Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Top Business Stories

A family business with a succession plan ... 476 years Add to ...

These are stories Report on Business is following Friday, Oct. 21. Get the top business stories through the day on BlackBerry or iPhone by bookmarking our mobile-friendly webpage.

Follow Michael Babad and Globe top business news on Twitter

A long-running succession plan Give a nod today, and maybe get some tips from, RJ Balson & Son, a British family-run butcher established when Henry VIII was on the throne.

Balson, based in Dorset and still run by the family, is Britain's oldest family business, according to new research by the Institute for Family Business to celebrate its 10th anniversary.

Balson was born in 1535, and has had a tremendous run with what it says are more than 20 types of bangers that can include elk, boar, ostrich and duck.

Here's what the butcher says about itself on its website: "In 1535, John Balson began trading meat at the local market in Bridport, Dorset, England. The Balson family has continued trading in Butchery for almost 500 years, making us England's oldest family butchers. Today, RJ Balson and Son butcher shop can be found in the same location it has been since 1880. The Balsons have managed to survive the influx of supermarkets and fast food, and still run a successful family business after all those years. The family joke is that we've just never made enough money to be able to retire."

The butcher has expanded, as you'd expect of a company that has been around since Jacques Cartier landed in what's now Quebec and Sir Thomas More was executed for treason over the issue of separation from the Roman Catholic Church. Its British shop is still operated by Donald and Joan Balson and their son, daughter and son-in-law.

Some of the others include construction firm R. Durtnell & Sons, now under management by the 13th generation, according to Campden FB, a family business magazine, and C. Hoare & Co., a private bank established in 1672 and whose clients have included Jane Austen.

Campden also reports on a Canadian Financial Executives Research Foundation study that finds just 40 per cent of privately-held companies have a succession plan on the go.

Inflation speeds up Inflation in Canada is running a bit hotter than expected, suggesting that weak economic growth "hasn't done much to dampen price pressures," according to Emanuella Enenajor of CIBC World Markets.

Consumer prices rose 0.2 per cent in September - 0.3 per cent when seasonally adjusted - bringing the annual pace to 3.2 per cent. The so-called core rate, which excludes volatile items and guides the Bank of Canada, rose to 2.2 per cent. That's the first time it has come in above the 2-per-cent mark since February of last year.

That's not likely to change the Bank of Canada's course in the near term, but it is tempering suggestions that Governor Mark Carney could cut his benchmark rate.

"The point remains that near-term inflation readings are set on the backburner by a central bank that is pursuing price level targeting in a de facto sense anyway," said Derek Holt and Karen Cordes Woods of Scotia Capital.

"The BoC is not doing so explicitly as its current inflation targeting mandate affords plenty of flexibility, but when Governor Carney reiterates that the BoC has allowed achieving its inflation target to vary over time horizons stretching from two to 12 quarters, the implication is that the current inflation targeting mandate gives the BoC plenty of latitude toward looking through near-term inflation readings that it can’t influence anyway. That leaves it primarily focused upon a growth bias and financial stability concerns as it remains on the sidelines throughout the next year."

OSC unveils reform measure The Ontario Securities Commission plans to allow people to settle cases without having to admit wrongdoing as part of a series of reforms to streamline enforcement, The Globe and Mail's Janet McFarland reports.

The regulator said today it will intends to create explicit guidelines to allow people to avoid legal action if they self-report breaches of securities laws or co-operate in an investigation, and will clarify its existing 'credit for co-operation' program to inform people how they can best self-report and come forward with information.

Kettle's on Waiting for something to happen in the long-running euro debt crisis really is like waiting for the kettle boil.

Again today, there are various reports and contradictions to give the markets no real sense of what's happening, other than that the leaders of the euro zone are trying to do something. Anything.

There are now suggestions leaders are looking at combining two rescue funds into one valued at about €940-billion, although it's anyone's guess as to what that could accomplish.

Despite the fact that Angela Merkel doth protest too much - she said today she agrees with Nicolas Sarkozy on the main points of a crisis plan - France and German remain apart on some fundamental issues such as the rescue fund, or EFSF. That led yesterday to the scheduling of a second euro zone summit that will follow Sunday's meeting in Brussels. I think the idea is that they'll all debate a plan on Sunday, and agree to it later in the week.

"There is no one who expects a full solution to at this weekend’s meeting (to be ratified by another EU summit next Wednesday), but there is hope for progress," said senior currency strategist Camilla Sutton of Scotia Capital.

"The fundamental problem in Europe is a sovereign debt issue that has been materially complicated by low growth," she said in a research note today.

"The solution isn’t a clear one. Recapitalization of the banking system, ring-fencing contagion, using the EFSF to its fullest capacity and agreeing to PSI levels for Greek bondholders do not fix the problems, but they remove enough uncertainty for the system to begin healing."

Separately today, the EU's statistics arm, Eurostat, released debt and deficit figures for 2010. While something of a rear-view mirror look, they're still worth a glance.

(Best Twitter line of the day so far goes to @dsquareddigest: "Hands up if you think that Sarkozy and Bruni should have called their daughter 'Angela,' to help provide a good atmos for the euro summit.")

GE profit up General Electric Co. today posted a healthy jump in its third-quarter results.

GE earned $3.22-billion (U.S.) or 22 cents a share, compared to $2.1-billion or 18 cents a year earlier. Revenue was little changed at $35.4-billion.

“We are pleased to deliver our sixth consecutive quarter of double-digit operating earnings growth in a volatile macro environment,” chief executive officer Jeff Immelt said in a statement.

Housing outlook A new report on Canada's housing market carries this notable title: "Slowdown postponed."

The report from National Bank Financial is in line with other forecasts, projecting the market will slow in 2012 and 2013, but it won't crash. National Bank's Shubha Khan also upgraded his projection for this year because of a stronger-than-expected third quarter and a longer-than-expected timeline for interest rate hikes in Canada.

"Given the resulting deterioration in the global economic outlook, the Bank of Canada is now expected to leave its policy rate unchanged until late 2012 or early 2013," Mr. Khan said.

"Mortgage rates will almost certainly linger near their current historical lows for at least the next 12 months, which should prevent a pronounced slump in housing market activity. We previously expected rate hikes would materialize as early as [the fourth quarter of]2011."

Mr. Khan projects an 8-per-cent gain in the dollar value of home sales this year, a 3-per-cent dip in 2012 and a 5-per-cent decline a year later.

"Given our interest rate outlook, housing affordability is projected to be stable through 2012, which suggests that home prices are unlikely to adjust materially next year," Mr. Khan added in a discussion about the debt service ratio, or DSR, for mortgages.

The DSR, or what's needed in terms of a household's disposable income to meet its monthly payments, now stands at 21.6 per cent, compared to a 20-year average of 20 per cent.

"In 2013, however, rising interest rates will result in a significant deterioration of the DSR ... pricing many potential buyers out of the market unless (i) home prices decline or (ii) households’ appetite for credit expands (i.e. households tolerate a higher DSR)," he said in the report.

"With the weak global economy weighing on consumer confidence and non-mortgage credit at record levels, this appetite is unlikely to grow. Therefore, home prices will have to fall, in our view ... we estimate that the average home price will have to decline by around 9 per cent from current levels if, as we expect, mortgage rates increase by 100 to 150 basis points in 2013."

Headlines of note

In International Business While Libya has monopolized the attention of the oil market this year, Angola has also been a source of supply disruptions, helping to push crude oil prices higher, Javier Blas of The Financial Times writes.

In Globe Careers Businesses initially saw social media as another way to market goods and services to customers. Now it’s gaining traction within companies as an effective way to reach workers, and to connect workers with each other. Marjo Johne reports.

From today's Report on Business

In the know

Most popular videos »

Highlights

More from The Globe and Mail

Most popular