March 2015 Canadian Economic Fundamentals

[Ally]

Harper says no need for action in the housing market, as rate wars rage

Prime Minister Stephen Harper said Wednesday Ottawa is closely watching developments in the still-hot housing market, but there’s no need for another intervention.

“I’m not saying I’m unconcerned. We are watching it. We’re not planning to take any immediate action,” Harper told reporters after an event in Mississauga, Ont.

Read the full article here.

 

[Ally]

Oil Prices: Freaking out investors for over 150 years

Whenever I read or watch financial media coverage of oil prices lately, the image that comes to mind is a bunch of kids who just ate half their weight in candy, washed it down with a gallon of Red Bull, and then run around the playground at warp speed. They both move so fast and sporadically that is almost impossible to keep up with them.

Read the full article here.

 

[Ally]

Tracking the layoffs in Alberta's oilpatch



CALGARY – Since oil prices began tanking last summer, there have been predictions of thousands of layoffs in Alberta’s energy-dependent economy. So just how many jobs have we lost so far? There are no hard and fast numbers. Alberta employers must reports layoffs of 50 or more people to the Alberta government’s ministry of Jobs, Skills, Training and Labour. But countless layoffs involve a handful of employees at small and medium sized businesses and so fly under the radar.

Read the full article here.

 

[Ally]

OPEC's decline will be Canada's gain as the organization's influence wanes

It’s tough to see any upside today from the break up – through job cuts, investment pullbacks, project cancellations — of many parts of Western Canada’s energy economy due to the collapse in oil prices.

But political scientist, author and business advisor Ian Bremmer, president of the influential New-York based Eurasia Group, believes Canada has a great future ahead as an energy producer – if it looks beyond the immediate, the obvious and the local.

Read the full article here.

 

[Ally]

Oilsands faces its biggest test in extended downturn

The collapse in the market for Canada’s heavy crude below $30 a barrel last week is hammering home a harsh reality for the nation’s oil-sands producers: There’s no one to save them this time.

Read the full article here.

 

[Ally]

Slumping oil prices cast shadow on World Heavy Oil Congress in Edmonton


EDMONTON - Slumping oil prices will cast a shadow on the World Heavy Oil Congress this week in Edmonton.

Organizers expect 20 per cent fewer people to attend the three-day international conference that has the theme: Producing More With Less.

Read the full article here.

 

[Ally]

Everything you want to know about falling oil prices

Mostly because of increased supply from America—up by 4m barrels a day since 2009. Although most crude exports are still banned, American imports have plummeted, contributing to a glut on world markets. Other producers have decided not to try to curb their production and keep the price up.

Read the full article here.

 

[Ally]

Oil 'stress event' to fuel Manulife Property, energy deals

(Bloomberg) -- Manulife Financial Corp. is telling owners of office towers and energy assets in Calgary that it wants to buy what they have, as long as any deals reflect the plunge in oil markets.

Read the full article here.

 

[Ally]

Sorry, doomsdayers. This isn't the thirties

Scary headlines sell, and the world economy since the 2008 crisis has given writers of scary headlines lots of material. Lately, the large type has featured two themes: Deflation, which threatens to suck the major economies into a black hole; and currency wars, which will have us at each other’s throats as we sink.

Hoping a turn of phrase can compete with the prophets of disaster, I must protest: this is altogether too much of a bad thing. The deflation doomsayers and the currency-war Jeremiahs can’t both be right. Yes, deflation is a threat — in theory. But probably not in reality. And if a desire to devalue their currencies prompts central banks to print more money, certainly not in reality.

Read the full article here.

 

[Ally]

The U.S. has too much oil and nowhere to put it

Seven months ago the giant tanks in Cushing, Okla., the largest crude oil storage hub in North America, were three-quarters empty. After spending the last few years brimming with light, sweet crude unlocked by the shale drilling revolution, the tanks held just less than 18 million barrels by late July, down from a high of 52 million in early 2013. New pipelines to refineries along the Gulf Coast had drained Cushing of more than 30 million barrels in less than a year.

Read the full article here.

 

[Ally]

What to do when the housing boom turns to bust


The economic downturn in Alberta is nothing new to Ryan Griffiths. The technician who works for the Ford Motor Co. in Airdrie, just north of Calgary, gets paid piecemeal based on every job he does. When the economy started to slow in 2008, he had to figure out how to make ends meet.

Read the full article here.

 

[Ally]

Housing market hints at change with decline in key cities

The housing market is a system that transfers wealth from young people buying first homes to long-time owners who sell.

It has always been so, but in recent years things have gone a little crazy. That's why the latest developments in the housing market are so notable for two groups - young adults despairing over their ability to afford a home and the people whose financial plan in retirement puts a lot of importance on cashing out of the family home.

Read the full article here.

 

[Ally]

Building a better apartment: How Canada compares

Rental housing doesn’t have to be boring.

Or ugly, or remote, or lacking in amenities.

At least that’s the conclusion reached by two Canadian architects who have recently travelled the world, looking at how rental and social housing is built in other countries.

Read the full article here.

 

[Ally]

Higher cost of imported goods to eat up Canadian gas savings

Canadians may be rubbing their hands with glee at the money they’re saving at the gas pumps, but there are consequences of lower oil prices that could hit other parts of their budgets, a TD Bank report notes.

Canadian households will save an average of up to $800 this year on gasoline as a result of oil’s 50-per-cent plunge since last summer, TD economists say.

Read the full article here.

 

[Ally]

Oilpatch recovery a long way out, Conference Board report says

CALGARY – Investment in Canadian oil plays has peaked and will not reach 2014 levels for at least another five years, a new report from the Conference Board of Canada predicts.

The report, released Wednesday, downplays the possibility of a quick recovery in the Canadian oilpatch, where cumulative employment, investment and revenue numbers have dropped along with oil prices. The think tank is now forecasting further drops in all of those metrics, and is predicting lower overall activity until 2020 at the earliest.

Read the full article here.

 

[Ally]

Why oil prices must go up

It may be difficult to look beyond the current pricing environment for oil, but the depletion of low-cost reserves and the increasing inability to find major new discoveries ensures a future of expensive oil.

While analyzing the short-term trajectory of oil prices is certainly important, it obscures the fact that over the long-term, oil exploration companies may struggle to bring new sources of supply online. Ed Crooks over at the FT persuasively summarizes the predicament. Crooks says that 2014 is shaping up to be the worst year in the last six decades in terms of new oil discoveries (based on preliminary data).

Read the full article here.