Search the Community
Showing results for tags 'Oil and Gas'.
The search index is currently processing. Current results may not be complete.
By now everyone is aware that the country is in a recession by the definition that the Tories legislated themselvestwo quarters of negative growth. Some claim there is a silver lining: jobs are up, GDP grew in June, and our exports to our largest trading partner are up. By now the Conservatives are playing politics with their euphemisms "contraction" and "technical recession." They're using these term because they truly believe that the economy has already recovered and that the dip is meaningless. However, putting the GDP aside and despite the growth in jobs and exports, there are other indicators that suggest we may not be pulling out of the recession at all. From the linked article by economist Iglika Ivanova: Business investment is down for three consecutive quarters For starters, business investment is still down and has been on the decline since the Tories won their majority government in 2011. Indeed, Mark Carney, then governor of the Bank of Canada, accused corporate Canada of sitting on stockpiles of dead money. Nothing has change since then and in fact it has only gotten worse. Consumers being able to signal demand is the lifeblood of any economy. Companies can't invest if people don't tell them with their dollars what they should invest in. People don't have the money to signal demand if corporate Canada is sitting on it and not investing. It's a catch 22 that requires intervention to get wealth moving again. And that's exactly what happened in January when the Bank of Canada cut interest rates. Except business investment continued to drop for two more quarters with no end in sight. It's not just oil and gas in decline Conservatives keep repeating that it's only oil and gas that have turned down. They must only be looking at the oil and gas column in the numbers because the truth is a number of sectors are in decline. Construction, manufacturing, and wholesale trade are all major indicators of our economic well being. For some bizarre reason, the Harper Government has completely ignored their precipitous decline and only refers to oil and gas. Household debt is on the rise Disposable incomes are falling. The rising consumer spending that people have pointed to as an indicator of our economy recovering is being financed by debt. While the interest rates are dropping, the proportion of debt to household income hasn't budged since 2008. Consumers are trying to spend their way out of the recession by incurring more debt, while businesses are sitting on stockpiles of dead money and not investing. -- So growth of 0.5% in June is nice, but our economy is still struggling under Harper's leadership. We need a better focus on a more diversified economy that doesn't give corporate welfare to companies who sit on that money. The problems with Canada's current economy run far deeper than a stagnate GDP.