Wednesday, Mar. 05, 2014 5:00AM EST
Economic growth in North America was unimpressive in 2013, and indeed over the past few years. The just-released gross domestic product (GDP) numbers for the 2013 fourth quarter gave the false impression that Canada (up 2.9 per cent annualized) is now outperforming the United States (up 2.4 per cent). This is a blip, and it won’t last.More »
Tuesday, Mar. 04, 2014 5:00AM EST
The idea of promoting a “growth agenda” in Canada seems to be gaining traction among those thinking about economic policy.
The Conference Board of Canada has stated that the 2014 federal budget, likely the last in a series of deficit-reduction documents, should be followed by budgets that focus on creating higher growth. A new video from the Liberal Party argues the need for more sustained growth, partly motivated by a collection of middle-class anxieties. And the G20 finance ministers recently agreed to recommendations from the International Monetary Fund to implement growth-friendly structural reforms.More »
Monday, Mar. 03, 2014 5:00AM EST
Finance Minister Jim Flaherty’s Feb. 11 budget projected that as early as next year, Canada will become the first G7 country to achieve a balanced budget since the onset of the financial crisis. It can be argued that Canada has among the most well-managed public finances in the world, earning it the highly coveted triple-A rating from every major credit-rating agency, a crown held by only a dozen countries. Even the United States cannot claim membership in this elite group.More »
Friday, Feb. 28, 2014 12:49PM EST
The big story in the release of data from this week’s Survey of Financial Security from Statistics Canada was that the median net worth of Canadian households has been increasing very significantly.
Net worth is the value of all assets (mainly housing, pensions and other financial assets) minus all debts. Median net worth has risen by 80 per cent from 1999, and by 44 per cent from 2005 in inflation-adjusted terms, to $247,800. (In a median, half have more and half have less.)More »
Friday, Feb. 28, 2014 5:00AM EST
Economically, Alberta is commonly compared to the other provinces with a host of superlatives – lowest unemployment, fastest population growth, strongest investment markets, etc. – and normally, these comparisons place Alberta at the head of the parade. But new research reveals one area where Alberta is, at best, in the middle of the pack. This may have serious implications for the province’s future economic prospects.More »
Thursday, Feb. 27, 2014 5:00AM EST
Economists in this country have been talking a lot lately about the importance of immigration policy as an economic engine for Canada. The World Bank reminds us that it’s also a critical economic engine for many of the countries from which Canada gets its immigrants.
In a blog post this week, World Bank economist Nikola Spatafora noted that remittances – the money that migrant workers send home to family in their their country of origin – totalled more than $410-billion (U.S.) in developing countries last year. That’s more than triple the official development-assistance funds sent to those countries.More »
Tuesday, Feb. 25, 2014 5:00AM EST
The proposal to reach an agreement by the end of 2014 on a trade and investment partnership serving the world’s biggest and second-biggest markets – the European Union and United States – is intended to deepen a transatlantic relationship, assert global trade policy leadership and advance a rules-based system for global governance.More »
Monday, Feb. 24, 2014 5:00AM EST
Should financial markets start worrying about wage inflation? Some recent research out of the U.S. Federal Reserve suggests the debate is heating up, and it could well spill from the Ivory Towers into the Street in the not-too-distant future. The current hot topic for wage inflation is whether the Fed policy should go short or long, when it comes to the duration of unemployment.More »
Friday, Feb. 21, 2014 5:00AM EST
BRIAN LEE CROWLEY
In the hit TV show, Vikings, the earl who rules over the Vikings is stuck in the old ways. He always wants to go raiding to the east, because, after all, they’ve always gone east, and even though the people there are just as impoverished as the Vikings, well, there is no place else to go.
Then along comes the hero, Ragnar, who has two things: The rumour of rich lands to the west (England) and a technological innovation allowing him, for the first time, to navigate there. When Ragnar returns with a ship full of booty, the earl confiscates it all and decides Ragnar is a dangerous and disruptive force who endangers the community’s way of life. Coincidentally, he is also a mortal threat to the earl’s dwindling authority.More »
Thursday, Feb. 20, 2014 5:00AM EST
The federal government’s decision to allocate $500-million to its auto innovation fund has added fuel to a long-standing debate in Canada around whether governments should compete to attract investments by firms.
The prospect of supporting Chrysler on a new $2-billion investment, and the Ontario government’s announcement before Christmas of support for a large-scale investment by Cisco Systems Inc., have also added to the discussion. While many conservative commentators and economists are opposed to using public funds to attract firms to Canada, governments of all political stripes continue to press ahead.More »
Wednesday, Feb. 19, 2014 5:00AM EST
Last week’s federal budget clearly illustrated how close the government is to restoring a balanced budget. Six years after the bottom fell out during the global financial crisis and recession, the 2014-15 budget signals the end to a tough but necessary period of fiscal consolidation. Current expectations are for a surplus of $6.4-billion in 2015-16, plus a contingency reserve of $3-billion; there is finally some room to manoeuvre in the years ahead.More »
Tuesday, Feb. 18, 2014 5:00AM EST
My students are often puzzled about the causes of inflation, the relationship between it and “money,” and the concerns over very low inflation. These questions also arise in current public debate. So here are a few pointers on these central macroeconomic topics.
Suppose you collect data from a large group of countries over 30 years. For each country, you measure the average annual inflation rate and the average annual growth rate of the “money supply,” which includes the physical currency in circulation and the total value of bank deposits. You then have a single data point for each country, showing that country’s inflation-money growth combination. If you plot these data, you’ll get the closest thing to a straight line that economic data ever generate: Countries with high long-run rates of money growth are also countries with high long-run rates of inflation, and vice versa (see chart).More »
Monday, Feb. 17, 2014 5:00AM EST
One of the low-lights in Canada’s recent disappointing export performance (as I pointed out in a recent ROB Insight commentary) has been the apparent deterioration in crude oil shipments. I say “apparent” because CIBC World Markets chief economist Avery Shenfeld has questioned whether the official oil numbers in Statistics Canada’s trade reports are accurate.More »
Friday, Feb. 14, 2014 12:59PM EST
You could hear the sound of jaws dropping across the nation this week when Finance Minister Jim Flaherty, in response to a question from a journalist, cast doubt on the idea of income-splitting for young families, something his party has been promising since March 28, 2011.
The idea – which would allow the higher-earning spouse to transfer income to their lower-earning spouse in order to reduce their total tax hit – provoked controversy right from the start. But it became an increasingly hard sell as economists and think tanks from across the political spectrum lined up in agreement: Income-splitting costs too much for something that is worse than doing nothing.More »
Friday, Feb. 14, 2014 5:00AM EST
We all know the guy. You see him at the wedding reception or summer barbeques – maybe he’s your cousin’s husband or the guy from work a few cubicles down. He’s pleasant enough, but he just doesn’t know quite how to carry himself or hold a normal conversation. He says weird things and has bad breath. We have a term for him: he’s socially awkward.More »
Thursday, Feb. 13, 2014 5:00AM EST
A sudden media storm has blown up over whether to raise the minimum wage. Ontario’s Liberal government now plans legislation to increase the province’s minimum wage by 75 cents to $11 an hour. In the United States, President Barack Obama made higher minimum wages a central theme of his State of the Union pledge to reduce economic inequality, saying “it is time to give Americans a raise.” The debate extends beyond North America: Higher minimum wages are now being hotly debated in countries from Britain to Bangladesh.More »
Sheryl is an independent macroeconomic strategist with over 20-years experience in the international financial industry and central banking.
Todd Hirsch is the Calgary-based chief economist of ATB Financial and author of The Boiling Frog Dilemma: Saving Canada from Economic Decline.
Clément Gignac is senior vice-president and chief economist at Industrial Alliance Inc., and chair of the World Economic Forum Council on Competitiveness and member of the Forum’s Sustainable Competitiveness Advisory Board.
Andrew Jackson is the Packer Professor of Social Justice at York University and Senior Policy Adviser to the Broadbent Institute.
Christopher Ragan teaches economics at McGill University; during 2009 and 2010 he was the Clifford Clark Visiting Economist at the federal Department of Finance in Ottawa.
Globe's Economics Team
Brian Milner is a senior economics writer and global markets columnist. In a long career at The Globe and Mail, he has covered diverse business beats, including international trade, the automotive industry, media, debt markets, banking and the business side of sports.