There is a lot of concern about there about the state of private pensions and private savings plans (RRSPs and the like). Having lost a quarter to a third of their value in the past year, those who anticipated a cozy retirement are now rethinking those plans. But the core problem is that asset values (houses, too) have grown at […]
Read more“I think there’s probably a lot of great buying opportunities emerging in the stock market as a consequence of all this panic.†– Prime Minister Stephen Harper, Oct 7, 2008, cited in the Globe from his CBC interview The TSX index closed that day at 9829.55 Today’s close was 7724.76. Thus, the TSX has dropped 21.4% since Harper issued his […]
Read moreThere’s been a fair bit of coverage recently about the big hit to defined benefit pension plans as a result of collapsing equity markets. That’s not a pretty sight, and many plan sponsors face serious short to medium term difficulties in financing their plans as funding deficits increase. But, most pension plan members can still count on getting the pension […]
Read moreInternational labour leaders including CLC President Ken Georgetti met with the heads of the IMF and World Bank, President Lula of Brazil and several other G-20 leaders before the summit to speak to the major trade union statement which called for immediate, co-ordinated action to avert a global jobs crisis, and fundamental reform of the de-regulated global financial system which got […]
Read moreThis statement is well worth reading, and may have some modest influence on the meetings. Brussels, 13 November (ITUC OnLine): Trade union leaders from the G20 countries will put forward a comprehensive plan to turn around the global economy, in meetings with world leaders in Washington DC on the eve of the financial crisis summit hosted by the US government […]
Read moreEric Helleiner and Stefano Pagliari have written an excellent briefing note on the politics of regulatory reform heading into the summit. In a nutshell, they argue that Franco-German initiatives to regulate some key elements of global finance – executive compensation rewarding extreme short termist, risky behaviour; off balance sheet activities; the fringe banking sector; over the counter derivatives – have […]
Read moreI debated Bill Watson from McGill on the economic crisis and the need for a “Bretton Woods II” for a half hour or so on the Sunday Edition, on CBC Radio. I found him more than a tad complacent myself – markets will bottom out and it would be a mistake to re-regulate neo liberal global capitalism and imperil all […]
Read moreHere’s the full version of the summary posted earlier – a much longer analytical section, and more detail on our suggested policy response. http://canadianlabour.ca/en/clc-response-economic-crisis-full-version CLC Response to the Economic Crisis Global capitalism: on the edge of the abyss Dramatic recent events have thrown into sharp relief some chronic and long-standing problems of our global and national economic system: an over-developed […]
Read morehttp://canadianlabour.ca/en/clc-response-economic-crisis-summary This call for government action was the result of deliberations at yesterday’s meeting of the CLC Executive Council, and reflects prior discussions among union economists. This is the summary. I’ll post the long version after it has bene translated and posted to the CLC web site. CLC Response to the Economic Crisis (SUMMARY) Global capitalism: on the edge of […]
Read moreDigging through the rubble of the financial crisis, Jeffrey Sachs lays out his agenda for a new international financial architecture, aka Bretton Woods 2.0 (version 1.0 was the system laid out in 1944, composed of the International Monetary Fund, the World Bank and the ITO->GATT->WTO): First, we need to restructure global finance, based on an expanded system of capital adequacy […]
Read moreThey truly are a bunch of self-serving, greedy etc etc. … http://www.guardian.co.uk/business/2008/oct/17/executivesalaries-banking The Guardian October 17 2008 Top Wall Street bankers to receive $70bn pay deals Simon Bowers Financial workers at Wall Street’s top banks are to receive pay deals worth more than $70bn (£40.4bn), a substantial proportion of which is expected to be paid in bonuses, for their work […]
Read moreFurther to Toby’s excellent post on Iceland. Here are some extracts from OECD Country Reviews – courtesy of Roland Schneider of TUAC – which show gross disregard for the risks as they were building. Economic Survey of Iceland 2006 Published on 9 August 2006 Chapter 1: Policy challenges in sustaining improved economic performance Iceland’s growth performance has considerably improved since […]
Read moreI was intrigued by what is happening in Iceland, so the following is a piece I’ve written on it. It has some introductory macro-economics in it, which I think it is good to keep in perspective as we consider the frantic attempts being made to prevent an economic depression. The economic and financial collapse of 2008 is shaping up to be […]
Read moreIn Tuesday’s CBC interview, Harper told Canadians that “there are probably some great buying opportunities out there†and specifically pointed to “oil stocks.†Since then, the Toronto Stock Exchange declined by 8% and its Energy Index fell by 14%. S&P/TSX Composite Index Tuesday’s Close = 9,829.55 Friday’s Close = 9,065.16 S&P/TSX Capped Energy Index Tuesday’s Close = 234.16 Friday’s Close […]
Read moreWhat irks me about the Harperites’ non-response to the economic crisis is their claim that they have responded by bringing in tax cuts, announced in the Economic and Fiscal Update almost a year ago, and perfectly timed to the occasion. There is an argument to be made for tax cuts as a fiscal stimulus, although I think they will do […]
Read moreLettre ouverte de la part d’économistes canadiens à propos de la crise économique actuelle et la réponse du gouvernement qui s’impose La crise financière mondiale qui s’aggrave, la chute des prix des matières premières à l’échelle mondiale et le risque grandissant d’une récession mondiale dévoilent des faiblesses inquiétantes de l’économie canadienne. Le simple fait de nous en remettre à nos […]
Read morehttp://canadianlabour.ca/en/working-families-demand-a-fundamental-change Working Families Demand a Fundamental Change 2008-10-06 15:59 A Statement on the Economic Crisis by Canadian Labour Congress President Ken Georgetti OTTAWA – Canadian working families will bear the brunt of a deep economic crisis caused by self-serving and arrogant corporate bosses, aided and abetted by complacent, and do-nothing governments. Our jobs and our pensions are at risk. Today, […]
Read moreI’m pasting in below a listserv note from Frank Hoffer with the Bureau of Workers Activities at the International Labour Organization, followed by a piece from Walden Bello. In these days of fianncial meltdown I do think we need to remind ourselves that this crisis is indeed rooted in the fact that “financialization” temporarily bridged the gap between the need […]
Read moreI calculate that Canadian trusteed pension plans have probably lost about $50 Billion since the end of March due to falling share prices. RRSPs are probably down about  $30 Billion. As of March 31st 2008 (most recent data) 4.6 million Canadians belonged to trusteed pension plans, and 5.8 million belonged to employer pension plans of all kinds. Total assets of […]
Read moreA good op ed from the New York Times. I wonder why we are not discussing this issue here – the stock market meltdown combined with the growing difficulties of the real economy are going to have huge impacts on pension fund balances. http://www.nytimes.com/2008/09/27/opinion/27ghilarducci.html?_r=2&ref=opinion&pagewanted=print&oref=slogin&oref=slogin Op-Ed Contributor Save Pensions By TERESA GHILARDUCCI THE meltdown in the financial industry isn’t merely a […]
Read moreThe 110 page U.S. Emergency Economic Stabilization Act of 2008 is certainly better than Paulson’s original 3 page proposal, but it falls so far short of what is needed that I wonder whether it will do more harm than good.  Despite its growth in size, it is still little more than a bail-out-come-swap financing deal for the  financial sector. The question […]
Read moreMore clear headed analysis of the choices from Tom Palley http://www.thomaspalley.com/ Saving the Financial System Copyright Thomas I. Palley A friend told me the economist Charles Kindelberger had two rules for a credit economy. Rule one was everybody should know that if they get over-extended they will not be bailed-out. Rule two was if everybody gets over-extended they must be […]
Read moreHere’s an interesting critique of the Fed – Treasury proposal, an op ed from the Washington Post. http://www.washingtonpost.com/wp-dyn/content/article/2008/09/20/AR2008092001059.html?hpid=opinionsbox1
Read moreThis piece by Tom Palley is interesting and a bit of a counter point to some other posts on this blog . He stresses the danger of populist opposition to “bailing out the bankers.” Tom’s blog is at: http://www.thomaspalley.com/?p=130 The Liquidation Trap The U.S. financial system is caught in a destructive liquidation trap that has falling asset prices cause financial […]
Read moreDuncan Cameron has an excellent – and disturbing – column on the still deepening financial crisis in rabble: http://www.rabble.ca/politics.shtml?sh_itm=14e122ab36db1c78ce34a64c243af494&rXn=1&
Read moreA salvo from Armine Yalnizyan on the bailout: GAJILLION DOLLAR BAILOUTS: FIVE THINGS TO THINK ABOUT By Armine Yalnizyan, Canadian Centre for Policy Alternatives As the US government continues to figure out just how much it will take to bail out financial markets, up to the tune of $1 trillion dollars, the sound of Dr. Evil’s voice creeps into in […]
Read moreBack in June, we co-awarded the first John Kenneth Galbraith Prize in Economics to Kari Levitt and Mel Watkins. Unfortunately, there was a snag with the transcription of Kari’s lecture and she had to recreate it. We now have the text and have posted it below. So congrats once again to both Kari and Mel for their outstanding contributions to […]
Read moreI wrote this article for The Tyee, looking at the US financial crisis with a view towards the Great White North. Their version has much nicer formatting and a funny cartoon. Update: Check out this week’s This Modern World. US Meltdown Puts Heat on Canada By Marc Lee Watching the turmoil in financial markets this past week, the question is […]
Read moreHere’s a statement from the Secretariat of the Trade Union Advisory Committee to the OECD (TUAC) http://www.tuac.org/en/public/e-docs/00/00/03/13/document_news.phtml The dramatic events on the US and global financial markets in the past days – the collapse of Lehman Brothers, the takeover of Merrill Lynch by Bank of America and not least, the government bailing out of AIG, the largest insurer in the […]
Read moreI have long subscribed to Challenge magazine, a generally progressive and accessible US economic journal which I recommend highly to readers of this blog. Individual articles can be downloaded, for a fee of $25. The current issue has an excellent piece by the LSE’s Robert Wade on the current financial crisis, which he sees as rooted not just in financial […]
Read more