs are just like future obligation bonds that are issued and will come due in the future only the debt is not reported. Future obligations are in effect, the unreported financial elephants in the room.

But I’m sure that reporting of future debt obligations payable to employees is different in Canada. It is different here, isn’t it Garth?

And the link:

http://www.cnbc.com/id/43302247/CNBC_EXCERPTS_MEREDITH_WHITNEY_MEREDITH_WHITNEY_ADVISORY_

#177 shanks on 06.28.11 at 1:00 pm

Long Live Garth, King of the Doomers!

(please finance my urban greenhouse project)

#178 Devore on 06.28.11 at 1:01 pm

http://vancouver.ca/police/recruiting/police-officers/salary-benefits.html

And don’t forget the benefits and pension. Not bad at all.

Now, the job’s not for everyone, obviously, but, lets make no mistake about it, you’re walking into it with eyes wide open.

#179 Bruce on 06.28.11 at 1:05 pm

Like the old song says, Every Time Two Fools Collide… Honestly, there are moments when it seems as if this world I’m living in is growing more and more insane and out-of-control by the day. Does ANYTHING make sense anymore? Over the past decade or so, I have witnessed a profound change in people and society in general–and not for the better as far as I’m concerned. Hell, don’t take my word for it. Talk to any one of our teacher’s in a major metropolitan center today and see how happy they currently are with their jobs… If there ever existed some magic capsule that would allow me to escape this nuthouse of a planet, I would gladly be the first to sign up. It’s getting to the point where I don’t believe or trust a thing I hear anymore…

#180 Small Steps on 06.28.11 at 1:11 pm

Police get paid very well. They make 83 k by their fifth year.
http://calgarypolicenews.typepad.com/cps_recruiting/salary_benefits/
It seems like public sector jobs have outpaced private sector ones (especially with benefits). I was told by a high school teacher (who makes 6 figures) that unions fight for higher wages and then take the corresponding job cuts until public pressure creates more funding.

#181 CrowdedElevatorfartz on 06.28.11 at 1:11 pm

@ #161 Nick
“…The “Quebec lives off the money sent their way by Ottawa” meme is a myth. But it’s fun to perpetuate that myth, so bigots do it….”

+++++++++++++++++++++++++++++++++++++
Ahhhh
So the truth = bigotry
Nice.
Well Nick, about 2 years after Quebec seperates and the voters realize they have been lied to by their leaders in the “National” Assembly ( last time I checked Quebec was still a Province. How does one become a “Nation” when your still a Province. Oh well hope you enjoyed Fete National eh?).
Since its inception the Equalization Program has paid into La Belle Province.
Quebec has ALWAYS been a net RECIEVER of Canadian tax dollars through the equalization program. Only 3 Provinces pay in more than they recieve. BC, Alta, Ont.
If you want to talk about bigots, look in the mirror.

#182 greg on 06.28.11 at 1:16 pm

Our national Debt isnt the problem in this country. It is the personal debt. we are the most indebted nation in the world, per capita for personal debt. we spend a 1.50 for ever 1 dollar we earn. the bearded boogie man living in caves wearing sandals in the middle east, the one who we are giving our rights up for to be protected from by government the one who has a worse chance of killing us then a bumble bee isnt your real enemy. if you are walking around a mall scared of arab men and buying Large Led 240 hz 60 inch tv on your credit card, youve been watching too much CBC and have been reading too many news papers. no information is better then misinformation. A library card and some curiosity will make you a lot smarter and wiser then a overpriced University Degree and massive debt. The credit Boom is coming to an end and its time for people to start paying it off. this will be painful to the economy and to the individual. it will also lead to contraction of money supply as people pay their debts down and stop taking out loans . this I can guarantee you scares the government and banks more then any Nationalist in the middle east who fights back cause we bombed his family. Hence more wars and more money printing is the solution by the government

#183 brainsail on 06.28.11 at 1:22 pm

Here is the public sector employment breakdown if anyone is interested.

http://www40.statcan.ca/l01/cst01/govt54a-eng.htm

#184 CrowdedElevatorfartz on 06.28.11 at 1:24 pm

@#161 Nick
a few facts and figures for you from an informed “bigot”

In 2007-2008, the federal government transferred $12.9 billion to the provinces through the Equalization Program (Department of Finance, Federal Transfers to Provinces and Territories). The following provides a breakdown of equalization payments by province.

2007-2008 Equalization Payments by Province ($ millions)

British Columbia
0
Quebec
7,160

Alberta
0
Newfoundland/Labrador
477

Saskatchewan
226
Nova Scotia
1,465

Manitoba
1,826
New Brunswick
1,477

Ontario
0
Prince Edward Island
294

Please note that Quebec recieved far MORE than its fair share in “equalization” payments. Ie %50+ and its population is now less than 20% of Canada. Perhaps we (the Rest of Canada) would save tax dollars if you Natinalist would finally stop bluffing and seperate?

have a nice day.
Google Provincial Equalization Payments if you want the truth instead of your own myopic view of the world through seperatist glasses.
Jerk

#185 Hoof - Hearted on 06.28.11 at 1:37 pm

Garth….

Was your blog attacked?

Couldn’t get on last night here in BC.

#186 Hoof - Hearted on 06.28.11 at 1:41 pm

Wasn’t it reported recently that Ontario Teacher Pension Fund once had a ratio of 10 :1 (ie contributors versus pension recipients…) now it is 1.5 : 1

I’ve heard the same things re: other public service pensions

Regardless…not much sympathy.
WHO paid T-H-E-M ?

#187 poco on 06.28.11 at 1:47 pm

#164–Squirrely
The idea that we should think of hiring more police is very scary. The incompetant hiring and screening practices of the national and local police forces has been under scrutiny for years. The bar has been lowered to the detriment of citizen safety. Talk to the auditor general about that.
Currently more citizens die at the hands of police in Canada in a year than Canadian soldiers are killed by the Taliban in the battles of Afghanistan and the ‘police actions’ around the world. Statistically it is much more dangerous to walk the streets of a Canadian city than the streets of Khandahar.
______________________________________________
You are full of crap !!!!–where do you you get this stuff from? if it wasn’t so stupid it might be funny

#188 poco on 06.28.11 at 1:58 pm

#145 greg
every man woman and child owes about 70,000 towards the canadian federal debt, in the states its around 500,000 depending on what you believe their real national debt is at. I remember in the boom they brought cops over from great britain as there was a shortage, seems like every time i get pulled over i am being talked to in a cockney accent. Seems like the government cant plan further then the next election. 4 year plans work great for politicians not for the average canadian who wasnt born with a silver spoon in their mouth and actually work for a living. Tell the Queen she can have her police officers back and we dont want her read headed Nazi Grandson here either.
______________________________________________
a little off on your figures

http://www.debtclock.ca/

i guess they hired all those lymies because no one was “qualified” in your town

and can you tell me –who are these that are born with a silver spoon in their mouth —life is what YOU make it

#189 disciple on 06.28.11 at 2:03 pm

I’ve got a bad disease
But from my brain is where I bleed.
Insanity it seems
Has got me by my soul to squeeze.
—————————————–
Conspiracy theory is kindergarten for the amateur historian. The importance of moving on is paramount to attaining the next level of enlightenment, because everything is a conspiracy and while you’re looking at them you’ll miss the fact that they have a GOAL!
—————————————–
…in the interests of science it is necessary over and over again to engage in the critique of these fundamental concepts, in order that we may not unconsciously be ruled by them.”
– Einstein 1969
——————————————
disciple says: There is a vicious unrelenting assault for your heart and mind right now in the media. It is clear to me to be a prelude to calamity. Take note, and be careful out there…

#190 no guts on 06.28.11 at 2:12 pm

According to this chart, it is indeed S’katchewan.
http://www.td.com/economics/budgets/govt_budget_jun11.pdf

#191 Hell in a Handbasket on 06.28.11 at 2:27 pm

@152 Abitibidoug.

Private companies will never go for it. Right now all productivity gains accrue to the bottom line and therefore to upper management and with the leftovers going to the shareholders.

Every company talks about how to increase productivity for the exclusive purpose of increasing EPS and net income. To allow people to work less hours so as to keep more people employed is not good fiscally speaking. It is cheaper to fire one person and increase everyone elses work than to take take the time worked and split it among more people because of the incidental costs that are associated with employing people (i.e., benefits, CPP, EI).

Even if private companies agreed to reduce work hours to keep more employed, they will never agree to keep wages up, so how are people going to live on reduced wages due to reduced salaries? The standard of living would decrease.

Our money is inflationary, so products and services will continue to rise (unless we are hit with a black swan defaltionary event), so it is necessary to keep wages up and we can only do this by working more and not less.

#192 jess on 06.28.11 at 2:31 pm

Among The Costs Of War: $20B In Air Conditioning, Says Former Pentagon Official
by NPR Staff
============
aviation fuels

Camelina sativa originated in Europe and is a member of the mustard family, along with broccoli, cabbage and canola. Sometimes called false flax or gold-of-pleasure, it thrives in the semi-arid conditions of the Northern Plains; the camelina used in the study was grown in Montana.

Oil from camelina can be converted to a hydrocarbon green jet fuel that meets or exceeds all petroleum jet fuel specifications. The fuel is a “drop-in” replacement that is compatible with the existing fuel infrastructure, from storage and transportation to aircraft fleet technology. “It is almost an exact replacement for fossil fuel,” Shonnard explained. “Jets can’t use oxygenated fuels like ethanol; they have to use hydrocarbon replacements.”
Source: Michigan Technological Universit

#193 CrowdedElevatorfartz on 06.28.11 at 2:40 pm

Quebec companies destined to move or change after separation.
Air CANADA ? Dont make much sense to have the Head Office in another country. Moved or sold(thank God and good riddance.)
Dairy Marketing Board quotas will be torn up. Currently 50% of ALL Milk, Eggs???, Cheese MUST come from Quebec. That will end. American or Canadian farmers will CRUSH the Quebec monopoly on dairy products. Wanna buy Quebec milk ? Pay double the price :)
Via Rail will move or be sold. Good riddance.
The “Van Doos’ regiment in Quebec City will disband and become a Quebec regiment(woo woo)
Standard Life Canadian head office will relocate to Calgary after almost 170 years in Montreal. Other ‘anglo” head offices will follow suit.
Cheap Quebec hydro power will become more expensive( its purchased from Newfoundland/Labrador) Quebec industry will become less competitive and suffer as a result.
Native Indians will demand status/ blockade/ smuggle and the new Quebec Military will not be adequately trained/equipped to deal with province(nation?) wide protests. Anarchy.
The US will not tolerate instability on its Northern Border and will close borders citing security concerns further exaserbating an already dire fiscal/political situation.( see Ft Drum New York Military base Billion dollar expansion…..)

Seperation est tres bien Oui?
Careful what you wish for Nicky ’cause 50 years after Quebec separates you wont recognize the place.

#194 David B on 06.28.11 at 2:48 pm

Here in Nova Scotia we had a slight surplus last year but forget that …. CNN is reporting there is a slight increase in housing in few states … so there you go another prediction come true according to world to GT!

Remember 6 years ago when we had over $15 Billion in the bank and a $3 Billion emergency fund and no Harper!

You got what you voted for now live with it!

#195 jess on 06.28.11 at 2:48 pm

shell business is shelf corporations

check out this address cute house but why all the mail boxes “inside” the house?
2710 Thomes Avenue
Wyoming

Tue Jun 28, 2011 11:31am EDT

SHELL GAMES: A Reuters Investigation

Articles in this series are exploring the extent and impact of corporate secrecy in the United States.

By Kelly Carr and Brian Grow

#196 goldfinch on 06.28.11 at 2:53 pm

“The ‘Quebec lives off the money sent their way by Ottawa’ meme is a myth. But it’s fun to perpetuate that myth, so bigots do it.”

Nick, you must be from the Lying Pegleg School of Economics that so many of your “countrymen” believe in. If it weren’t for the money Alberta sends you, you’d have been bankrupted decades ago. Well, at least you wouldn’t have $1 daycare. You’re a province of welfare queens. Just own it already.

#197 Carp on 06.28.11 at 2:53 pm

Two provinces have no deficit (NF,SK)

NS has the lowest per capita deficit in Canada ($214); and the next closest is BC with $374.

(SOURCE: Pre-Budget Consultation 2011 documentation)

#198 The InvestorsFriend on 06.28.11 at 2:54 pm

DEBT SCHMET

This talk about government unfunded liabilities is way overblown.

If we applied the same logic to ourselves then when we are born we have an unfunded liability for the costs of our living for the next 80 years or so.

Every parent gets an unfundedl iablity of about 22 years with each child born. So what? most parent pay that liability as they go. They don’t save up $200k and then have a kid.

Similarly, governments will pay tomorrow’s costs tomorrow.

To hear the alarmists talk you would think that the whole world is in debt. To whom? Martians?

Furture generations? Rest assured that in the net for the world as a whole it is impossible to borrow from future generations. A given country can do so, but not the world as a whole.

So, relax the world is in great shape, never better. Today is great, tomorrow will be even better.

#199 Opportunity on 06.28.11 at 2:57 pm

New Brunswick

#200 Jan Etter on 06.28.11 at 2:59 pm

This is not on today’s topic (more like yesterday’s) but I’d be curious to hear your views on this opinion piece by Lawrence Solomon, I think you’ve said much of the same thing on this blog in the past.

An excerpt:
“Deregulate Housing
…Canada’s housing sector -far from operating on free-market terms -has been a creature of federal industrial policy since the 1930s, when Ottawa passed the Dominion Housing Act to subsidize housing, kick-start the economy and improve Canada’s social values. Home ownership, then as now, was seen by many as a promoter of social stability. In subsequent decades, the federal government added more and more subsidies to the housing sector, bringing us to the situation we face today, where unbridled home-owning has become the single biggest threat to Canada’s economic stability.

The remedy for Harper is straightforward: Rather than ignore the distortions in Canada’s housing sector and cause Carney to raise interest rates, Harper should systematically peel back the layer upon layer of subsidy that levers our giant housing market into a teetering threat. Each layer that Harper removes will not only act to strengthen the Canadian economy, it will also act to save taxpayer dollars…”

http://www.nationalpost.com/news/Deregulate+housing/5004198/story.html

#201 Nostradamus Le Mad Vlad on 06.28.11 at 3:14 pm

-
“. . . public finances suck . . . The two are about to collide. Which brings me back to the cops. We might be needing more of them.” — Austerity riots on the horizon here? As well as all levels of govt.; see HST link next.

HST This is as good a reason for C-H-F to have pushed Campbell to bring in the HST (along with a bunch of other items), and why the present BC Liberals are pushing so hard for it to go ahead;
Campbell added the extras in to increase the provincial govt.’s coffers, but all C-H-F had to do was increase GST to 10% and cut income taxes a few years ago. But they’re in govt., so wouldn’t understand the simplicity of that.

“The budget was in surplus in 2005 when Mr. Harper came to power. Cutting the GST by 2% reduced revenues by $14 billion a year, and when the recession further crashed tax intake, the deficit swelled, especially as stimulus spending started. In addition, the Conservatives have increased program spending and the size of the civil service every year since gaining power in January of 2006. The result: $40 in deficit, a rising federal debt and now the inevitable deleveraging. Perhaps Mr. Harper should have been more conservative. — Garth”

Other than saying C-H-F are not economists and never will be, Garth’s comment is bang on.
*
#191 jess — “. . . to purge radioactive cesium from the body before it creates malignant cells.”

Thing is, about these ‘accidents’, most govts. react way to slow (as in Fukushima), then fake all sorts of theories and stories, putting one story up after the other when incompetence has long since taken over.

With most of these incidents, it has become a case of the blind leading the blind; ordinary people, incl. govt. workers don’t have the slightest idea of how to actually avoid accidents like these in the first place, as shortcuts, needed for fast production (not necessarily efficient) are used, and someone pays the price.

Blame is passed to the lowest urchins, but responsibility is not taken by the higher-ups.

“..” the drug for $100 for 30 grams even though the raw material is only $3,000/ton.????” — Must be one helluva drug!

#197 TurnerNation — “We’re all connected.”

There is a vast chasm being thinking / believing and knowing. In some way or other, you are correct but it’s for each person to discover for themselves when their present lifecycle concludes.
*
Re: What province?I was leaning toward to Labrador, but now I’m rooting for Baffin Island. They have lots of moose and human-eating mosquitoes; it’s a very fficient system!
*
Wildrose Party New platforms; Fukushima As efficient as the CPC; Jet Stream moves quickly.

Deutschemark set for comeback, and Minus One Cue Soros — one country may leave Euro. Germany? China Spending billions to save Euro; Facebook To bite, or not bite the dust?

Look who is buying up cheap, flooded farmland by the Missouri, and HAARP; NWO What of Russia and China being the new head honchos? 21:28 clip Remember Star Trek, matter and anti-matter? It seems to be here! Links in Plasmic power in PlasmERG engine; Links in. What are they hiding in Joplin? Interesting Something’s up in Nebraska — 7-7-11, Or Los Alamos FF. Choose wisely! But nuke production to be expanded at Los Alamos.

#202 R on 06.28.11 at 3:17 pm

It’s B.C…Just joking…With Christy pestering the P.M. we should win the ship building contracts. That will get us out of the red and back in the black. Just like the Olympics did. Hahahah.

#203 Coho on 06.28.11 at 3:28 pm

Want to fix the problem? Abolish privately owned central banks. This situation is the product of them sucking their host nations dry for decades if not centuries. They’ve sucked people and nations dry for far too long. Things will continue to deteriorate unless those self-serving exploitative country killers are shut down. They control the money supply. They conjure up money as debt with no backing and charge interest. Our dollar has slowly been devalued. The work we do today is worth less than it will be tomorrow. This gradual erosion of our buying power has put us in so much debt to the debtors (private elite bankers who have more money than God) that soon we’ll be Greece.

Most people work through the irresponsible spending in their 20′s and 30s’. Of course some have always been good with money and some will always be bad with it, but the majority of people wise up when they get older. Expecting a reasonably comfortable living shouldn’t be too much to ask for 80 hours labour per week per family.

I’m tired of hearing we are living beyond our means and being compared to starving Africans. IMO, those blaming their fellow Canadians for wanting to live a middle class lifestyle and saying “we’ve had it too good for too long” are doing a huge disservice to themselves and their middle class brethren, not to mention their country. If it eases their conscience to have one meal a day, to walk 5, 10, or 20 miles to work, to drive a jalopy, to wear rags, to eat kraft dinner while watching the decadence surrounding the royal visit, then so be it.

If there was a will among the powerful to set up a reasonable equal distribution of wealth among the people of the world, there would be no poverty, no wanting, less illness, suffering and death, and certainly no war. But that doesn’t suit the ruling class. There needs to be war and exploitation the world over to achieve their quest for riches and world domination. This hasn’t changed for millennia.

The ruling class just loves to see the have-nots cut each other down while they continue to count their ever growing riches. Less for the people means more for them. And these same ruling class be they monarchs, powerful families, etc. who own the private Central Banks, World Bank and IMF are vulching up hopelessly indebted countries which need to sell off their infrastructure and resources to stay alive.

So, as the people and their nations continue to get screwed by the powerful unelected, thanks to their enabling governments which follow dictates and policies passed down to bankrupt their countries, we need more cops to control the unemployed, the working poor or soon to be poor, those despairing and without hope, and what’s left of the middle class that continues to expect much too much from its impotent bi-weekly paycheck.

#204 Coho on 06.28.11 at 3:30 pm

Correction: The work we do today is worth more (not less) than it will be worth tomorrow.

#205 On the Side Lines on 06.28.11 at 3:45 pm

Nova Scotia I’m dying to read your book!

#206 Devore on 06.28.11 at 4:01 pm

http://www.yattermatters.com/2011/06/25156/

It’s been posted here already, but bears repeating. Van West sales have fallen off a cliff. Down 61% MoM. Prices have flattened.

This smells like what happened in Richmond in Q1: volume and demand up, flippers and speccers flood in, prices jump 20%, volume drops to nothing, price increases arrested, inventory swells. A classic pump and dump.

Of course, it could be nothing. Could be issue with the data. Could be just regular seasonal behaviour.

One month does not a trend make, but this is very curious.

#207 VICTORIA TEA PARTY on 06.28.11 at 4:09 pm

IT TAKES A PILLAGE…

…to triumph over those pesky, riotous, tax-avoiding Greeks who spend other peoples’ money and then refuse to pay them back!

Or does it? The very thought…!

Then along comes the latest, 21st Century, incarnation of Marie Antoinette, France’s former finance chick, Christine Lagarde, to head up the IMF, an organization akin to a robber-baron collection agency. It is now up to its armpits in Greece!

Christine, say the “insiders”, is a hard-ass when it comes to keeping the books. What?! France’s books are in WHAT sort of condition?

Anyway, one fine future afternoon, she’ll look down upon the computer-stained wretches of the “presse” and announce that if the Greeks can’t pay back the IMF, and EU loans, then “Let them eat Pillage…!”

MEANWHILE BACK TO WHAT’S GOING ON IN GREECE RIGHT NOW, THE BBC REPORTS:

“Police have fired tear gas in running battles with stone-throwing youths in Athens, where a 48-hour general strike is being held against a parliamentary vote (tomorrow, Wednesday) on tough austerity measures…

Thousands of protesters have gathered outside parliament in the capital where public transport has ground to a halt…

PM George Papandreou has said that only his 28bn-euro (£25bn) austerity plan would get Greece back on its feet…

If the package is not approved, Greece could run out of money within weeks…

Without a new plan in place, the EU and IMF say they will withhold 12bn euros of loans which Greece needs to repay debts due in mid-July…”

You can check out the endless news coverage about Greece.

But here’s a nugget I uncovered on the German magazine Der Spiegel.

This guy, Stefan Homburg, is a renowned German economist, with heavy-duty connections to all who matter in Germany, the only real engine of economic growth in Europe and, therefore, the only real bailer-outer of Greece, Portgual, Ireland and, hopes to NOT be such soon to Spain, Italy, Belgium and, perhaps, France (it’s tough times but someone’s gotta do it)!!

Mr. Homburg says he’s busy buying Greek bonds that now provide 22 per cent interest on some maturities!

Why? Read his unsettling answer! “I believe in the boundless stupidity of the German government.”

And then he said this gem about the future of the EU experiment:

“Sooner or later, this much is certain, the system will be blown apart by political and economic factors. And, unfortunately, there is a great danger that, when this happens, it is not only the euro that will fall apart, but also the entire EU.”

So there, Mr. and Mrs. Canadian and US stock market investors of this date. You drove up the markets, TODAY, because you believe all is settled in Europe. The Greeks will toe the line, Marie Antoinette will save the Rest of US from the Rest of Them, and all is lollypops and roses…

Yeah, right. Stay tuned.

Meanwhile a visit back to the 19th Century, and Greece, courtesy of the late, great English “travel agent,” actually a famous poet, one John Keats, and a snippet from his “Ode on a Grecian Urn” classic poem.

“…Would it be like that, but no.
What little town by river or sea shore,
Or mountain-built with peaceful citadel,
Is emptied of this folk, this pious morn?
And, little town, thy streets for evermore
Will silent be; and not a soul to tell
Why thou art desolate, can e’er return….

…Thou, silent form, dost tease us out of thought
As doth eternity: Cold Pastoral!
When old age shall this generation waste,
Thou shalt remain, in midst of other woe
Than ours, a friend to man, to whom thou say’st,
“Beauty is truth, truth beauty,” – that is all
Ye know on earth, and all ye need to know.

The Clappers of Hell now decend on a former great civilization in a portent of “Things to Come” for many others.

We live in interesting times, in spite of the machiavellian machinations of the newest Marie Antoinette.

Wishing her good luck, against the depredations of the Greeks, and other indebted Euro scofflaws, AND the US, too (!), is hyperbole mixed with hubris. Silly, in other words. Grecian Urn, anyone?

#208 Kate on 06.28.11 at 4:10 pm

BC doesn’t have any debt because we have Chinese investors to pay for it! ;)

#209 BrianT on 06.28.11 at 4:14 pm

That is my favorite picture so far-that mutt has good taste.

#210 Ben on 06.28.11 at 4:26 pm

Iceland

lol

#211 Markey on 06.28.11 at 4:27 pm

#160 – Crowded… Zieg hiel! You must have extensive experience working in the public sector to have developed such bitterness and resentment.

#212 jason on 06.28.11 at 4:30 pm

In finance, leverage is a general term for any technique to multiply gains and losses.[1] Common ways to attain leverage are borrowing money, buying fixed assets and using derivatives.[2] Important examples are:

>Borrowing money isn’t leverage unless you use that money to make more money. They are using leverage they are just using debt.
Leverage makes it sound like they is a business reason to go in the hole, there isn’t one.
No they are just robbing peter to pay paul…

#213 Opportunity on 06.28.11 at 4:32 pm

PEI

#214 Imstupid on 06.28.11 at 4:36 pm

#115 Mr Buyer

I believe that the comment you posted was not thought out before you posted it. I would never join the military, voluntarily or by law. I would rather go to jail. To fight for others greed and power is something I do not believe in. The people who die in war are always the poor, the people who have the fewest reason to fight. You will see the ruling class talk a big game but their kids will not be standing infront of bullets, ours will. For that reason I day f off to any country that would have a mandatory army.

#215 Lawn (South) Asian on 06.28.11 at 5:07 pm

It is Saskatchewan… My home province.

Someone (above) indicated abolishing the Senate would save us our debts… NOPE. The Senate operates on 1/5th the operating budget of the Commons. Senators drive the serious work of most committees on the Hill, while most Commons MPs pose for the QP cameras. Most voters (ignorantly) believe the Senate does nothing. To be truthful, while most MPs are doing only ONE thing: working to get re-elected, Senators are actually participating in the workings of gov’t (committees and commissions, other research for which MPs don’t have “time”).

If we abolish the Senate, MPs in the Commons will likely have to DOUBLE their staff to manage the workload. At the loftier Commons price tag, this will be more expensive than keeping the Senate. Better to set some ground rules on appointments, set some base credentials, and have attendance guidelines for all MPs.

#216 The InvestorsFriend on 06.28.11 at 5:10 pm

Greg at 181 reports
we spend a 1.50 for ever 1 dollar we earn.

No Greg, the staistic is that on average Canadians owe $1.50 for each $1.00 in earnings.

So on average debt is 1.5 times income…

That’s quite a bit defferent from what you said.

Also none of us are average. (you know with 1.4 kids and all). Take care of your own debt and you will be okay.

The world meanwhile will take care of itself.

#217 greg on 06.28.11 at 5:14 pm

#178 The INVESTORS FRIEND………… I dont think the government unfunded liabilities is over blown at least not in the states. their human resources unfunded Liabilities is over 100 trillion dollars not on the books cause its not funded. it is supposed to be though cause when they take their social security of their cheque its supposed to go into a savings account for their retirement but instead the government spends it right away. and with a 3rd of the population over 50 there is 0 chance that the middle class can afford to pay these baby boomers when they retire as a 3rd of the nation goes from paying taxes to living off of the decimated middle class. its a ponzi scheme, it works when there is a lot of people paying into the bottom of the pyramid and few collecting from the top, the problem is the triangle has been flipped upside down and its only a matter of time before the U.S. government steals americans 401k’s and makes them invest it into their national debt. This is a massive problem i doubt you realize how big it is as medicare and social security is what is going to take down the states.

#218 greg on 06.28.11 at 5:19 pm

sorry got my numbers mixed up i mean # 198

#219 Rob on 06.28.11 at 5:21 pm

Hey Garth,

How about giving us a primer on why the DB is doomed and how long term bond rates affect the funding. As well some info on OSFI’s funding requirements may be in order.

I know that from a business perspective, a DB may be a boat anchor due to the windup funding requirements but I recall that a certain conservative MP went on a cross Canada pension roadshow and later made recommendations (yet to be implemented by our majority government) that would improve the long term viability of most DB plans.

Our particular DB is about 2 billion in the hole, but a 2 point increase in the long bond rate would wipe out the deficit overnight…

#220 CrowdedElevatorfartz on 06.28.11 at 5:31 pm

@#211 Markey
experience in the Public Sector?
Nah.
Just from watching my friends and relatives who “work”(bwahahahahahaha) there.
They wouldnt last in the private sector for more than a week before they quit or were fired.
Dont worry you’ll find out soon enough.
EVERYONE has reached taxation saturation.
There’s no more money to suck out of the teat of the Canadian taxpayer.
Whetehr you like it or not.
Financial breakdown is comming for the overindulged public sector. Pension clawbacks, medical benefits revoked, user fees,…..
Get ready.
The real world is about to bite you in the azz…. :)

#221 Timing is Everything on 06.28.11 at 5:32 pm

Hey Garth…Is this the a case of the fox watching the hen house? Do you know this guy?

“Victoria-area investors beware. David Michaels, principal of Michaels Wealth Management, is staging another of his “lunch-and-learn” seminars at noon today.”

“In B.C., anybody can sell securities products that qualify for exemptions from prospectus and registration requirements. That covers a vast array of high-risk, illiquid investments such as oiland-gas and real estate limited partnerships.”

http://tinyurl.com/66htv53

Never heard of him. Mercifully. — Garth

#222 Bill Gable on 06.28.11 at 5:40 pm

I take great exception to Stats Can’s latest attempt at trying to find out everything about my Family, just about down to the kind of Tuna fish we like.

I refuse to give away data to the leaky data hounds in Ottawa.

I filled out the census = but the intrusive second form is right out of Nazi Germany.

Canada is losing it’s “freedoms”, and they are leaking away.
This is not the Canada that my late Father spent 6 years freezing to death on a Corvette, on the North Atlantic during WW2, for.

What happened to privacy and the right to LIVE instead of being told how to exist?

I feel sick at heart seeing my boomer friends going slowly mad, as they realize they are done like dinner. Debt ridden, leveraged to death, and there is no way out.

No jingle mail in 9/10 Provinces in Canada.

Is ANYONE paying attention to Mr. Turner?

Can’t they see that Flaherty and Carney are saying rates are going up?

When one of the Top German economists says he is loading up on 22% Greek Bonds – because “The stupidity of the German Government is boundless” – I just about fell over.

Help me, Rhonda.

#223 BrianT on 06.28.11 at 5:49 pm

#198Invest-You should be teaching economics at a prestigious university-your ignorance is your ticket. Re your great “parents” example, that is not an unfunded liability-it is funded by the earnings or income of the parents. If the expense of raising the child was far in excess of what the parents would be expected to earn you would have an unfunded liability. The USA has huge unfunded liabilities which simply means either 1.payments go down or 2.taxes go way up or 3. combo of these or worse. Thsi current group of old fogies is getting more than anyone else before got and way way more than anyone after will ever get-this is the sweet spot.

#224 Helicopter Ben on 06.28.11 at 6:13 pm

#188 POCO. I may have had the national debt and personal debt lumped together i dont know, i am trying to find where i got 70,000 from its either from one of my economic books, but i havent found it yet. it may be from a podcast i heard as i listen to a lot of them. I have a lot of information and numbers in my head and i dont thoroughly research them when i write on here, just go from on top of my head. Canadians owe around 45,000 towards personal debt and around 16 thousand towards national i might have heard the 2 added on a podcast and thats where i got the number . I still stick by what i was saying personal debt is way more of a problem then national debt , one of the reason is most of the debt canadians own is poisonous debt they have acquired to “invest” in their house thinking its an asset but its not as robert kiyosaki says its a liability and a horrible one at that especially if you bought around the peak. part of the reason we never had a huge down turn yet in our economy is we were spending money with our credit cards even after the 2008 crash cause we think somehow its different here in canada. As far as the silver spoon remark goes a lot of officials elected are stupid rich. I changed my name on here from greg to helicopter ben. My buddy bernanke is going to be throwin money from helicopters

#225 Mr Buyer on 06.28.11 at 6:23 pm

#214 Imstupid … Sadly, a strong military is a necessity in my half baked estimation. Corrupt use of the military is another matter (as with many things, not as intractable a problem as it first appears, a few creative laws and punishments would attenuate many abuses). I am guessing that even you could imagine a unique scenario in which you would find yourself committing to armed conflict as part of a team.

#226 Helicopter Ben on 06.28.11 at 6:26 pm

# 216 investor friend Call me stupid but i dont see much of a difference in your argument that canadians owe 1.50 for every dollar earned as opposed to spend 1.50 for every dollar earned. if u bought a house or car you took a loan and spent that money . http://www.theglobeandmail.com/report-on-business/canadas-brewing-debt-storm/article1537623/

#227 TurnerNation on 06.28.11 at 6:31 pm

Was this posted?

Condo owners are facing a large repair bill for a newer southwest Calgary building that is already leaking.

An inspection at the Bella Vista Condominiums on 14 A Street in the neighbourhood of Bankview turned up building code violations, said Liberal MLA Ken Hehr.

Residents say an inspection at the Bella Vista Condominiums turned up building code violations. CBCOwners are facing bills of between $77,000 and $189,000 each to pay for repairs to the roof, eaves, balcony and parkade in a building where a one bedroom penthouse suite is currently listed for sale at $317,000.

http://www.cbc.ca/news/canada/calgary/story/2011/06/28/calgary-condo-bella-vista.html

#228 TurnerNation on 06.28.11 at 6:35 pm

Should have rented! Condos are for renting and maybe flipping if you are lucky, not for owning. Who wishes to own and be responsible for an entire building? Not I.
————
Mohsan Najati bought his condo two years ago and soon noticed leaks. He said he can’t afford the repairs.

“I’m already in debt, so I don’t have any options,” he said. “I already have a second mortgage. I don’t have equity. I don’t have any cash. I don’t have anything. So I am already actually foreclosed.”

Hehr said other owners he has talked to are contemplating bankruptcy. “This is a serious, life changing event for people. It’s very tragic.”

http://www.cbc.ca/news/canada/calgary/story/2011/06/28/calgary-condo-bella-vista.html

#229 garrulous squirrel on 06.28.11 at 6:46 pm

#187 Poco……spoken like a true closet cop in denial and afraid of being outed as a killer psycho and part of a rat bag of killer psychotics who think they’re above the law.. Disonance is a bitch….do you have to drink yourself to sleep at night or like a true sociopath do you not even care? Beat the wife and kids……..much?

As we have seen the thing that happens is this….a cop murders a citizen….then a massive coverup takes place and the denial public relations machine moves into high gear with all the cops telling stories about the ‘bad character ‘ of the victim. Then…when it turns out that the cops have been lying all along but they still deny responsibility and hide behind the shoddy investigations ( when evidence is lost and the perpetrators are not even interviewed) done by themselves.

As far as the stat that indicates that more Canadian citizens die at the hands of police in Canada than soldiers in Afghanistan at the hands of the Taliban…..this is all public information….something the cops have a hard time denying.

The auditor general has chastised the police for inadequate hiring practices…unless you live under a rock this story has been reported in various forms on public broadcasts.

Compare us to the United States..where the citizen on citizen murder rate far outstrips Canada but……. cops rarely shoot first and ask questions later as the national police in Canada has proven themselves as being predisposed to do. The police in the US are accountable while in Canada …..not. The fact that cops kill more citizens per capita in Canada than in the US is also public information.

It leads to only one statistical conclusion…that police in Canada are trigger happy killers versus their US counterparts.

Now personally I think that police use murder as a weapon of intimidation….crowd control if you will….much like rape is used by African and Asian regimes. They ( our once respected police) have built a measured reputation of murdering citizens with impunity and without just cause or provocation ( some have ended up shot in the back of the head while handcuffed) and therefore they believe that killers will be more accepted as authority figures and that the citizens are cowed when confronted. Such is the depravity and moral bankruptcy of the leaders.

#230 Mark on 06.28.11 at 6:52 pm

Hey Garth, have you ever taken a step back and realized you write a blog that is about how investing in real estate is a bad deal?

Not at all. I love real estate. Just don’t buy it without money or believe its sultry promises. — Garth

#231 Nostradamus Le Mad Vlad on 06.28.11 at 7:19 pm

-
For disciple, Turner Nation and Chaos The answer is not quite, but this is a step in the right direction, and Cinnamon.

GS firing US employees so it can hire in Singapore; Christine Lagarde Selected as new IMF chief (not that it matters), plus other links; David Cameron cracks up Brit. HoC with naughty joke during Greek debate (short video clip); 5:39 clip Athens police turning out to be thugs; 0:20 clip Mitt Romney — at least someone loves the US Fed!

11:02 clip US military budget has tripled since 1997; Germany and China sign mega-trade deals; Obama + Taxes “Obama is taking America the same direction as Greece.” wrh.com; 12:26 clip Chicago US$108 bln. in the hole; IEA Oil Dump “. . . there is very little stopping OPEC at this point from decoupling from the U.S. dollar completely . . .”, which was what Sadaam was about to do; Are these the known unknowns or vice versa?

Asteroid “Now there is a confidence builder!” Another fraud by scientists, much like CC; Perfect Disguise Nuke FF? More BS “Global Warning and the grab for Carbon Taxes is as legitimate as Killer Bees or Y2K. The money junkies are hoping that now we are in summer you will have forgotten the record-setting snow (leading the the record-setting flooding) all over the northern hemisphere!” wrh.com.

Wikileaks Dumped CFR doesn’t care for WL; Fukushima in Nebraska — were these floods caused by GW? This could stir the volatile pot in the ME; Wisconsin “If those little bastards want an education, they can join the @#%ing ARMY! Our first loyalty is and will remain to the private central bankers! All hail the campaign donors! Sieg HEIL! Sieg HEIL! Sieg HEIL!” — Official White Horse Souse; TSA Body Scanners “Those who live by the scanner shall die by the scanner!” wrh.com.

#232 TurnerNation on 06.28.11 at 7:30 pm

#173 disciple on 06.28.11 at 12:25 pm

I noted a while ago that police harass homeless people the most. Why? Because homeless people do not pay into the cartels each month – the banking, insurance, telco, oil cartels.
They are bad employees, the homeless people.

#233 Slopetester on 06.28.11 at 7:33 pm

A follow-up to Coho #203 ..

“Once a nation parts with the control of its currency and credit, it matters not who makes that nation’s laws. Usury, once in control, will wreck any nation. Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talk of the sovereignty of Parliament and of democracy is idle and futile.”

William Lyon Mackenzie King, 1935 (during the ’25 campaign, and prior to the passing of the Bank of Canada Act)

#234 CrowdedElevatorfartz on 06.28.11 at 7:38 pm

First?

#235 No Fun Vancouver on 06.28.11 at 7:41 pm

Some reasons why people may want to own rather than rent in Vancouver:

1. Bed bugs;
2. Typically in Vancouver not allowed pets in rentals;
3. No dishwasher/washer/dryer or allowed to put one
in;
4. apartment sized appliances;
5. and the 2 magic words no granite or stainless!

#236 pulse on 06.28.11 at 7:47 pm

Dear Children;

I am sorry to inform you of the consequences of the timid and weak generations that proceeded you.

You see, they all lined up at the trough of something for nothing and paid no attention to history’s lessons. They bought in to the lies and schemes of an army of Shylocks and sold your future. They thought their own pension would benefit from downsizing, outsourcing, productivity gains and rationalizations. In fact they rewarded the 21st century’s robber barons most handsomely to sell your hopes and dreams to foreigners.

You have been sacrificed. The march of generations will continue, but you have been placed in servitude; they forgot honest weights and measures and have thrown you into the volcano.

With some delicacy from an old pro;

http://caracommunity.com/content/bill-caras-blog-jun-28-2011

and in case you missed it on the news pablum, a little reality for you to teach your parents who thought they voted for ‘conservatives’

27. The aggregate outstanding principal amount of the following loans must not at any time exceed $300,000,000,000 or any other amount that is authorized for the purposes of this section under an appropriation Act:

(a) all mortgage or hypothecary loans that are insured by corporations that are or were approved mortgage insurers; and

(b) all mortgage or hypothecary loans that are insured under contracts of insurance that could be deemed to be policies under section 19 and that are entered into by companies that have never been designated as approved mortgage insurers.

and further down your list of potential masters to receive the protection of $300,000,000 of your future tax payments

43. In sections 44 to 48, “agreement” means

(a) the agreement entered into by Her Majesty and The Mortgage Insurance Company of Canada that was made on January 1, 1991 and subsequently assigned to GE Capital Mortgage Insurance Company (Canada);

(b) the Management Agreement entered into by Her Majesty, The Mortgage Insurance Company of Canada, Royal Bank Investment Management Inc., and Royal Trust Corporation of Canada that was made on November 1, 1991;

(c) the agreement entered into by Her Majesty and AIG United Guaranty Mortgage Insurance Company Canada that was made on November 21, 2006;

(d) the Custody and Security Agreement entered into by Her Majesty, AIG United Guaranty Mortgage Insurance Company Canada and RBC Dexia Investor Services Trust that was made on November 21, 2006;

(e) the Management Agreement entered into by Her Majesty, AIG United Guaranty Mortgage Insurance Company Canada and RBC Dominion Securities Inc. that was made on November 21, 2006;

(f) the agreement entered into by Her Maj-esty and PMI Mortgage Insurance Company Canada that was made on July 12, 2007;

(g) the Custody and Security Agreement entered into by Her Majesty, PMI Mortgage Insurance Company Canada and Citibank Canada that was made on July 12, 2007;

(h) the Management Agreement entered into by Her Majesty, PMI Mortgage Insurance Company Canada and TD Asset Management Inc. that was made on July 12, 2007;

(i) the Management Agreement entered into by Her Majesty, Canada Guaranty Mortgage Insurance Company and Phillips, Hager & North Investment Management Ltd. that was made on May 5, 2010;

(j) any reinsurance agreement to which Her Majesty and a company or a predecessor to a company are parties;

http://www.parl.gc.ca/HousePublications/Publication.aspx?Language=E&Mode=1&DocId=5088345&File=101

#237 Killer Chicken or Imploding Boomer? on 06.28.11 at 7:54 pm

Shawn/Greg – I enjoy the “unfunded liabilities” discussion too. But it would have freaked me out when I was in my early 20s to calculate my own personal UL. To
live a middle-class life, raise a family etc, I’ll use
$50K/yr as constant dollar “personal revenue” that I
have to generate. Lets see 50K times 40 years. Wow
$2M! I’m in debt before I start…..

Greg – get to work on it and quit worrying.

#238 BoomerBoy on 06.28.11 at 8:07 pm

What’s second prize, two books?

Here’s my contest;

One-thousand dollars to anyone who can guess when one of Garth’s predictions will come true.

#239 mackie on 06.28.11 at 8:45 pm

There is no chance the public sector workers are going to get shafted here. The government and its workers – that includes public service, police, fire and teachers – will continue to bleed taxpayers. They are the chosen ones. Pensions to die for, benefits private sector employees could only dream of and retirement “factors” that get them out and into the good life 10-15 years earlier than the rest of us can even dream about. And all that money comes out of our (private sector employees) pockets at the same time as our pensions, our pays our benefits are being cut. Time for a taxpayer revolt Greek style.

#240 Joe on 06.28.11 at 8:45 pm

#154 UBZ – When the economy crashed I thought would be an excellent time to invest in the Dollar Group, the company that owns the Money Mart stores. Feels dirty to think of making money off of people paying 25% to get at their own money, but it was a no brainer that they would make money. DH thought I meant the Dollar Store chain when I said Dollar Group so I never capitalized on others misfortune, alas they both do well in times of trouble so it’s a win anyway.

#241 Oakville Owner on 06.28.11 at 8:57 pm

If most of the people on this site put 10% to 12% of their pay into a pension plan they would have a nice pension too. Yes that is what each officer pays off of each and every cheque! For a first class officer that adds up to $355 every 2 weeks or $710 a month.

Given what has occurred in York region today I think $83000 a year and benifits is not that much to put your life on the line for others.

RIP Cst Styles.

#242 disciple on 06.28.11 at 9:05 pm

TurnerNation…LOL…great observation. In a way, I am now homeless…er, I mean, houseless, as a renter…

#243 Helicopter Ben on 06.28.11 at 9:11 pm

#237 Killer chicken. …….. I am not worried at all i have quit a bit of money saved i put into silver and gold, and have 0 debt. i basically bet the farm that we are going to have high inflation if not hyper inflation in the next decade or so. if i am wrong silver and gold wont crash to 0 though i could lose a decent chunk of money. what got me into all this was I had a lot of money saved from working in shitty fort mac (electrician) and was looking to buy a house in calgary. I had a real estate agent and mortgage broker and almost bought a few times, but being single and the high mortgage payments freaked me out. I found out that real estate might not be the best route to go and started looking to invest my money elsewhere. I ended up reading about real estate then rrsp’s then economics then world economies. bit of a rabbit hole but glad i didnt buy. so if the world does go to hell i will actually make a lot of money, so i am far from worried. deflation is the only thing that would really hurt but helicopter ben wont allow that to happen. Bernanke said he would drop money from a helicopter to stop deflation, and he basically has so far, the united states had a lot of deflation but QE’S have offset it for now, QE3 is coming i am sure of it.

#244 Abitibidoug on 06.28.11 at 9:48 pm

@disciple #165: I got my “free” education from the benevolent government, paid for by tax payers. Hare as the tried, they didn’t fully assimilate me and wip e outmy ability to think independently.

@Roial1 #165: You say this wealth accumulation is like a drug. When you are young and trying to build up equity, you want lots of money so that’s true. Once you are established and have all your debts paid off you don’t need as much money, and would prefer time off. It’s like getting a train going, where to accelerate the diesel locomotive works hard at full power to overcome the inertia of all that mass. Once cruising speed is reached acceleration, and consequently force to overcome inertia, becomes zero and much less effort is required to overcome rolling friction to maintain speed. Similarly, I am 50 years old, have accumulated wealth, and would gladly work a 30 hour week.

@Hell in a handbasket #191:
Did anyone ever consider that with fewer hours people would be more productive? I’ve worked at many places and the pattern is the same. By Wednesday afternoon or Thursday morning most people are dragging their asses saying is it Friday yet? The drudgery of it all saps people of energy and results in less productive work per hour. You asked how people could get by on less. Over the years productivity and wages have increased greatly, and what has it gotten us? More stuff and a bigger house to keep it all in. Why do I need a big monster home, a new fuel guzzling SUV every 2 years or all that other excess stuff? I would rather have more time to actually enjoy the lesser amount of stuff I already have.

#245 TurnerNation on 06.28.11 at 10:51 pm

For Nostradamus. Official army web site

http://www.arnorth.army.mil/News/Army-North-exercises-capabilities-during-Ardent-Se.aspx

Kentucky, Missouri, Mississippi and Tennessee.
In the national-level exercise, Ardent Sentry 2011, personnel from U.S. Army North, the Joint Force Land Component Command to U.S. Northern Command, conducted 24-hour operations May 16-19 to support the Federal Emergency Management Agency in response and recovery efforts following a simulated 7.7 magnitude earthquake that devastated much of the area in the seismic zone and overwhelmed state efforts.
“Our primary task is to assist local authorities with saving lives and mitigating suffering,” said Col. John Tulley, assistant chief of staff for plans, operations and training, U.S. Army North. “In the case of the New Madrid Seismic Zone, it’s not ‘IF’ it will happen – it’s ‘WHEN’ it will happen.”
This year marked the 200th anniversary of the 1811 New Madrid Seismic Zone earthquakes, which were recorded as some of the largest earthquakes to strike the continental United States.

#246 noise on 06.29.11 at 1:03 am

last

#247 Grampa Hindsight on 06.29.11 at 2:28 am

Did I just read that some people are being laid off at environment Canada !!…Thank God… they are not there to help anyone anyway

#248 Dan M. on 06.29.11 at 7:11 am

Question…why is it that large corporations can run debt to income ratios of 50:1…but places like Canada and the US get all freaked out about ratios of 2 or 3 to 1? Why is it so different for business?

#249 UVZ on 06.29.11 at 10:06 am

#240 Joe

[... thought I meant the Dollar Store chain when I said Dollar Group so I never capitalized on others misfortune, alas they both do well in times of trouble so it’s a win anyway.]

That’s funny. :-)

There are interesting ethical angles to investments. Any bloggers who think they are on the high road should self-reflect further. But it is still unfortunate.