Tuesday, May 15, 2012 8:45 AM EDT
Inflation hawks may get their wings clipped
Anyone wondering if inflation fears remain deeply imbedded in the German psyche need only glance at a front-page scare story Friday in Bild-Zeitung. “Inflation Alarm!” the popular tabloid blared in big letters. “How quickly will our money be eaten away?” To underscore the fear factor, the newspaper ran a photo of a billion-mark note, three of which would have purchased a loaf of bread in 1923, the year it was issued.
On the same day, Bundesbank chief Jens Weidmann told another newspaper that German citizens can count on the central bank to maintain its hawkish vigilance on inflation and dismissed out of hand the suggestion that Germany might be willing to tolerate somewhat higher wages and prices.
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Monday, May 14, 2012 7:37 PM EDT
Forget what you’re hearing: Greece won’t quit euro soon
Greece’s worsening political crisis makes its exit from the euro zone seem a foregone conclusion. But this may not happen at all – and certainly not as quickly as some analysts would have us believe – even if anti-austerity forces manage somehow to form a government after what is sure to be another election next month.
Thursday, April 12, 2012 11:16 AM EDT
Dark clouds behind the silver lining in U.S. trade
The latest trade numbers for Canada and the U.S. send potentially troubling signals about both economies, where demand appears to be softening.
Canada’s trade surplus for February came in much weaker than analysts had projected, as exports slid. The merchandise advantage for February was only $292-million, which compares unfavourably with a revised January figure of $1.95-billion. The culprits were resources and vehicles, which contributed heavily to a slide in exports of 3.5 per cent. Energy shipments fell 6.9 per cent and autos plunged nearly 12 per cent, after several months of impressive gains.
Wednesday, April 11, 2012 1:14 PM EDT
Why you shouldn’t write off the U.S. economy just yet
Plenty of bearish analysts see a long, hard slog for the United States, with several more years of lacklustre growth, high unemployment, flat housing, weakened financial institutions and worsening public finances. Some economy watchers draw comparisons to Japan and its two decades of stagnant growth, sideways stock market, high debt levels and bouts of deflation.
But if you believe, as I do, that the resilient U.S. economy is fully capable of finding a path to full recovery and decent, if not great, growth, you will get plenty of support from Ruchir Sharma, author of Breakout Nations, about the rising new stars of the global economy.
Sunday, April 15, 2012 5:06 PM EDT
Spain follows a tired script as bond yields spike
Well, so much for costly European efforts to build a protective fence around dangerously vulnerable members of the euro zone. The bond market continues to pummel Spanish and Italian bonds – while driving German yields to record lows – amid fears that embattled governments will not get their fiscal houses in order and the European Central Bank’s moves to prop up the region’s ailing banks will not be sufficient.
The bond market’s renewed aversion comes at a particularly bad time. Euro zone governments will to have find takers for more than €1-trillion worth of debt this year, and European banks face bond redemptions of more than $600-billion in the first half of the year alone.
Sunday, April 15, 2012 2:13 PM EDT
We say we want higher tax, but we'd never vote for it
If the results of a new Canadian survey and more public comments from wealthy Americans are to be believed, people of means are willing to fork over more in taxes to preserve and strengthen the safety net for the less fortunate.
American billionaire Warren Buffett set off the rich-will-pay campaign by telling anyone who would listen that his tax bill was ridiculously low – lower, in fact, than his own secretary.
Friday, March 9, 2012 6:25 PM EST
Memo to Lisa Raitt: Stay out of Air Canada’s business
Air Canada’s biggest union has signalled its intention to strike and will be legally able to do so at 12.01 a.m. Monday. My advice to the International Association of Machinists and Aerospace Workers: Don’t bother wasting your time printing the picket signs.
If federal Labour Minister Lisa Raitt was prepared to step in to keep flight attendants on the job last October, what do you think the government’s reaction will be to a strike of mechanics, baggage handlers, electricians and airplane washers. CUPE cancelled a planned walkout of flight attendants last October after intervention by Ms. Raitt made such a move effectively illegal. Air Canada AC.B-T would have been able to stay in the air with management staff. But when the mechanics et al go, the airline can’t.
Monday, April 2, 2012 4:17 PM EDT
Six Canadian banks among world’s safest
As the European debt crisis slogs on and a handful of too-big-to-fail American banks face a seemingly unending litany of woe stemming from their near-death experiences in 2008 and 2009, it’s intriguing to check out the ranks of the world’s safest banks.
Six Canadian players all rank among the top 25 most creditworthy banks in the latest semi-annual list compiled by Global Finance magazine and appearing in its April edition. Royal Bank of Canada RY-T leads the Canadian pack in 10th place, with Toronto-Dominion Bank TD-T in 11th spot and Bank of Nova Scotia BNS-T in 14th. Caisse centrale Desjardins holds down 18th spot, while Bank of Montreal BMO-T and Canadian Imperial Bank of Commerce CM-T come in at 23rd and 24th, respectively.
Tuesday, March 6, 2012 2:57 PM EST
The euro zone’s €1-trillion nightmare
No one expected the Greek bond swap deal with private-sector creditors to go down smoothly, not when haircuts of more than 70 per cent are being forced down their throats. But it’s not as if the holdouts have a serious alternative. There’s no more money on the table, and they would do far worse in the open market or in a messy Greek default.
The speculators still hope to cash in on their credit default insurance, as soon as Athens tries to force all private bondholders to accept the same terms. But what if you’re an institutional investor also holding, say, Spanish or Italian bonds or securities issued by euro zone banks? The value of many of those investments would fall off a cliff.
Thursday, February 23, 2012 9:46 AM EST
Romney tax plan too reliant on robust U.S. growth
Mitt Romney’s tax and spending proposals underscore an old political rule -- never spell out any parts of a fiscal or economic platform that are better left to voters’ imaginations. But the struggling Republican presidential hopeful now fears that his ring strategy of bobbing and weaving around every issue could lead to a technical knockout.
So he laid out a tax plan that he insists will be balanced, fair and revenue neutral, while still shielding the coupon-clippers like himself from any onerous increases.
Brian Milner on the economy Contributors
Brian Milner
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, the debt markets and banking. He spent two years as an associate managing editor in the Report on Business, before becoming The Globe's New York bureau chief in 1994. From his vantage point in the world's financial capital, he covered the greatest economic and stock market boom in modern history, as well as a raft of U.S. political, cultural and social topics.
Mr. Milner first began writing a markets column called Taking Stock in late 2000, before joining the editorial board in 2003. He resumed writing the column on a weekly basis in 2007 after returning to the ROB. He is the author of a best-seller, The Hidden Establishment (Viking, 1991), which profiled secretive, wealthy immigrants. He is an award-winning magazine writer and has also written a history of Toronto for a popular guide book. And in his spare time, he has ghost-written and edited books on economic, social and sports subjects. The best known is Shifting Gears (Harper Collins 1993), one of the first books to examine the impact of the technological boom on the economy. He is a frequent commentator on radio and television.
