Ontario’s Electricity Sector III: Legislative & Finance Update

My January and April posts on the Ontario electricity sector described how decisions by different Ontario governments gave rise to excess electricity generation with an inflated cost structure, leading to higher electricity prices. Here I discuss the latest development, the Liberal Government of Ontario’s proposed financial framework for its “Fair Hydro Plan” (FHP). In election mode, the Government tabled Bill […]

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Intellectual Dishonesty at the Ivey Business Journal

Under the headline “Canada Isn’t Rotten to the Core”, the new editor of the Ivey Business Journal, Thomas Watson, attacked my book “Thieves of Bay Street” in his inaugural editorial. Although the book hit bookstores almost two years ago, and has faded from view, I found this assault so distorted to what “Thieves” explores I felt it warranted a response. […]

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The Big Banks’ Big Secret

The CCPA today released my report: “The Big Banks Big Secret” which provides the first public estimates of the emergency funds taken by Canadian banks.  The report bases its estimates on publicly available data from CMHC, the Office of the Superintendent of Financial Institutions, US Federal Reserve, the Bank of Canada, as well as quarterly reports from the banks themselves. […]

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Stock Market Swindles Galore

This past weekend (March 31st), Sino-Forest Corp. announced it was filing for bankruptcy protection. The Chinese-Canadian company, once the largest publicly-traded forestry firm on the TSX, collapsed under allegations it was nothing more than a sophisticated fraud and Ponzi scheme. Sino-Forest’s demise wiped out about $6-billion in shareholders’ value, making it a catastrophe on par with Bre-X Minerals back in […]

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The Meaning(lessness) of Money — Why “Quantitative Easing” Won’t Do What People Think it Will Do

There has been much talk, of late, about the ineffectiveness of conventional monetary policy — i.e., lowering the target for the overnight interest rate to incite borrowing and hence economic expansion — and the need for monetary authorities to consider something more dramatic, like so-called “quantitative  easing” — the active buying of government debt and other securities in the open […]

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Laughing All the Way to the err…Bank

The Canadian Bankers’ Association must be happy.  They’ve somehow managed to convince pundits south of the border, and even a few here who really ought to know better, that they’ve somehow been able to weather the economic and financial storm with absolutely no help from the federal government. The most recent evidence for this position is this editorial by Newsweek […]

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“Severe and Unusual Stress” — A Definition In Search of A Situation

Well. Finally. Some clarity. Sort of. Earlier this month, Bank of Canada governor Mark Carney made appearances before the House of Commons Finance Committee and the Senate Banking, Trade and Commerce committee to discuss the Bank’s latest monetary policy report . Transcripts are now available and with a little reading-between-the-lines, they tell us a lot, I think, about the true […]

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The Credit Crunch Hits Home?

What is going on out in Canada’s wild and woolly financial system? First, the Bank of Canada convinces the Department of Finance and the Conservatives that it “needs” expanded powers to purchase a broader range of securities (see my earlier post for why their arguments are not very convincing). And then, earlier this week, a small notice on my Scotiabank […]

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The Budget and the Bank

Over the years, federal budget legislation has acquired the feel of U.S. omnibus bills (the Farm Bill is probably the quintessential example). To some extent, this is to be expected. Ever since the “disastrous” Trudeau era, the imperial Department of Finance has not-so-quietly re-asserted its domain over the federal bureaucracy. One manifestation of Finance’s power has been the increasing tendency […]

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Avoid Blame, Change the Game!

The asset-backed commercial paper (ABCP) debacle: who is to blame?  According to the National Post , it’s everybody and nobody.  I find myself in unusual agreement.  While I don’t wish to see likely criminals let off the hook, a better approach out of this mess is to change the rules of the game. Last August, the Canadian market for non-bank ABCP was […]

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Levy Institute on sub-prime and US developments

Randall Wray, in a paper for the Levy Institute, provides a nice history of the sub-prime debacle, and connects it to the economics of Hyman Minsky (whose name has resurfaced in the wake of the current connundrum) in Lessons from the Sub-prime Meltdown: This paper uses Hyman P. Minsky’s approach to analyze the current international financial crisis, which was initiated […]

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Where is Finance Minister Flaherty?

Where is Finance Minister Flaherty? by Doug Peters and Arthur Donner. (from today’s Toronto Star)   (Doug Peters is the former Chief Economist of The Toronto-Dominion Bank and was Secretary of State (Finance) from 1993 to 1997. Arthur Donner, a Toronto economic consultant, began his career as an economist at the Federal Reserve Bank of NewYork.)   “The credit problems […]

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