Canada's Economy is Growing

I was spending some reading a few articles online today and came across another interesting one. While I was on CBCs website I found an article about the Canadian economy. In April of this year 19,200 jobs were created. Although this is good news for the economy the national unemployment rate went up by a tenth of a percentage point mostly because more people began to look for work. This really is not a bad thing, I must say my reaction to the news is a little mixed.

Inside the article I found that the majority of the jobs were in the food services sector which is known for lower paying positions. On the plus side 16,000 jobs were added in the construction sector - a very seasonal sector, gains are mostly expected to rise in Canada's second season: Construction. Now granted that jobs were added in both the food services and construction sectors both have some draw backs. Housing markets are cooling at least that is what I am reading which really cannot be all that good for sustainability. But there is a silver lining, our country is growing despite all the talk about recession in the US.

At least in the face of adversity our Canadian Dollar is still holding its ground. Even if there are some mixed reports about job growth in Canada the overall picture that I am getting from the article is that Canadians are buying into our own markets. One of the keys to keeping our GDP on track is to support our own industries and rely less on imports for the many things we purchase everyday. I have never claimed to be an expert economist but I do like sharing my opinion; in any case even though there are mixed reactions to the news, there still are more hurdles to jump over. For example: crude oil continues to become more expensive but the problem with oil is that if you use less they're going to raise the price anyway. The cost of gas is not the only problem facing us today but it is one of the most broadcast problems.

Part of our problem lies with the snails pace of battery technology. We have the knowledge to build and produce electric cars for the market but current battery technology limits the range on these vehicles to about 20km don't hate me if this number is wrong, its an old number there may have been some advancements. But I seem to be going on a tangent again, back to the article.

The Bank of Canada is still wary of our domestic economies robustness as the weakening in the US markets continues. A strong Canadian dollar has been the reason for a lot of closures in Canada last year and this year. The company I work for used to have a manufacturing plant in Canada, shortly after the dollar peaked and was trading for $1.10 with the US One Hundred and Sixty-Three people were laid off and the manufacturing went back down to the US. Our domestic robust economy certainly could be linked to the withdrawal of US manufacturing companies and a lot of people showing an entrepreneurial spirit. I don't know every thing but I like to think positive. In any case this has been my opinion, what do you think?

News Story: Canadian economy adds 19,200 jobs

Bail Out Your Own Boat

I read something today that I found interesting. The Harper government has stated that it will not bail out a sinking business. This just means that it really is sink or swim. I'm not surprised that the Canadian government is not in the business of keeping a company a float; shouldn't a good business be able to keep its own head above water for it to be a good business? I have worked for some good companies and some bad companies before and the good companies have an uncanny ability to make a decent profit to keep the business running. Isn't that the nature of business?

I may not be a business man, but I have seen what good companies can do to increase their profit margin. If you need a government grant to stay in business, you must be doing something wrong. Most companies can be competitive and create their own niche, these companies will be successful. With business' that don't need financial help from governments, the amount of money injected into the economy is minimal and allows for government funds to be funnelled into something else.

I remember hearing about Ford getting a needed cash injection from the government not to long ago and the Oakville Ford plant was able to stay open because of it. Now of course that saved a lot of jobs, but it really only helped the community in Oakville Ontario; surrounding cities are struggling to keep jobs local and more people are commuting to work. Steel workers rule some cities, but the problem is that other jobs in those cities are mostly retail and usually are not enough to help the city grow. When your city only has two types of jobs available like steel work and retail work, if you want a good job you're going to have to commute to find one.

The Canadian economy is going to slow eventually but more jobs need to be created before the economy slows. The sooner these jobs get created the less likely an economic slow down will occur. Out in the west of Canada, jobs are plentiful and usually pay better than some jobs here in central Canada. Granted the cost of living is higher in the west, the rest of Canada is slowly catching up. More and more houses are going for higher prices and the market doesn't look to be slowing down. In general, what I've seen indicates that Canada's economic boom is not over yet, sure the dollar is trading better against other currencies but it will not last forever. Canadians need to support Canadian business instead of the burden falling on the shoulders of the government. I personally agree with Harper's government when they state that they will not bail out any business. I think Canada would be better if the government forces companies to sink or swim. That's my opinion, what's yours?

Image Source: Wiki Media Commons
News Story: Ottawa won't be in bailout business this year: PM

Another Word About the Canadian Dollar

Today I was reading a report on the Canadian economy. But more specific, a report on job growth in Canada. The recent rise of the Canadian dollar has made many changes to the Canadian economy, one of these changes affects business. With the Canadian dollar trading at par with the U.S. dollar or greenback, U.S. companies are now finding it more costly to manufacture goods in Canada. When the Canadian dollar was trading roughly at 75 % of the U.S. dollar, the exchange rate made manufacturing goods in Canada much more appealling because the actual cost was about 75 % of the numbers due to the exchange rate. Now that the Canadian dollar is close to or at par with the U.S. dollar, costs simply are rising.

With a growing economy, job growth is definitely a key ingredient for sustaining long term economic growth. The fact that manufacturing jobs have been cut in most provinces should not discourage Canadians from investing in Canadian business'. It is imparitive for sustained growth that Canadians continue to purchase Canadian made goods and services. The recent out cry for lower prices got national attention and the Retail Council of Canada took notice. Some prices have come down along with a 1% cut in the G.S.T. (Goods and Services Tax, for those who are not familiar with this tax) has made goods and services a little easier to afford. But what does this all mean for our economy?

Simply put, a larger amout of disposable income will inevitably increase the amount of larger purchases. The tax on a new home will now be 1% cheaper than last year, every Canadian will now save a whole 1 cent on every dollar spent. This really doesn't sound like a lot, but when you put 1000 pennies together you do get $10. Granted this small decrease doesn't look like much, but don't worry it all adds up, eventually. But back to the report on job growth.

With American business finding it cheaper to do business in the U.S. it is important that Canadian manufacturers realize that there is more room for diversity in those sectors. Not only do Canadians need to adopt a policy of 'Buy Canandian' but we need to realize that the departure of U.S. corporations from our manufacturing sector creates room for Canadian business. It is possible that the Canadian economy can benefit from sustained economic growth, we just need people with ideas as well as investment capital to create more growth. The Canadian government will give out grants for those willing to start a new business. If you have an idea, it would be worth the time it takes to look into attaining a grant from the government to get started. What do you think?

Image source: my camera phone

News Story: Loonie slumps on feeble jobs report

Canadian Company Goes Global

I was sitting at the Chiropractor's office today just waiting for my appointment, and I picked up a copy of today's 'National Post.' I found a rather interesting article about a company called 'Agrium.' Now in this article, it describes the strength of the agricultural sector right now and how Agrium has recently been acquiring a few other companies and have effectively placed themselves in the global marketplace. Not bad for a Canadian based company.

I think the strength of the Canadian dollar against the 'greenback' has contributed the recent acquisitions of Agrium. A stronger dollar will give you more buying power. This has been some of the best financial news I've heard since the dollar began its rise to par. As I write this article the little 'widget' I have on my side bar is telling me that the Canadian dollar has slipped a little to just under par, but its still close to the greenback. Back to Agrium, the latest release was the acquisition of U.A.P. Holding Corporation for a very large sum, I believe the article states the sum as $2.65 billion U.S.D.. Agrium gains $1 billion in equity as well as their stocks trading higher on stock exchanges.

Is this just the first of more possible purchases between Canadian companies and American? Well since Canadians have been outraged about higher prices here in Canada compared to prices in the U.S., people have be doing some cross border shopping to get the most out of their dollar. I can't really blame them, but now we have new sales praising the dollars recent rise, whether or not that will discourage cross border shopping remains to be seen. With a stronger Canadian dollar, retailers are forced to lower prices to prevent cross border shopping, but the dollar has been on the rise for more than year, we should have seen a decrease before having to go to the media or cross the border for shopping just to get retailers to listen to us.

Sources:AGRIUM-UAP DEAL LAUDED
Image:deltafarmland.ca

Prices Fall, Finally

As of late, the C.B.C.s website has been a major source for inspiration for my posts. This time, its an update about parity pricing. In the article, Prices fall though retailers warn deep cuts won't arrive until 2008 retailers are willing to finally bring some prices down. Also, they are willing to give discounts on most magazine and book prices. This has been one of the biggest concerns that Canadian consumers have been voicing their opinions on. This is definitely a good step forward.

As long as the Canadian dollar continues its rise or at least remains at a similar trading price with the U.S. Greenback, Canadians will eventually see some lower costs. But the recent high, described in Loonie closes above $1.07 US on strong job growth predicts an all time high of $1.10, which is definitely good for Canada's economy. However, our dollar has seen an increase against the U.S. Dollar, but really has not seen an increase versus other currencies. As a Canadian I am concerned about this. A lot of our goods for sale in the market are imported, and if we import from other countries, the exchange rate on those goods could be a great deal higher than the exchange rate between Canada and the U.S.. Right now, the U.S. Dollar is stronger against the Euro than the Canadian Dollar.

Another piece of good news, I have recently heard commercials telling consumers that prices are going down. It will take some time for prices to come down, but if its being advertised by retailers, it will happen. Thankfully the Canadian Media has been keeping up with the story and Canadian retailers are taking note. Nobody really wants to see consumers cross the border just for lower prices, but with reports of job growth on the rise, lower prices is more of a reality than a fantasy.

Granted that the job growth here in Canada is on the rise, we also have to look at producing more Canadian made goods at lower costs in order to sustain our economy. With an increase in competition in Canadian markets this can be achieved. I have studied economics, but I am no expert by any means, but increasing the supply of a good will help to bring down the price in the marketplace. Also there are many barriers to entry in the Canadian marketplace, if we want to sustain the current growth of our economy, more competition needs to be introduced. These barriers to entry should be reduced to encourage more competition into our markets.

Even though Canada has a smaller demographic in terms of population compared to the U.S., it is definitely possible to create more competition in today's marketplace. There are ways to gain entry into today's marketplace. The Canadian Government does have a program to aid entrepreneurs to start their own business, I still have to do some more research on this, but our government recognizes that we need to see more growth in our economy.

This is just my opinion and I do believe that Canada does have a roll to play in the global market place. Some of my suggestions could change the country for the good, but I am definitely not willing to run for political office. In the coming days and weeks, I will look at the larger picture of the Canadian economy, hopefully to gain a greater appreciation of the current competition and to look for little details that could improve our economy.

Parity Prices?

There has been a lot of complaints by consumers in Canada recently. C.B.C aired a special on Canadian consumers demanding a lower price. The special was called "Dollar for Dollar" and it included opinions from Canadian consumers. This is a good thing, because Canadians are finally starting to realize that the consumer can affect the price. Even the Retail Council of Canada has taken note. The Retail Council of Canada has issued a letter to Canadian suppliers to reduce prices.

Now of course there are other factors to consider when looking at the price of goods, it's not just the retailers that set prices. Manufacturers also set prices for their products. Also, Canadian manufacturers have higher operating costs than their counterparts in the U.S. which will affect the price of Canadian made products. Another thing to consider when looking at high prices, is competition.

Granted that the Canadian market is smaller than the U.S. market, but there are fewer and fewer competing companies. In addition to that, there are many barriers preventing more competition in the Canadian market. As well here in Canada, we have higher safety standards than some other countries and have to pay to make sure that a product is safe for sale on the Canadian market. Along with higher taxes, all these factors will be included in the price of a product on the Canadian market.

It isn't likely that we will see parity pricing here in Canada, but if more and more consumers start to stand up for themselves, we can effectively drive the price down. Canadian retailers do not want to see business go south of the border and are working to reduce prices. The Retail Council of Canada have a link on their website to a petition of sorts that will allow you to let the suppliers know that you want lower prices. This is a good thing and will help the Canadian consumer stand up for themselves and demand lower prices!

A note to Canadian consumers

I was taking a look at www.cbc.ca and found some interesting articles. The first one of note Canada will become one of the most powerful nations: Tony Blair, an article about a speech that former prime minister of Britain, Tony Blair made in Calgary, Alberta this past Friday. And the second one, Loonie briefly nudges $1.04US. Both articles show that Canada is getting more notoriety on the international stage. But even with these news worthy articles, Canadian consumers are still paying high prices for everything they purchase.

It is appauling that Canadian consumers have so much trouble sticking up for themselves. The worst part is that the consumer is supposed to control the market, not the retailer. You are the one with purchasing power, regardless of how much money you have, you still are the one who should be deciding how much you pay for an item. Recently I have stopped buying fruits and vegatables from my local grocery chain, instead, I go to a produce market, which is a specialty store. Sometimes in order to find better prices you have to shop around to find them. Now I wouldn't consider shopping around for the cheapest price being cheap, more like thrifty.

As a home owner, I have had to learn how to be thrifty. Especially when you are only supporting yourself on one income, when the majority of home owners are two income families, you have to learn how to be thrifty. Personally, I have a set amount that I would be willing to spend for an item. If the item is a necessity, then I would purchase it at the best price I can find, but if not and I can wait, I will look for a much better price and then purchase the item at the lowest price possible. I think a lot of Canadians have been too concerned with being called cheap while in school, it is during that time while you are growing up that you need to learn basic shopping skills. Sometimes you can be blinded by brand names or trends, but the bottom line is you have to look for the lowest price out there, that is why we have stores competing against each other.

Another reason for high prices is that certain markets are being dominated by franchises, and the old mom and pop shops are being reduced to a thing of the past. It is these mom and pop shops that help bring prices down, they encourage healthy competition in markets that are saturated with corporations trying to get you to spend every cent of your disposable income in their chain. If you want to see prices come down, look for the best price and support the little stores/restaurants that have to compete with brand name franchises.

A Brave New North America

Welcome to the twenty first century. Now to go along with the E.U. the N.A.U. is gradually being formed. It starts with the Security and Prosperity Partnership (S.P.P) agreement formed between, President George W. Bush, Prime Minister Paul Martin, and President Vincente Fox. The S.P.P. is just a stepping stone towards a much larger agreement, conceived in secrecy and will ultimately be demanded by the people.

Do you want to know what people will cry out for? It is the North American Union (N.A.U.). It is an alliance much like the European Union (E.U.) and is only the second of two more similar forms of government breaching the shadows on the horizon. The story is just now breaking news, well at least to me, I have been unaware of it until now. I don't have enough information to fully draw a conclusion as to whether or not this North American Union will be for all the citizens of our continent a good move. I have been actively searching the website setup for the purpose of informing citizens on the S.P.P. as well as looking for more information on how it affects Canadians on the Canadian site for the S.P.P. I will undoubtedly report more of my findings as time goes on.

What I have learned from these websites is that, the S.P.P. is not a step towards a larger governing body such as the North American Union. Although there is an awful lot of conspiracy theories that are pointing towards the formation of a North American Union. New technologies are being developed for the implementation of the Union as well as pictures posted of the Amero. All of this is based on reports in the media.

I am still doing more research on the topic and will continue to post more on the subject of the North American Union. I am very interested in the affect the Union would have on the Canadian economy, as well as the growth potential the S.P.P. has towards our economy. As a Canadian, I will endeavor to research the affects of the S.P.P. on our economy and will report more details as I find them.

To be Continued...