By: Obert Madondo Satirical Duffy $90,000 Bill Veteran B.C. newspaper satirist Dan Murphy engaged in a little good old-fashioned Canadian political satire when he created a fake $90,000 bill starring scandal-plagued Sen. Mike Duffy. The Bank of Canada wants us to believe a serious crime has been committed here, according to Times Colonist.
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Politics and Entertainment: why focus on inflation when there is little evidence of a inflationary trend while there are abundant statistics revealing just how bad things are for both the unemployed and the underemployed.
One of the official goals of central bank monetary policy is supposed to be low employment fostered through what is known as an expansionary policy by lowering interest rates with the hope that low credit rates will encourage businesses to expand their operations by way of capital investment in hard assets or
Continue readingPolitics and Entertainment: why focus on inflation when there is little evidence of a inflationary trend while there are abundant statistics revealing just how bad things are for both the unemployed and the underemployed.
One of the official goals of central bank monetary policy is supposed to be low employment fostered through what is known as an expansionary policy by lowering interest rates with the hope that low credit rates will encourage businesses to expand their operations by way of capital investment in hard assets or
Continue readingPolitics and Entertainment: why focus on inflation when there is little evidence of a inflationary trend while there are abundant statistics revealing just how bad things are for both the unemployed and the underemployed.
One of the official goals of central bank monetary policy is supposed to be low employment fostered through what is known as an expansionary policy by lowering interest rates with the hope that low credit rates will encourage businesses to expand their operations by way of capital investment in hard assets or capital expenditures of some sort and new hirings. We’ve had this policy in place for quite some time now, and yet employment really hasn’t improved one iota. If anything it’s merely gotten worse along with – because of the incentive of low interest rates – an astounding increase in personal debt to the unseemly tune of a 165% income to debt ratio.
While some businesses are moderately expanding their operations, they do not seem to be increasing employment. Instead, they are either retaining cash and letting it grow – Carney’s so-called hoarding ‘dead money’ – or off shoring/third-partying employment at lower wage standards. Using low interest rates to try to control both inflation* and encourage employment, in other words, simply isn’t working.
But why focus on inflation at all when there is little evidence of any sort of inflationary trend while there are abundant statistics revealing just how bad things are for both the unemployed and the underemployed.** The focus should clearly be on increasing employment, but since low interest rates appear not to be working, printing money to monetize our national debt is just about the only worthwhile option left for a central bank to consider, and just about every central bank in the developed world is doing just that with the exception of Canada. Why not Canada? Because of a neurotic, ideological fear of inflation that might be generated by a larger money supply – too much money chasing too few goods and thereby raising prices and potentially distorting the price of some financial assets. We are ruled by true believers.
But with that twisted caveat in mind and bearing in mind that this would constitute only a technical solution, not the genuine transformation we really need, printing money for a determinant period of time is still a good choice; for it would allow the government to spend with a bit of comfort in order to build, say, infrastructure and other employment generating programs that both stimulate the economy and employ people as well as potentially lower the Canadian dollar and thereby increase exports.
The problem is that strategy is a political choice, one that would require an intelligent government interested in generating employment rather than imposing wage-suppression and sustaining asset stability.* But the new head of the Bank of Canada apparently plans on maintaining the same old failing monetary policies of his predecessor and his CEO, Flaherty, by privileging inflation over employment as a primary policy direction – albeit a mandated policy but one that nevertheless serves only the neoliberal investor class, not ordinary Canadians. This narrow, misguided perspective is no doubt the reason Stephen Poloz has been chosen as the new Governor.
‘Growth’ and ‘inflation’ are prominent in the news stories about the new Governor with a wish to increase employment nowhere to be found. He’ll get along just fine with Steve and Jim.
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* Inflation is an enemy of neoliberalism for two reasons: it erodes the monetary value of already held assets such as bonds and creates pressure to increase wages. Quantitative easing of any sort is a no no under our strict neoliberal regime, though I would not be surprised to see it applied to private sector financial organizations should they need bailing out of some sort.
** For example, “the number of temporary workers in Canada hit a record two million last year, according to Statistics Canada. That amounts to 13.6 per cent of the work force compared with 11.3 per cent in 1997, when such record-keeping began.
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** For example, “the number of temporary workers in Canada hit a record two million last year, according to Statistics Canada. That amounts to 13.6 per cent of the work force compared with 11.3 per cent in 1997, when such record-keeping began.
And since the recession, temporary work has grown at more than triple the pace than permanent employment – up 14.2 per cent for temp work between 2009 and 2012, versus 3.8 per cent for permanent workers.” http://goo.gl/DkBDm

The Progressive Economics Forum: Polozogistics: Nine Thoughts About the Choice of the New Bank of Canada Governor
1. He’s Number Two: Stephen Poloz was widely acknowledged in economic and political circles as the second-best choice for the top job at the Bank of Canada. So the surprise was not that he was chosen. The surprise was, Why Not Tiff Macklem? Will someone please find out and tell
Continue readingThe Progressive Economics Forum: A Weak Week for Canada’s Economy
On Tuesday, Statistics Canada reported that job vacancies have fallen to the lowest level recorded since it began collecting these figures two years ago. On Wednesday, the Bank of Canada projected growth of just 1.5% for this year. On Thursday, Statistics Canada reported that the number of Canadians receiving Employment Insurance
Continue readingThe Ranting Canadian: Wife of Bank of England governor turns herself into a guillotine-magnet
Wife of Bank of England governor turns herself into a guillotine-magnet: Diana Carney – wife of the new Bank of England governor (and former Bank of Canada head) – had a Mary Antoinette moment on March 25, 2013 when she whined on Twitter that she and her husband were having
Continue readingThe Progressive Economics Forum: Breaking The Taboo on Monetizing Deficits
In a very long and fascinating speech which has been amplified by Martin Wolf in the FT, Lord Adair Turner seeks to break the taboo on discussion of the potential ability of central banks to monetize fiscal deficits. His argument boils down to a political economic one … Some monetization
Continue readingThe Canadian Progressive: Black hockey players, aboriginals, gays nixed from Canada’s new bills
“The Bank of Canada considered celebrating gay marriages, black hockey players, and turban-wearing RCMP officers on its new plastic bank notes” By Obert Madondo | The Canadian Progressive, Feb. 11, 2013: And so the Harper Conservative-inspired whitewashing of Canada continues. Last summer, we learned that the Bank of Canada had nixed the image of
Continue readingThe Canadian Progressive: Canadian Labour Congress says corporations hoarding cash, paying fat compensation to CEOs
CLC report: Corporate Tax Freedom Day is January 30 – Big businesses hoard cash from tax giveaways, not investing in jobs by Canadian Labour Congress | Jan. 29, 2013 OTTAWA – A research study by the Canadian Labour Congress shows that CEOs in Canada could be dancing in their suites to celebrate
Continue readingThe Progressive Economics Forum: Labour Market still weak: Bank of Canada
The Bank of Canada released their January 2013 Monetary Policy Report. Of note, the Bank downgraded its growth expectation for 2013 to 2.0% from 2.3%, and expects the Canadian economy will not reach full potential until late 2014. Several key points in the January MPR reinforce what progressive economists have
Continue readingTHE FIFTH COLUMN: If a Tree Falls in the Forest is it not Canadian if it Originated in Norway
I remember way back when when I was in school, not back in the days of the one room schoolhouse but back in the days of the eight classroom schoolhouse with one class for each grade when everyone walked to school, learning about maple trees and maple l…
Continue readingTHE FIFTH COLUMN: If a Tree Falls in the Forest is it not Canadian if it Originated in Norway
I remember way back when when I was in school, not back in the days of the one room schoolhouse but back in the days of the eight classroom schoolhouse with one class for each grade when everyone walked to school, learning about maple trees and maple leaves. We learned
Continue readingTHE FIFTH COLUMN: If a Tree Falls in the Forest is it not Canadian if it Originated in Norway
I remember way back when when I was in school, not back in the days of the one room schoolhouse but back in the days of the eight classroom schoolhouse with one class for each grade when everyone walked to school, learning about maple trees and maple leaves. We learned
Continue readingThe Progressive Economics Forum: What Does the Bank of Canada Do?
The Board of Directors of the Bank of Canada have retained Odgers Berndtson to seek a new Governor, and have placed an ad in the Globe and Mail, the Economist and La Presse. The wording of the advertisement is questionable. First, it states that “the Bank of Canada is the
Continue readingAccidental Deliberations: Deep thought
Much as I generally promote open access to information, I’m starting to come around to the idea that the Cons should feel free to apply a “national security” exemption to pretty much any information about their decision-making. After all, if anybody around the globe knew exactly what they’re dealing with
Continue readingAccidental Deliberations: On transferable skills
Stephen Gordon is at least moderately panicked about the less-than-surprising news that some Lib operatives tried to recruit Mark Carney to serve as the party’s national leader – and there may be worse to come. But I’ll argue that there’s far less to be concerned about than Gordon, Mike Moffatt
Continue readingPolitics and Entertainment: This will be the Regime’s Primary Alibi followed by the EU crisis when the Canadian Economy Sinks into Recession
Canada faces near-recession if U.S. plunges over ‘cliff,’ Carney warns “Carney warns of risk from U.S. Bank of Canada Governor Mark Carney has warned that a failure by U.S. politicians to reach a new budget agreement before time runs out would push Canada close to another recession… the bank warned
Continue readingPolitics and Entertainment: This will be the Regime’s Primary Alibi followed by the EU crisis when the Canadian Economy Sinks into Recession
Canada faces near-recession if U.S. plunges over ‘cliff,’ Carney warns “Carney warns of risk from U.S. Bank of Canada Governor Mark Carney has warned that a failure by U.S. politicians to reach a new budget agreement before time runs out would push Canada close to another recession… the bank warned
Continue readingPolitics and Entertainment: This will be the Regime’s Primary Alibi followed by the EU crisis when the Canadian Economy Sinks into Recession
Canada faces near-recession if U.S. plunges over ‘cliff,’ Carney warns
“Carney warns of risk from U.S. Bank of Canada Governor Mark Carney has warned that a failure by U.S. politicians to reach a new budget agreement before time runs out would push Canada close to another recession… the bank warned that Canadi
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ans are still borrowing at a faster pace than their disposable income, making them more vulnerable if they lose their jobs or home prices tumble. The ratio of household debt to gross domestic product now stands at a record high 163 per cent, up from 161.5.”
Let us not forget, however, that the Canadian economy in and of itself has not been managed well by this extreme neoliberal government that has consistently placed investors, the financial sector, natural resource exports, and free trade before the real industrial domestic economy. wage fairness, and job creation for the middle and working classes. A 163% household debt/GDP ratio is also indeed worrisome as is the fact that whatever equity most Canadians have is inextricably bound to their still mortgaged houses. Get ready.