My post on this past Monday’s Gross Domestic Product (GDP) release emphasized the disconnect between profits and investment in the corporate sector. As Andrew commented on that post, the public sector’s contribution to the recovery is also noteworthy. That point seems especially relevant in the wake of a federal budget devoted to continuing previously announced stimulus. The right-wing critique from […]
Read moreBoth employment and unemployment edged down between November and December, reflecting a smaller total labour force. This news raises concern that some jobless workers are leaving the labour force altogether. However, the labour-force decrease was only 9,000, far smaller than the previous monthly increase. Overall employment changed so little because private-sector payrolls stabilized. While stability is welcome after the recent […]
Read moreThe national inflation rate jumped to 1.0% in November from 0.1% in October. As Statistics Canada notes, this apparently large increase is “due primarily to gasoline prices.” Specifically, last month’s gasoline prices are being compared to the depressed gasoline prices of November 2008. Given the changed base of comparison, it is not surprising that the headline inflation rate has returned […]
Read moreCanada’s extended summer of deflation ended in October, when the national inflation rate rose to 0.1%. This change reflects a lowered base of comparison: the price of gasoline plummeted between September and October of last year. The return of inflation should not be overstated. Today’s inflation rate is barely positive and falls short of the 0.3% that analysts had been […]
Read moreCanadian Gross Domestic Product (GDP) fell by 0.1% in August. The decline mainly reflected temporary closures of major oil rigs, mines and mills due to maintenance or labour disputes. This explanation is valid, as far as it goes. However, the broader issue is that more widespread economic growth should be more than offsetting these isolated events. Today’s release reveals a […]
Read moreWhile some prices rose slightly and others fell slightly between July, August and September, the total Consumer Price Index has remained exactly the same through these months. The annual inflation rate declined by 0.9% in September, tying July for the largest rate decline since 1953. All provinces but Saskatchewan now have negative inflation. While the main story continues to be […]
Read moreOn Thanksgiving, Canadians can be thankful that public stimulus spending propelled a surprisingly strong labour-market rebound in September. This morning’s release shows full-time employment up and the unemployment rate down. However, the jobs picture is not as rosy as these top-line numbers imply. Stimulus Working? The improvement in Canada’s labour market should not be taken as an indication that government […]
Read moreFlat Gross Domestic Product (GDP) figures for July provide a sobering reminder that the technical end of a recession may not imply a rapid recovery. Output appears to have stopped shrinking, but this morning’s release suggests stabilization rather than growth. Rounding to the nearest billion, all-industry GDP has been $1,184 billion for three months. It had peaked at $1,241 billion […]
Read moreLast week the United Nations Environment Programme (UNEP) published an update for the G20 Summit on its call from earlier this year for a Global Green New Deal. Â This update showed that Canada is close to the bottom in the stimulus funds it is committing to green economic areas. According to the UNEP, only 8% of Canada’s stimulus spending is […]
Read moreThe first chart in today’s Third Report on the Economic Action Plan (Chart 1.1, page 8 ) appears to show that Canada is tied with Japan for the largest stimulus package in the G-7. Exactly the same bar graph appeared in the Second Report back in June (Chart 1.2, page 12). While this seemingly impressive chart has been promoted to […]
Read moreThis morning’s consumer price figures for August are reminiscent of July. The annual Consumer Price Index decline was 0.8% (compared to 0.9% last month.) With the exception of July, August was the sharpest drop in consumer prices since 1953. In both July and August, eight of ten provinces posted negative inflation rates. The only province with positive inflation in both […]
Read moreLayoffs Continue Today’s Labour Force Survey indicates that full-time employment declined by 4,000 in August. There were 7,000 fewer jobs in goods-producing industries. Retailers Hire A surprising 21,000 new jobs in retail and wholesale trade propelled economy-wide employment up by 27,000. This increase consisted entirely of part-time jobs. While any employment gain is welcome news, the quality of these new […]
Read moreThe September BC Budget is a new look at a budget most have come to see as a fake. February’s budget was not passed through the legislature due to the May election, and up to E-Day the government maintained the fiction that it had a small-ish deficit of just under half a billion dollars. Since that time, the government has […]
Read moreIn July, the Consumer Price Index posted an annual decline of 0.9%, the most negative inflation rate since July of 1953. This decline is troubling not only because it is larger than last month’s decline, but also because it is more widespread. Recent decreases in inflation have mainly been driven by lower gasoline prices in 2009 compared to 2008. This […]
Read moreDeflation is no longer a spectre, but a reality for Canada. This morning, Statistics Canada reported an inflation rate of minus 0.3%. Inflation turning negative was widely predicted, including in my previous comments on the Consumer Price Index. Although not surprising, today’s news has important implications for the debate about further fiscal stimulus. Statistics Canada noted that June 2009 was […]
Read moreAfter many months in which tens of thousands of jobs disappeared, the revelation that “only” 7,400 fewer Canadians were working in June may seem like good news. But this relatively small decline in total employment masks more ominous trends. Self-Employment In June, employers eliminated 44,600 paid positions in Canada, but 37,200 more Canadians declared themselves to be self-employed. This development […]
Read moreThis morning, Statistics Canada revealed the country’s worst-kept secret: the economy contracted for a second consecutive quarter in the first three months of 2009. Adjusted for inflation, Gross Domestic Product dropped by 1.4%. If this trend continued (and compounded) for a year, the Canadian economy would be 5.4% smaller. On the other hand, this decline was not bad enough to […]
Read moreStatistics Canada has revealed that, adjusted for inflation, Gross Domestic Product (GDP) declined by 0.1% in February. This decline is on par with September and October, but far less severe than November (-0.7%), December (-1.0%), and January (-0.7%). There are grounds for hope in that a slower pace of decline is a necessary precondition for a return to economic growth. […]
Read moreWith my oped last week on the NDP platform making me less than popular over at NDP HQ, today the Sun published my take on the Liberals’ platform, thereby guaranteeing that the list of Christmas parties I get invited to dwindles to next to nothing. BC’s Economic Challenges and the Liberal Platform By Marc Lee The BC Liberal platform features […]
Read moreMedia coverage of the Bank of Canada’s much anticipated Monetary Policy Report inevitably focuses on the prospect of “unconventional” measures, such as quantitative and credit easing. But the verbs in today’s headlines – “may use” , “ready to” , “lays out” , “sets stage” – reflect how little was actually announced. The Bank provided three pages explaining quantitative and credit […]
Read moreBelow is an oped of mine that was done at the request of the Vancouver Sun and that ran in today’s paper. Unfortunately, for reasons that are not entirely clear, the last two paragraphs were cut off, leaving the oped hanging. I put them back in below, and have requested that the online version be changed. UPDATE: The online version […]
Read moreKudos to the Bank of Canada for significantly reducing its target interest rate from 1% to 0.5%. A month ago, it took the position that already-announced monetary and fiscal stimulus was sufficient to propel a swift economic recovery later this year. Today, in both word and deed, it acknowledged worsening economic conditions and the need for more stimulus. Why Not […]
Read moreThis afternoon’s news that the American stimulus bill passed without a single Republican vote in the US House of Representatives seems to validate Paul Krugman’s skepticism of bipartisanship. The Democratic effort to compromise with Republicans limited the amount of stimulus spending (as opposed to questionable tax cuts) in the package. If this constrained package proves insufficient, the Republicans will be able […]
Read moreI just returned from the Steelworker Mecca of Hamilton-Burlington, where the Michael Coren Show is taped. It will be broadcast at 8pm tonight through the Crossroads Television System (CTS) on cable in Ontario and Alberta, and on satellite across Canada. Sarah Blackstock of the Income Security Advocacy Centre and I squared off with two Kevins, one from the Canadian Taxpayers […]
Read moreAlarmist media reports on “Buy America” rules for steel used in US public infrastructure projects have emphasized the value of Canadian steel exports allegedly threatened, but have largely ignored the similar value of American steel imported by Canada. In fact, in the most recent month for which data is available (November 2008), Canada bought more steel from the US than […]
Read moreFigures released by Statistics Canada this morning reveal that Canada’s real GDP dropped by 0.7% in November 2008, its largest monthly decline since a 1.0% drop because of the August 2003 power outage. With the exception of that unique event, November’s decline was the largest since at least February 1997, the oldest month for which precisely comparable figures are available. […]
Read moreThe more I read Budget 2009, the less stimulus I see. The very first page of text in the Budget Plan commits to “inject fiscal stimulus of 2 per cent of gross domestic product (GDP)†(page 9). For 2009-10, the Budget introduces new spending and tax cuts worth $18 billion, about 1.2% of GDP (page 217). But it accounts for […]
Read moreThe Fraser Institute, Canadian Centre for Policy Alternatives, Informetrica, Bank of Montreal, and yours truly square off in today’s Toronto Star (page A17).
Read moreToday’s Consumer Price Index suggests that Canada is lunging toward deflation. The annual inflation rate plummeted to just 1.2% in December, 2.2% lower than only three months ago. If this pace continues, the national inflation rate will turn negative in the next few months. Two provinces, Nova Scotia and New Brunswick, already recorded negative inflation rates in December. Of course, […]
Read moreWe are now into full blown Budget consultation mode, with MPs of all parties going through a bit more than the usual pretence of listening before the actual Budget is finally put to bed by the government a few days hence. For once, even the Conservative inner circle seem a bit unsure of where to go. Below the closed (charmed) […]
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