Friday, November 02, 2007

Busy, Busy, Busy

I am so busy right now its difficult to post regularly but here is what I've been thinking this week.

1) Mohican gives the fall mini-budget a B+ mark for a balanced approach to lowering taxes for individuals, consumers, and corporations. It makes Canada more competitive in an investment sense and helps us all keep more dollars in our pockets. I am a big fan of consumption taxes rather than income taxes so the mini-budget loses marks for the further cut to the GST. I would rather see that money spent on a broader income tax cut. That said, lower taxes are good for everyone.

2) The US Federal Reserve cut rates this week, prompting a broad selloff in the US dollar and a substantial rise in Gold and Oil. I don't see how the US economy is going to avoid a recession given the inflation outlook in the country to the south. Fuel prices alone could be enough to slow the economy into recession given the weak housing market already in place.

3) The Stingy Investor has some great research on various investment techniques and stock picking strategies. I highly recommend reading about them if you are into that sort of thing.

4) The REBGV and FVREB will release statistics on real estate sales, inventory, and prices for October early next week. I'm curious what sort of price action we will see. Clearly the FVREB is leading the march toward a declining market before the REBGV tips. Time will tell.

12 comments:

solipsist said...

I hear you on the busy, busy, busy mohican. Is it the baby thing? Not sure. Chipman announced no new additions to his family, and neither did the pope. They have been less regular as of late as well. I know that babby has made me more busy, but...

Your post on value investing was timely - I have been looking at a company on the TSX - V. I can't claim to know anything about value investing though, I have a predilection for high-risk venture capital investing. Always the contrarian, I guess.

solipsist said...

Oh, and on the "mini budget", I give it a C-. I think that cutting corporate tax (by so much) in such a boom time was a bad move. The Canadian economy has been on fire, and I don't really see the need for that cut.

I agree with you on the GST cut, leave well enough alone. We are used to paying that tax, and consumption tax cuts do nothing for the lesser well-off, and the GST is a huge boon to government coffers. They would have been better to put it back to 7%, and put the proceeds into education, R&D, and health, as far as I am concerned.

The Liberals get an "F" for ineffectuality, though. What kind of freak-show are we running in Ottawa? "Canadians don't want an election" - says who? We did not give the "Conservatives" a majority for a reason, and to all intents and purposes, they have one. This is very disturbing. (can I give them worse than an "F"?)

Strataman said...

The Liberals get an "F" for ineffectuality, though. What kind of freak-show are we running in Ottawa? "Canadians don't want an election" - says who? We did not give the "Conservatives" a majority for a reason, and to all intents and purposes, they have one. This is very disturbing. (can I give them worse than an "F"?)
Solopist: Bottom line and be honest an "A" is more like it. Irregardless of their policies stop and think for awhile? Who would you give an "A" to just on talent(political)?

solipsist said...

If you mean an "A" for talent for the Cons, I would tend to agree at first blush, but in the longer term, I'm not so sure.

The Libs are a failure, and would have done much better with Rae. Dion vs. Harper reminds me a lot of Trudeau vs. Clark. The ophidian wipes the floor with the principled every time. That is because it is more about winning the game than it is about doing the right thing.

Historically, we don't like smug, smarmy bastidges, and they take their rightful vilification in time. Look at The Walking Jaw Mulroney. His besmirch just won't go away, and that is nothing compared to the smirch that is truly his.

Beating the kid with glasses when he is smaller, and already down, just to intimidate others, is not heroic, or worthy of praise, in my slanted, but non-partisan view.

craigpbbrett said...

I think that cutting corporate tax (by so much) in such a boom time was a bad move. The Canadian economy has been on fire, and I don't really see the need for that cut.

BOOM TIME, ECONOMY ON FIRE. ONLY BECAUSE OF RISING COMMODITY PRICES. OVERALL, MANUFACTURING INCLUDING HI-TECH IS GETTING DRILLED. WHEN COMMODITY PRICES RETURN TO EARTH, THIS RESOURCE AND REAL ESTATE-FUELED ECONOMY IS IN TROUBLE.

the GST is a huge boon to government coffers. They would have been better to put it back to 7%, and put the proceeds into education, R&D, and health, as far as I am concerned.

LEAVING ASIDE THE NOTION THAT GIVING THE GOVERNMENT YET MORE MONEY TO WASTE, I MEAN SPEND, IS EVER A GOOD IDEA, JUST WHO DO YOU THINK DOES THE R&D? NOT GOVERNMENT, BUT THOSE BUSINESSES WHICH GOT THE TAX CUT YOU DIDNT LIKE.

solipsist said...

No need to shout craigpbrett.

A lot of R&D was/is done by universities, and polytechnic institutes - funded by gov'ment programs. Oriented strand wood products (UBC if I'm not mistaken) is one example. TRIUMF at UBC, another. Canadarm, extreme weather construction, Canadian Space Agency, stem cell research, all come to mind. The Blackberry was realized at the U of Waterloo, and was a major innovation.

Sunoco, Exxon, Walmart, etc., do not need our money. When do you think the price of oil will return to earth? They are digging up Alberta for oil because there is not a lot of "conventional oil" left that is easily accessible.

How about R&D in alternative energies? Grants for augmentation through geo-thermal, tidal, etc.? Research into new crops that can be grown as the climate changes would also be useful.

It's not all about Viagra and horsepower. When the Big 5 banks make record profits quarter after quarter, year after year, they do not need our money either. They already get so much of it.

Warren said...

Solipsist,

I'd rather see have seen the GST stay high and reductions in personal income tax as well, but I'm not sure I agree with ballooning government spending as the solution. Like it or not we do compete globally, and so our corporate taxes have to be competitive with the rest of the G8 at least, or we will suffer much more in the long run.

Ideally I would have also liked to see environmentally targeted tax cuts (like the ecoauto rebate), and money for things like transit in big cities.

The feds can allocate money for health care, but its the provinces who spend it, I'm not sure how much direct control the feds can exercise.

jesse said...

"I think that cutting corporate tax (by so much) in such a boom time was a bad move."

Flaherty gave some insight into his motivations for tax cuts. The manufacturing sector is hurting and he himself appeared hurt after Chrysler announced 1800 layoffs DESPITE his generous grandfathered tax cuts announced just days before. At least he's fighting the good fight.

Strataman said...

solipist "Beating the kid with glasses when he is smaller, and already down, just to intimidate others, is not heroic, or worthy of praise, in my slanted, but non-partisan view." True and very compassionate. Myself I was always a supporter of the Guy with with the lousy English and crooked smile. I won't support the kid with the glasses because believe it or not there are not a lot of compassionate business people or for that matter compassionate "let's be nice to the poor guy" leaders of the rest of the world. To pretend that we don't need a leader with cunning is a pipe dream. I don't support labels but rather the relative intellect of party leaders in the world of politics which in my opinion means you better be a damn good poker player!

Strataman said...

Or less long winded; Know when to hold and know when to fold. The guy with the glasses is quite likely to hold with a pair of deuces! :-)

Paul said...

I hear FVREB detached are down 3.5% across the board?

oh please said...

Paul - yep, FVREB stats are up now. High end must be drying up (White Rock excepted) as the max individual decline per region was -2.6%. Abby is now down almost 5% in two months. That's all SFH - townhouses and condos are mainly up in price, also suggesting that the market is maxing out and we may have seen the turn.