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Clement makes a slip The male brain, according to Industry Minister Tony Clement, is "very strange."
Mr. Clement made the comment while talking to a telecommunications gathering in Ottawa today, seemingly to clarify why he'd slipped up and said "we need more Canadian sex stories," rather than what he'd meant to say about needing more Canadian "success stories." He quickly fixed his error, The Canadian Press reports.
"I have no explanation," he added. "It really was not on my mind. It just sort of blurted out there."
He was talking about the government's digital strategy.
Scotiabank to buy rest of DundeeWealth Bank of Nova Scotia is acquiring the rest of DundeeWealth Inc. for $2.3-billion.
Already holding 18 per cent, Scotiabank said today it will pick up the rest for $21 a share, a deal that values DundeeWealth at $3.2-billion.
The acquisition "demonstrates our strong commitment to build our wealth management presence in Canada and aligns to our global wealth management strategy," said Scotiabank chief executive officer Rick Waugh.
K+S to acquire Potash One Shareholders of Potash Corp. of Saskatchewan didn't get much of anything from the fertilizer frenzy, but it's a different matter for those owning Potash One Inc. stock.
K+S Aktiengesellschaft, one of the world's major fertilizer suppliers, said today it struck a deal to acquire Potash One for $4.50 a share. The two companies put the total value of the deal at $434-million.
You'd be forgiven if you thought Potash One studied the failed takeover of Potash Corp. by BHP Billiton, which sparked the anger of, and fierce opposition from, the Saskatchewan government, subsequently leading to Ottawa rejecting the hostile bid.
K+S and Potash One stressed in a statement today that they expected production capacity of up to 2.7 million tonnes would lead to an investment in Saskatchewan of $2.5-billion (U.S.) and the creation of up to 300 jobs.
How do Canada's boards rank? Proxy advisory firms are gaining some serious clout among institutional shareholders, The Globe and Mail's corporate governance expert, Janet McFarland, writes today.
In today's Report on Business, Ms. McFarland takes and in-depth look at Canada's biggest companies, and how they rank on the Globe's ever-tougher measures for corporate governance. She looks at the issues, and the winners and losers, and talks to several of the players.
Ireland to begin talks Now that Ireland has sought a rescue package, the negotiations begin. The EU, the IMF and Britain, which are leading the bailout effort, are certain to demand rigid terms, though Ireland is steadfastly opposed to changing its coveted low corporate tax regime.
Aid isn't aimed only at Dublin's finances, but also at the country's embattled banks, which the government said today will be overhauled as part of the package. The banks are expected to be restructured.
"The details of the package still have to be hammered out, but reports put the size of the bailout at €80-billion to €95-billion (Finance Minister Lenihan said it will be less than €100-billion)," said BMO Nesbitt Burns economist Benjamin Reitzes.
"It will be a 3-year loan, and the details should be fleshed out by the end of November. A large chunk of those funds will be to support the banking system, whose losses could be at least €85-billion according to Irish central bank Governor Honohan."
Three points remain unclear, noted Scotia Capital economists Derek Holt and Gorica Djeric:
- The exact size of the haircuts debt holders could take.
- The strings attached to the bailout package.
- How the ratings agencies interpret the impact on Ireland's debt.
"The strings could include greater EU input into Ireland's corporate tax structure that others, like Germany, have long viewed as oriented toward poaching capital from the rest of Europe," they said in a research note.
"In the short run, Ireland is right to remain committed toward its current tax policies. Raising corporate taxes when the problem is the massive external debt of Ireland's companies and particularly its banks would only further aggravate the problem, while offering no guarantees of additional revenues."
The Irish government, already under extreme political pressure, is also preparing a budget for early next month.
- Carl Mortished: Rescue was easy - Ireland's future the real worry
- As economy falters, Irish scatter again
Who's next? After Ireland's decision, markets are already looking for the next shoe to drop, and the betting is on Portugal, and then Spain.
Portugal's finance minister said his government will do everything it can to meet its budget targets, which would cut the deficit to 4.6 per cent of gross domestic product next year, and hasn't said that it's looking for a bailout. The markets remain wary.
There is still somewhat of a pall hanging over future developments that may continue to provide restraint to [the euro] and it is notable that Portuguese, Greek and Spanish bond yields are not showing a significant propensity to ease off highs," said Scotia Capital currency strategist Sacha Tihanyi.
"Thus the musical chairs that is the market's rotating negative focus on high sovereign risk countries in the euro zone is likely to continue, and perhaps (in extremis) until each country of focus receives a support package from the [European Financial Stability Facility]"
With the I and the G in the so-called PIGS - Ireland and Greece - now in the bailout crowd, the focus is shifting quickly to the P and the S.
"The fact is we've now had two dominos fall in the space of six months in Greece and Ireland, and attention will inevitably shift towards Portugal, and soon after to Spain whose housing market is in dire straits, suggesting that this bailout package will not be the last, and confirming the complete inadequacy of the so-called European bank stress tests in the summer," said CMC Markets analyst Michael Hewson.
U.S., China policies a threat Canada is threatened by the double-punch of the Federal Reserve's latest stimulus program and China's continued moves to hold down the value of its currency, a PIMCO official warns.
"The U.S. and China are the two governments that are causing the biggest distorions in the private markets," Ed Devlin wrote on the company's website. "While expressing it in different ways, they both have the same policy: our currency, your problem."
The Fed has been criticized for its latest program of quantitative easing, popularly known now as QE2 and defended by Ben Bernanke and other officials of the U.S. central bank. It aims to boost the economy by driving down longer-term interest rates, through purchases of longer-term Treasuries, but there are fears the U.S. dollar is being debased. China, too, has been roundly criticized for keeping its yuan artificially low.
"How does the Fed's QE2 and China's currency interventions threaten Canada?" Mr. Devlin said.
"The fundamental threat is that government interventions by the U.S. and China translate into distorted prices that subsequently change the behaviour of Canadian consumers and businesses. They may lead to misallocated resources (both capital and labour) and a lower standard of living for Canadians."
Douglas Porter, the deputy chief economist at BMO Nesbitt Burns, noted in a separate report that while Canada is still running a moderate trade surplus with its biggest trading partner, the U.S., its deficit with China has "widened relentlessly" to more than $30-billion, or about half of the overall external shortfall.
That, he added, is "reinforcing the point that an undervalued yuan is certainly not just an issue for the U.S. to deal with."
Loonie at too lofty heights? The Canadian dollar is overvalued and needs at least to soften somewhat, but its strength isn't enough to kill the recovery, economists say.
The outlook for Canada's economy and its fiscal standing, compared to its peers, have been drawing money into the country, notably into bonds. At the same time, the U.S. dollar has depreciated. What we're left with is a Canadian dollar that has appreciated and is expected to continue rising - according to some economists, to hold above parity next year.
That can spell trouble for exporters and manufacturers as a stronger currency pushes up the costs of their goods to foreigners. But, asks assistant chief economist Yanick Desnoyers of National Bank Financial, is it an economy killer?
"The fact is, if there is one cyclical currency that can appreciate, it is the Canadian dollar," Mr. Desnoyers said in a research note, pointing out that Canada's real effective exchange rate, which is weighted by the value of exports to Canadian trading partners but also takes into account inflation differentials, sits at just about where it was in 2000.
"This also stands out when compared to other major cyclical currencies as Canada remains competitive," Mr. Desnoyers said. "Consequently, there is room for the loonie to rise without killing the economy."
In a separate report on Canada's trade and current account deficits - the former is near a record - deputy chief economist Douglas Porter of BMO Nesbitt Burns noted that the latter is "at least a warning signal" that the loonie may be overvalued.
The loonie, he said, has far outpaced the run-up in commodities, and based on such prices would be "more appropriately valued" at a range in the low- to mid-90-cent level.
His report projects, as have others, that exports will remain a drag on economic growth next year. While net foreign liabilities are negligible at this point, it would be a concern if Canada ran large current account deficits for several years. Current account balances are the broadest measures of trade.
"Canada suddenly finds its broad trade deficit in the company of countries that have typically been cited as extravagant over-spenders/under-savers," Mr. Porter said.
While this could be just a "passing phase," one of four developments needs to occur to make certain it doesn't become chronic:
- The U.S. will have to start spending again.
- The loonie will have to soften
- Canadians and Canadian governments will have to spend less.
- Prices for commodities key to Canada's economy will have to boom.
Ed Devlin of PIMCO also noted in an article on the company's website that "we are long-term bullish" on the loonie. He, too, believes that global developments add to the attractiveness of the currency, but notes that "a distortedly high Canadian dollar is a problem for Canada as it will hurt our ability to export and tighten financial conditions on all consumers and businesses."
Retailers gear for Black Friday The race is on among U.S. retailers in the run-up to Black Friday, the day after Thursday's Thanksgiving feast when the holidy shopping season begins in earnest.
Wal-Mart Stores Inc. , for example, said it will match the prices of its competitors.
Wal-Mart and others are also ramping up their online deals, with steep discounts.
Russia's poor sell their hair Russia's poor are increasingly cutting and selling their naturally blonde hair for sale as hair extensions in richer, western countries, The New York Times reports.
While dark hair is in greater supply, lighter shades are more scarce, not just because of the colour but because they're easier to dye, the newspaper said. Many in Russia, it said, have few economic alternatives so they offer their hair for small amounts of money.
In one impoverished region of central Russia, the Times said, blonde hair has become a "precious harvestable commodity."
This isn't new, the newspaper said, having moved from Western Europe decades ago, through regions like Poland and then into Russia and the Ukraine after the Soviet Union collapsed in the early 1990s.
"But as more of the world's light-haired women have climbed the economic ladder, the search for poor blondes willing to part with their locks has become ever more difficult," according to the report.
It's a huge business. While a 16-inch braid, the shortest for a buyer, will go for about $50 (U.S.), the estimated size of the hair extension markets is $250-million a year.
From today's Report on Business
- Sullied image: U.S. probes insider trading
- Drilling companies scramble for workers
- At The Top: Putting stock in diversification
- The foreign owner of Canada's vital U.S. trade link
And, read our Streetwise blog and Your Business section.