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Source: Bloomberg Quebec’s unemployment rate fell to the lowest on record last month while Alberta’s surged to a two-decade high, underlining the the swing in Canada’s economic momentum through the recovery from an energy crash. Joblessness in the mostly French-speaking province fell to 6.2 percent in November from 6.8 percent in October, and in Alberta it climbed to 9 percent. The national jobless rate declined to 6.8 percent from 7 percent, Statistics Canada said Friday from Ottawa. “I’m stunned -- it’s a banner year” for Quebec, said Sebastien Lavoie, assistant chief economist at Laurentian Bank Securities in Montreal. He linked good times to a construction boom in his hometown, a low dollar boosting service industries and business confidence aided by provincial government budget surpluses. The movement of jobs from the western oil patch to central Canada’s service and factory hubs meshed with Bank of Canada Governor Stephen Poloz’s view that non-energy companies will help the world’s 10th largest economy recover over the next few years. Poloz said this week he would only cut his 0.5 percent benchmark interest rate if there was another shock like the oil crash. His next rate decision is Wednesday. “Quebec is within a whisker of posting the lowest unemployment rate in the country, something that we haven’t seen in the 40 years of available data,” said Doug Porter, chief economist at BMO Capital Markets in Toronto. The job report “strengthens the view that the Bank of Canada will be perfectly happy staying on the sidelines.” Quebec is tied more to manufacturers like Canam Group Inc. and Montreal-based software makers, who benefit from Canada’s weaker dollar and a growing U.S. economy. South of the border, payrolls increased by 178,000 jobs, the Labor Department said, bringing the unemployment rate down to a nine-year low of 4.6 percent. The province added 8,500 jobs in November and over the past 12 months the number of unemployed people has dropped by 17 percent. It wasn’t all good news: part of the reason the jobless rate fell was 20,300 dropped out of the labor force, the most since since December 2014. Lavoie at Laurentian Bank said it would be “extremely surprising” for Quebec to make further major gains in the job market over the next year. The figures have yet to reflect some announced cutbacks at Bombardier Inc. that haven’t happened yet, and the U.S. might be about to get tough on Quebec’s large softwood lumber industry. “There are also growing uncertainties linked to trade,” he said. “There will be duties on lumber, so that’s not going to help future job creation.” The mixed pattern also showed up in the national figures. Employment climbed by 10,700 in November as 27,600 left the labor force. Economists surveyed by Bloomberg News projected the jobless rate would be unchanged and employment would decline by 15,000.

http://montrealgazette.com/news/local-news/montreals-economic-stagnation?__lsa=c702-331f Stagnation city: Exploring Montreal's economic decline Peter Hadekel PETER HADEKEL, SPECIAL TO MONTREAL GAZETTE More from Peter Hadekel, Special to Montreal Gazette Published on: January 31, 2015Last Updated: January 31, 2015 7:28 AM EST Prime St-Catherine St. real estate stands vacant in Montreal on Tuesday January 27, 2015. Prime St-Catherine St. real estate stands vacant in Montreal on Tuesday January 27, 2015. John Mahoney / Montreal Gazette The Montreal skyline is dotted with construction cranes as an unprecedented building boom continues to unfold in condo and office construction. On the surface, at least, signs of prosperity abound. But look a little deeper and you’ll see a city that’s slipping behind the rest of the country. Over the last decade, Montreal’s economy grew by an average of just 1.5 per cent — the lowest rate among Canada’s major cities. Personal disposable income is also the lowest among the country’s eight biggest cities, and unemployment is among the highest. The bad news doesn’t stop there. Montreal is living through a period of crumbling infrastructure, widespread corruption, failed governance, inadequate fiscal power, low private investment, an exodus of head offices and an outflow of people. Even the real estate activity that’s dominating private investment in Montreal these days is of some concern to economists. They point out that it’s largely speculative and does little to improve productivity, innovation or the knowledge base of the local economy. We’re starting to see the long-term cost of the city’s economic decline. What if Montreal had simply kept pace with the Canadian average over the last 25 years? A November report from the Institut du Québec, a research group started jointly by the Conference Board of Canada and the HEC Montreal business school, found that if the metropolitan area had grown at the Canadian average since 1987, per capita income would be $2,780 higher today and income for the province as a whole would be up even more. “Despite its strengths and obvious attractions, Montreal suffers from major economic shortcomings compared with Canada’s other large urban areas,” said the report. “It fails to adequately fill its role as driver for the provincial economy.” That role becomes more important in a global economy that relies on cities as engines of growth. We are witnessing intense competition between cities for capital, talent and ideas — a race that risks leaving Montreal behind. Montreal’s economic heyday At the dawn of the 1960s, the case could still be made that Montreal was Canada’s business capital, even though Toronto was gaining fast. A black-and-white snapshot of the city’s economy looked like this: Perched at the top was a thriving financial industry, driven by banks, insurance companies, stock exchanges and investment brokers. The city was home to the head offices of the Bank of Montreal and the Royal Bank of Canada, as well as insurance giant Sun Life. Both the Montreal Stock Exchange and the Canadian Stock Exchange served a large community of brokerage and investment firms. A big part of the picture was a broad network of head offices in Quebec’s natural resource industry. Ste-Catherine St. W. in 1963. Montreal was once the economic capital of Canada. Ste-Catherine St. W. in 1963. Montreal was once the economic capital of Canada. Photo courtesy City of Montreal Archives Farther down the chain were the factories that made Montreal hum: metal and machinery plants, appliance manufacturers and rail-equipment makers, food processors and cigarette plants. The so-called soft sectors of the manufacturing industry were thriving in the days just before Asian imports began. Montreal was Canada’s leader in clothing, textiles, leather and shoes, with the industry providing well over 100,000 jobs. The St-Lawrence Seaway opened up the shipping industry through the Port of Montreal while the city served as headquarters for both Canadian National and Canadian Pacific Railways. In 1962, when world-renowned architect William Zeckendorf completed the stylish Place Ville Marie office tower, it seemed to symbolize a new optimism for Montreal. What followed instead were decades of underperformance in which the city never fulfilled its promise. The head office operations of the Bank of Montreal and the Royal Bank gradually shifted to Toronto to take advantage of that city’s impressive growth as a financial centre. Political tensions over language and the issue of Quebec sovereignty hurt private investment and drove some of the wealthiest and best educated people out of the province. Sun Life left in a huff in 1978 after the Parti Québécois took power for the first time. The Canadian Stock Exchange closed its doors in 1974, while the Montreal Exchange lost increasing trading volumes to its Toronto rival before switching its vocation to financial derivatives. The fancy new airport built in Mirabel didn’t take off as promised, with Toronto becoming the hub for Canadian air travel. At the same time, the city’s aging industrial base felt the first effects of globalization as imports from Asia began to hurt the textile and clothing industry. The Montreal economy tried to reinvent itself and got a boost from free trade in the 1990s. Industries such as aerospace gained in importance thanks to the success of aircraft maker Bomabardier Inc. while investment also picked up in pharmaceuticals and information technology. But as the new millennium began, more negative trends had crept in: offshoring, outsourcing, contracting out. Companies had found new ways to cut costs by sending work to places like China, India and Mexico at a fraction of local wage rates. More industrial plants began to shut their doors. Gazette front page from January 7, 1978. Insurance giant Sun Life left the city for Toronto shortly after the Parti Québécois took power for the first time. Gazette front page from Jan. 7, 1978. Insurance giant Sun Life left the city for Toronto shortly after the Parti Québécois took power for the first time. Gazette file photo Failures along the way Economist Mario Lefebvre, president of the Institut de Développement Urbain du Québec, points to a number of failures along the way. Perhaps the biggest, he says, is Montreal’s inability to adapt its transportation network to the new realities of the global economy. The airport, the port, the rail network and the highway system need to work seamlessly together. “Goods and services are not produced in one place anymore, those days are gone,” he says. “Step one might be in Brazil, step two in Chicago, step three in Montreal and step four in China. To be a player in this kind of environment, goods and services must be able to come in and out of your city quickly. “We have all the means of transportation but the fluidity between them is still very complicated. There are too many decision-makers involved and we end up with projects that are not completed as rapidly as they should be.” The city’s aging industrial base remains vulnerable because it hasn’t closed the productivity gap with other jurisdictions. “We have educated people,” says Lefebvre, “but we haven’t surrounded them with state-of-the-art technology.” The private sector hasn’t done its part to renew the city’s industrial base with new machinery and equipment. And with a low rate of investment in research and development, innovation in Montreal has lagged behind the rest of the country according to measures such as the number of patents per capita. One of the biggest obstacles facing Montreal is its low rate of population growth. Among the country’s eight biggest cities, only Halifax had a lower rate of growth over the last 10 years. Montreal’s population grew at an annual average of one per cent, vs. 1.6 per cent for Toronto and nearly three per cent for Edmonton and Calgary. The low birthrate and the low rate of immigrant attraction explain part of the trend. But perhaps most serious, according to the Conference Board, is that on average more than 16,000 people a year leave the metro area for other parts of Quebec or other provinces and countries. Just holding on to that number of people each year would have added more than 450,000 to the population over the last 30 years. That would have meant more people working, paying taxes and spending money on housing, goods and services. It would have given a real boost to economic growth. So would have a stronger commitment from the provincial government to help Montreal. Lefebvre points out that the Quebec government has been pushing a Plan Nord strategy to develop natural resources in the northern regions, but what Quebec really needs is a Plan Sud that helps Montreal develop its knowledge-based economy. Closed stores on Ste-Catherine St. in Montreal Tuesday January 27, 2015. Closed stores on Ste-Catherine St. in Montreal this month. John Mahoney / Montreal Gazette The payoff would be so much bigger, he argues, not only for the city but also for the province. A dollar of additional economic activity in Montreal generates at least another dollar for the province in spinoffs and benefits. Montreal funds more than half the government’s spending, 53 per cent of provincial GDP and more than 80 per cent of all research and development. Along with a Plan Sud, the government should at last recognize that Montreal needs new tools to manage its economy, Lefebvre says, including new fiscal resources and powers to promote investment, integrate immigrants and train workers. The property tax base has reached the limit of its ability to fund those new services. While such legislation has been promised, it’s not yet clear how much real power will be conferred on Montreal. The federal government has a role to play, too, Lefebvre argues. “I think we wasted an incredible opportunity when the GST was reduced by two percentage points (in 2006). A GST point is worth about $7 billion. If we had given just one point to the cities for infrastructure, that would have meant an extra $50 billion to $60 billion for infrastructure over the last eight years.” Fighting the exodus The city has suffered other blows. One is the decline in the number of head offices that call Montreal home. Between 1999 and 2012 Montreal lost nearly 30 per cent of its head offices, according to an estimate by the Institut du Québec. Toronto suffered a five-per-cent loss as economic weight shifted to Western Canada, but the impact on Montreal was far more painful. “Head office jobs are important for the indirect impact they have,” said Jacques Ménard, president of BMO Financial Group in Quebec. Head offices support a range of activities like legal, financial, accounting and advertising services. They maintain high-quality, high-income jobs and provide the city with a measure of economic influence. Part of the solution is to create more such companies in Montreal in the first place, Ménard says. Quebec is suffering from a deficit in entrepreneurship and can’t expect to replace these corporate losses without growing new success stories. “If you look at a company like Stingray Digital, it didn’t even exist seven years ago. It’s now in 110 countries,” Ménard says about the Montreal-based provider of digital music services. “I’m on the board of directors and I have seen the company grow to where it now has 200 high-paying jobs in its headquarters.” Along with the head-office challenge, Montreal is looking to become a more international place to do business, taking advantage of its multilingual and multicultural assets and its potential position as a gateway to the Americas for European and Asian trade and investment. Construction continues around the Bell Centre in Montreal Tuesday January 27, 2015. Construction continues around the Bell Centre in Montreal Tuesday January 27, 2015. John Mahoney / Montreal Gazette European firms already have a significant presence here and now “there is a ton of money looking to leave Asia for investment diversification,” says Dominique Anglade, who heads the economic development agency Montreal International. Asian money represents a big potential opportunity for the city as it tries to sell itself internationally and attract both investors and professionals from abroad. People are eager to come here, she insists. “We had 300 openings on the last recruiting mission we did in Europe and for those openings there were 13,000 applicants. There’s a phenomenal attraction power, especially for workers who are educated.” Still, it’s not easy for companies and professionals to move here. Companies are often deterred by the weight of regulation and red tape in Quebec while professionals face barriers such as the recognition of their credentials or concerns about French-language requirements and schooling. When 50 top executives were interviewed last year by the Boston Consulting Group on the challenges facing Montreal, several said that the emphasis on French in the immigrant selection process restricts the pool of talent on which Montreal can draw. They argued it would be better to cast the net wider and invest more in French language promotion rather than in defensive measures. Digging ourselves out At Ménard’s request, the Boston Consulting Group looked at the experience of other cities that suffered economic difficulties and how they managed to turn around. The report focused on cities such as Pittsburgh and Philadelphia in the U.S., Manchester in Britain and Melbourne in Australia. All have made impressive comebacks, owing largely to two common factors: a high degree of citizen engagement and a focus on infrastructure projects that have made those cites better places in which to live and work. RELATED Two Montrealers helping breathe new life into city's economy It’s one reason Ménard launched his Je vois Montreal initiative last fall in an effort to get citizens rather than governments engaged in the process of building a better Montreal. “We’ve had so much of the top-down approach — ‘We know what’s good for you,’ ” he says. “Yes there is a role for governments, but communities really thrive when citizens take ownership of their future.” Je vois Montreal has launched more than 100 projects to get the city moving again. While they are not heavy on investment or job creation, they do herald a significant change in the mindset of many Montrealers who are simply fed up with the status quo sent via Tapatalk

How $40 oil would impact Canada’s provinces What does Canada’s economy look like with oil prices at $40 a barrel? Certainly it won’t be the energy superpower envisioned by Prime Minister Stephen Harper. If $40 a barrel still seems a ways off, consider that the benchmark price for oil sands crude is already trading in that price range. What’s more, if production from high-cost sources isn’t withdrawn from an oversupplied market, oil prices may soon be trading even lower. The first thing Canadians should recognize about the new world order for oil prices is that – contrary to what we’re being told by our federal government – the economy is no longer in dire need of any new pipelines. For that matter, it can live without the new rail terminals being built to move oil as well. Yesterday’s transportation bottlenecks aren’t relevant in today’s marketplace. At current prices there won’t be any massive expansion of oil sands production because those projects, which would produce some of the world’s most expensive crude, no longer make economic sense. The recent spate of project cancellations by global oil giants – Total’s Joslyn mine, Shell’s at Pierre River, and Statoil’s Corner oil sands venture – is only the beginning. As oil prices grind lower, we can expect to hear about tens of billions of dollars of proposed spending that will be cancelled or indefinitely postponed. Not long ago, the grand vision for the oil sands saw production doubling over the next 20 years. Now that dream is in the rear-view mirror. Rather than expanding production, the industry’s new economic imperative will be attempting to cut costs in a bid to maintain current output. With the exception of oil sands players themselves, no one will feel those project cancellations more acutely than new Alberta Premier Jim Prentice. His province’s budget is beholden to the gusher of bitumen royalties that will no longer be accruing as planned. He could choose to stay the course on spending, as former Premier Don Getty did when oil prices plunged in the 1980s, in hopes that a price recovery will materialize. That option, as Getty discovered, would soon see Alberta’s budget surplus morph into spiralling deficits. The province’s balance sheet wasn’t cleaned up until the axe-wielding Ralph Klein took over. In his first term, Klein slashed spending on social services by 30 per cent, cut the education budget by 16 per cent and lowered health care expenditures by nearly 20 per cent. Of course, falling oil prices are a concern for much more than just Alberta’s budget position. Real estate values also face more risk, particularly downtown Calgary office space. For oil sands operators, staying alive in a low price environment won’t just mean cancelling expansion plans and cutting jobs in the field. Head office positions are also destined for the chopping block, which is bad news for the shiny new towers going up in Calgary’s commercial core. If plunging oil prices are writing a boom-to-bust story in provinces such as Alberta, Saskatchewan and Newfoundland, the narrative will be much different in other parts of the country. Ontario’s long-depressed economy is already beginning to find a second wind, recently leading the country in economic growth. And the engine is just beginning to rev up. As the largest oil-consuming province in the country, lower oil prices put more money back into the pockets of Ontarians, while also juicing the buying power of its most important trading partner. Ontario’s trade leverage with the U.S. is set to become even more meaningful as the Canadian dollar continues to slide along with the country’s rapidly fading oil prospects. Just as the oil sands boom turned Canada’s currency into a petrodollar, pushing it above parity with the greenback, the loonie is already tumbling in the wake of lower oil prices. And it shouldn’t expect any help from the Bank of Canada, which continues to signal that it’s willing to live with a much lower exchange rate in the face of a strengthening U.S. dollar. A loonie at 75 cents means GM and Ford may once again consider Ontario an attractive place to make cars and trucks. Even if they don’t, you can bet others will. With the loonie’s value falling to three quarters of where it was only a few years ago, we’ll start seeing Ontario, as well as other regions of the country, start to regain some of the hundreds of thousands of manufacturing jobs that were lost in the last decade amid a severely overvalued currency. For the Canadian economy as a whole, much is about to change, while much will also remain the same. Once again, oil will largely define the fault lines that separate the haves from the have-nots (or at least the growing from the stagnating). But at $40 oil, it’s the consuming provinces that will drive economic growth. Rather than oil flowing east through new pipelines, jobs and investment will be heading in that direction instead. http://www.theglobeandmail.com/report-on-business/industry-news/energy-and-resources/how-40-oil-would-impact-canadas-provinces/article22288570/

http://www.huffingtonpost.ca/2014/11/28/cities-best-reputation-vancouver-montreal-toronto_n_6234654.html

Montreal to host conference on reducing growth BY MICHELLE LALONDE, GAZETTE ENVIRONMENT REPORTER http://www.montrealgazette.com/business/Montreal+host+conference+degrowth/6600947/story.html MONTREAL - Just as events are forcing Quebecers to debate some fundamental questions about our economy and our future, five Montreal universities happen to be hosting a weeklong conference on “degrowth” – a movement that questions whether economic growth should be our society’s primary goal. “Degrowth is an attempt to force us out of this lock-step way of thinking that growth is always good,” said Peter Brown, a professor at McGill University’s School of Environment and one of the conference’s organizers. Brown said the conference – which starts Sunday and ends Saturday, May 19 – has been in the works for years and is modelled on similar conferences in Paris in 2008 and Barcelona in 2010, and is leading up to a global conference on the issue next fall in Venice. But he admits the timing is serendipitous. The Occupy movement, the recent record-breaking Earth Day march in Montreal, concerns over the push to develop northern Quebec and the continuing student strikes are all signs that many Quebecers are questioning the “business-as-usual” approach to economic development. Brown says all of these movements may find common ground in the notion that a narrow focus on growing the economy at any cost, while discounting effects on the environment and human well-being have led mankind to commit some catastrophic errors. Gross domestic product should not be used as the key measure of a country’s well being, because it ignores the cost of creating wealth (for some), such as environmental degradation and human suffering, say proponents of degrowth. Errors like runaway global warming, habitat destruction and a widening wage gap between rich and poor will lead to calamity for future generations, and a forced, unplanned “degrowth” period that will be painful, they warn. “Any healthy civilization looks after future generations ... we just don’t do that,” Brown told The Gazette on Thursday. The conference will feature panels and lectures by academics and activists prominent in the North American degrowth movement. The big draw will be a public lecture by ecologist David Suzuki called Humanity in Collision with the Biosphere: Is it Too Late? on Friday at 11 a.m. at UQÀM. (Admission to Suzuki’s talk is free, but registration is required). The conference, titled Less is More; Degrowth in the Americas, runs from May 13 to 19. Registration costs $200 per day, or $390 for all seven days, with reduced fees offered to students or members of “grassroots Montreal-based organizations.” Talks will be recorded and posted on the conference website (montreal.degrowth.org). mlalonde@montrealgazette.com Twitter: @mrlalonde © Copyright © The Montreal Gazette ********************************************************************************************************************* Québec - Forward Never, Backwards Ever

Growth in mining sector reshaping Quebec economy BARRIE MCKENNA OTTAWA— Globe and Mail Blog Posted on Thursday, March 15, 2012 12:48PM EDT http://www.theglobeandmail.com/report-on-business/economy/economy-lab/daily-mix/growth-in-mining-sector-reshaping-quebec-economy/article2370299/ Think of the Quebec economy, and the traditional drivers are energy, forestry and manufacturing. But there’s a new engine in Quebec – mining – and it’s reshaping the economy of both the province, and the country. Investment in the province’s mining industry is expected to reach $4.4-billion this year, up 62 per cent from 2011. That’s nearly equal to the capital that will be poured into manufacturing ($5-billion), a remarkable 27 per cent of all business investment in the province and represents half of all mining investment in the country, according to a National Bank of Canada analysis of recent Statistics Canada figures. “That’s never happened before,” National Bank of Canada chief economist Stéfane Marion said in an interview. “It’s a huge growth driver for the province this year, and in the future.” It’s not the only first. Quebec will lead the country in mining investment this year, outpacing Ontario, Mr. Marion said. Mining investment is expected to hit $3.7-billion in Ontario, $2.8-billion in B.C. and $500-million in Alberta. For Quebec, the money pouring into dozens of iron ore, gold, copper and other mining projects could add a full percentage to GDP this year and cause an unexpected boost in royalty revenue for the cash-strapped government. It will also have spinoff benefits for Montreal-area manufacturers, who will help supply mining-related equipment. But Mr. Marion said there are broader implications. The Quebec economy is starting to look a lot more like the booming resource-rich provinces of the West. “This is a material change in the industrial structure of Quebec,” Ms. Marion said. “It brings the interests of Western Canada and Quebec into line. It’s not just a pure Western Canada story now. It’s spreading to Eastern Canada.” Quebec is also positioning itself to capitalize on the growing resource appetite in China and other fast-growing emerging economies, he said. And the good news: The mining boom is just getting started as Quebec plots its 25-year “Plan Nord” strategy.

(Courtesy of The Financial Post)

Six Canadian cities out of 50 have the winning combination that attract migrants * Six Canadian cities out of 50 have the winning combination that attract migrants Calgary, Waterloo, Ottawa, Vancouver, St. John’s and Richmond Hill have what migrants are looking for when choosing where to locate, according to the Conference Board’s second report assessing the attractiveness of Canadian cities. Read the report here. “Cities that fail to attract new people will struggle to stay prosperous and vibrant,” said Mario Lefebvre, Director, Centre for Municipal Studies. “These six cities come out on top across all rankings, so they appear to have an overall winning combination that is attractive to migrants. Although it would be hard to imagine a more diverse group of cities, each has particular strengths that make them magnets to newcomers, both from within Canada and abroad.” City Magnets II: Benchmarking the Attractiveness of 50 Canadian Cities, analyzes and benchmarks the features that make Canadian cities attractive to skilled workers and mobile populations. The performance of these cities is compared on 41 indicators grouped across seven categories: Society, Health, Economy, Environment, Education, Innovation, and Housing. The challenge in determining overall attractiveness is that when individuals are choosing a new city, they value attributes of city living differently. Weights were computed for each of the seven categories. For migrants with a university degree, the Education category matters the most (21 per cent) in the decision to locate, followed by Society (20 per cent), Innovation (19 per cent) and Economy (13 per cent). Migrants without a university education consider, in an overwhelming fashion, that the Economy category matters the most (33 per cent) and followed by Society (20 per cent). “In deciding where to live, university-educated migrants prefer cities with higher Education and Society outcomes. Migrants without a university education place more value on a city’s economic strength,” said Lefebvre. “However, the study shows that a city that is attractive to a certain type of migrant ends up being attractive to all, so policy makers must be cautious in crafting policies aimed at attracting university graduates only.” Overall Grades The six “A” performers – Calgary, Waterloo, Ottawa, Vancouver, St. John’s and Richmond Hill, Ont. – range between big and small cities, from the West Coast to the East Coast, and include both urban and suburban centres. Specifically: * Calgary’s strong economic results come as no surprise given its performance over the past decade, but the city also ranked first in Innovation and second in Housing. * Waterloo’s worldwide reputation for high-tech excellence in education and business is well deserved. Ranked number-one in Education, Waterloo also posted strong results in Economy, Innovation and Housing. * Ottawa reaps the benefits of a strong and well-educated public sector. The nation’s capital excels in Innovation and Education, and, apart from Health, scores well across all categories. * Richmond Hill, a fast-growing city north of Toronto, has become the second most diverse city in Canada. A well-educated workforce contributes to its high scores in the Education and Innovation categories. * Vancouver enjoys an enviable climate and a vibrancy that comes from its young, diverse, and multicultural population. * St. John’s has achieved a strong productivity level that even surpasses that of Calgary and Edmonton. It is also a stellar performer in Health and Environment categories. The “B” class includes 14 cities – Edmonton, Victoria, Markham, Vaughan, Kingston, Oakville, and Guelph are consistently in the top half of this group. The City of Toronto also earns an overall “B” grade. Although held back by lacklustre results in the Health and Environment categories (too few physicians for such a large population, and too many days of poor air quality), the City of Toronto leads all cities in the Society category, particularly the proportion of foreign-born population and the proportion of population employed in cultural occupations. In all, the Toronto census metropolitan area (CMA) obtains five of the top 14 spots. The Toronto CMA attracted 35 per cent of Canada’s immigrants (about 85,000 per year) between 2001 and 2006, but this is partly offset by migrants – 25,000 annually – leaving for other Canadian cities. London, Halifax, Lévis, Regina, Québec City, and Burlington also receive “B” grades. A total of 21 cities get “C” grades, including three of Canada’s largest urban centres: Winnipeg, Montréal, and Hamilton. Although an overall “C”, Mississauga – with its high number of immigrants – gets a “B” in attractiveness among university-educated migrants. Four of Vancouver’s suburbs – Richmond, Burnaby, Coquitlam, and Surrey – earn “C” grades, as does nearby Abbotsford. Generally, Vancouver’s suburbs lag behind in Health and Economy. Sherbrooke, Gatineau, Kitchener, Barrie, Saskatoon, Moncton, Brampton, Kelowna, Thunder Bay, Peterborough, St. Catharines, and Sudbury also get “C” grades. The “D” class includes nine small or mid-sized cities – four in Ontario: Oshawa, Brantford, Windsor, and Cambridge; four in Quebec: Longueuil, Saguenay, Trois-Rivières, and Laval, and Saint John, New Brunswick. Along with struggling economies in most cases, seven of these nine cities have shown little population growth, while the other two posted a decline in population (Saint John and Saguenay). These nine cities are also clustered near the bottom of the Innovation and Education categories. Performance By Category * Society – Canada’s largest cities post the best results, with Toronto and Montreal capturing the only two “A” grades. Toronto’s suburbs rank highly, as do Vancouver and Victoria. * Health – Small and mid-sized cities dominate this category, which mainly measures per capita access to care. Only Kingston and St. John’s get “A” grades. Vancouver and Quebec City are the only big cities to rank in the top 10. Suburban cities, which rely on services located in the urban cores, face the greatest challenges – 10 of the bottom 12 are neighbours of either Toronto, Montreal or Vancouver. * Economy – Although the rankings are based on 2006 data and pre-date the recession, the Conference Board expects cities with strong economies back then to rebound and post the strongest showing following the downturn. Calgary, Edmonton and Vaughan earn the only “A” grades in the ranking; Edmonton’s strong economy makes it particularly attractive to non-university educated migrants. Five Toronto-area suburbs make the top 10. Ottawa and Waterloo also rank in the top 10. * Environment – Seven of the eight cities in British Columbia included in this report earn “A” grades and dominate the top 10 rankings, due largely to good air quality and a mild climate. Montreal ranks last and Longueuil is also near the bottom. Mississauga, Burlington, Vaughan and Oakville also earn “D” grades. * Education – The “university towns” of Waterloo and Kingston outclass their counterparts and earn the only two “A” grades. Small and mid-sized cities dominate the results for teachers per student population, with four small Ontario cities (Burlington, Waterloo, Peterborough and Guelph) grabbing all the “A” grades on this indicator. * Innovation – Calgary, Richmond Hill and Ottawa get “As” for Innovation. Cities with broad manufacturing or resource-based economies generally fare less well in this category. * Housing – Small and mid-sized cities generally do the best in this category, thanks in particular to relatively affordable housing. The Quebec City suburb of Lévis leads all cities, and five other Quebec cities rank in the top 10. The opposite is true for all eight B.C. cities, where homes are generally expensive. As a result, these cities fall in the bottom half of the rankings and five of them, including Victoria and the Lower Mainland cities, get “D” grades. http://www.muchmormagazine.com/2010/01/six-canadian-cities-out-of-50-have-the-winning-combination-that-attract-migrants/

Canada sees surprising job gains in August Financial Post September 4, 2009 Canada posted a surprising gain in employment in August as the economy showed signs that it was pulling out of a recession. Canada posted a surprising gain in employment in August as the economy showed signs that it was pulling out of a recession. Photograph by: File, AFP/Getty Images OTTAWA — Canada posted a surprising gain in employment in August as the economy showed signs that it was beginning to pull out of a recession. Statistics Canada said Friday that 27,100 positions were added during the month, compared with 44,500 losses in July. The unemployment rate edged up to 8.7 per cent in August from 8.6 per cent the previous month. The gains were led by part-time and private-sector employment, the federal agency said. There were 30,600 part-time jobs added in August, while 3,500 full-time positions were lost. Hardest hit was the manufacturing sector, which shed another 17,300 in August. The biggest gains were in the retail and wholesale trade, up 21,200, and finance and real estate, up 17,500. Six provinces saw employment rise, with the biggest increases in Ontario, British Columbia and Quebec. Alberta lost the most jobs in August. "Since employment peaked in October 2008, total employment has fallen by 387,000 (down 2.3 per cent)," the agency said. "The trend in employment, however, has changed recently. Over the last five months, employment has fallen by 31,000, a much smaller decline than the 357,000 observed during the five months following October 2008." Most economists had expected the economy to lose jobs in August, with the consensus being about 15,000 fewer positions. They also expected the unemployment rate to rise to 8.8 per cent. "This report may not quite carry the good housekeeping seal of approval for the recovery, but it certainly is another big step in the right direction," said Douglas Porter, deputy chief economist at BMO Capital Markets. "While we can quibble about the details, the broader picture here is that the labour market is stabilizing, and apparently much faster than in the U.S." (The U.S. Labor Department said Friday that 216,000 jobs were lost in August, although that was less than analysts had expected.) Charmaine Buskas, senior economics strategist at TD Securities, said "the fact that the (Canadian) unemployment rate continues to rise has a bit of a mixed messages, as the initial interpretation is negative, but suggests that workers are slowly becoming more encouraged by better prospects in the job market." "Ultimately, this report, while positive, is not going to have much impact on the Bank of Canada. It has already committed to keep rates on hold, and one month of good employment numbers is unlikely to sway the decision." Avery Shenfeld, chief economist at CIBC World Markets, said: "Half a loaf, or in this case, half a job, is better than none, so an increase in Canadian employment driven by part-time work is still an encouraging signpost of an economic recovery now underway." The employment report follows some mixed signals of an economic recovery in Canada. On Thursday, the Organization for Economic Co-operation and Development said Canada's economy will contract two per cent in the third quarter of 2009 before edging up 0.4 per cent in the final three months of the year. That's in contrast to forecasts by the Bank of Canada, which expects the country's gross domestic product to grow 1.3 per cent in the third quarter of this year, followed by a three per cent gain in the final three months of 2009. The central bank also forecast the economy will contract 2.3 per cent overall this year and grow three per cent in 2010. Last week, Statistics Canada reported GDP increased 0.1 per cent in June, even as the second quarter declined overall by 3.4 per cent. The outlook by OECD, a Paris-based group of 30 industrialized nations, shows Canada's recovery lagging along with the U.K., which is expected to decline one per cent in the third quarter and be flat in the final quarter, and Italy, which is forecast to shrink 1.1 per cent and grow 0.4 per cent, respectively. August unemployment rates by province: Newfoundland and Labrador 15.6% Prince Edward Island 13.7% Nova Scotia 9.5% New Brunswick 9.3% Quebec 9.1% Ontario 9.4% Manitoba 5.7% Saskatchewan 5.0%. Alberta 7.4% British Columbia 7.8% Source: Statistics Canada © Copyright © Canwest News Service

Quebec leads Canadian economic rebound: Charest By Mike De Souza, Canwest News ServiceAugust 14, 2009 CHELSEA, Que. —Quebec Premier Jean Charest, said Friday the Quebec economy is in better shape than the rest of the country because its infrastructure spending is flowing while deficits are lower than other jurisdictions. The Quebec economy is in better shape than the rest of the country because its infrastructure spending is flowing while deficits are lower than other jurisdictions, including the federal government, Premier Jean Charest said here Friday. Charest made the comments standing next to Prime Minister Stephen Harper as they announced a new phase in a construction project extending a highway leading north from Ottawa through the Outaouais region in Quebec. "It is true that Canada's economy has done better than the vast majority of countries in the world and within Canada, Quebec's economy has done better than the average economies in Canada," said Charest. "The size of our deficit is smaller than the size of the federal government's deficit or the deficit in Ontario." Federal opposition parties have criticized the Harper government's infrastructure stimulus plan, arguing that money is not flowing out the door fast enough for projects to begin construction. Charest said that billions of dollars are already flowing into the Quebec economy from infrastructure and energy investments totalling more than $40 billion over the next five years. "We had growth in 2008 and yes we'll have a slowdown, and yes we've lost jobs but overall, Quebec's economy has done better," said Charest. "Why? because we invested in infrastructure and energy and because we have a long-term vision." He noted that even the Obama administration's $800-billion stimulus plan has not yet had an impact. "Not a lot of money in the United States has yet reached the point where the investment is happening," said Charest. "In fact, very little of that money has gone out the door." Harper said that there is still work to be done to ensure that Canada breaks out of the recession rapidly and moves into a strong position. "Canada has not gotten out of this global recession," said Harper. "We must continue our efforts and persevere. Now is not the time for political instability. It is the time to continue to focus on our economy." © Copyright © Canwest News Service

Un très bon article du G&M ce matin sur la "résilience" de l'économie québécoise: http://www.theglobeandmail.com/report-on-business/few-bumps-in-la-belle-provinces-recession-ride/article1240146/ Few bumps in la belle province's recession ride At Sandoz Canada Inc. in Boucherville, Que., sales are rising and the work force is growing. The generic pharmaceutical producer's growth is more subdued than usual, to be sure. But this isn't the picture of a company struggling through a recession. And so goes Quebec, where the global slump has caused discomfort but not intense pain. The province's economy is contracting, but at nowhere near the pace of devastation as in other parts of Canada. This milder recession is seen in the job market, where employment has fallen just 0.7 per cent in the past year. And in the real estate market, where prices are stable. And at Sandoz, where revenue has climbed more than 10 per cent in the past year. “We've seen, over all, still some growth. And we've done some limited hiring,” said Pierre Fréchette, chief executive officer of the company, which opened a new factory in Boucherville last year. “We've been pretty sheltered from the situation outside of Canada, and outside Quebec.” For the country's second most populous province, it could have been a lot worse, even though the global crisis has struck hard at manufacturing and exports – two areas core to Quebec's economy. Thanks to export diversification, a real estate market that didn't overheat and sheer luck, the province that makes up 20 per cent of Canada's economic heft has fared much better than in past recessions. “The main industries of Quebec are not in restructuring mode. This is just a cyclical downturn,” said Sébastien Lavoie, economist at Laurentian Bank of Canada in Montreal. The most obvious example of the mild nature of the recession in Quebec is in the labour market. The 0.7-per-cent drop in employment in the past year compares with a 1.8-per-cent contraction nationally, and much larger declines in the other major provinces. Compared with previous recessions, Quebec workers have had it easy this time. The 1990s recession cut the provincial work force by 2.9 per cent, while the 1980s recession destroyed 7.4 per cent of jobs. Quebec's unemployment rate, now 8.8 per cent, is slightly above the national average (8.6 per cent), which is usual. But it is significantly below Ontario's 9.6 per cent. And most of Ontario's job losses have been full-time positions, while Quebec's are mainly part-time. Overall growth in Quebec contracted sharply in the first quarter, but, again, not as sharply as the country as a whole, nor as Ontario in particular. Indeed, Quebec's growth has outpaced Ontario since 2006 – a trend that is expected to persist into next year, and something that has not happened in decades. While Ontario and Quebec are often lumped together and characterized, fairly, as Canada's manufacturing heartland, the structure of Quebec's manufacturing sector has changed dramatically since the previous recession, analysts say. “Quebec has gone through a transformation,” said John Baldwin, director of the economic analysis division at Statistics Canada and one of Canada's top authorities on productivity. Free trade with the United States encouraged all of North America to shift from the manufacturing of non-durable goods to durable goods, to take advantage of economies of scale and growing global markets, according to a new paper by Mr. Baldwin. But Ontario's manufacturing and exports had always been concentrated in durable manufacturing – steel, cars, machinery and equipment. Quebec, on the other hand, was the centre of non-durable manufacturing for Canada, with its textiles and shoes. During the 1990s and especially in the past decade, Mr. Baldwin said, Quebec switched over, but expanded into areas where Ontario was not as dominant – aerospace and pharmaceuticals. Quebec had a painful adjustment, scaling back its textile sector and shutting down large parts of its pulp and paper industry in the past decade. But that restructuring is largely over, economists say. In this recession, like recessions of the past, manufacturing has suffered more than other sectors. But since Quebec does not have Ontario's dependence on U.S. consumption of cars, and is not as dependent on energy exports as the West, it has not been as vulnerable. About a third of Quebec's gross domestic product comes from exports, and 75 per cent of those exports go to the United States. But the U.S. market is far more important for Ontario because 42 per cent of the province's GDP comes from exports, and 84 per cent of its exports are sold to Americans. Sales of cars, mainly from Ontario, are down about 40 per cent so far this year. Quebec's aerospace sector has faltered too, recently, but not to the same extent. “We are not in the same situation as the auto sector,” said Joëlle Noreau, senior economist at Desjardins Group. But Quebec's recession is mild not simply because it avoided the crisis in the auto sector. It's also because export volumes have surged in other areas, especially in the pharmaceutical industry, rising 80 per cent so far this year from 2008. Most of that growth comes from generic drug companies taking advantage of expiring patents – a cycle that is not at all related to the global crisis, said Mr. Fréchette at Sandoz. “Obviously, we see pressure on our margins,” he said in an interview. “But our business is driven by very specific events. In general, the prospects are good.” While economists say they are tempted to point to clever business strategies and forward-thinking industrial policies as explanations for Quebec's mild recession, they are quick to say plain luck is a major factor, too. “We were blessed,” Ms. Noreau says. As Quebec's roads and bridges fell into disrepair a few years ago, the provincial government responded by investing heavily in infrastructure. Well before the recession started, the government earmarked $42-billion, or 14 per cent of GDP, for a five-year building plan. While other provinces are preparing to spend heavily, too, in a bid to fight off recession, Quebec's plan has already kicked into high gear, she said. Luck is also behind the stability in the housing market, said Marc Pinsonneault, senior economist at National Bank Financial. The prerecession runup in house prices was not nearly as notable in Quebec as in the West and Ontario, he said, so there was no bubble that needed bursting. Stable housing prices have meant that the net worth of many Quebeckers has not plunged as much as elsewhere, a trend that has added strength to the domestic side of the province's economy, Mr. Pinsonneault added. There are, of course, real fears that Quebec's luck could run out. The aerospace sector has stumbled in the past couple of months, and orders are drying up. Aerospace accounts for about a quarter of the province's exports, but sales typically respond to turns in the economy with an 18-month lag, said Jean-Michel Laurin, economist at the Canadian Manufacturers & Exporters. Already, Bell Helicopter, a division of U.S.-based Textron Inc., announced 150 layoffs in July at its Montreal-area plant, linked to sagging demand for its products. In the refinery sector, Mr. Laurin adds, Royal Dutch Shell has warned that it could shut down its Montreal refinery that employs 550 people. The pharmaceutical industry will no doubt come under pressure as indebted governments around the world are pressured to cut health care costs in the coming years, to get their deficits under control. And the strong Canadian dollar is adding yet another burden to exporters' lists of problems, Mr. Laurin said. “Regardless of where you go in Quebec or Ontario, we're all very dependent on the U.S.”

Le Canada gagne 35 900 emplois en avril Publié le 08 mai 2009 à 08h06 | Mis à jour à 08h09 Agence France-Presse Ottawa Le Canada a gagné 35 900 emplois en avril, de façon inattendue, essentiellement grâce aux travailleurs indépendants, tandis que le taux de chômage se maintenait à 8%, son niveau le plus élevé en sept ans, a annoncé vendredi l'institut de la statistique. Les analystes s'attendaient à une perte de quelque 50 000 emplois en avril après une saignée de 61 000 le mois précédent et à ce que le taux de chômage passe à 8,2%. Ce taux est resté inchangé à 8,0 % en avril par rapport à mars, car la hausse de l'emploi a coïncidé avec une croissance de la population active, note Statistique Canada. Malgré l'augmentation enregistrée en avril, 321 000 emplois ont été perdus au Canada depuis octobre 2008. En avril, le nombre de travailleurs indépendants a cru de 37 000, indique Statistique Canada dans un communiqué, précisant que 39 000 emplois à temps plein ont été créés, alors que 3600 emplois à temps partiel étaient perdus. Le secteur manufacturier, durement frappé par la crise, a gagné 6 700 postes en avril, mais il en a perdu 106 300 au cours des 12 derniers mois. La hausse de l'emploi en avril s'est manifestée pour l'essentiel dans les provinces du Québec (+22 000) et de Colombie-Britannique (+17 000). En avril le salaire horaire moyen avait progressé de 4,3% par rapport au même mois l'an dernier. __________________________________________________________________________________________ Canada adds 36,000 jobs HEATHER SCOFFIELD Globe and Mail Update May 8, 2009 at 8:13 AM EDT OTTAWA — The Canadian work force managed to grow slightly in April, adding 36,000 positions, mainly through self-employment, Statistics Canada said Friday. As a result, the unemployment rate was unchanged at 8 per cent last month, the highest in seven years. “This is a better-than-expected report that no one saw coming,” said economists at ScotiaCapital Inc. “Yes, there were distortions including the heavy influence of a gain in self-employment that we mistrust at this point in the cycle. But the losses elsewhere were much less significant than feared.” The unexpected gain in employment sent the dollar up by 0.93 cent (U.S.) against the U.S currency. Economists had been expecting the pace of job loss to let up a little bit in April after months of steep decline, forecasting the elimination of 50,000 positions compared to 61,000 in March. They had predicted an 8.3 per cent unemployment rate, up from 8 per cent in March. While economists expect self-employment to expand during a recession, as laid-off workers create opportunities of their own, the increase in April was substantial. About 37,000 new self-employed positions were added to the work force, accounting for well over half of the 61,800 increase in self-employment over the past year. Jobs among people employed by others, on the other hand, fell a statistically insignificant 1,100 positions. Stabilization was also evident in the sectors that have shed the most jobs during the recession – manufacturing and construction. Employment in both those categories was changed very little in April, with construction employment declining 7,500 jobs and manufacturing employment growing 6,700 positions. In the goods side of the economy overall, employment barely budged in April, but has declined by a sharp 6.3 per cent since last October. The services side of the economy, which has been less touched by the recession, added 35,100 positions in April, particularly in the information sector and in culture and recreation. Since October, when the labour market began to slide, employment economy-wide has fallen by 321,000 positions. That's a decline of 1.9 per cent, with the losses concentrated in constructing, manufacturing and natural resources. Full-time employment rose by 39,000 positions in April, while part-time was little changed. However, full-time employment is still down 2.5 per cent since October. By region, employment rose in both Quebec and British Columbia. Quebec gained 22,000 positions, but because more people joined the work force, its unemployment rate rose to 8.4 per cent, from 8.3 per cent in March. British Columbia added 17,000 jobs, and its unemployment rate stayed still at 7.4 per cent. Still, the gains don't come close to making up for losses in the previous months. Ontario, where job losses have been severe, managed to stabilize in April, shedding 3,000 positions. Its unemployment rate stayed stable at 8.7 per cent. Ontario's job losses account for half of the country's total decline since October. By demographic, the April employment gains went mainly to adult men, and to women over the age of 55. Economists were surprised by the job creation, even though some indicators have suggested lately that the Canadian economy was showing signs of life. They warned that the job creation probably wouldn't last, since the all-important auto and manufacturing sectors are poised to cut severely in coming months, and because mothballed natural resource projects aren't about to roar back to life. Economists are often skeptical of self-employment numbers because they suspect that respondents to Statistics Canada's survey of households would rather say they're working for themselves than admit to being unemployed. Plus, many self-employed people earn considerably less than employed people. “That said, we can't dismiss the headline because of dubious self-employment gains, as there were only 1,100 job losses beyond the self-employment component,” the Scotia economists said. The labour report was undeniably good news, agreed Douglas Porter, deputy chief economist at BMO Nesbitt Burns. “Now that's what I would call a green shoot,” he said. Still, he warned against getting too carried away. “While quite encouraging, it's important to recall that head fakes are always possible,” he said. During the darkest days of the recession of the early 1990s, for example, Canadian employment managed to rise in five separate months. “Still, this marks a huge improvement from the wicked job losses seen over the winter, and is yet another strong signal that the economy may be approaching bottom – certainly sooner than most forecasters believed possible just a few weeks ago.” Indeed, there are a growing number of signs that the free-fall that inflicted the Canadian economy at the end of last year and the beginning of this year began to let up in February and March. Auto and housing sales have picked up, the drop in exports slowed, manufacturing output stopped plunging and financial markets showed signs of recovery.

Urban areas see revival in housing construction http://www.usatoday.com/money/economy/housing/2009-03-10-urban-construction_N.htm?csp=34

Deflation a concern in North America By Paul Vieira, Financial Post February 20, 2009 OTTAWA -- Inflation in North America is to remain benign for the months -- and perhaps years -- ahead, analysts say, as a shrinking global economy undercuts commodity prices and inventories in Canada remain at excess levels. Data were released in both Canada and the United States on Friday. The Canadian numbers, Bay Street economists say, further strengthen the case for the Bank of Canada to cut its key lending rate by a further 50 basis points on March 3. Further, the data indicate deflation remains a concern for policy-makers on both sides of the border. Statistics Canada said the headline inflation rate dropped for a fourth consecutive month, to 1.1% from 1.2%. The Bank of Canada’s core rate, which removes elements subject to volatile prices, such as energy, dropped to 1.9% from 2.4%. That is in contrast to the United States, where the cost of living rose 0.3% in January, the first climb in six months based on stronger energy prices. Last month, prices fell 0.8%. The U.S. numbers initially eased deflationary fears. Analysts, however, were not so confident. "The near-term risk has lightened a little bit, but if anything the medium-term risk may have been ramped up a notch or two by the clear evidence about how the global economy is sliding," Douglas Porter, deputy chief economist at BMO Capital Markets, said. "The deep dive in the global economy threatens to further undercut commodity prices, and more broadly, pricing power in other industrial goods." Mr. Porter said the BMO economics team envisages the global economy shrinking 0.5% this year. As it happens, economists at Toronto-Dominion Bank issued an updated outlook that forecasts a similar contraction in the world economy -- the first since the Second World War. "Deflation is not a paramount risk right now -- but it is a risk when you are looking at a global contraction," said Richard Kelly, the TD senior economist who issued the revised global forecast. The Bank of Canada had forecast inflation would dip below zero for two quarters this year, largely based on the big drop in energy prices. However, the central bank has dismissed concerns about deflation, calling risk "remote." Mr. Porter said he believes Canada can avoid deflation, "but my conviction is weakening given just how weak the global economy has become." In a related report, David Wolf, chief Canadian economist at Bank of America Securities-Merrill Lynch, said inventory held by Canadian companies remains at higher levels compared with their U.S. counterparts. As a result, this excess supply will attract lower prices -- which will further drive down inflation. Mr. Wolf added there remains an "excess" overbuilding of housing supply in Canada. "That will continue to be a factor that will put a lot of downward pressure on prices," he said, adding that new house prices make up a small component of the consumer price index. © Copyright © National Post

SAN FRANCISCO (MarketWatch) -- The credit crunch may only be in its early stages and a bigger contraction in lending in coming months could have "serious implications" for the U.S. economy, Standard & Poor's Rating Services said Friday. While politicians and others have complained that banks aren't lending, the data on credit outstanding credit in the U.S. only tenuously supports this idea, the rating agency said. See related story. "What's behind the apparent difference between perception and reality?" Standard & Poor's credit analyst Tanya Azarchs said. "It may be that, while growth in overall credit was positive through at least third-quarter 2008, it has risen at a slower pace than at any time since 1945 -- far below the 8%-10% rate in most years." Banks are replacing loans as they mature, but there's little net new loan growth, she noted. "That could mean that the slowdown in lending is just an opening act, and a true credit crunch may yet take the stage," Azarchs warned. Banks are making fewer and fewer commitments to lend, and new issues of bonds and securitized assets have slowed to a trickle, the analyst said. "This portends a contraction in total credit available in the coming months," she wrote. "Since this lack of lending may have serious implications for the economy, the U.S. government has been devising policies that would encourage banks to lend." Given such pressure, S&P is focusing more on whether banks are free to make loans they think are prudent and on the health of the overall economy, Azarchs said. http://www.marketwatch.com/news/story/Credit-crunch-may-only-have/story.aspx?guid={4F0DA616-A789-49A7-9EFE-A65C5A0986F9}

NEW YORK (CNNMoney.com) -- The Masters of the Universe have been dethroned. Now the question is just how much Wall Street's meltdown is going to hurt the city of New York and, by extension, its high-priced housing market. Even in a city where $20 million townhouse listings don't raise an eyebrow, signs of trouble abound. Fourth quarter 2008 sales volume was down a whopping 40% from 2007 according to New York brokerage the Corcoran Group. And the average price of existing homes dropped 3.6% during the same period. The S&P Case-Shiller Home Price Index showed a price decline of 8.6% for the New York metro area, including the city and the surrounding suburbs, for the 12 months ending November 30. New York's economy runs on Wall Street money, and after the failure of Lehman Brothers and the sales of both Merrill Lynch and Bear Stearns, there isn't nearly as much of it as there used to be. After the financial markets imploded, the New York real estate market "stopped dead," said Dottie Herman, CEO of broker Prudential Douglas Elliman. "If you think you're going to lose your job, you're not going to buy. [We're] a long way off from the past couple of years." Whereas bidding wars were once commonplace, city apartments are now languishing on the market. Leonard Steinberg, a Prudential Douglas-Elliman agent who handles many high end listings, has been trying to move a $1.2 million condo located in the Chelsea part of town for more than a year. The home was originally priced at $1.4 million. Gotham's grim outlook And the city's economic conditions are only getting worse. On Friday, New York City Mayor Michael Bloomberg announced $1 billion worth of budget cuts as Gotham steels itself against a rapidly dwindling tax base. Its coffers are expected to dwindle by a stunning $4.1 billion for fiscal 2009, which ends June 30, thanks to the economic turmoil. Perhaps it's no surprise then that Goldman Sachs recently issued a report predicting that New York City's normally-stratospheric prices will fall as much as 44%. And investors betting on derivatives based on the Case-Shiller Home Price Index aren't much more optimistic. They're betting that New York prices will tumble over 21% over the next 4 years. Jobs are the obvious problem. Some 65,000 payroll jobs were lost in the last three months of 2008 alone, according to the city Comptroller's office. New York's unemployment rate jumped to 7.4% in December, up from 6.3% in November. Jonathan Miller, president of Miller Samuel, a premier appraisal firm in the city, said that financial market turmoil could hit home prices harder in New York than anywhere else. "It's more exposed than other metro areas to financial industry job losses," Miller said. And Wall Street types who are lucky enough to hang onto their jobs have seen their 2008 bonuses slashed by 44% compared with 2007 levels. If New York City does somehow manage to dodge the real estate bullet that's crippled so many other metro areas nationwide, it may be thanks to some of the market's unique qualities. "We didn't have the rampant speculation that many places had," said Miller, who cited cities like Phoenix and Las Vegas. Most New York buildings require buyers to run their finances by a coop board for approval, and to put down at least 20%. And, by virtue of its limited size, the city didn't experience the kind of rampant overbuilding that places like the Sun Belt saw. Additionally, the city is benefiting from the overall trend toward urban living that should help maintain demand for housing. "Our findings indicate that upper-middle and high-income households have increasingly chosen to reside in the city, said city Comptroller William Thompson, "suggesting that our city may be more resilient to this economic downturn than in 1990 when companies and families were fleeing New York." All that, however, only helps so much. Any time you subtract billions of dollars from a local economy there will be vast ripple effects. Restaurants, retail putfits and of course, real estate will all suffer. Said Miller: "We're going to have to go through more pain before things get better."

Economy Shed 598,000 Jobs in January Article Tools Sponsored By By EDMUND L. ANDREWS Published: February 6, 2009 WASHINGTON — The United States lost almost 600,000 jobs last month and the unemployment rate rose to 7.6 percent, its highest level in more than 16 years, the Labor Department said Friday. It was the biggest monthly job loss since the economy tipped into a recession more than a year ago, and it was even worse than most forecasters had been predicting. In addition, the government revised the estimates for previous months to include another 400,000 job losses. For December, the government revised the job loss to 577,000 compared with an initial reading of 524,000. Over all, it said, the nation has lost 3.6 million jobs since it slipped into a recession in December 2007. “Businesses are panicked and fighting for survival and slashing their payrolls,” said Mark Zandi, chief economist at Moody’s Economy.com. “I think we’re trapped in a very adverse, self-reinforcing cycle. The downturn is intensifying, and likely to intensify further unless policy makers respond aggressively.” Despite the jobless number, Wall Street opened strongly with all three major exchanges up more than 1.5 percent. As in previous months, employers in January slashed their payrolls in almost every industry except health care Manufacturers eliminated 207,000 jobs, more than in any year since 1982. The construction industry eliminated 111,000 jobs. And retailers, who were wrapping up their worst holiday shopping season in years, eliminated 45,000 jobs. One modest exception to the bad news was in workers’ wages, which have thus far not reflected the dramatic plunge in employment. Hour earnings edged up to $18.46, up 5 cents, and average weekly earnings climbed $614.72, up $1.67. But over all, the new data reinforced the impression of an economy that has become increasingly trapped a vicious circle slumping consumer demand, falling business investment, rising unemployment and mounting losses in the banking system. Christina D. Romer, head of the President’s Council of Economic Advisers, said the report reinforced the need for Washington to acted quickly on a economic stimulus package. “If we fail to act,” Ms. Romer said, “we are likely to lose millions more jobs and the unemployment rate could reach double digits.” Although the United States officially slipped into a recession in December 2007, the decline was erratic and temporarily disguised by the impact of the emergency tax-rebate last spring. Since September, analysts say, economic activity suddenly plunged on almost every front. The monthly pace of job losses shot up to about 500,000 a month for the last three months of 2008, and the new report offered no hint that bottom is in sight. Last week, the number of Americans filing first-time jobless claims reached a 26-year high, with 626,000 filling out initial applications. “This is a horror show we’re watching,” said Lawrence Mishel, president of the Economic Policy Institute, a left-of-center economic research organization in Washington. “By every measure available-loss of employment and hours, rise of unemployment, shrinkage of the employment to population rate- this recession is steeper than any recession of the last forty years, including the harsh recession of the early 1980s.” Most forecasters had predicted that the economy would lose about 540,000 in January. Instead, the Labor Department estimated that 598,000 jobs disappeared. To be sure, monthly payroll numbers are subject to big revisions in the months that follow. But most other indicators of the job market had been trending worse as well. Major retailers, rocked by one of the worst holiday shopping seasons in memory, have been shutting stores and laying of armies of workers in recent weeks. On Thursday, the nation’s retailers reported that sales fell 1.6 percent in January, the fourth consecutive month of steep sales declines. And in sign that the country’s slowdown continues to reach beyond its borders, Canada, America’s largest trading partner, reported Friday that its unemployment rate jumped to 7.2 percent in January, from 6.7 percent in December. In Washington, Friday’s gloomy job report put more pressure on Congress to pass an economic stimulus bill. The House passed a bill last week that would provide more than $800 billion in spending and tax cuts. In the Senate, still bogged down by objections from Republicans, lawmakers were hoping to be able to muster enough votes to pass a measure on Friday “Today’s unemployment numbers are even worse than we thought,” said Representative Barney Frank, the Massachusetts Democrat who leads the House Financial Services Committee. “If anything can persuade Congressional Republicans to stop their hyper partisan sniping at the recovery package, these disastrous employment numbers should be it.” For comparison, the unemployment rate was 4.9 percent in January 2008. But some analysts contend that the current unemployment rate of 7.6 percent understates the labor market’s problems because the percentage of adults participating in the labor force has slumped in recent years, and those people are not listed as “unemployed.” Peter Morici, an economist at the University of Maryland, estimated that if the labor force participation rate today was as high as it was when President Bush took office, the unemployment rate would be 9.4 percent. Ian Shepherdson, chief North American economist for High Frequency Economics in Valhalla, N.Y., said the government had become the only source of energy left to break the cycle of slumping demand for goods and falling production. “The public sector needs to act,” Mr. Shepherdson wrote in a note to clients. “It needs to prevent an endless spiral of attempts to increase saving, leading to reduced spending, leading to reduced incomes, leading to further attempts to raise savings, and so on.” “We remain firmly of the view that the package now in Congress is the bare minimum required to slow the shrinkage of the economy over the next year.” Many economists expect that the economy will continue to contract until July at the very least, but at a slowing pace in the second quarter. That would make it the longest recession since the 1930s, outlasting the two record-holders, the mid-1970s and early 1980s downturns. Each of these recessions lasted 16 months. The current recession, which started in December 2007, would reach that milestone in April. The Federal Reserve continues to pump money into the financial system at a furious pace. Since September, the central bank has more than doubled its reserves, from $900 billion to more than $2 trillion, by literally creating new money. The Fed has used some of that money to help bail out financial institutions, from Citigroup and Bank of America to the American International Group. It has been pumping hundreds of billions of dollars into new lending programs, stepping in for banks and other financial institutions to buy up a widening array of corporate debt. Later this month, the Fed will begin a $200 billion program, in conjunction with the Treasury, to finance consumer debt ranging from car loans and credit card debt to student loans. But analysts say that the big problem is not a shortage of money, but a shortage of demand for products by businesses and consumers. As a result, banks are overloaded with excess reserves, made available by the Fed, which they are often simply parking at the Fed. _________________________________________________________________________ Les Américains payent le gros prix pour les banquiers de Walt Street, je n`ai pas de pitié pour eux, ils ont plongé le monde en crise, en ce sens, ils méritent grandement les conséquences...

Financial crisis bringing global economy to standstill: IMF By Veronica Smith WASHINGTON (AFP) – The International Monetary Fund slashed its economic growth forecasts Wednesday, predicting the severe financial crisis would brake global growth to the slowest pace in six decades. "World growth is projected to fall to 0.5 percent in 2009, its lowest rate since World War II," the IMF said in a sharp 1.75-point downward revision of November forecasts. "The world economy is facing a deep recession" under continued financial stress, it warned. The advanced economies were expected to contract by 2.0 percent, their first annual contraction in the post-war period and far more than the negative 0.3 percent the IMF estimated less than three months ago. "Despite wide-ranging policy actions, financial strains remain acute, pulling down the real economy," the 185-nation institution said, warning its projections were made in a "highly uncertain outlook."

New York City fears return to 1970s Tue Jan 27, 2009 By Joan Gralla http://www.reuters.com/article/newsO...50Q6IH20090127

Poll Finds Faith in Obama, Mixed With Patience Article Tools Sponsored By By ADAM NAGOURNEY and MARJORIE CONNELLY Published: January 17, 2009 President-elect Barack Obama is riding a powerful wave of optimism into the White House, with Americans confident he can turn the economy around but prepared to give him years to deal with the crush of problems he faces starting Tuesday, according to the latest New York Times/CBS News Poll. The latest on the inauguration of Barack Obama and other news from Washington and around the nation. Join the discussion. While hopes for the new president are extraordinarily high, the poll found, expectations for what Mr. Obama will actually be able to accomplish appear to have been tempered by the scale of the nation’s problems at home and abroad. The findings suggest that Mr. Obama has achieved some success with his effort, which began with his victory speech in Chicago in November, to gird Americans for a slow economic recovery and difficult years ahead after a campaign that generated striking enthusiasm and high hopes for change. Most Americans said they did not expect real progress in improving the economy, reforming the health care system or ending the war in Iraq — three of the central promises of Mr. Obama’s campaign — for at least two years. The poll found that two-thirds of respondents think the recession will last two years or longer. As the nation prepares for a transfer of power and the inauguration of its 44th president, Mr. Obama’s stature with the American public stands in sharp contrast to that of President Bush. Mr. Bush is leaving office with just 22 percent of Americans offering a favorable view of how he handled the eight years of his presidency, a record low, and firmly identified with the economic crisis Mr. Obama is inheriting. More than 80 percent of respondents said the nation was in worse shape today than it was five years ago. By contrast, 79 percent were optimistic about the next four years under Mr. Obama, a level of good will for a new chief executive that exceeds that measured for any of the past five incoming presidents. And it cuts across party lines: 58 percent of the respondents who said they voted for Mr. Obama’s opponent in the general election, Senator John McCain of Arizona, said they were optimistic about the country in an Obama administration. “Obama is not a miracle worker, but I am very optimistic, I really am,” Phyllis Harden, 63, an independent from Easley, S.C., who voted for Mr. Obama, said in an interview after participating in the poll. “It’s going to take a couple of years at least to improve the economy,” Ms. Harden added. “I think anyone who is looking for a 90-day turnaround is delusional.” Politically, Mr. Obama enjoys a strong foundation of support as he enters what is surely to be a tough and challenging period, working with Congress to swiftly pass a huge and complicated economic package. His favorable rating, at 60 percent, is the highest it has been since the Times/CBS News poll began asking about him. Overwhelming majorities say they think that Mr. Obama will be a good president, that he will bring real change to Washington, and that he will make the right decisions on the economy, Iraq, dealing with the war in the Middle East and protecting the country from terrorist attacks. Over 70 percent said they approved of his cabinet selections. What is more, Mr. Obama’s effort to use this interregnum between Election Day and Inauguration Day to present himself as a political moderate (he might use the word “pragmatist”) appears to be working. In this latest poll, 40 percent described the president-elect’s ideology as liberal, a 17-point drop from just before the election. “I think those of us who voted for McCain are going to be a lot happier with Obama than the people who voted for him,” Valerie Schlink, 46, a Republican from Valparaiso, Ind., said in an interview after participating in the poll. “A lot of the things he said he would do, like pulling out the troops in 16 months and giving tax cuts to those who make under $200,000, I think he now sees are going to be a lot tougher than he thought and that the proper thing to do is stay more towards the middle and ease our way into whatever has to be done. “It can’t all be accomplished immediately.” While the public seems prepared to give Mr. Obama time, Americans clearly expect the country to be a different place when he finishes his term at the end of 2012. The poll found that 75 percent expected the economy to be stronger in four years than it is today, and 75 percent said Mr. Obama would succeed in creating a significant number of jobs, while 59 percent said he would cut taxes for the middle class. The survey found that 61 percent of respondents said things would be better in five years; last April, just 39 percent expressed a similar sentiment. The telephone survey of 1,112 adults was conducted Jan. 11-15. It has a margin of sampling error of plus or minus three percentage points. The poll suggests some of the cross-currents Mr. Obama is navigating as he prepares to take office, and offers some evidence about why he has retooled some of his positions during this period.

Ottawa's '09 deficit may hit $14B Nov 20, 2008 11:16 AM Les Whittington OTTAWA BUREAU OTTAWA–An independent parliamentary review of the Harper government's finances concludes the federal Conservatives are likely to run budget deficits "in the near term," possibly beginning this year. The report by Kevin Page, the new Parliamentary Budget Officer, says the weaker economic outlook poses a risk to the government's attempts to achieve its "short-term and medium-term fiscal targets." Assuming no changes in Finance Minister Jim Flaherty's policies, "the downgraded economic outlook suggests the government would record modest and temporary deficits in the near term,"according to the analysis released this morning. While a budget surplus is still possible this year, the report warns the negative impact on government revenues because of the turmoil on financial markets is not yet known. "As a result, a deficit for this (2008-09) fiscal year is a distinct possibility." Page says the deterioration of the federal government's financial picture in the first nine months of 2008 is not so much the result of the weakened economy as Flaherty's policies, particularly the latest reduction in the GST tax and reduced corporate income taxes. This has caused federal revenues to decline by $353 million in the first nine months of this year. The budget office projects a budget deficit of $3.9 billion in 2009-10, although it adds that, if the economic downturn proves worse than expected, next year's federal deficit could hit $14 billion. The budget office was created in 2006 to provide independent fiscal forecasts for parliamentarians. This is Page's first budgetary study. Parliament's budget watchdog said Thursday Ottawa is in danger of running deficits starting this year, ballooning to as high as $13.8-billion next year, before returning to a surplus position starting in 2011-12. Nevertheless, the watchdog still projects a surplus for this fiscal year of at least $1.7-billion. Its "average" scenario, which is midway between worst- and best-case, projects a $3.9-billion deficit next year and a $1.4-billion shortfall in 2010-11. The outlook comes from the Office of the Parliamentary Budget Officer, a newly-created body that aims to provide non-partisan economic analysis. It used nearly a dozen private-sector forecasts to develop its outlook, and made judgments as how certain changes in growth would affect federal coffers. It made its budget deficit call based on what is expected to be weak economic growth for the country as the global economy tries to pull itself out of a financial crisis. The "external factors" that supported recent growth in Canada have "reversed course," the office's report said. "The weaker Canadian outlook ... poses a risk for the government to achieve its stated short-term and medium-term fiscal targets," the budget officer, Kevin Page, said his outlook. "Assuming no major fiscal policy changes, the downgraded economic outlook suggests the government would record modest and temporary deficits in the near term." The budget office also warned that a deficit for this fiscal year remains "a distinct possibility," due to decisions to cut the GST and corporate taxes - and not weakened economic conditions. But officially, the office projects a surplus this fiscal year as low as $1.7-billion to as much as $6-billion. "While the year-to-date fiscal results, as well as all of our projection scenarios, suggest a modest surplus in 2008-09, it will be some time before the implications for [government] revenues of the recent financial market turmoil are known." Opposition politicians immediately pounced on the report, saying misguided Conservative decisions on spending and tax cuts put the country into a deficit position. "Will the Prime Minister admit, coming from his own appointee, Kevin Page, that he is no longer anywhere to hide? The deficit is not the fault of the international community. He and his reckless Finance Minister are the sole proprietors of Canada's deficit," John McCallum, head of the Liberal Party's economic team, said during debate in the House of Commons. Stephen Harper, the Prime Minister, responded: "We need to correct the facts. There are numerous prognostications about the future. And the Minister of Finance will deliver his fiscal update in the week to come -- and that will provide the facts to all members of Parliament." The fiscal update, scheduled for some time next week, will provide the Department of Finance's outlook on the economy. But Mr. Page's report steals some of the thunder. Mr. Harper added Thursday Canada remains in a surplus position, and is one of the few countries in the industrialized world that can boast about that during this current downturn. Meanwhile, Mr. Page said there are a range of policy initiatives the government can enact to address the current economic slowdown, among them a stimulus package to boost demand. But, he added, "the key challenge for policymakers is to address short-term pressures while maintaining a longer-term vision, enacting policies that are fiscally sustainable and address the fundamental long-term challenges." Chief among those long-term challenges is boosting Canada's lacklustre productivity growth. "With population ageing reducing growth in the labour force going forward, fostering productivity growth will be absolutely essential for ensuring sustained increases in living standards," Mr. Page said. In the Speech from the Throne, delivered Wednesday, the government warned of "misguided" attempts to stay in a budget surplus position given the state of the global economy. The last time Ottawa recorded a deficit was in 1996-97, when former finance minister and prime minister Paul Martin oversaw a shortfall of $8.7-billion. pvieira@nationalpost.com

As the Economy Worsens, Is There Money for Play? The economy was a factor in a recent merger involving Dale Earnhardt’s team, left. General Motors often runs Super Bowl commercials, center, and sponsors events like the baseball All-Star Game. By KATIE THOMAS Published: November 15, 2008 From the “Buick” emblazoned on Tiger Woods’s golf bag to the Chevrolet Camaro that Cole Hamels drove home last month for being named the most valuable player of the World Series, it is hard to be a sports fan without stumbling across some type of advertisement for General Motors. The company consistently ranks first among advertisers of televised sporting events, outspending other automakers by more than two to one. Billy Casper, left, received a car for winning the inaugural Buick Open in 1958. The tournament has been a PGA Tour staple. But as G.M. faces a financial crisis that has executives pleading with Congress for a federal bailout, many are wondering how far the company’s troubles will extend into the sports industry, which is already struggling to attract advertisers and sponsors in a weakened economy. “It’s one of those trickle-down effects that people don’t look at,” said David E. Cole, the chairman of the Center for Automotive Research, a nonprofit research organization. “It has already hit hard.” G.M. has been scaling back its sports presence for at least a year. Cadillac, a G.M. brand, withdrew its sponsorship of the Masters golf tournament in January, and this summer, G.M. ended its relationships with two Nascar racetracks: Bristol Motor Speedway in Tennessee and New Hampshire Motor Speedway. The company is not renewing its longstanding partnership with the United States Olympic Committee when their contract expires at the end of this year. In one of the most dramatic examples of the company’s diminishing sports profile, G.M. said recently that it would not buy television commercials in this season’s Super Bowl broadcast. As G.M. argues its case before Congress, some firms whose contracts with the company are up for renewal are anxiously monitoring developments. “We’re actually in negotiations as we speak,” said Mitch Huberman, the senior vice president of Fox Sports Enterprises, which owns Pac-10 Properties and handles marketing for the Pacific-10 conference. Its contract with Pontiac, also produced by G.M., ends this year. “There are a lot of question marks in terms of where budgets are going,” Huberman said. “It’s kind of wait and see.” G.M., hit hard by plummeting consumer spending and tight credit markets, has reported that it is running out of cash and faces bankruptcy if it does not receive emergency federal assistance. In its third-quarter report, released earlier this month, the company said it planned to trim advertising by 20 percent and promotional spending by 25 percent. “We’re looking at literally everything,” said Peter Ternes, G.M.’s director of communications for sales, service and marketing. He said the cuts would be applied evenly but did not provide details about proposed changes to the company’s sports budget. Still, he said G.M. would not withdraw from sports entirely. “I think we’ll still be there,” he said. “It may not be at the volume that people have seen before, but we’ll still be a presence.” G.M.’s troubles come at a time when sports organizations are struggling to attract sponsors in a weak economy. The Nascar teams Chip Ganassi Racing and Dale Earnhardt Inc., citing a difficult economic climate, announced a merger last week. On Friday, the Tour de Georgia, one of the nation’s premier cycling events, said it was canceling its 2009 race because it could not find a sponsor. Also on Friday, Nascar said it was suspending all testing at its tracks next season as a cost-cutting measure. Like beer and razors, automobiles have long been a staple of commercials during major sporting events, and for good reason, marketing experts said. At a time when digital video recorders and an array of cable channels have splintered television audiences, sporting events attract a large and passionate audience who often watch events as they happen. G.M. has historically taken advantage of this audience by investing heavily in television advertising. The company has been the top TV sports advertiser for at least the last five years, vastly outspending its nearest competitors. For example, in 2007, G.M. spent close to $578 million on TV sports advertising. The No. 2 advertiser, Toyota, spent less than half that, or nearly $287 million, according to Nielsen Media Research. Earlier this year, General Motors aired 11 advertisements during the Super Bowl, according to TNS Media Intelligence, a research firm. The decision not to buy a Super Bowl ad in 2009 may have more to do with public perception than with the company’s cash-strapped predicament. This year’s spots are each selling for $3 million, a fraction of G.M.’s total sports spending. However, if the company were to receive a federal bailout, airing a Super Bowl commercial could anger taxpayers who see the purchase as extravagant, said Kenneth L. Shropshire, the director of the Wharton Sports Business Initiative at the University of Pennsylvania. “Then people are saying, was that the right use of money for a one-day sporting event?” he said. Although executives for several television outlets would not speak publicly, several said their sales representatives had detected a shift in G.M.’s ad purchases — what some called a “flight to quality” — toward programs that have proved successful in the past. And although G.M. recently scaled back its presence on networks in prime time, one network television executive said sports remained a “stable destination.” There are signs that G.M. is continuing to invest in some sports. About a year ago, Chevrolet extended its sponsorship of Major League Baseball through the 2010 season. Ternes, the G.M. spokesman, pointed to plans by the company to invest heavily in next year’s N.C.A.A. men’s Final Four in Detroit, the nation’s automobile capital. On the surface, organizations with existing agreements with G.M. may consider a bailout a preferable outcome, because under a bankruptcy, the company could ask a court to void contracts. But because a federal bailout would also very likely lead to significant restructuring, some said G.M. could be compelled to try to renegotiate active contracts anyway. “With the bailout probably comes strings attached, and what those strings are, who knows?” said Greg Brown, the president of Learfield Sports, which handles marketing for 50 university athletic programs. Rather than seek to cancel existing contracts, several sports executives said G.M. and other companies were more likely to scale back promotions and focus on initiatives that led directly to a sale. “If you’re on the verge of bankruptcy, then you want to find out how to get the money now, rather than how do I get the 15-year-old to start thinking about the car they want to buy in the future?” Shropshire said. Sponsors may focus on promotions that draw fans to dealerships, like T-shirt giveaways or ticket sweepstakes, said Jim Andrews, the editorial director of IEG Sponsorship Report, a trade publication. Sponsorships, he added, can also create a “warm, fuzzy” perception that a company is supporting a customer’s favorite team. “That’s why you’re not seeing any of the automakers, even though they are in dire straits, saying we’ve got to pull out wholesale,” Andrews said. “Because I think they know there is a return on investment.” In some cases, foreign automakers have stepped in when American companies have pulled out. Chevrolet, for example, decided not to renew its sponsorship of the United States Ski Team last year, but Audi took its place. Honda recently replaced Dodge as the official automobile of the N.H.L. Although the troubles in Detroit played a role in that outcome, Honda fit better within the N.H.L.’s goal of becoming a more international brand, according to Keith Wachtel, the league’s senior vice president for corporate sales and marketing. But for now, marketers at a variety of sports organizations say they are in for some tough times. “In this environment, autos are going to be off across the board,” said Tim Finchem, the commissioner of the PGA Tour. Two of its tournaments are sponsored by Buick through 2010, and others are sponsored by Chrysler, BMW, Honda and Mercedes. “They’re doing, in varying degrees, terrible,” he said. “The U.S. automakers are really struggling. Now, who knows?” Finchem, however, said he was confident the companies would remain in business, which meant “they’re still going to be selling cars and, again, we have a good platform from which they can promote.”

U.S. Economy: Retail Sales Drop in October by Most on Record By Shobhana Chandra and Bob Willis Nov. 14 (Bloomberg) -- Retail sales and prices of goods imported to the U.S. dropped by the most on record, signaling the economy may be in its worst slump in decades. Purchases fell 2.8 percent in October, the fourth straight decline, the Commerce Department said today in Washington. Labor Department figures showed import prices dropped 4.7 percent, pointing to a rising danger of deflation, and a private report said consumer confidence this month remained near the lowest level since 1980. ``The weakness in growth is intensifying and inflation pressures have evaporated,'' said James O'Sullivan, a senior economist at UBS Securities LLC in Stamford, Connecticut, who accurately projected the decline in sales. ``Deflation is a word that will be increasingly used over the coming months.'' Spending may continue to falter as mounting job losses, plunging stocks and falling home values leave household finances in tatters. Retailers from Best Buy Co. to J.C. Penney Co. are cutting profit forecasts ahead of the year-end holiday shopping season, when many stores do most of their business. Federal Reserve Chairman Ben S. Bernanke said at a conference today in Frankfurt that continuing strains in financial markets and recent economic data ``confirm that challenges remain.'' The Fed chief said central bankers worldwide ``stand ready to take additional steps'' as warranted. Economists surveyed by Bloomberg News predict the Fed will lower its benchmark interest rate to a record 0.5 percent by March from the current 1 percent. Policy makers next gather in Washington Dec. 16. Stocks, Treasuries Stocks fell and Treasuries rose. The Standard & Poor's 500 Stock Index dropped 1.8 percent to 894.09 at 10:11 a.m. in New York. Yields on benchmark 10-year notes fell to 3.75 percent from 3.85 percent late yesterday. The Reuters/University of Michigan preliminary index of consumer sentiment was 57.9 in November compared with 57.6 last month. The measure averaged 85.6 in 2007. Retail sales were expected to fall 2.1 percent, according to the median forecast of 73 economists in a Bloomberg News survey. Purchases in September were revised down to show a 1.3 percent decrease compared with an originally reported 1.2 percent drop. ``The September-October credit jolt to the economy is showing up in all of the numbers now,'' Ellen Zentner, a senior U.S. macroeconomist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York, said in a Bloomberg Television interview. ``We're expecting the worst recession, possibly, post-World War II.'' Worse Than Estimates Retailers have now logged the longest string of monthly declines since the Commerce Department's comparable data series began in 1992. Excluding automobiles, purchases decreased 2.2 percent, almost twice as much as the 1.2 percent decline anticipated and also the worst performance on record. Declines were broad based as furniture, electronics, clothing and department stores all showed loses. Demand at automobile dealerships and parts stores plunged 5.5 percent after falling 4.8 percent in September. Car sales are among the most affected as banks make it harder to borrow. Treasury Secretary Henry Paulson this week said the government will shift the focus of the second half of the $700 billion rescue plan from buying mortgage assets to unclogging consumer credit. President-elect Barack Obama and Democrats in Congress are under pressure to push through another stimulus plan even before the new administration takes over. Filling-station sales decreased 13 percent, also the most ever, in part reflecting a $1-per-gallon drop in the average cost of gasoline. Excluding gas, retail sales fell 1.5 percent. Gain at Restaurants Sales at furniture, electronics, clothing, sporting goods and department stores were also among the losers. Restaurants, grocery stores and a miscellaneous category were the only areas that showed a gain. ``Since mid-September, rapid, seismic changes in consumer behavior have created the most difficult climate we've ever seen,'' Brad Anderson, chief executive officer of Best Buy, said in a Nov. 12 statement. The Richfield, Minnesota-based electronics chain said sales in the four months through February 2009 will decline more than it previously estimated. Rival Circuit City Stores Inc. filed for bankruptcy protection this week. Macy's Inc., Target Corp. and Gap Inc. were among the chains that reported same-store sales dropped in October, while shoppers searching for discounts on groceries gave sales a lift at Wal- Mart Stores Inc., the world's largest retailer. Nordstrom yesterday cut its profit forecast for the third time this year. Worst Season J.C. Penney, the third-largest U.S. department-store company, today forecast earnings that trailed analysts' estimates and posted its fifth straight quarterly profit decline as shoppers cut spending on home goods and jewelry. Shoppers are pulling back as the labor market slumps. The unemployment rate jumped to 6.5 percent in October, the highest level since 1994. Employers cut more than a half million workers from payrolls in the past two months. The longest expansion in consumer spending on record ended last quarter, causing the economy to shrink at a 0.3 percent annual pace. The economic slump will intensify this quarter and persist into the first three months of 2009, making it the longest downturn since 1974-75, economists forecast in a Bloomberg survey conducted from Nov. 3 to Nov. 11. Excluding autos, gasoline and building materials, the retail group the government uses to calculate gross domestic product figures for consumer spending, sales decreased 0.5. The government uses data from other sources to calculate the contribution from the three categories excluded. To contact the reporter on this story: Shobhana Chandra in Washington schandra1@bloomberg.net

High tech US firms outsource to Montreal Tue, 2008-11-11 06:03. David Cohen An IT recruitment agency in Montreal says there has been a spike in the number of American companies crossing the border into Canada -- especially Montreal -- to do their software development and to save money. Kovasys Technology cites the unstable economy in the US, and massive layoffs. It says more and more companies are deciding to save money and move their IT operations to a cheaper but not out of the way location, and for many, that means Montreal. Quebec introduced subsidies for high tech companies less than a year ago.

No housing crash in Canada "In most eastern cities, builders continued to enjoy modest price gains." JAY BRYAN, The Gazette Published: 9 hours ago The latest data out of Canada's housing market demonstrate two things clearly: it's going through a significant slowdown, but, just as important, it's not following the U.S. market down the drain. The number of new homes started by Canadian builders in October was down, but only by three per cent, much less than expected by forecasters. So far this year, notes economist Paul Ferley at the Royal Bank, average monthly starts are down by less than five per cent compared with the plunge of 30 per cent seen in the U.S. Still, housing starts in Canada have been drifting down since they peaked at an annual rate of 277,000 two and a half years ago. The rate in October was 212,000. Market analysts believe that pent-up demand for homes has been increasingly satisfied over the past few years. As well, rising prices squeezed affordability for those looking for a first home. Now most analysts believe the construction decline will accelerate in the coming year, as a slowing economy puts more pressure on would-be buyers. Nevertheless, new-home prices as of September (these numbers take longer to compile), were holding up well, reflecting the same resilient demand that has kept home construction busy. A survey by Statistics Canada finds that average new-home prices across Canada were up by 2.1 per cent in September from a year earlier, although there's a lot of variation among major cities. The sharpest price changes were in cities with resource-based economies. In St. John's and Regina, where local booms have yet to peter out, prices were up by 23 per cent. But in Alberta, where an oilsands investment frenzy has cooled recently, gains have ended. In Calgary, the average new home price was down by one per cent. In Edmonton, it fell by six per cent. And after having soared higher than anywhere else in Canada, prices stalled in Vancouver (up 1.4 per cent) and Victoria (no change). In most eastern cities, builders continued to enjoy modest price gains, with the average new home up by 4.8 per cent in Montreal, three per cent in Toronto, 6.1 per cent in Quebec City and 4.3 per cent in Ottawa-Gatineau. There was a similar regional divide in housing starts, with British Columbia and Alberta down sharply from a year ago, while Atlantic Canada, Quebec and Ontario are up. As a slowing economy squeezes prices, it's likely to be the highest-priced markets that will show the most substantial price losses, suggested Douglas Porter, deputy chief economist at the Bank of Montreal. Canada's housing downturn is likely to be much milder than the one in the U.S. because it's fundamentally different, he said. The U.S. housing collapse stemmed from a home-price bubble whose collapse is taking down the whole economy, but the key influence on Canada's generally healthy market is merely the predictable drag from a North American recession. However, a few cities in Canada witnessed such big price gains that they're likely to sell off sharply, Porter said. When the latest resale prices for existing homes come out late this week, he expects to see continued drops in Canada's highest-priced cities: Vancouver, Calgary and Toronto. In Quebec and Atlantic Canada, existing home prices have continued rising and should continue to hold up relatively well, he predicted, because their more modest growth remained tied to fundamentals like average incomes. As of September, the average Montreal resale price was up by 4.4 per cent from a year earlier, while Halifax was ahead 10 per cent. By contrast, Toronto was down three per cent, Calgary was off six per cent and Vancouver had lost eight per cent. jbryan@thegazette.canwest.com