Will get this blog running back up again.

The post is self-explanatory. Thank you for your time.

Downsized Rundown [DR]: Who gets the credit?

Topic of the Day: Canada's economy to grow moderately: OECD

I'll be holding Downsized Rundowns, which are shorter and easier to read snippets on the current economic climate, with more focus on thought-provoking and discussion where applicable. It's just to keep people updated. Today's focus and Downsized Rundown, ironically, is a report by the Organization for Economic Co-operation and Development, which reported that Canada's growth will grow up to 2.3 percent next year and 3 percent by 2012. In other words, there's a projection for growth, and considering that it's happening under Harper's administration, you can bet that it'll be significant election fodder in the future.

This is interesting, considering that only in 2009 that there were talks with Chrysler on downsizing and cutting down the costs of the Canadian plants and wages to remain afloat. Now, a year later, there's a very good report from a generally neutral and objective source, from the Organization for Economic Co-operation and Development, telling us that we're doing something right.

What are your thoughts on this? Do you think this growth will hold? Is this a result of the regulations on the banking sector? Do you think Harper's administration may use this as future economic electoral cannonfire to return to power? What are your thoughts?

Line Dash: A Brief Look at Zeitgeists in Policy-Making in Arizona's Immigration Laws

Key thoughts: What role does the corporation play in Arizona, compared to other American states? To what extent does this influence the cohesion of government policies in the United States?

Can racial sentiment become a main factor in future implementation of similar policies?

Of course, I'm sure most of you are familiar with Arizona's Bill 1070, which in the most magnanimous legalese possible gives officers in Arizona, under particular pretences, the ability to deport and imprison (within contextual limits) those that they consider to be illegal immigrants.

This is further given credence if the person does not have a passport, Green card or Visas on them when stopped. In other words, it's a crackdown on illegal immigration by providing more presumptive capacity and capability to the police in Arizona.

Authorities such as Roger Mahony have declared the policies 'Nazism' while others state that the policies undermine the capacity of the federal government to manage their own borders.

Now, as you can guess, on that level critics may argue that it becomes the possible fostering soil for racial profiling, or even worst, it may polarize the existing sentiment between democrats and republicans even further. While I do put on the image above to be an amusing quip and display of the situation, the fact of the matter is that I find the situation to be a lose-lose scenario.

Well, not entirely. If we apply a triumvirate rather than a single Weber-esque scale of win-lose or win-win or lose-lose relationship, we can find an interesting third party that would make our position actually a lose-lose-win. That third party is the private prison industry.

A study by the National Public Radio has found out that the majority of drafters and funding entities that came to support the politicians that pushed for the enactment of the bill are members of large corporations, such as ExxonMobil and Connections Corporate. Furthermore, these large corporations have interestingly provided lobbyist donations to those lobbying.

So not only does it suggest an institutional framework for racial profiling, community undermining and general unpleasantness for those who have immigrated to the United States legally or those born in the United States (particularly in Arizona), undermines the power of bordering of the US Federal Government, but it also ebbs multiple concaves of corporate pressure and incentive.

This stuff is stuff you generally see in dystopic political novels by a George Orwell wannabe on Lulu.com or something, not in real life, or at least, not in places outside of China.

The role of corporationsin this is particularly baffling, as while I understand their motives, no law or suits have been placed, as far as I know, making it somewhat of an ideological marginalization of the whole 'media watchdog' shindig, since I see alot of articles here, here, and here.

Yet, interestingly, only Bloomberg seems to be addressing the other side from the typical 'look at protestors' and 'this is a NEW step', which waxes multiple flavours of disconcerting for other newspapers.

Therefore, is this indicative of the American sentiment? Media, unquestionably focuses alot on immigration, especially the larger media moguls in America, and therefore, would this support, while having vocal  resistance from various groups and government backlash, but would the media play a structural role? A review by Business Week showed that 62 approved of the police asking others if the police believed immigrants were allowed.

For a country that lauds free speech and freedom till the eagles fly home, why is there such a sentiment of instituional control? Why even so is it perpetuated by the media? Is the corporation really to blame for exploiting the situation? It's a corporation job to make money, after all.

Would society, thereby, be the problem? What are your thoughts, and what are your thoughts on the role corporations play in the passing of these bills?

Looming Markets and Currency Contrasts: Long-term or Short-term?

This will be short, mainly since this came to me while I was reading the papers and subsequently was preparing for class. Anyhow, recent declarations for a stronger federal grip on the US market has led to an increase in confidence of investors and a rise in value of Canadian commodities.


Now I'll keep this short because it hits me more as an update than actual news. In summary, the promise of government intervention in the market to maintain the sluggish US economy has led to investors to having more confidence in the US market, leading to rise in investor confidence. What this means is that people with money are more willing to invest rather than save it, and thereby with more money to invest, companies have more money to loan out, use and develop. More jobs may be created, but that's only insofar as the government keeps an eye on how they spend their money.


The Stimulus package, thereby, was an artificial investment. This is the real thing, and as I stated in my earlier posts, the recession is officially over as of May 2009, but we're still feeling the effects of a long-term hard-hit economy. 


These facts are prescient to the issue because this is a good example of investor confidence by market externalities - when investor confidence shoots up in a newly regulated market, confidence shoots up in the Canadian border because ours is already regulated. Because ours was already managed, the value that it carries is affected by the rise in value from the US market. That's how we get a rise in the value of Canadian commodities and dollar.


While the dollar is playing square-dancing with the US currency, it's not all rainbows and sunshine. A weak dollar makes foreign exports to the US most costly, and Canada is no exception. All North American Free Trade Agreement aside, the issue is that Canadian resource companies will benefit, buy information companies will not.


This is because resource is quantifiable, perceivable, wholly measurable and limited. Things such as gold and oil (which shot up with the growing mining industry) go up because those are resources that cannot be made. They're non-renewable. Comparatively, information, while sometimes more pricey and important in a tertiary economy (one that relies on service industries to perform a vast majority of legwork in the country), can move borders easily. Gold deposits cannot.


So weaker US dollar and parity of Canadian means that a larger tech base in the US will be cheaper than their comparative Canadian tech base, so we may seem some short-term damage. But all in all, its seems good.


That said, there are some interesting things to note - firstly, not even businesses subscribe to Misian free business practices in a wholly free market., and secondly, mining seems to be growing even though moves such as the Whitehorse Mining Initiative was made years ago (and is not a recent development). Why? Any thoughts on that?


Leave your posts and comments, and any feedback is appreciated.

Trade Movement: Regionalising our economies in Asia?

This post is fairly succinct - at least, I hope - because while I enjoy writing articles that sycophant the words of someone else, I prefer not to lavish other writers for too long before I start getting my knickers in a twist. A recent article in the Globe and Mail quite proudly professed about the benefits of trade and how it would strengthen Canada's industries if we established stronger trade relations with countries in emerging economies, namely China, Brazil, India, Russia and other emerging economies.

While I generally support this idea, I do have some thoughts, after looking at the whole notion, as to what and how we're going to approach this. Now, the praise in the Globe and Mail of this idea was derived from the paper Trade, Innovation and Prosperity, which was released by the Institute for Competitiveness and Prosperity.

Innovation, as anyone would agree, is important - it allows the development of new ideas, technologies, methodologies, ontologies and ideologies that progress society as a whole. As such, as a paper that openly has 'Innovation' in its title, I strongly hope to find significant innovative measures and ideas within its 62 page report.

In regards to positive and agreeable things, I do believe that Canada's required to at least establish stronger trade relations with developing economies, and I do believe this needs to be done before these nations reach what the paper defines as 'the innovation tipping point' (Martin 10). This tipping point, while never defined (to the best of my knowledge when reading this report), is inferred that it will give respective developing economies a significant advantage. I will not argue against that point, because innovation is a powerful economic tool.

Now, in regards to establishing trade relations, the paper states that because Canada's market size is small, we must make innovation a more focal point in our development, again something I agree with (Martin 16). Now, the paper then states that US trade versus Chinese and European Union trade is a falling and rising correlation - as US trade diminishes, trade with the Chinese and the European Union increases (Martin 18, 19).

In fact, an interesting point to note is that the Canadian-US market has been in a reduced state of demand in that American markets have dropped significantly within this year, suggesting that we need to look for other trading partners. It is thereby no coincidence that the shrinking of our trade surplus nearly halved within the span of a month in 2010 is indicator we need to rely on more varied markets.

Putting all our eggs in one basket is not a good idea, especially when that basket is falling apart. Thereby, the proposal to establish relations with trade with emerging economies such as Brazil, Russia, China, and India are all interesting and vital ideas, and while the idea to do so is not new or exciting, it is a welcome reminder of our current economic climate: we need to rely on our partners to the south a lot less.

But how should we do it? What industries do we have that we can trade with? PricewaterhouseCoopers notes that by the date of 2050, the multiple emerging markets may become economic superpowers, with China, Brazil and Russia among them (Martin 27). Their strong industrial base and their capacity for innovation gives them a strong advantage in the future over ours, especially when our industrial sector is becoming increasingly automated.

It is here, therefore, that Canada's position as a possible 'trend-setter' is most required, and of course, because our productivity is tied to our development (and while we lose some jobs, more work is being done for less cost, increasing productivity), and depreciation of our dollar increases manufacturing employment. Depreciation means that assets of a particular firm lower their value, making each unit they produce albeit cheaper. 

This may be applied to anything from information to development to the currency to part productions, and in this case the depreciation shows that we aren't losing a market, and that Canada still has a role to play in the industrial market.

If we didn't play a pivotal role in the market, then depreciation would have still resulted in loss of jobs because it would have been shipped to an even lower currency anyways. So this means we have a presence in the international market, and we can insert some sort of foothold (Martin 42).

But which one? A look at Statistics Canada suggests that we have grown in agriculture and minerals, professional services and resources, construction the most, on an average of about 8 percent in a span of year. We thereby need to understand what resources are required in each nation, what technologies can be developed and how we can maintain an innovative foothold for when these emerging economies do become world players.

I believe understanding what competitive advantages these nations have are much more important that simply establishing trade relations, because we don't want to:

a. Aggravate local and infant industries (industries protected by government)

b. lose money against corruption, unfair subsidies and corporate theft, all of which are rampant in emerging economies

By understanding where our markets would be fit we can then more slowly 'sprinkle' in Canadian innovative markets to establish trends that allow us to have stronger and better market control and competition in these emerging economies.

We need to take a look past our trade relation with the United States because dependency on one nation is just too risky, especially when we see exactly how difficult it is for them to change their policies and paradigms on free market enterprises and stimulus packages.

That said, do you guys believe that we should stay true to the US and hope they ride the storm out? Or that we should establish these new markets? Is positive historical political amicability between states important to the extent that we should trust them? Or do you think we should insert Canadian-acceptive industries, markets and paradigms into these emerging economies?

Forecast of Sentiment of Small Business Owners

The current forecast that I am showing right now is a forecast that split up the most important problems between small business owners stretching from 1996 to 2009. Now, while I understand that we are currently in 2010 and the economy has been on a bit of slow growth since June 2009, the situation stands in that we can't be absolutely sure as to what will happen until then. The reason why I am posting this is because it's important as a reflective image of our existing economic paradigms.

What I mean when I use the word 'paradigm' is in the context of the dominant social belief in our society - are we more centrist, leftist, right-winged, etc.? Understanding our paradigm dictates who will win, who won't, etc. However, the issue that paradigm measurement has is that it's difficult to measure where people stand: they may lie, or change, or be unsure as to what they're planning on doing or what their positions are. As a result, measuring paradigms can be a bit tricky.

When data such as this, however, comes along, I make it my personal mission to splash this data all over where I can find it, because it is important prevalent. I won't tirade for too long, because it is also evident that drolling about economics is as exciting as looking at two rabid hedgehogs play swing-ball.

The chart above is a measurement of the percentage of small business owners that display what their main worries are and what are prescient problems in their industry. Now, before I begin, the source was from the Economist, and there was no mention of exactly the size, area, or the definition of 'small'. As such, I apologise for the lack of supplied data, and any issues that may arise on the readers' end in regards to your opinion riding on those definitions know that you have my empathy.

This survey shows that poor sales are still the dominant feature, with the idea of taxes running fairly consistent. Now, this is interesting because a good chunk of the Republican platform in the United States is to cut taxes so that business owners may have more money. This chart, otherwise, deals with basic supply of purchasing power by customers to small businesses. In other words, we need more people to buy, says small business owners.

This is important because now that fundamentally becomes a counter-point for the Republican economic platform - the idea of giving people money to spend may be fallacious because won't spend - that's important, because if people don't spend, then we don't have a good enough purchasing power parity.

Now this is funny, actually, because of this not-spending-but-saving sentiment among Americans there is more money in the banks. With more money in the banks, that means that the bank has more consideration (the means upon which they may loan and carry in value of gold), thereby raising their profits as they can lend out more. With more lending, more money is being made, so costs are better offset.

In fact, this recent plight against small businesses is interesting because group Citibank's recent rejuvenation (turning a profit in the May quarter of 2009), there's a rise in points in the DOW Jones. For Citibank to have made more money means that they'd need to have more consideration, meaning they'd need more money to use to loan out.

With more money to loan out, more is made in principal fees and interest, meaning deficits are cut more and more, meaning they may more money. More money equals higher points, more confidence in the banks, more investments. Everybody wins, even so far as to say that the recession is over, despite initial sentiment believing that Citibank may not survive.

Now, in all fairness, banks are still clawing their way back up, Citibank included, but I find it interesting how as small businesses lose sales, banks get more money and voila! recession instantly over.

Of course, I understand that there are multiple events going on that time - Madoff's plead to guilt and the restructuring of Chrysler and General Motors in addition to the abdication of GM's Chief Executive Officer. I'm not saying these events are unimportant, but I am saying that it is fairly coincidental, if it is a coincidence at all that cutting the sales of small businesses took the US out of its (legally) recession.

Frankly, this doesn't help jobs, which Americans still sorely need.

Lot o' lovin': Attack Ad on McDonald's stirs up a frenzy on nutrition

Subjects: Is it fair to be talking about nutrition in a recession? Why Vegetarian and not simply healthier eating?

This particular little gem was found within the Guardian, roaming the camera around a corpse before finally breathing out the words 'Make it Vegetarian' slam the ads. In response, McDonald's is replying in full with a statement stating it's essentially up to the consumers to decide themselves as to what they do or don't eat.


Furthermore, the National Restaurant Association (NRA for short, and mis-interpretive amusement if that's what makes you smile) has, according to the Guardian, scared the public with limited information on nutrition. There are a few grey areas that are much subtler than some people may think here, and there are some basic constitutional as well as legal factors to consider that bely yet another layer of market paradigms and economic zeitgeists.


Let it be known that I am certainly a man who looks out for his health - I exercise regularly, I'll eat and drink enough healthy foods to offset any cholesterol or general consumptive unmentionables that would otherwise have no qualms enacting the battle of Normandy in my stomach. That said, I feel more inclined to consider that this situation is in favor of McDonald's than the Physicians' Committee for Responsible Medicine (PCRM).


Suffice to say, while the attack ads are generally aimed to reduce consumption of McDonald's products, I do believe that McDonald's may in fact be receiving in a better position than without the attack ad. In fact, there is a definite silver lining in this cloud that people might not see (and I strongly doubt that McDonald's might even see). That said, this is speculative at best, so whether this attack ad does something and I just had too little faith in my fellow man is another question altogether.


We know the idea of market paradigms and economic zeitgeists. The concept is the fact that people will buy things because it is generally accepted that they want to buy things because it's what's socially 'cool'. People drink at Starbucks and not buy Nabob rip-offs because it is 'cool' to get things from Starbucks. The Fashion Industry, as another example, determines seasonally what the market paradigm and economic zeitgeists will be. As such, understanding market preferences based on peoples' perception of 'desirable' and 'undesirable' is important.


We can say that with the current status of healthier eating and attack campaigns from groups such as the documentary Supersize Me, the perception of McDonald's is still low enough that attack ads may not be an effective motivation for people to drop Big Macs and pick up soy milk and eat tofu chips (which are delicious, by the way). Now, I'm saying this because the ad specifically called for people to 'Eat Vegetarian', so there's an agenda that's not immediately apparent - it's pushing the consideration for a more vegan lifestyle, and improperly managed, is a costlier move.


This goes down to money - organic and environmentally kept products are much more difficult to offset in terms of cost because of both their economy of scale (smaller markets) and the difficulty in maintaining the standards compared to competition. Americans may not be willing to adopt the practice of vegetarianism, and considering the economy's state, it may not affect McDonald's strength that much. Though hamburgers in the America may not be recession-proof like those in Canada, McDonald's still reports strong quarterly numbers.


So will it make a dent in the market? Possibly not, at least, not a noticeable one considering how much the company rakes in per quarter, and the transition from eating Big Macs to warrant killing someone to become a vegetarian is a jarring and (in the poor fiscal hands of American middle class) costly change. Vegetables may be cheap in theory, but to get the allotted nutrients requires some other unorthodox substitutes for the meat dilemma.


I can't envision Americans shifting halfway, but rather shrugging plainly and giving up to another Big Mac, only to promise to 'do some running' to placate their own self-image. I just don't think we're in the stage to re-affirm Green, Alternative and Libertarian policies again because we don't have a good enough economy yet.


Now, so while it doesn't affect the market, we know that the paradigm is pushing for a 'McDonald's is bad' campaign, so what does that mean? Well, it means that less successful foolish cases will be filed against McDonald's, whether out of greed or sheer idiocy. In fact, the attack ad affirms McDonald's position as generally providing unhealthy food, so it may be advantageous for them since it gives them third party evidence that it is widely known that their food is on consensus unhealthy.


While it seems like an odd thing for me to argue, the fact that they have a leeway out of the 'impression it is good for you' is no longer a viable means for people to commit lawsuits for health reasons against them (or at least, successfully). The paradigm and zeitgeist that McDonald's is unhealthy also shoves away people who may genuinely not know the effects of McDonald's food, but may choose to eat there anyways. In other words, it gives the company a way-out in saying that people do know their food is unhealthy.


If this doesn't turn out to be true, then like I said, it's speculation, but if it is true, then perhaps McDonald's may find a blessing in this after all.