tag:blogger.com,1999:blog-5902253799556549537.post3621400619503448463..comments2024-03-20T02:13:07.412-04:00Comments on Fictional Reserve Barking: Economists to Parliament: fiscal policy must remain flexible, government cuts can't go too far, caution is the key wordcircuithttp://www.blogger.com/profile/08565443970730261572noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-5902253799556549537.post-73134159854417949272011-10-02T17:48:14.378-04:002011-10-02T17:48:14.378-04:00@all(nod) I would just add to the current conversa...@all(nod) I would just add to the current conversations that juo (nod) a few columns ago (Sept 13, 2011), highlighted the need for commodities to behave within parameters for Canada to be insulated from the global downturn. I am not as optimistic as juo on whether that is the case, or even possible. I will acknowledge that he had a further caveat as to the persistence of global aggregate demand, something that definitely seems to be waning on the horizon; however, I think he may have underestimated the obstinacy of governments to entertain public expenditure programs on a longer term. <br />On the other hand, the BoC may be softening its humors with respect to its rate programs and its proferred targets. Fine calibration. <br />Absolutely stay the course, circuit.B.Swellshttps://www.blogger.com/profile/13800749885538075676noreply@blogger.comtag:blogger.com,1999:blog-5902253799556549537.post-75383528943996258992011-10-01T22:26:37.221-04:002011-10-01T22:26:37.221-04:00FRB's last few columns and comments on the Can...FRB's last few columns and comments on the Canadian economy were very revealing. I agree with Terence that FRB has been on target for predicting the slowdown in Canada. The Lavoie exposé in Ottawa at the Committee meeting was alarming however, it was not as alarming as some by your commentators.Coleen E.noreply@blogger.comtag:blogger.com,1999:blog-5902253799556549537.post-58213059872925449312011-10-01T14:09:32.161-04:002011-10-01T14:09:32.161-04:00Thanks Terence. The signs were there. Consumer bor...Thanks Terence. The signs were there. Consumer borrowing has been weakening since '09. Business investment *had* to slow. Although govt stimulus in Canada was decent in recent years, it was only a matter of time before this component ran its course. As Lavoie mentions, without exports (due to strong CAD), growth prospects are nil. An important indicator was the weak US GDP numbers in 2011Q1. The quarterly change from the previous period should have been an important signal to Canadian policymakers.circuithttps://www.blogger.com/profile/08565443970730261572noreply@blogger.comtag:blogger.com,1999:blog-5902253799556549537.post-80154725759568189672011-09-30T21:42:36.105-04:002011-09-30T21:42:36.105-04:00No one came so close to predicting the Canadian re...No one came so close to predicting the Canadian recession as you did. What a way, circuit, what a way!Terence Kolacs ONTnoreply@blogger.comtag:blogger.com,1999:blog-5902253799556549537.post-27194298833086105612011-09-30T21:38:57.701-04:002011-09-30T21:38:57.701-04:00Indeed, I also sensed a discomfort from the commit...Indeed, I also sensed a discomfort from the committee members. The questions were telling. Not much there to really drive the point that current policies and preoccupations are ill-advised. As always, your take on the corporates is well-taken. MP Jean's final set of questions on corporate surpluses were a pleasant surprise. Lavoie's response that the lack of AD is exactly what MPs need to hear. Combined that with his comments on the slowdown in exports and the high level of personal indebtedness, the case for fiscal stimulus is easy to make. Unfortunately, I'm not overly optimistic on the fiscal front. As you say, BoC may have to play the lead role in the months ahead. Now's the time.circuithttps://www.blogger.com/profile/08565443970730261572noreply@blogger.comtag:blogger.com,1999:blog-5902253799556549537.post-27215090271019943472011-09-30T07:35:36.340-04:002011-09-30T07:35:36.340-04:00FRB (nod!!) has been navigating that course for a ...FRB (nod!!) has been navigating that course for a while, and better than the pundits. your column on a declining GDP back in august was fairly comprehensive. in fact, all your columns on the canadian economy have been on target. <br /><br />thanks for the link on scof. i usually record f&b. i know lavoie's (nod) work and he is very credible, unfortunately, with too little time and incorrect questioning, he isn't permitted to address the real issue. targeting corporate taxes is one fiscal measure (you also signaled that a while ago on a great day's column) but i'm cynical about the effect. we've already commented in FRB that decreasing corporate free cash flow immediately triggers an expense cut-usually payrolls. lesson learned from the 2008 collapse. nothing suggests any difference than a tit-for-tat, unless you've attained the critical labour mass where further payroll cuts are equivalent to reductions in fixed costs, and will effect adversely the structural character of the organization targeted. fiscal policy must address a simultaneous incentive program for all manufacturing companies, major tax reductions for small businesses, including holidays, and BoC has to adjust the rate program immediately to weaken our dollar substantially. i appreciate Mr. Carney's consideration of ......... but macrodata is persuasively onside. no need to wait longer.<br /><br />all else is lip service. the quality of interventions by some committee members was disappointing. no one stood out, probably as a result of some impending or confirmed discomfort with the dire oncoming predictions of a major squall. they should be reading your column.<br /><br />stay the course, circuit.JH Crawhttps://www.blogger.com/profile/08829348139831448877noreply@blogger.com