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These are stories Report on Business is following Tuesday, Sept. 17, 2013.

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Rosenberg on real estate
Like many other economists, David Rosenberg wonders today what happened to a housing bust some observers had predicted.

"As if to purposely defy the Canadian economy, banking and loonie bears, home resale activity rose 2.8 per cent sequentially in August and over 11 per cent on a year-over-year basis," the chief economist at Gluskin Sheff + Associates said in a research note today.

He was referring to August sales numbers released yesterday by the Canadian Real Estate Association, which, as The Globe and Mail's Tara Perkins reports, showed a rebound from a government-induced slump a year earlier.

That's when Finance Minister Jim Flaherty tightened mortgage rules to cool down the market and head off a bubble.

Now, homebuyers appear to be rushing to beat higher mortgage rates, boosting home sales across the country.

"The national sales/listing ratio moved up to 54.6 from 51 in July, reflecting a tighter balance to the housing market, and, as such, prices rose 8.1 per cent on a year-over-year basis, the fastest pace in over two years," Mr. Rosenberg said.

"So much for the housing bust."

Mr. Rosenberg is not alone.

Chief economist Douglas Porter of BMO Nesbitt Burns, for example, noted that house prices keep "quietly churning" forward, though last month's national average was skewed by the country's most expensive cities.

"Suffice it to say that next to no one predicted a big mid-year bounce in home sales at the start of 2013, when calls for Canadian housing market calamity were all the rage," he said after yesterday's numbers were released.

"Contrary to the Greek chorus of woe, sales are now above their 10-year average in seasonally adjusted terms," he added.

"And, the year-ago comparisons will remain quite easy for the next eight months, so settle in for a spell of potentially solid year-over-year figures even if sales do simmer down notably in coming months."

Most economists don't fear a burst bubble.

Diana Petramala of Toronto-Dominion bank noted that sales remain 11 per cent below the 2009 peak, and that increases in longer-term mortgage rates will probably "keep housing demand in check."

Moody's warns B.C.
Moody's Investors Service today urged British Columbia to stand firm on its "resolve and discipline" where the finances of Canada's westernmost province are concerned.

In its annual report on the province, which it rates triple-A with a negative outlook, the U.S. agency said the province has "sufficient flexibility" to absorb the latest increases in its debt juggling act.

"Due to the significant debt reduction achieved by the province over the last decade, the province faced the recent downturn with improved fiscal flexibility and has been able to absorb the recorded and anticipated increases in debt burden," Moody's said in its report.

"With cash financing requirements expected over the next three years, the province's debt burden is expected to increase moderately to roughly 98 per cent of revenues in 2015-16."

British Columbia's deficit was $1.1-billion for the 2012-2013 fiscal year as sagging natural gas prices and production hit revenues.

But the province still pledges to balance the books in the 2013-14 fiscal year, with a small surplus of $154-million, followed by a jump to $446-million a year later.

"British Columbia has a strong track record of meeting budget targets and will need to maintain this resolve and discipline to ensure that deficits arising from the recent economic downturn remain temporary and do not impair the province's finances on a permanent basis," said Jennifer Wong, the lead Moody's analyst on the province.

Separately, in a new forecast today, Royal Bank of Canada projected economic growth would slow in British Columbia this year to 1.5 per cent., rebounding in 2014 to 2.7 per cent.

Barrick shares in spotlight
Shares of Barrick Gold Corp. rose slightly today amid reports that investors are ramping up the pressure for change.

These shareholders, based in Europe, plan to write the gold giant's board, seeking to speed up the transfer of power from co-chairman Peter Munk, according to The Wall Street Journal.

As The Globe and Mail's Jacqueline Nelson reports, investors have been unhappy with Barrick, leading to a dispute earlier this year over the large compensation to co-chairman John Thornton.

At the same time, a U.S. activist hedge fund has also contacted U.S. shareholders in a campaign to change the Barrick board.

Microsoft hikes dividend
Microsoft Corp. today hiked its quarterly dividend by a nickel to 28 cents (U.S.) a share.

The software giant also announced a share buyback program of up to $40-billion, similar to the repurchase scheme that was set to expire at the end of this month.

Keystone lobbying worth millions
The Keystone XL oil pipeline may show no signs of going anywhere at this point, but the lobbying effort behind it has become an industry of its own.

According to data compiled by Bloomberg, there are now lobbyists for more 54 interested groups. Almost $16-million (U.S.) was pumped into advertising in the 2012 election, and more than $1-million has been put into TV advertising so far this year.

Tom Steyer, the founder of the Farallon hedge fund, is committing $1-million on his own to a campaign launched the Sunday before last to oppose TransCanada Corp.'s controversial project, which would carry Alberta oil to the U.S. Gulf Coast.

Those in favour of the pipeline, such as U.S. producers, are also spending big time.

This battle will mark its fifth anniversary on Thursday, based on when TransCanada first applied for U.S. approval.

Since then, Keystone has become a battleground for environmentalists and others. The administration has already TransCanada once, forcing the Canadian giant to reroute the proposed pipeline and ask again for approval.

President Barack Obama has yet to decide.

According to Bloomberg, the lobbyists are putting their efforts on a "small group" of officials at the U.S. State Department.

"It's the equivalent of old banking legislation that sent some lobbyists' kids to private school for 10 years, and then to college for four more," Burdett Loomis, a University of Kansas political science professor, told the news agency. "It was the 'Lobbyist Support Act.'"

Markets mixed
Asian and European stocks slipped today, settling down after yesterday's rally and in advance of the Federal Reserve's key policy announcement yesterday. North American stocks, though, were up in early trading.

Yesterday, global stocks rose after Larry Summers pulled out of the race to succeed Ben Bernanke as chairman of the U.S. central bank, leaving vice-chair Janet Yellen as the front-runner.

Today, however, it's the Fed decision that looms large, with expectations its policy makers will unveil plans to begin pulling back on their massive bond-buying program known as quantitative easing, or QE.

"Dealers are beginning to lock in profits from yesterday's rally, with speculation of a $10-billion tapering in the Fed's bond-buying scheme," said market analyst David Madden of IG in London, referring to the rumoured reduction in the $85-billion-a-month program.

"The only way dealers will be surprised is if the trim is more or less than $10-billion. Investors are reacting well to the rumour that Janet Yellen will take over from Ben Bernanke in the new year, as Ms. Yellen is more likely to keep the QE tap flowing."

Asian and European stocks fell, while North American exchanges rose.

"Investors are tweaking their positions in what is being called the 'autumn of QE' caution as markets are preparing for the Federal Reserve's decision on whether to begin tapering its asset-purchase program," said sales trader Ankit Kapur of CMC Markets in London, referring to the central bank's policy-setting group, the Federal Open Market Committee.

"After months of anticipation and speculation the Federal Open Market Committee must decide tomorrow whether to begin to wind down their quantitative easing. The anticipation is a $10-billion to $15-billion reduction in the $85-billion-a-month program. Some analysts are also predicting the Fed will seek to strengthen its forward guidance to stabilise the markets."

Manufacturing up
Canada's factories rebounded in July as sales climbed 1.7 per cent.

And, as Statistics Canada noted today, the gains were fairly broad-based as 15 of the 21 industries measured posted better numbers.

Sales rose 2.1 per cent among durable goods manufacturers, and 1.2 per cent among those on the other side of the ledger, such as petroleum and coal.

The federal agency's "miscellaneous" category was also interesting as sales powered ahead almost 24 per cent, primarily because of jewellery and silverware.

Ontario turned in the best performance among the provinces, with manufacturing shipments climbing 3.2 per cent to mark the highest showing since June, 2012.

"The rebound in the volume of manufacturing sales in July is encouraging and suggests that, while not significantly related to flooding in Alberta, weakness in June was nonetheless temporary," said economist Nathan Janzen of Royal Bank of Canada.

"While challenges for the sector remain, we expect that stronger growth externally, particularly in the United States, will support stronger manufacturing activity over the second half of this year and into 2014."

Over all, inventories increased by 0.4 per cent, the inventory-to-sales ratio dipped to 1.4 from 1.41 in June, and unfilled orders rose by 0.4 per cent.

"Note that overall manufacturing sales remain slightly below year-ago levels (-0.1 per cent year-over-year), inventories have risen to record levels and the inventory-to-sales ratio is on the high side of normal," said senior economist Robert Kavcic of BMO Nesbitt Burns.

"Suffice it to say that the sector would certainly welcome a sustained pickup in growth south of the border."

Keeping up with the Kardashians
As nicknames go, this one's a little spicier than "Maple."

British analyst Timothy Ash has dubbed Armenia's new offering the "Kardashian bond," a dollar-denominated issue for which there was a roadshow last week.

(Debt denominated in Canadian dollars but issued by foreign institutions are known as Maple bonds, while Yankee bonds are U.S.-dollar notes sold by foreign institutions south of the border.)

Mr. Ash used his nickname in a research note last week, and then again today when pointing out that "it's gone a bit quiet on the Kardashian new bond issue front after last week's roadshow … Perhaps they are mulling over investor feedback."

(This is not to suggest that markets should expect a "Snooki bond" from New Jersey.)

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