Oct. 25, 2013


  • Central banks around the world are reinforcing loose monetary policy (low interest rates).
  • This week the Bank of Canada downgraded Canadian growth forecasts to 2013Q3: 1.8% (vs 3.8%), 2013Q4 2.5% (vs 2.5%), 2014Q1 2.3% (vs 2.7%), 2014Q2 2.3% (vs 2.8%), 2014Q3 2.4% (vs 2.8%), 2014Q4 2.6% (vs 2.8%).
  • The Bank of Canada now expects total inflation to return to the target 2% at the end of 2015.
  • The IMF lowered its forecast for global economic growth to 2.9% in 2013 and 3.6% in 2014 from July’s projected rates of 3.1% for 2013 and 3.8% for 2014.
  • Morgan Stanley’s co-chief global economist says “we are at the cusp of another round of global monetary easing”.
  • Societe Generale’s global head of economics says “there is a concern at central banks that what we’re seeing is another false start in their economies”.
  • Moving to tighten monetary policy before the Federal Reserve is ready to do so would drive currencies up against the US dollar to the detriment of exports.


  • German Chancellor Angela Merkel and French President Francois Holland are saying “a rule of good conduct is that you don’t bug the cell phones of people you meet regularly at international summits”.
  • Some European politicians are calling for a suspension of trans-Atlantic trade talks amidst allegations of US spying on Angela Merkel.
  • The European Parliament has advanced privacy legislation that would forbid the transfer of data generated in the EU to an outside country unless the subject and the source country give permission.
  • A recent estimate indicates that the US National Security Agency’s surveillance program could reduce potential revenue to US IT service providers (examples: Cisco, Symantec) by as much as $180 billion.


  • The December Western Canadian Select discount to WTI is $34.50.
  • Institutional purchases of US homes accounted for 14% of sales and all-cash sales rose to 49%. Analysts are suggesting that this is keeping families from buying homes.
  • Prime Minister Harper said that Canada will raise the threshold on foreign takeovers of small business to $1 billion vs the current $344 million for the US, Mexico, and 12 other countries as a result of its free trade pact with the European Union.
  • Singapore and China are introducing direct trading between their currencies.
  • Owners of the French soccer clubs mandated a strike by their players on the weekend of November 30th to protest the French government’s plan for a 75% marginal tax on salaries of more than €1 million.