From whizz to fizz


Not long ago Bank of Canada Governor Mark Carney was deemed a manipulative idiot on this blog for saying the national economy would explode higher in 2010. Since then, more than 300,000 people have lost their jobs. Would it have been possible for Mr. Carney, late of Goldman Sachs, to sound any more aloof from real life?

Contrast that with Ben Barnanke, chairman of the US Fed, and unquestionably the most important banker on the planet. He invited 60 Minutes into that big granite building in Washington, then took the cameras to his home town – where his boyhood home was recently foreclosed on.

Bernanke, for all his warts, did more to build confidence in that television interview than the last $700 billion in bailout money. By showing his roots in a neighbourhood grocery store, by sharing his experiences as a waiter and, above all, standing in front of the seized family home demonstrated that he knows the real economy. At least, he knows real media.

Meanwhile, somewhere in Europe, Carney and his boss Jim Flaherty (who hand-picked him) was backpedalling as fast he as could from his last prediction. Events, he told reporters with a straight face, are breaking to the downside. So the odds are that when the BoC leaves its next official dropping that gonzo forecast of 3.8% growth next year will fizzle.

And so should Carney. While a deputy minister at Finance, he was the main guy who worked on Flaherty and convinced him to nuke income trusts, levelling a 31% tax which destroyed the sector. It also wiped out an estimated $20 billion in private savings – money which was not available to help grease the financial system when it was needed three years later.

Carney was slow to drop interest rates in Canada, while Bernanke moved with lightening speed. Carney did nothing to warn about, or prevent, a disastrous relaxing of mortgage lending standards in Canada after the 2006 budget. But, neither did Bernanke attack the subprimes (to be fair, he did not take over the Fed until the damage was done). Carney cut his teeth on Wall Street as a rising star in one of the investment banks that spread toxic assets around the world. Bernanke was an academic, then a civil servant.

Mostly, though, Helicopter Ben was on the tube before a huge TV audience patiently explaining how stuff screwed up and what he’s doing to fix it. Carney was shedding his last creds, sucking back his intemperate words, while on a taxpayer-financed junket in soon-to-be-bankrupt Britain.

Think I’m too harsh on the Governor? There’s one other thing worth knowing.

I’ve met him.


For today’s blog, “One thousand hot ideas,” click here.



#1 Big Picture Guy on 03.15.09 at 8:44 pm

Carney should do the honorable thing and step down.

#2 Sun Yat-sen suit on 03.15.09 at 9:12 pm


The Duke of Ottawa and his feudal old boys network.

#3 Mike B on 03.15.09 at 9:20 pm

Ditto… what he(Garth) wrote.

#4 Investx on 03.15.09 at 9:24 pm

With all this gloom, Toronto/GTA real estate is not as bad as predicted. February stats show that it’s only down YoY 5%. Far from a crash.

#5 bobs your uncle on 03.15.09 at 9:44 pm

The central bankers, like Carney, are desperately trying to keep the fait money/fractional reserve system alive at any cost.

Once Joe Sixpack loses confidence in the system it will collapse. The banks don’t trust their counterparties because they suspect their balance sheets are just as bad, or worse, than their own.

The loans that the BoC took off our banks books and put onto CMHC were dumped there to try and help the reserve ratio for our banks. By doing this it was supposed to free up more money for consumer loans ect.

I suspect that the properties CMHC, and the taxpayer, now hold are no longer worth the amount outstanding on them.

The banks take the profit, the taxpayer gets the risk.

#6 Bill-Muskoka (NAM) on 03.15.09 at 9:46 pm

They all talk in BS Buzzwords IMHO! Monty Python would be challenged to top them!

George Carlin, rest his soul, would be having the Top of his Game today with these mouthpieces and their trickster phaseology!

And to think how upset the Guardians of Democracy and Decency got over the ‘ForbiddenSeven Words’? They are nothing compared to the lieing BS these Flim-Flam Artists spew daily.

#7 Andrew toronto on 03.15.09 at 9:55 pm

That was quite the interview , at least he came clean that we came very close to a depression 2.. what Irks me , like many others this will not End good. How in heavens name will he be able to collapse the bad banks and AIG , Fannie and fredie .. and take money out of the system when the ecomony starts to recover without causing more crsises.. plus it will take years. The situation may be stablizing but the daamge has been done and will take years to get those being laid off working again. Do we even have years before the next crisis hits Inflation or peak oil or climate change event..

#8 Bill-Muskoka (NAM) on 03.15.09 at 10:25 pm


Did you fire up the Crotch Rocket this weekend? Hope so!!!

#9 Torquemada on 03.15.09 at 10:26 pm


Can you really claim that nuking the income trust tax loophole was a bad decision? I earned a decent Calgary living working with these trusts. I was as dependent on the gravy train as anyone and I knew the whole system was a tax dodging scam. I’m glad it’s gone. And if this was Carney’s doing then he’s gained a few points in my book.

#10 Bill-Muskoka (NAM) on 03.15.09 at 10:31 pm

#7 Andrew toronto on 03.15.09 at 9:55 pm

We need not be worried about Climate Change because it is NOT happening in Alberta and we all know Alberta is the Centre of The Universe. If it is not happening in Calgary, then it can’t be real anywhere else on this planet! That is a ‘fact!’ God has told this man so apparently?

Global warming’s no longer happening: So why are eco types moaning about record highs while ignoring record lows?

#11 Too Old Bob$ on 03.15.09 at 10:36 pm

“he was the main guy who worked on Flaherty and convinced him to nuke income trusts, levelling a 31% tax which destroyed the sector. It also wiped out an estimated $20 billion in private savings”

My older brother and I were invested in a Trust Fund. He was using the income to supplement his retirement. I was just investing. We thought everything was ok when they said Trusts were not to be touched or changed. Well Thankyou!! for the advice. We both lost money (on paper), but not as bad as it could have been. The price dropped about $15.00/ share. Along comes a Company willing to buy out the Trust at a set price. Shares go back up about a $7.00 increase. Long story shortened, he lost about $100,000.00, I lost about $15000.00. Thank God he was well diversified and me, well I just keep working to try and get it back. :/
Moral- don’t trust the Government for advice…ever!!

#12 john m on 03.15.09 at 10:41 pm

lies ,greed,incompetence and quest for power got us into the mess our country is in and our only hope is that the same people will get us out of it……… if it wasn’t so sad it would be funny!

#13 Bobby G on 03.15.09 at 10:43 pm
This is why I will never trust Bay/Wall Street ponzi schemes in my lifetime

#14 Wealthy Renter on 03.15.09 at 10:55 pm

“With all this gloom, Toronto/GTA real estate is not as bad as predicted. February stats show that it’s only down YoY 5%. Far from a crash.”

Ah, spin, glorious spin.

The numbers are not out for March, but the TREB data shows that total home sales in the GTA were 11090 in January & February 08, and 6790 in January & February 09. That is a 39% YoY decline in sales.

That is notwithstanding the 20% shave in total sales experienced in the GTA between 2008 & 2007 (74,552, compared to the 93,193.)

What is not bad about those numbers?

#15 For #4 Inventx: Better do the math yourself: Paul Milton on 03.15.09 at 10:57 pm

I do not know about prices on the moon, but Central Districts (C1 to C15) prices in Toronto are minus 9% lower and sales down minus 65% versus February 2008.

Here is the REAL DATA, no rosy media lies:

Feb 2009 Sales : 1,185
Feb 2009 Average Price $463,107
Feb 2008 Sales: 1,952
Feb 2009 Average Price $505,145

PROOF: Open the files and search for Central area summary:

That’s not all, because the price drop differential will increase in next 3 months, because March, April and May 2008 were the peak of the 12 years cycle. Plus prices are sliding 25000 every month due to GLOVES-OFF tough LIVE or DIE competition among sellers! Fun game to watch, grab a seat, ist’s fun!
Predicting a 19% to 27% drop from April 2008 to April 2009.

So the average folk not only already lost 42000 Dollars, but will lose a lot more.
Wow, imagine the pain of the smart fellas that bought 600K homes: a quick 54000 dollars down the drain, and another 59000 to 108000 to come.
Imagine how much stuff one can buy with that! Even a few years of real sunny vacation. Let them buy, they do a great great great service to SOCIETY, we need these really smart fellas buying at the peak, let them live, hold them dear, and don’t wake them up pleeeeeeaaaaaase!

#16 Wealthy Renter on 03.15.09 at 11:13 pm

Double post time. I am a bit surprized that sales have fallen so dramatically in the GTA. Sales obviously peaked in the GTA in 07. Sales in Jan & Feb 07 were in 11945, so we are almost down almost 45% Yo2Y.

With a little digging into the Treb Data, GTA sales in March were 8515 (07) and 6631 (08) .

I wonder how close we will come to those numbers this year?

As an aside, those year over two year numbers worked great for realtors when comparing 08 to 06, but the comparisons will be ugly for for 09 to 07. I bet we don’t see much of them this year!

#17 Wealthy Renter on 03.15.09 at 11:27 pm

The Treb data is interesting. From about 1970, there have been very few absolute declines in YoY home sales in the GTA. The biggest YoY decline was about 25% between 1989 and 1990. We could easily beat that this year.

It surprizes me how fast sales recovered in 1991, but average prices declined.

1988 49,381 229,635
1989 38,960 273,698
1990 26,779 255,020
1991 38,144 234,313


#18 Basil Fawlty on 03.15.09 at 11:29 pm

Who in their right mind would hire someone from Goldman Sachs to run their Central Bank? Talking about putting the Fox in charge of the Henhouse! It’s like putting Al Capone in charge of the Liquor Distribution Branch.

#19 Reg on 03.15.09 at 11:37 pm

Holy mackeral you people! Close to a depression? Naw. Not even close yet to the recession many of us remember in ’82. I remember mortgage rates at 29 percent. Hell, I had a bargain at 11 percent. I believe the problem is that many of those affected the most by this current economic turmoil, don’t have any recollection of what happened in ’82. Times are bad, yes. But we’ve been through worse and we’ll get through this as well. Golden rule = Live within your means (excluding credit) and save a bit for a rainy day.

#20 ralph on 03.16.09 at 12:35 am

Now you know why people get turned off to capitalism and turn to socialism because of people like Carney.

#21 . . . fried eggs and spam . . . on 03.16.09 at 12:53 am

Good heading — ‘From Whiz To Fizz’.

Interesting to see what will happen in the days to come. Sunday afternoon was The Passionate Eye on CBC with their documentary ‘Inside The Meltdown’ — — followed by Ben Bernanke on 60 Minutes.

As most know, Hank Paulson and Mark Carney worked together at Goldman Sachs before they took up their respective posts with their govts., so at that time, Bernanke didn’t have too much of a lead role in things — Paulson was the one hung out to dry in front of all the msm pundits.

With Paulson gone, Bernanke had no choice but to come on to a well-watched TV show, try to calm and reassure people’s nerves about what may / may not transpire.

#64 JoJo at 1:14 pm wrote in the prior entry– “From March 16-to April 24/09 will see again the worst Stock Market Crash ever.”

Wouldn’t be overly concerned with dates, as they are flexible, but Monday — tomorrow — is March 16. Sizeable decreases in stock markets tend to happen in the last few months of a year, but now all bets are off as circumstances are different.

I have no doubt that Bernanke is a well-intentioned and honorable man, but again, sheeple are led and fooled so very, very easily and quickly.

Keep eyes and ears peeled on overseas markets in the short term; the way they go — up or down — is a good indicator of where the rest of us are headed.

If all stock markets tank big time in the very near future, then it will be curious to see how CDS’s and Derivatives play along — there are several trillion dollars of them outstanding, and I understand (not fully sure) that AIG holds a bunch. It may well be in combination with several other factors, all of which are happening at an ever-increasing speed.

New home construction here in the Okanagan has all but dried up. workers laid off and yet the provincial govt. is spending a wad on new projects — a brand new Port Mann Bridge (approx. $3.3 bln.), increasing the size of Hwy. 97 — oh, there is a fixed-date provincial election coming up in May, so that’s more taxpayers’ money down the drain.

2009 is sure shaping up to be a year none of us has ever experienced, or will likely soon forget — The Cycle Of Nines.

#22 Happy Renter in North Van on 03.16.09 at 12:58 am

I guess the “Best and Brightest” from Goldman Sachs is an oxymoron… I’m so sick of these GS alums (Hank Paulson et al.) being hand-picked to fix the mess they so handsomely profitted from…

#23 asp on 03.16.09 at 12:59 am

Can someone please explain to me how lowering interest rates actually helps the Canadian situation? As I understand it, we don’t have a credit crisis here, the banks still have unlimited capacity to lend money to Canadian businesses (there are no reserve requirements and limited exposure to US subprime CDS’s). Interest rates were already low enough not to be a hindrance to borrowing for an otherwise viable business.

What we have is lack of borrowers. Companies don’t want to borrow money because their revenues have fallen flat. The US is no longer buying our stuff. Commodity prices are way down, so even what we do sell does not bring in that much money. Changing the interbank rate from 2% to 0.5% does not change any of that.

Or is it designed to prop up the housing bubble by lowering interest rates on mortgages? If that is true, why don’t they legislate lower rates on credit cards?

#24 surprised on 03.16.09 at 1:16 am


I can’t believe that you, of all people, support income trusts in Canada.

I do not support the state destruction of private wealth. — Garth

#25 gold bug on 03.16.09 at 1:44 am

Who says we avoided a Depression?

#26 Jeff Smith on 03.16.09 at 3:30 am

Geez! When they throw big numbers around like this, I feel my meager savings and net worth is just puny. All those years of work for nothing.

#27 The Tallyman on 03.16.09 at 5:42 am

That 60 min interview is right up there with the best of the late night hucksters.

Bernanke must be getting desperate to be whoring in plain view.
And the biggest scam is that the Fed isn’t even a govt institution but a private enterprise run by the the real bosses of the US govt.

Really desperate, watch out America.
The vampires are venturing out in broad daylight.

#28 Mike B on 03.16.09 at 7:17 am

Totonto RE yes some decent sales but only lower priced stuff or bargain mega ones. Saw a sold one on wknd that was purchased 2 yrs ago for 910k zero done to it and just sold for 800k from an asking of 899k. Still lots to go for a realistic correction but if the stock market gets goosed by rules changes then all bets are off for RE estate especially with all those comm. sales people and greedy sellers.

Carney comes from an education based family and went to one of those ivy league schools. He did his job in defending the first mega bailout.. His buds on wall street are proud.

#29 on 03.16.09 at 7:20 am

I’m not sure if any politician out there could have stopped the financial downturn. They could, however, tell the truth.

The big cause for the downturn was the false economy that was created out of cheap credit, which artificially caused everyone to feel richer, and thus spend more.

The contraction that we’re feeling now is simply a reversion to the mean. the problem is that we were so high above the mean to begin with, that the fall is just that much further.

A side-benefit, however, is that the environment will be better – less building, less consumption = less waste.

#30 David Bakody on 03.16.09 at 7:46 am

#2 Sun Yat-sen suit on 03.15.09 at 9:12 pm Harper>Flaherty>Carney

The Duke of Ottawa and his feudal old boys network.

Right On Sir/Madame …… Now here is a real “Deadly Coalition” (Financial Death) the whole Country should be worrying about!

#31 David Bakody on 03.16.09 at 8:00 am

Overnight news: Billions of American taxpayer bailout money (Bush) that went to AIG also went offshore to other financial institutions. (WTO eh) ….. all this begs me to question just where will our $75 Billion that the Harper/Flaherty/Carney Coalition approved while on an extended taxpayer Christmas vacation will wind up. Bailing out toxic loans? or has it already been done?

Hello MSM are y’all up yet ….. and there is more, much more if you care to investigate, or will y’all just get a new set of knee pads. ( sorry to sound unkind but Canada belongs to all our children and to let the Harper coalition snowball it’s hard working people is not fair and you have 10x the resources Garth Turner has and the control of the MSM wait you are the MSM!)

#32 dd on 03.16.09 at 8:23 am

Carney and all the top brass has be out of touch with reality from day one. They forget their roots. They forget to take a stroll around the old block, to ask people on the streets, to ask the barber “what the news is.”

He makes $XXXX a year and most on this site make sell. And we saw this coming.

#33 dd on 03.16.09 at 8:26 am

#21 . . . fried eggs and spam .

At least Hank Paulson had the presents. Mark Carney. Mark Who?

#34 Jonathan on 03.16.09 at 8:43 am

To be fair to the Cons they didn’t want to touch the income trusts.

When Bell and a long list of other companies decided that they could juice more returns for their shareholders by avoiding taxes, it was time to make some unwelcome changes. I think the number of trusts was going to triple that year alone. It would have cost the federal government tens of billions in lost taxes.

Nice spin. And why were trusts multiplying? Because S. Harper had declared a Coservative government would never milk them. Tax leakage? The feds refused to provide any evidence of it. Bell? Look at it now. Converting to a trust would have been in the best interests of the nation. — Garth

#35 Bill-Muskoka (NAM) on 03.16.09 at 8:47 am

I guess the “Best and Brightest” from Goldman Sachs is an oxymoron…

#22 Happy Renter in North Van on 03.16.09 at 12:58 am

Like ‘Z’ said in MiB ‘You are everything we have come to expect from years of government training!’ LOL

#36 Jonnay on 03.16.09 at 8:55 am

I am most worried about the 40 billion in “other assets” in the BoC balance sheet. If our banking system is the best in the world and our banks are in such great shape, why do we taxpayers have to support these “temporary” (they keep being rolled over) repurchase agreements? I say, let those repos expire without renewal, let’s get some gold to support (at least some of) the currency and let the bad assets fail and work their way out. If it takes down some companies, maybe they deserved it, for having invested in a lie for short-term profit?

#37 Bill-Muskoka (NAM) on 03.16.09 at 8:57 am

#19 Reg on 03.15.09 at 11:37 pm

You’ve got that RIGHT ON! I, too, lived through the ’80-’82 nightmare. This is merely an inconvenience compared to then, a mere end to insanity and inflated nothingness of value!

That is why they are NOT raising the interest rates at this time. Wait until the bank profits start to tumble and then we will see the same assinine ‘solution’ they used back then. This is merely a culling of competition, and some of the Big Boys got caught.

Same piss poor manglement, different Scam this go around. This time it is all about the poor RE investors. everyone thinks they are a millionaire going to buy cheap, reno, and then flip properties turning a huge profit. They all forget people still need a place to live.

When the riots begin, the molotov cocktails start being flung, then it will be the natural result of years of failure by government to regulate these arrogant bastards.

They haven’t seen nothin’ yet as the old saying goes!

#38 Samantha on 03.16.09 at 8:59 am

Speaking of Carney and Goldman Sachs, here’s another thread of the tapestry woven by the financial industry:

Nice picture developing, eh?

#39 Bill-Muskoka (NAM) on 03.16.09 at 9:02 am

#34 Jonathan on 03.16.09 at 8:43 am

Bell had no rational reason to be involved in IT’s. It was another example of a law poorly written by incompetent politicians. The IT’s were for people, not damn corporations.

Bell should move to India where all their worthless CSR’s are. Then they can truly enjoy their ‘offshore’ like tax exemption.

What a joke of legal BS! Thank the CA’s and lawyers for finding the loophole and screwing the general populance out of their hard earned futures. Oh, and thank Steve the LIAR for the result.

#40 PTDBD on 03.16.09 at 9:03 am

Calculated Risk has a picture of the young, bearded Bernanke holding a sign in front of him saying:
The End is Near

As for his predictive powers just last year both Bernanke and Paulson predicted that there would be no recession.

As for housing, Bernanke said “…and at this point, the troubles in the subprime sector seem unlikely to seriously spill over to the broader economy or the financial system.” (June 5, 2007)

#41 Bill-Muskoka (NAM) on 03.16.09 at 9:20 am

#18 Basil Fawlty on 03.15.09 at 11:29 pm

Yes, or Madonna, Paris Hilton, etc., in charge of Chastity Belts!

#42 Jonathan on 03.16.09 at 9:36 am

Nice spin. And why were trusts multiplying? Because S. Harper had declared a Conservative government would never milk them. Tax leakage? The feds refused to provide any evidence of it. Bell? Look at it now. Converting to a trust would have been in the best interests of the nation. — Garth

Ok good points as well.

Remember Accountability Act that got Harper elected? It is amazing how power clouds good intentions. By some records this is one of the least transparent governments’ yet.

#43 RG on 03.16.09 at 9:48 am

When are they going to tell us that all these huge massive bailouts are just propping up the Mother of all Ponzi/Madoff schemes?

#44 Bill-Muskoka (NAM) on 03.16.09 at 10:25 am

Remember Accountability Act that got Harper elected? It is amazing how power clouds good intentions. By some records this is one of the least transparent governments’ yet.

#42 Jonathan on 03.16.09 at 9:36 am

Do you really believe Harper ever intended to be either accountable or transparent? I do NOT!

#45 Rhino on 03.16.09 at 10:26 am


Main Entry:
or car·ney or car·nie \ˈkär-nē\
Inflected Form(s):
plural carnies or carneys
often attributive
circa 1933

1 : carnival
2 : a person who works with a carnival

Carney To wheedle, to keep caressing.
Attempts to attract patrons to entertainment by exhorting passing public, describing attractions of show and emphasizing variety, novelty, beauty, or some other feature believed to incite listeners to attend entertainment. May conduct brief free show, introducing performers and describing acts to be given at feature performance.”

YUP! I would say he is well named. Works for a bunch of clowns as a bit player – Harpo the clown and Flatulence his sidekick, who have turned the HoC into a freak show.

‘Step inside and see distortions of reality beyond your expectations! Come one; come all!! Price of admission? Your savings, the future of your children, and a donation to the ruling class!!!’

#46 Peter @ Canadian Banks on 03.16.09 at 10:31 am

Killing income trusts was a big mistake. Lots of capital left Canada because of that.

#47 dodgedabullit in Alberta on 03.16.09 at 10:32 am

Greetings: The next phase, Commercial Real Estate:

#48 canuck on 03.16.09 at 10:38 am

Here’s a great idea that brings back the barter system: Time Banks No cash changes hands; no tax implications for either party.

#49 Herb on 03.16.09 at 10:40 am

As a professional spin-doctor sees it –

In Canada, reality has finally caught up to the world of political half-truths, misinformation and message-spinning. Increasing job losses, mortgage foreclosures, bankruptcies and downward spiralling economic statistics have made it impossible to run from the truth.

With a good summary of the dawning of the truth at

#50 Ben's a Clown on 03.16.09 at 10:43 am

Ben Bernanke didn’t know what was coming, and now, he’s the guy who’s going to fix everything. Fat chance. Go listen to the people who know, the Austrian schoolers you’ll find on They’ve been talking about the real estate bubble from 2002 and its likely results. Or go to youtube and check what people like Peter Schiff and Jim Rogers have had to say.

#51 Irene on 03.16.09 at 10:52 am

Carney should do the honorable thing and step down.

There is nothing honorable about Carney, Harper or Flaherty and the Con Mp’s. As for the market in RE, the realtors are the ones along with the Media promoting more Greater Fools with their BS. They deserve to be prosecuted for spreading false statements

#52 jess on 03.16.09 at 11:15 am

…so one can predict the end of the recession but when asked how many more unemployed he said that was something that couldn’t be forecasted …

Regulators will test how well the banks can hold up in a “baseline scenario” with a 2 percent slide in the economy this year and unemployment at 8.4 percent, in addition to a “more adverse” situation. The test also assumes housing-price declines of 14 percent this year and 4 percent in 2010 as a baseline case. The more adverse possibility would see drops of 22 percent and 7 percent, respectively.

#53 Bill-Muskoka (NAM) on 03.16.09 at 11:59 am

#43 RG on 03.16.09 at 9:48 am

When there is another ‘Wag The Dog’ crisis and they need a new Scapegoat! ;-) We know the signs when the WMD’s (Words of Mass Deception) are prevailing, eh?

#54 subprimenow on 03.16.09 at 12:01 pm

“Mostly, though, Helicopter Ben was on the tube before a huge TV audience patiently explaining how stuff screwed up and what he’s doing to fix it.”

Disagree. Ben never saw this coming and has proven he is clueless on how to fix it. He should be in jail and the FED abolished. In short, he is lying or the dumbest person ever to be on 60 minutes.

#55 Bill-Muskoka (NAM) on 03.16.09 at 12:05 pm

And now ‘The Rest of The Story’

Feds go after Bernard Madoff’s riches

Now I am :-)

#56 JOHN on 03.16.09 at 12:08 pm

This story goes back to what garth was saying about how the media is trying to put a spin on the market and how things are looking up gimme a break. All Im hearing right now is how the market is ready for a rebound because sales are higher in February than January. Looking back at stats of Edmonton that has been the case since 2004. As canadians we’re smarter tan that, dont be the “Greater Fool”

#57 rory on 03.16.09 at 12:09 pm

Hi all …I told myself I was not going to post anything for awhile – to break my habit. It’s hard.

I am going to wade in on the Income Trust (IT). Not an expert here and my facts may be wrong but away we go.

First, did not financial engineering create a lot of the mess we are in today? (IT were engineered as a way past paying taxes)
Second, gov’ts need tax revenue. (We all don’t like it but is a fact of life).
Third, if the companies were so good that underlined the IT business why could they not just pay a greater dividend. (Dividends are at a disadvantage to IT.)
Fourth, we all talk about expectations. Stocks gave like 8% long term and yet IT were giving out double that at times. (Sustainable???)
Last, financial intuitions created IT but the gov’t let them happen. (We all make mistakes; this was the way back from that original mistake. Costly, but from my perspective a good thing as I was not in IT – just dividends)
Conclusion, dump financial engineering and go back to making money the old fashioned way by investing in good companies, having them reinvest in themselves to grow their dividends – level the playing field for all.

I guess that is my message – same rules for all should apply. Yeah NAM I am a dreamer.

KISS concept should apply to life and finances.


Now tell us everything about grossed-up dividends and preferential tax rates on that class of investment income as opposed to capital gains and interest earnings. Maybe you were right not to post in the first place. — Garth

#58 MikeB on 03.16.09 at 12:10 pm

Can we all say “suckers rally” together please. TSX up almost 200 points led by our “solid” bank stocks. Yes they guys who wanted some cash to keep their feeble balance sheets on an even keel. Classic sheisters. Beware the person crying poor the loudest.

What will happen when the US banks factor in their writedowns instead of just the simpleton information they provided last week. The market is filled with sheeple.

#59 JOHN on 03.16.09 at 12:15 pm

Here’s another “positive spin” absolutely unbelievable, and the thing is people will feed into this garbage, do me a favor everyone wherever part of the country your from and tell me where there was a year when sales were less in February than January?? I think alot of us will come to the same conclusion.

#60 JOHN on 03.16.09 at 12:16 pm

Do me a favour everyone look back at your stats whichever part of the country your from and tell me a time when sales were less in February than in January

#61 Bill-Muskoka (NAM) on 03.16.09 at 12:29 pm

Ben Bernanke was NOT sitting in the Bush adminstration.

Ben Bernanke

Bernanke is particularly interested in the economic and political causes of the Great Depression, on which he has written extensively. Before Bernanke’s work the dominant monetarist theory of the Great Depression was Milton Friedman’s view that it had been largely caused by the Federal Reserve reducing the money supply. Bernanke focused less on the role of the federal reserve, and more on the role of private banks and financial institutions[18].

Bernanke found that the financial disruptions of 1930-33 reduced the efficiency of the credit allocation process; and that the resulting higher cost and reduced availability of credit acted to depress aggregate demand, identifying an effect he called the financial accelerator. When faced with a mild downturn, banks are likely to significantly cut back lending and other risky ventures. This further hurts the economy, creating a vicious cycle and potentially turning a mild recession into a major depression.[19]

Economist Brad DeLong, who had previously advocated his own theory for the Great Depression, notes that the current financial crisis has increased the plausibility of Bernanke’s theory. [20]

The cause is the adherents to Freedman’s false views of how the economy works, chief among whom was George W. Bush, and Harper is also an adherent of Freedman’s views.

Many of the attack comments sound like more of the Redumblican’s BS rhetoric of ‘Blame the Liberals’. Man, that song and dance is way long out of tune!

#62 ts harpoon on 03.16.09 at 12:42 pm

Like most of you, I recently witnessed the Batman versus Joker battle waged between CNBC Mad Moneys’ Jim Cramer and Jon Stewart. Those knock out blows delivered by Stewart to that slime-ball could easily be matched by our straight shooter Garth Turner to take on BoC Gov’na Mark Carney, or Minister Tony Clement or Minister Jim Flaherty or maybe even PM Stephen Harper!!

Garth: “Mr. Flaherty – Did you not say a few months ago that we would not run a deficit?”
Jimbo: “Uhum…Yes…But…”
Garth: “But what?”
Jimbo: “ It helped us get elected, and by the way did say…”
Garth: “Thanks for your honesty.”
Garth: “ P.M. Harper. Great speech in Brampton ON on March 10th. Who writes your speeches? Anyway, did you say something about a certain amount of Canadian optimism must prevail over real-world pessimism? Wouldn’t you say that pessimistic reality has been around say, way before March 10th? Do you want a free lesson in communications? I’ll be in Ottawa on April 24th…”

Okay bloggers – Please assist in completing this fictitious dialogue…

Garth, I’d like to read what you would ask these guys.

#63 Bill-Muskoka (NAM) on 03.16.09 at 12:47 pm

#54 subprimenow on 03.16.09 at 12:01 pm

Would you like to explain Harper and Flaherty’s brilliant foresight now?

#64 Happy Renter in North Van on 03.16.09 at 12:53 pm

Bill – Muskoka,

“Like ‘Z’ said in MiB”… I don’t get the cultural reference… Sorry, it must be before my time…

#65 highway61 on 03.16.09 at 1:23 pm


#66 Bill-Muskoka (NAM) on 03.16.09 at 1:40 pm

More on Ben Bernanke.

Recession could end this year: Bernanke

Asked about the biggest potential dangers now, Bernanke suggested a lack of “political will” to solve the financial crisis.

He said, though, that the United States has averted the risk of plunging into a depression.

“I think we’ve gotten past that,” he said.

The Fed chief on Sunday’s broadcast repeated his ire over the AIG bailout, saying that over the past 18 months, that was the case that angered him the most. He recalled “slamming the phone more than a few times on discussing AIG.”

The government’s four efforts to save the troubled insurance giant total more than US$170 billion. A collapse of AIG would have wreaked havoc on the global economy, the Fed has said.

AIG ignited fresh outrage over the weekend with news that it’s making $165 million in bonus payments to executives on Sunday, most of them in the unit that sold risky financial contracts that caused huge losses for AIG.

When the financial crisis intensified last fall, Bernanke and President George W. Bush’s Treasury Secretary Henry Paulson rushed to Capitol Hill for help. That led to the swift enactment of a $700 billion bailout package in October. Since then, banks have received billions in capital injections in return for government ownership stakes in them.

Looking back, Bernanke said the world came close to a financial meltdown. Asked how close, Bernanke responded: “It was very close.”

Bernanke admitted that the Fed could have done a better job of overseeing banks. Critics say lax regulatory oversight contributed to the crisis.

Reminds me of the heady days of the ‘Missiles of October!’

#67 Bill-Muskoka (NAM) on 03.16.09 at 1:45 pm

#64 Happy Renter in North Van on 03.16.09 at 12:53 pm

The quote is from ‘Men in Black’ (The original movie, not the sequel) when they are interviewing all the ‘Best of the Best’ military candidates for the position. Will Smith was then chosen as ‘J’ to eventually replace ‘K’s’, played by Tommy Lee Jones, out going partner!

#68 Bill-Muskoka (NAM) on 03.16.09 at 1:50 pm

#62 ts harpoon on 03.16.09 at 12:42 pm

Good idea, but Cramer was at least capable of being honest when inescapably confronted.

Those are not traits of Harper or any of his entourage of Parrots. They simply cannot ever tell any truth to anyone. We are all his enemy! Nice leadership, eh?

If you doubt my assessment watch QP, or just ask Garth how it works?

#69 TS on 03.16.09 at 1:55 pm

The following link will take you to a piece about the price of resale homes in February falling over 9%.

#70 Bill-Muskoka (NAM) on 03.16.09 at 1:59 pm

Now tell us everything about grossed-up dividends and preferential tax rates on that class of investment income as opposed to capital gains and interest earnings. Maybe you were right not to post in the first place. — Garth

Garth, please tell us who wrote the legislation that created the IT’s? Also, who dreams up all the cute little terms that mean nothing to the average person? Is there a Select Committee somewhere in Oddawahaha?

Were you part of it?

I, too, believe in the KISS principle, but hey, I don’t make my income losing other people’s money!

I also do not gamble and rarely ever buy one of those Sucker Tickets called Lotto 649 or Super 7, or any others. I have a better chance of having the Mother Ship beam me up! Hey? What’s that shiny thing on the horizon? Oh never mind, just another plane headed into Pearson! LOL

#71 jess on 03.16.09 at 2:04 pm

if calgary is having an uptick than why was the pres.of business ass. calling for more affordable housing …

could it be that all those empty units are ready for the government to subsidize the landlords?

#72 jess on 03.16.09 at 2:19 pm

Friday, June 3, 1932 Senate hearings

history repeats and rhymes and it is the nightmare from which we all try to awake.

#73 Bill-Muskoka (NAM) on 03.16.09 at 2:33 pm

How Brain Dead are they in Calgary? Seems some are NOT, but others????

Calgary activists ramp up anti-Bush efforts

CALGARY — George W. Bush can expect a cordial welcome tomorrow inside a Calgary convention hall as the wildly unpopular former U.S. president gives his first public address since leaving office, but outside, a gauntlet of protesters don’t plan to be the least bit polite.

Local activists have been ramping up their anti-Bush efforts in advance of the $4,000 per table invite-only event titled a “Conservation with George W. Bush.” The media is banned from hearing Mr. Bush talk about “eight momentous years in the Oval Office” and “the challenges facing the world in the 21st century.”

Bush detractor Pat Westmacott can’t believe there’s even an audience willing to pay to hear him speak.

“Is he giving squinting lessons?” he joked, but then his tone turned serious. “This man brought on the biggest deficit in U.S. history and took the rest of the world down with him.”

Well, who in their right or Right mind would pay $4,000 to listen to the Global Moron of all time, Bush? Man of Man, talk about Greater Fools? These must be THEM!

Some people just live in DENIAL!

#74 Jonathan on 03.16.09 at 2:33 pm

MILTON & Surrounding Area, ONTARIO
Real Estate Update


February 26, 2009
1565 Listings (

March 10, 2009
1651 Listings (

March 16, 2009
1709 Listings (

This is an increase of 9.2% or 144 units in 12 business days (2.5 weeks). Even as sales strengthen as buyers head into the spring market, inventory levels keep rising.

If inventory increases linearly then it will double in less than 24 weeks (5.5 months). If inventory continues to accelerate at its current pace, inventory will double in 6.5 weeks (38% weekly growth rate).

#75 Grumpydawgs on 03.16.09 at 2:35 pm

The big picture is the US industrial production falling again, 12 months in a row. You could simplify the 1.4% drop by annualizing it out at a negative 16.8 drop, but that optimistic as the forecasts are for more revision downward. Since Canada has 85% of it’s economy ( OK go ahead and argue) tied to the health of the US economy, the forecast from Carney is really “we’re screwed”, but for political sake he can’t tell the truth. We are far from a rebound of 3.8% Marc. This is just the beginning of the downturn.

The best analogy is that they are acting like overbearing parents wanting to make thier childs playground boo boo to go away by saying soothing words but know that wounds take time to heal.

#76 Jay Currie on 03.16.09 at 2:35 pm

For the moment Carney is doing what a Governor of the Bank of Canada might be expected to do in a recession: drop interest rates, keep the Canadian banks solvent, be prepared to assist the banks by purchasing assets the Government of Canada is already insuring.

The question is what Carney will do if the economy hits a cliff. For example what does he do if the auto industry falls into bankruptcy meaning that 100,000 plus mortgages teeter towards default.

Garth is not optimistic having met the man. I am not optimistic simply because of the limited tools Carney has left in his workshop. Printing money is really all there is left and that, as we know, pretty much ensures significant inflation a year or two out.

Worse, Carney could be looking at a situation in which you have asset deflation – those housing sales numbers are not looking good – and CPI inflation due to a radical increase in money supply.

And, to make it all the more exciting, there is every chance there may be an election in fall of 2009 or Spring 2010 with all the political spending that will entail.

Whether Carney will be able to simultaneously apply stimulus and monetary discipline is the question which he needs to get right.

#77 Jeff Smith on 03.16.09 at 3:09 pm

Probably much worse than 9%. The announcement is of course from the CREA. They are probably gonna water it down as much as they can. So instead of the stagger X% down compare to last year. They are gonna say, oh its not that bad only 9%. Don’t worry, activities are up; new buyers market, blah blah.

#69 TS on 03.16.09 at 1:55 pm

The following link will take you to a piece about the price of resale homes in February falling over 9%.

#78 Investx on 03.16.09 at 3:38 pm

“With all this gloom, Toronto/GTA real estate is not as bad as predicted. February stats show that it’s only down YoY 5%. Far from a crash.”

Wealthy Renter:

“Ah, spin, glorious spin.

The numbers are not out for March, but the TREB data..”

Let me clarify… the YoY 5% drop was in PRICE. That’s not as bad as doom and gloomers thought. SALES are still way down YoY, yes.


#79 Too Old Bob$ on 03.16.09 at 4:23 pm

“#73 Bill-Muskoka (NAM) on 03.16.09 at 2:33 pm How Brain Dead are they in Calgary? Seems some are NOT, but others????”

So true Bill, but I heard they were going to hire Lily Allen to sing the opening tune for his arrival.

WARNING:: Very explicit!! Do not enter if you don’t like blanked out swearing.

Garth don’t post if not suitable.

#80 @Garth 2 on 03.16.09 at 4:23 pm

Agree with Investx here…

The sales volume decline and inventory build up in the Toronto area did NOT tap into prices the way people here are predicting… that’s a fact now.

“total home sales in the GTA were 11090 in January & February 08, and 6790 in January & February 09. That is a 39% YoY decline in sales.”

Your own spin is so obvious, it’s pretty disgusting.

Combining the numbers from January and February ignores that year-on-year prices went from around -10% in January to -5% in February. And the sales volume went from -47% in January to -31.5% in February. That’s an *improvement*.

The market is slower for sure, but most people were surprised at the change in the trend line from late 2008. Basically, we hit resistance rather early.

When March numbers come out they *will* be lower than February, but that has been the case since 2002 and prior. Look for the March average prices to be the average of the January and February prices.. if it’s far off from (say, more than 10% from the average then maybe you might be on to something).

I am not a real estate pumper in the least, and was surprised myself to see February numbers showing a bounce; I have been telling people to wait, but then again, I’ve seen California prices run up for decades, and anything could happen if the correction here isn’t severe.

If you look at the numbers historically, the question is not where the market will be this summer.. the question is where it will be in 2011 and thereafter. The crash at the end of the 80’s took to seven years to touch bottom with the first 2 years of decline being the worst. Think about that, think about how much older you are after seven years, sitting in an apartment, munching on squirrels, waiting to cherry pick a real deal. Even though most of the decline happened right away, real estate modestly decreased in value for years. It is the long term market that is at stake for realtors, and it’s too early to be so ridiculously assured that prices will go down 18% or 27% etc…

#81 Jake on 03.16.09 at 4:54 pm

Holy cow Bill, you’ve been busy today. ~1/4 of the posts, nice work. Just a comment on the global cooling article you posted in #10.

I am a man of science, and I am still undecided on the issue of global warming. I have been involved in debates at the university level and I have seen scientists agree to disagree about it. I attended one lecture where a group of political science students were giving a global warming denier a very hard time about the scientific evidence he was presenting. These BAs thought they knew more about the science being discussed than the presenting scientist (PhD). Sometimes I think those on the other side to the global warming debate gets as hard a time as Garth and RE bears have been getting from RE bulls over the past couple of years. Questioning global warming is not a popular path. Universities are very political and it can be difficult to get grants/funding for “inconvenient research.”

Like I said before, my mind is not made up with regards to global warming. That being said, there certainly are other obvious detrimental consequences of pollution that are a major concern.

#82 Bertie on 03.16.09 at 4:54 pm

Unbelivable.. a Calgary acquaintance just doesn’t get it. They bought a commercial property 3 years ago and of course it is way down in value. Add to that, the commercial tenants cannot afford the rent they are all being charged and some may bail or close.
Add to that, the acquaintance bought a home that has also gone down in value at least $600K (bought 2 years ago against advice).
Then, they also bought a fixer-upper to flip for big bucks. It never sold — now hoping to rent it. Our 2 cents was to advise against both house purchases. Now they are $100,000 in the hole on that one. I roughly estimate their negative equity to be around $1.4m.
Now they want to buy 2 more houses to flip because prices are “LOW” (and the real estate agents are not being truthful with them).
I mentioned to them that real estate prices are going to drop further and for a long time, and I gave the reasons why. I could physically see in their face they could not comprehend the words.
Talk about falling for the hype and never learning? This is the embodiment of human ignorance out there. This is typical of the people who lose big to the hucksters. I can see that there is absolutely nothing you can say to people like that. They happily sink their own ships and the rest of us can only stand and watch them go down.

#83 Bill-Muskoka (NAM) on 03.16.09 at 4:57 pm

#79 Too Old Bob$ on 03.16.09 at 4:23 pm

Bad video link. Please try again! Thanks!

#84 lgre on 03.16.09 at 5:38 pm

Sales will probably go up in the next few months, but so will inventory..RE prices increase when demand out weighs supply..and that, will not happen for a very long time. So for investx and other wishfull thinkers..hold on to your saddle cause its gonna be a slow but rough ride.

#85 Bill-Muskoka (NAM) on 03.16.09 at 5:59 pm

#82 Bertie on 03.16.09 at 4:54 pm

Even scarier is they breed and vote!

I, too, am a man of science, and my concern remains what is happening to our oceans. PhD’s are some of the politicized beings on this planet. So much for their ‘superior’ knowledge. There is also good old, albeit almost extinct nowadays, Common Sense.

Remember I was not the one saying what I linked to. this guy is so obviously biased that his cred is ZERO with me! Remember, don’t shoot the Messenger, eh? LOL

BTW, I have worked extensively in the environmental field. It too is plagued with Geological (aka, Civil) Engineers who found they had to make a living so they became Environmental Engineers. They write multi-million dollar reports, but never treat one drop of pollution. Again, Zero Cred with me.

Work The Solution is my motto!

Thanks for the reply however! Have a nice day!

#86 Too Old Bob$ on 03.16.09 at 6:18 pm

“#83 Bill-Muskoka (NAM)
Bad video link. Please try again! Thanks!”

Not sure what happened there, here’s the proper link.

PS. unless moderators didn’t approve.

WARNING:: Very explicit!! Do not enter if you don’t like blanked out swearing.

Garth don’t post if not suitable.

Guess what? — Garth

#87 . . . fried eggs and spam . . . on 03.16.09 at 6:18 pm

Another view of mathematics and govts., how they fool sheeple so easily with a para. below. —

“Alan Greenspan is a liar. The Federal Reserve and its long standing partner, the US Treasury, engineered the housing bubble, including the fraudulent inducement of America as part of a financial coup d’etat. Our bankruptcy was not an accident. It was engineered at the highest levels.”

#88 JoeCalgary on 03.16.09 at 6:23 pm

#81 Thanks for that, Jake. I, too, am concerned that so much focus on the effects of global warming–and why aren’t we talking adaptation, no matter whether climate change exists and no matter what’s causing it, if so–is taking attention away from the ongoing pollution in all its forms and stalling the work that must be done to alleviate it, now.

#89 TheComingDepression on 03.16.09 at 6:58 pm

Rumours flying around Washington today—-1 year suspension – no cap gains tax on anything bought THIS YEAR irrespective of when you sell it.

#90 BaRB the proofreader on 03.16.09 at 7:12 pm

#81 Jake,

I met one of the anthropogenic global warming deniers.
Little did he know that he and I have a friend in common.
Let me tell you about these “Deniers”… They are paid very well to spin their denials. Wherever there is money, you will find people like these – willing to say anything for money.
He is well paid in this case by oil & gas, which happens to be his field of work, and he is associated with the Univ. of Calgary.
Humans have sped up this cycle of natural warming. But worse, we are making the temperature rise so steep and rapid that a reversal probably will become out of the question. Chew on that.

#91 baRB the proofreader on 03.16.09 at 7:19 pm

Former U.S. Attorney General calls for Calgary Bush arrest

“We Dare Not Blink: Canada’s Duty to Arrest George W. Bush”
— by Ramsey Clark

#92 dd on 03.16.09 at 7:40 pm

#71 jess on

“calgary is having an uptick than why was the pres.of business ass. calling for more affordable housing …
could it be that all those empty units are ready for the government to subsidize the landlords?”

That is what the city and province should do right now. Why build when there are cheap condos on the market!

#93 jess on 03.16.09 at 7:44 pm

them vs us….mentality

North American Free Trade Agreement to give Mexican trucks full access to U.S. roadways beginning in 1995.

#94 Herb on 03.16.09 at 7:54 pm

Too Old Bob$,

like Muskoka, I have been working your youtube link at #79 (and #86) to see what Garth might want to protect me from, and like Muskoka, I’ve come up dry.

So which of the many videos on that youtube link do you think might not be suitable for our consumption? Rest assured that Muskoka and I have deleted many an expletive in our day.

#95 Coho on 03.16.09 at 8:04 pm

Interesting that the Goldman Sachs bunch and all the other high flyers on Wall Street all called the “brightest” and the “best”.

I’ll concede that they’re smart…and if “best” means figuring out ways to enrich themselves to the financial devastation of countless others, then the term “best” certainly fits.

Anyone remember the saying “If you had brains, you’d be dangerous.” Someone would say that to a dummy with evil intentions…but these banksters are both evil AND very smart, which makes them dangerous.

#96 bobs your uncle on 03.16.09 at 8:05 pm

#90 Barb, glad you still believe in global warming. I rank global warming right up there with Y2K, the tooth fairy, reptilians and best of all “Property never goes down in value” ROTFLMAO

#97 Coho on 03.16.09 at 8:25 pm

Bill Clinton (Slick Willy) has been a key player in the dismantling of the United States of America…not to mention the Bush’s…from Prescot Bush, to Herbert Walker and of course Dubya.

It was at the end of Clinton’s term that the Glass-Steigal Act was overturned. He also gave/sold technology to the Chinese…including military secrets.

As someone posted earlier…it’s the foxes guarding the hen house, indeed. It’s the enemy within that is in the process of quashing our liberty.

As Thomas Jefferson said, “If the government fears the people, there is liberty…but if the people fear the government, there is tyranny.”

#98 Too Old Bob$ on 03.16.09 at 8:47 pm

“Guess what? — Garth”
Ha Ha!!
You should have just deleted my first post, then I wouldn’t have tried again thinking it was an error. :)

Too easy. — Garth

#99 Taxpayer like you on 03.16.09 at 8:48 pm

Response to 57 Rory

I agree, and I dont understand Garths reply.

Basically wages, interest and dividends all have the same tax rate. The dividend gross-up simply accounts for the portion of tax paid by the dividend generating corporation, therefore giving the government the same
cut as if the corporation paid you the untaxed profit as a wage. Garth – you must own a coporation or two??

And yes, everybody must have seen the income trust thing coming. It just had to. No way it would last.

So that just leaves us cap gains………

#100 Irene on 03.16.09 at 8:58 pm

Jake, I am a scientist too, I am a 22 year old female,drop dead gorgeous, and know the difference between, Global warming and Global change which we are experiencing. Oh did I mention that I come from royalty and am wealthy? And…. I too can lie a lot and still have fun doing it. It stinks to lie and exaggerate doesn’t it? Lol

#101 JoeCalgary on 03.16.09 at 11:50 pm

“The International Monetary Fund is poised to embark on what analysts have described as “global quantitative easing” by printing billions of dollars worth of a global “super-currency” in an unprecedented new effort to address the economic crisis.”

#102 TakingResponsibility on 03.17.09 at 12:35 am

Re: Barb at #91 [Bush’s Calgary Speech]

Did you know the next “honoured” Calgary guest speaker will be Condoleezza Rice? (May 13)

#103 Future Expatriate on 03.17.09 at 8:35 am

#102: Condoleeza’s speeches are in high demand… at the end she peels her skin off and turns into a cobra.

Really something to see… no one’s yet been able to figure out how she does it.

#104 blacksheep on 03.17.09 at 12:30 pm

Fundamentals have not changed.

MSM says buy, and the sheep do.

Poor souls.

take care

#105 Future Expatriate on 03.18.09 at 10:30 am

Never waste pity on the brainless.

Ignorance is bliss.

#106 barb the proofreader on 03.18.09 at 3:07 pm

#96 ‘bobs your uncle’ said: “glad you still believe in global warming. I rank global warming right up there with Y2K, the tooth fairy, reptilians and best of all “Property never goes down in value”
Your ignorant propaganda-style post is a “good reminder” for all caring, smart and informed human beings… that there will always be devious and uninformed people like you who will post garbage like that.
Your post reminds everyone that ignorant people like you are out there, ready to mislead the masses in any way you can.

#107 Sally on 03.18.09 at 7:27 pm

I don’t understand why so many people take issue with Garth updating his theories as new information becomes available. That’s simply rational behaviour.

Why should someone remain married to a ‘doomer’ theory (or any other) if new information indicate that such an outcome is less likely? Such an intractable position seems more worthy of criticism than the aforementioned rational thought process, at least to me…

That isn’t to say that one should not take steps to minimize the risks of somewhat unlikely scenarios, but one also has to be able to accept other possibilities (and their potential likelihood).

#108 David on 03.18.09 at 9:11 pm

The labour cost component on an automobile product is about 6%. But go ahead beat and bleat about UNIONS THAT CONTROL COMPANIES. AIG did not have any union workers and their exposed counterparty risks are $440 billion. Too important to fail!! They are only 33% of the way through their crucial bailout and 100 % through with their much valued retention of “best talent” bonuses. Beat on Chrysler workers if you want. Chrysler does not have to pay health care benefits in Canada like they do in the USA, but when there is a “crisis” everything is on the table and negotiable.
Let parasitic insurance companies that produce nothing fail.