http://business.theglobeandmail.com/servlet/story/RTGAM.20090109.wflaherty0109/BNStory/Business/?page=rss&id=RTGAM.20090109.wflaherty0109
http://www.thestar.com/business/article/564381
This does not look good, especially when the man in the top position goes on record with such statement.
Nobody says which sector will be hurt the most. But it hurts to see that the downturn in automotive sector drags to whole country down.
I was watching CBC national yesterday, and some economist mentioned about investing heavily in infrastructure. I don't have much idea how economy works, but
- Does Federal and provincial government have sufficient money to invest heavily in infrastructure?
- It may provide employment to infrastructure and associated industries, but isn't it like hot air? We won't be manufacturing any tangible product, we won't be exporting anything. So how will we generate the income?
Maybe people who are planning to immigrate Canada may have to think to extend their arrival till things return back to "normal"
I guess Flaherty's comments only cements fears instilled in all by the once ominous goings-on in the market. Since you cannot avoid industry/sector dependencies, this will inflict pain on each one of us in more ways than one.
I guess that warm corner atop the subway vent at yonge-bloor is already taken.
-----------------------------------------------------------------
If you have a gun, you can rob a bank.
If you have a bank, you can rob everyone.
- Bill Maher
Location: God's own country
Posted on: 09-01-09 16:01:15
Quote:
Originally posted by meghal
I was watching CBC national yesterday, and some economist mentioned about investing heavily in infrastructure. I don't have much idea how economy works, but
- Does Federal and provincial government have sufficient money to invest heavily in infrastructure?
- It may provide employment to infrastructure and associated industries, but isn't it like hot air? We won't be manufacturing any tangible product, we won't be exporting anything. So how will we generate the income?
Maybe people who are planning to immigrate Canada may have to think to extend their arrival till things return back to "normal"
Meghal,
The worst is yet to come and it will get worse for us before it gets any better for us. The recent elections and the power grabbing senario's have left us in a much worse position as politicans are looking to safeguard their incomes rather than helping the country. I am deeply disspointed with the Cnservatives for porouging the parliment and not doing anything concrete to help us through the recession.
To answer your queries :
Most of the Govt's all across the world are in debt. So to fund any massive boost, they either sell assets (like roads, Buildings lands), or borrow from the WB or countries for interest, or issue bonds to the public which is guranteed or even print the money and add it to the federal debt to be repaid.
In this economy (where one canot expect a return), it is best to invest in infrastructure by building roads, bridges, highways, Subways etc.. Infrastructure means Roads, Sewpage pipe line, Electric lines, Subways, Water treatment plants etc... The advantage is manifold. It provides employment, boosting of certain manufacturing/mining industries (like cement, copper, Steel, Aluminium, Ashphalt) etc.. so that they can pave way for the boom time which follows any recession (like building new houses in infrastructure developed lands, easy movement of people to newly built developments by subways, raods etc..). This is way better than the govt. building new manufacturing plants with no one available to buy the manufactured goods (like Automobiles, heavy machinary etc...). Again this is not my view, ut the view of top economists in NA and Europe.
The economy is expected to get better in the summer of 2010 and hence I will ask the immigrants to come by end of summer or mid winter of 2009/10 so that they can get used to Canada and then start jobs in the summer of 2010. For the rich immigrants, I would recommend that they come and upgrade their education in Canada so that they will be ready for employment in the summer of 2010. Also the immigrants should know that even in the boom days of Canada, it would be a challenge to find professionals jobs in Canada unless they are in IT or finance.
hope this helps
Peace by TK
-----------------------------------------------------------------
I am a Gents and not a Ladies.
The last time when such massive infrastructure spending was taken by Govt was during the Great Depression (FDR's New Deal).
That process was overlapped by WWII.
It remains to be seen whether this time around similar infrastructure spending can get us out of depression or now.
The government has essentially exhausted all the tools of monetary policy so good ol' fiscal policy is the only resort left.
But the main diff. between the 1930s and now is that the US govt. didn't have a deficit of $1T then (and an overall shortfall of more than $50T if you account for underfunded social security and medicare).
Fiscal policy may not work for the US this time because of the massive debt they are already carrying.
And I don't think starting new wars is a valid option these days either (like it was back in the 1930s).
-----------------------------------------------------------------
"Mah deah, there is much more money to be made in the destruction of civilization than in building it up."
-- Rhett Butler in "Gone with the Wind"
....the public health care system is being affected also. In a press release this morning, it was mentioned that there's going to be a reduction in the quality o services, longer wait times, people will have to travel loner distances or services and certain medical centers are already considering charging for services like Physiotherapy. There seems to be a projection that 5000 jobs will be lost this year in the hospitals and most hospitals are saying that they are running as efficiently as possible and there's no further room for making any cuts ! !
Damn this recession ! !
Recessions are opportune times for the govt. and companies to release bad news that was known anyway.
This impact on health care services hasn't happened overnight and it's not because of the recession by any means.
It's just that this is the perfect time for the Ministry to release this news.
It gets buried in all the "noise" around recession.
Similarly, recessions are perfect time for the govt to push through legislations and rules that they wanted to implement anyway but couldn't do so because of some resistence or another.
Under the blanket of recession, it becomes very easy to justify almost anything.
Recessions, like wars, are awfully convenient.
-----------------------------------------------------------------
"Mah deah, there is much more money to be made in the destruction of civilization than in building it up."
-- Rhett Butler in "Gone with the Wind"
