Nov. 15, 2013

THE HONOURABLE JIM FLAHERTY, CANADA’S MINISTER OF FINANCE – ONE ON ONE, NOVEMBER 12, 2013

  • Canada has the best job creation in the G8 over the past 10 years. Job prospects for our young people are expanding. Mr. Flaherty wants to shift the focus from job training to job creation.
  • The government debt servicing is now only 11¢ of every dollar vs the peak of 30¢.
  • Mr. Flaherty does not want a housing bubble, “if you lose your financial footing people will get hurt.” He will intervene again if he has to.
  • He won’t intervene on the C$ unless it is over $1.10 as you can only effectively intervene once.
  • He is still concerned that we have not seen the bottom of the European banking crisis.
  • Mr. Flaherty is a strong supporter of all pipelines and believes that the West to East pipeline is the most obvious first choice. It is a deep water port, ice free, refineries are already in place and the right of way is defined.
  • Mr. Flaherty is a strong supporter of infrastructure development and hence has extended the Canada Fund by 8 years and $70 billion. As well, P3’s will have an expanded role and have been very successful, especially in transportation and hospitals.
  • The EU pact, together with NAFTA, would give Canadian companies access to 50% of the world’s GDP. We will be the only country with both agreements.
  • Once we have a surplus, he is still committed to increasing the TFSA limit, family income splitting and a health tax credit.

JANET YELLEN, US FEDERAL RESERVE CHAIR NOMINEE – CONFIRMATION HEARING

  • Janet Yellen believes “we can do more” and that hiring is ‘imperative” and the economy is performing “far short” of potential.
  • Ms. Yellen made clear that QE could not continue forever but the benefits outweigh the costs.
  • She is undertaking “a very comprehensive review” of non-traditional banking activities such as commodity trading and may introduce rules to limit the undermining of financial stability.

TIDBITS

  • Bank of America said that LNG prices could reach a record as Asia’s buying surge spurs demand capacity to grow by as much as 5x faster than supply.
  • The IEA says that US will surpass Russia as the world’s top oil producer by 2015 amid booming output from shale.
  • GM is moving its international headquarters to Singapore from China in Q2 2014.
  • Canada’s September trade deficit dropped by more than 50% to $435 million. Exports grew 1.8% while imports grew 0.2%. Exports to the US comprise 75.1% of all Canadian exports.
  • Canadian home prices were up 0.1% in October M/M and rose 3.1% Y/Y.
  • Diabetes kills 1 person every 6 seconds and afflicts 382 million people world-wide according to the International Diabetes Federation.
  • China is reforming their 1 child policy. Going forward if either parent is an only child, the couple can try for a second child.
  • European Q3 GDP rose 0.1% vs an increase of 0.3% in Q2.