These are stories Report on Business is following Monday, Nov. 21. Get the top business stories through the day on BlackBerry or iPhone by bookmarking our mobile-friendly webpage.
Dumb, smart and arguably funny things 1. It's not often that you get to make a true "how-many-whoevers-does-it-take-to-change-a-lightbulb" joke. But today, The Canadian Press reports on access-to-information documents that show it cost the government a full $500 to move a light fixture from a room at Muskoka's Deerhurst Resort for the G8 summit. "The work order actually entailed an electrician, an apprentice/assistant and a carpenter for disassembly and relocation of the large boardroom table," said a spokeswoman for Skyline Hotels.
2. Britain's Transport Secretary Justine Greening warned today that air travellers will not be able to escape body scans when they're fully introduced. There have been health and privacy concerns related to such scans, but, Ms. Greening said in a statement today, I do not believe that a 'pat down' search is equivalent in security terms to a security scan." Here's what interested me: "Software which automatically analyses images is currently in development. Where this technology has developed to a stage at which it passes rigorous government testing, airports will be expected to deploy it when they renew or replace their equipment. This will mean that in the future images will no longer be seen by human reviewers. In addition, airports will also be required to undertake routine testing of hardware and software to ensure that they remain unable to copy, save, or otherwise transmit images. This will be verified by the Department's transport security inspectors."
I'm not sure what it means that human reviewers won't be able to ogle, and that only a machine gets to snicker at what you look like under your clothes.
3. Tweet of the day, from Nouriel Roubini @Nouriel: "The return to the Gold Standard caused the Great Depression. Now some gold bug lunatics want Gold Standard 2.0 to get us Great Depression 2.0."
4. Tweet from @BlackBerry today: "The #BlackBerry #PlayBook is at select #US & #Canadian retailers starting at $199. Limited time. bbry.lv/BBPBOF #HappyHolidays!" This is good news?
5. "The EU has made several international commitments to protect sharks, in line with the United Nations' Food and Agriculture Organization's (FAO) Code of Conduct for Responsible Fisheries, and in particular under the International Plan of Action on Sharks (IPOA-Sharks) adopted by the FAO in 1999," the European Commission said today as it proposed a full ban on the practice of "shark finning." Now, if only the EU could only deal with those other sharks.
6. Christmas is coming, and so are the office parties. You know, the parties that lead to the water cooler gossip and jokes the next morning? U.S. employment lawyer Patricia Weisberg has a list of dos and don'ts. It should be required reading, including why you should skip the mistletoe. "While most employers still want to foster a sense of fun for employees during the holiday season, it’s becoming increasingly apparent that the traditional 'wild office party' of past eras is not healthy for the spirit and camaraderie of the employees in the modern workplace," Ms. Weisberg, a partner at Walter & Haverfield LLP of Cleveland, writes on TLNT.
7. Colour commentary of the day, from Scotia Capital's Derek Holt: "Through marketing over recent weeks, I warned of my bias that the congressional supercommittee represents nothing but downside risks to U.S. growth and the broad risk trade as it replays the same debt ceiling ruckus of late summer. My bias was buy Treasuries and the US$ and ditch the risk trade. The risk trade's hesitant supporters are now spending this morning spinning Yoko Ono vinyl in preference to listening to another round of endless media clips by GOP members and Democrats pointing the finger at one another."
8. The Wall Street Journal reports today that the U.S. black bear population has rebounded from being almost extinct to the point where several states have either expanded or launched bear hunting seasons. Did I mention this just so I could say that the bear market is back? Absolutely.
Markets, currencies roiled Dual debt crises and economic fears combined to push down global markets today, roiling stocks and currencies.
Tokyo's Nikkei shed 0.3 per cent, and Hong Kong's Hang slipped 1.4 per cent. Europe's major markets were down by up to 3.4 per cent, and the ugly mood spread into North America, where the S&P 500 and Toronto's S&P/TSX composite also slumped.
The Canadian dollar tumbled along with stocks.
"It's a combination of political and economic worries weighing on markets today with the afternoon's focus on stalemate in the U.S. to agree budget cuts, said David Jones, chief market strategist at IG Index.
"There is also concern that the new government in Spain may be slow off the mark to put in place austerity measures to avoid a bailout - it does feel like we have been here before in one form or another in recent months and the net result is that investors have little reason to be loading up on risk at the beginning of this week."
Supercommittee poised to fail As Kevin Carmichael writes in today's Report on Business, the U.S. "supercommittee" searching for ways to slash the debt is on the brink of collapse today, and its members are expected to announce they've reached an impasse.
The committee was charged with finding how to cut $1.2-trillion (U.S.) over 10 years, with its deadline this week. Failure to do that is supposed to trigger automatic cuts starting in 2013, but, of course, this story is still playing out in Washington. And in global markets.
"An announcement admitting failure is likely today, following yesterday’s televised bickering along partisan lines that makes it clear Congress will achieve little if anything constructive as the U.S. plunges into its year-long presidential election marathon that paralyzes Washington," said Derek Holt and Karen Cordes Woods of Scotia Capital.
"At stake is whether the 2-per-cent payroll tax cut that kicked in at the start of this year will be extended for another year, and whether extended jobless benefit programs will also be continued for another year. While extending the two forms of stimulus would do nothing to growth because Americans have become accustomed to them, failing to extend the benefits would impose a significant shock upon household finances that would up the ante on [first half of 2012]recession risk."
Where could things go from here?
"In our mind, there are two likely scenarios on the back of this - first, the committee agrees to an amount less than the $1.2-trillion target of reductions, with the remainder being filled via 'automatic triggers.'" said Mark Chandler and Ian Pollick of RBC Dominion Securities.
"However, given the tone of the headlines leaking out, the second most likely scenario is that no agreement is reached while finding ways to void the triggers (this has legal precedence). Clearly, the near-term implications of a 'no deal' would be a second round of downgrades by the other ratings agencies (Fitch & Moody's)."
France gets a warning France got a warning from a major U.S. credit rating agency today, and this time it's real.
Unlike the false downgrade earlier from Standard & Poor's, Moody's Investor Service warned that a continued to spike in borrowing costs could hit the country, which now has a triple-A rating and, with Germany, is at the core of the euro zone.
“Elevated borrowing costs persisting for an extended period would amplify the fiscal challenges the French government faces amid a deteriorating growth outlook, with negative credit implications,” Moody's said.
- Moody's warns on French rating
- Debt crisis strikes at heart of Europe
- A new euro crisis strategy: deny the debt
- Spanish prime minister-designate faces towering task
- Marchionne feels Italy is 'on the mend'
- Brian Milner: A word from the ECB could go a long way in euro crisis
China fears mount Investors are growing concerned again about China, as China becomes more concerned about the rest of the world.
According to The Wall Street Journal today, in October China marked the first monthly outflow of foreign money since 2007 amid concerns that the country's economy is slowing. Coupled with that, according to the report, is the fact that investors have to bring their money back home to meet their own needs.
This also partly due to investors no longer believing the yuan will climb.
China, in turn, is warning that the global economy faces a bleak outlook.
How Canada conquered its debt crisis As Canada's former prime minister puts it in an interview with Reuters, "there would have been a day when we would have been the Greece today."
The news agency takes an in-depth look today at how Canada attacked its own debt troubles in the mid-1990s, with interviews with officials of the day, eventually bringing its debt-to-GDP ratio to 29 per cent by 2008-2009 from its high of 68 per cent in the 1990s.
There are some great moments retold in this piece, and some choice quotes from former prime minister Jean Chrétien and others from his time in office, when the Liberals decided they had to tackle the problem, no matter the cost. Among them:
"We used to thank God that Italy was there because we were the second-worst in the G7." Scott Clark, associate deputy finance minister at the time
"I said to myself, I will do it. I might be prime minister for only one term, but I will do it." Mr. Chrétien
"He said, 'Darling, I will be back home in the next election. I will be defeated, because the prime minister explained to us this morning what he intended to do." Mr. Chrétien, recalling how Lawrence MacAulay, a junior minister, phoned his wife after a key meeting
Canada, of course, went on to slay the dragon within four years with, Reuters notes, "the biggest reduction in Canadian government spending since demobilization after World War Two."
Fairfax bids for Prime Fairfax Financial Holdings Ltd. has its eye on the local pub.
Prem Watsa's company has jumped into the bidding for Prime Restaurants Inc. , the owner of dining and pub establishments such as Fionn MacCool's, D'Arcy McGee's, Paddy Flaherty's, Tir nan Og, East Side Mario's and Bier Markt.
Fairfax is offering about $71-million for the chain, a bid that was solicited by Prime after an offer from Cara Operations Ltd.
This followed a deal with Cara under which there was a so-called go-shop period to see if there were better offers out there.
“After carefully weighing the alternatives, in consultation with our legal and financial advisors, the board of directors has concluded that the Fairfax offer provides greater shareholder value than Cara’s existing offer,” chairman Steven Sharpe said in a statement.
Whither the wireless upstarts? With two CEOs recently departed from the Canadian wireless startups they helped get off the ground, a prominent industry analyst is asking whether the new companies have a fighting chance in a sector still overwhelmingly dominated by three big players, The Globe and Mail's Iain Marlow reports.
Canaccord Genuity analyst Dvai Ghose published a bearish research note citing the departures, as well as other management shuffles at the two companies, and wondered whether the Canadian government's attempt to engineer competition was failing in a sector where BCE Inc. , Rogers Communications Inc. and Telus Corp. still have roughly 95 per cent of the wireless subscribers.
- MF Global shortfall could exceed $1.2-billion: trustee
- Gilead Sciences to buy Pharmasset for $11-billion
- Aecon gets nod for Potash Corp. contract
In Economy Lab While having a budget can help, spending your free time at the mall and hoping to stay within budget is like spending your free time at the pub and hoping to lose weight: it just is not going to happen. Frances Woolley's advice for financial literacy month: Don’t go shopping.
In International Business Until Iraqis sort out their future, the risk for oil company investors is that fools rush in, the Lex blog team at The Financial Times writes.
While team work is an asset, it’s important to be noticed for your individual strengths as well. If your team did good work, make it known that it was you who led the team, Dianne Nice writes.
In Personal Finance Do you know what your break fee is? Only the bank does.
From today's Report on Business
- Girding for 'a lost decade' of joblessness
- Hot commodity: Thieves acquire taste for used cooking oil
- Energy industry set to cut funding for oil sands environmental watchdog
- Canada competes: Canada, like Steve Jobs, should zero in on innovation