US DEBT CEILING
- The deadline to increase the ‘US debt ceiling’ is October 1, 2013. As of September 25th the US had federal debt of $16.7 trillion, about $25 billion less than the legal limit.
- Treasury Secretary Jacob Lew calculated the US would run out of money by October 17.
- The fiscal issue continues to be a political fight with Republicans trying to defund Obamacare (the Affordable Care Act).
- The US has never officially violated its ‘debt ceiling’ however there have been 17 funding gaps between 1977 and 1996 with government shutdowns in 1995 and 1996 lasting between 5 days and 2 weeks.
- Moody’s estimates that a three to four week shutdown could reduce Q4 GDP by as much as 1.4%. (Q1 GDP 1.1%, Q2 GDP 2.5%)
NORTH AMERICAN HOUSING
- Dr. Gary Shilling says the US housing recovery is precarious because “it is based on rentals. It’s not based on new homeowners” who are the basis of any solid rally.
- US home ownership is 65%, the lowest in almost 18 years.
- Dr. Robert Shiller says that he is “not worried about a slowdown” in the housing market because he is “more worried about bubbles” that appear to be back in the US housing market.
- The number of new condos sold in the Greater Toronto area during August dropped 18% Y/Y to the lowest August level in 10 years.
THE ALBERTA WORK WEEK – STATISTICS CANADA
- The average employee in Alberta worked approximately 32.2 hours in July, 5.9% longer than the national average. (Canada and Saskatchewan 30.3 hours, Ontario 30.2, Quebec 30.1)
- Albertans worked an extra hour and 20 minutes (4.2% longer) than in July 2003. Across Canada, the average employee worked about 30 minutes less per week in the same period.
- It appears employers may be requesting more overtime to avoid hiring more workers.
- Longer hours come with distinct drawbacks, workplace stress and illness may also be rising.
- Prime Minister Harper says “My view is that you don’t take ‘no’ for an answer” with respect to Keystone XL approval.
- Economists at Canada’s leading banks are cautiously optimistic about the outlook for Canada’s economy. National Bank’s Chief Economist, Stefane Marion says “the economies that will succeed going forward are the ones that can attract private capital and talented people to join their economies to slow down the impact of an aging population.”
- Euro-area economic confidence rose for a fifth month to 96.9 from 95.3 M/M.
- US household net worth increased in Q2 by $1.3 trillion (1.8%) helped by higher stock and house prices.
- Japan’s inflation accelerated to the fastest pace since 2008, up 0.8% in August Y/Y.
- US and Russia have agreed on a UN Security Council resolution demanding Syria to give up its chemical arms, but does not threaten military force if it fails to comply.