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Email this2:53 pm
October 27, 2013
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Norman1 said
Inflation is not even across the entire CPI basket. Gasoline is +43.6% over the year. At the other end, clothing and footwear is just +0.7%.
Gasoline (and eventually natural gas) is also coming off multi-year lows, since about the end of 2014. O&G companies have had a very rough time of it for about 6 years, not being able to invest enough to replace production. Only now has it again re-gained a more normal position. See https://www.macrotrends.net/1369/crude-oil-price-history-chart and click on 10 or 20 years for a historical view.
That is going to continue to work its way through the supply chain for a number of months yet.
3:13 pm
October 29, 2017
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Norman1 said
christinad said
Just to add i find the attitude to poor people paternalistic overall in this forum. The poor people i know (though not a lot) are quite resourceful and are good budgeters. I think they would rise to the challenge of inflation.They have risen to the challenge. That's likely why there is no significant change in the percentage of people who are less than $200 from insolvency between March 2017 and March 2021, in spite of a 7½% increase in the price of the CPI basket over that time.
But we haven’t had inflation rise so fast and over this many months, in recent times. So one has to wonder how much more can they be pushed before going over the edge. I really do hope they can keep adapting, but I’m a, preventative maintenance, minded person. I don’t wait and see how long my banging and bouncing, water pipe will hold out. I get a plumber in to fix the thing before it busts and floods the place.
3:20 pm
October 21, 2013
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christinad said
Just to add i find the attitude to poor people paternalistic overall in this forum. The poor people i know (though not a lot) are quite resourceful and are good budgeters. I think they would rise to the challenge of inflation.
Not everybody here has this negative attitude. When you see something posted that insults the poor, speak up!
3:32 pm
October 29, 2017
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April 14, 2021
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christinad said
I really don't understand why its such a divisive topic. All I know is when i went to Walmart last week i paid $1.3 for a tomato!
savemoresaveoften said
the "transitory" guy said u underpaid for ur tomatos the last few years, so you should still be happy paying $1.30 today
🙂
For $1.30, I could have gotten 5 pounds of tomatos at Walmart. Of course, I always by the discount / clearance items.
The crux of the matter is that some folks buy the freshest, brightest, and most expensive items while others can get along with the ugliest tomatoes while getting the same nutritional value. 
4:02 pm
September 11, 2013
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christinad, I tend to agree with you when you say the poor "would rise to the challenge of inflation". Some others here don't seem to have that faith in them.
Ok, Vatox, re preventative maintenance guy - remind me again, maybe I missed it, what specific preventative maintenance would you be implementing at this time? Is it just raising interest rates now? And/or other things?
Tomatoes are a discretionary purchase, and no-one's forcing you to buy them, so if they're too expensive find something cheaper to eat.
4:17 pm
October 15, 2015
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I am unwilling to have my salmon burger without a tomato. That said it was a really big tomato and had i had time i would have gone to the produce store instead to find something smaller. I am a typical middle class person unwilling to give anything up.
4:29 pm
October 15, 2015
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Plus i'd like to add i've said before i don't think as a single person inflation affects me that much. Certainly paying 1.3 for a tomato is painful but its not going to break the bank for me. I don't take transit so i don't have that expense. We all have to make decisions on what we are going to give up and what we are going to have to pay for to keep with inflation.
4:33 pm
October 29, 2017
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Bill said
christinad, I tend to agree with you when you say the poor "would rise to the challenge of inflation". Some others here don't seem to have that faith in them.Ok, Vatox, re preventative maintenance guy - remind me again, maybe I missed it, what specific preventative maintenance would you be implementing at this time? Is it just raising interest rates now? And/or other things?
Tomatoes are a discretionary purchase, and no-one's forcing you to buy them, so if they're too expensive find something cheaper to eat.
Well, I suppose I’m just looking at interest rates, because the BoC is supposed to be implementing its mandate to control Inflation. But perhaps we could hash out other methods.
I’m also concerned about low interest rates because it makes it too easy for people to just reach out for more debt, and that makes the potential bomb larger..
https://mnpdebt.ca/en/resources/mnp-consumer-debt-index
EDIT: high inflation and more debt, are definitely not the answer
6:00 pm
October 29, 2017
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Was just watching the news. COVID-19 and Omicron variant along with Christmas gatherings was the subject. Get vaccinated and keep your gatherings small were the highlights. But it was one statement I heard that totally fits this discussion.
“These are personal choices every Canadian will have to make, but their impacts could be felt by everyone”
That is so perfect!
Canadians get to choose how they live and we all have to deal with it.
6:36 pm
September 11, 2013
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cristinad, re the tomato, I wasn't addressing you specifically but rather just pointing out that there are some things (e.g. some basic clothes) that we all need but others (e.g. tomato) that we are free not to buy if we find them too expensive. And I think most people do that, i.e. many folks just buy whatever's on sale that week for much of their groceries.
Inflation's great for debtors. Governments borrow hundreds of billions now to be paid off decades later with inflated dollars. Or homeowners take out max mortgages knowing their wages will only go up over the years, often a lot if inflation's high, making it much easier to pay off as time goes on.
7:13 pm
October 15, 2015
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I read housing is 10% of Canada’s gdp and that doesn’t seem bad. But then i read this
Canada’s housing investment as a share of the economy is higher than any other OECD nation, with the exception of New Zealand, Macquarie’s research shows. And it exceeds the amount of business investment in Canada.
https://nationalpost.com/news/canada/canadas-unhinged-housing-market-captured-in-one-chart
This doesn’t seem healthy and i think if high inflation leads to increased rates to cool housing that’s a good thing. Of course, my mortgage is locked in so i can say that. It also suggests Canada should look to increase business investment and i’m not sure if decreasing housing costs would help with that.
5:45 am
March 30, 2017
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High real estate values have a direct and profound impact on inflation in my mind.
As rent goes up, it drives up the price of all finished products, from restaurant meals to the tomato.
11:28 am
September 11, 2013
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I agree, christinad, increasing business investment is vital.
And your point reminded me of what an acquaintance told me a few weeks ago. He's looking to sell his main business and he's found that a significant % of the investment groups, pension funds, etc who come kicking tires quickly delete it from their list because one of their check boxes is no investments in Canada. Apparently many foreign (mainly USA in this case) investors do not want to put their money here. So increasing (foreign) business investment might be harder than we think.
11:46 am
October 27, 2013
Online
It is really a different subject from inflation but foreign investment in Canada is becoming less attractive each passing year, especially since the imposition of a range of new costs put on business, e.g. carbon taxes, higher payroll costs such as covid paid leave, inability to undertake new developments on a timely basis, etc. Death by a thousand cuts.
The G&M had a recent article that looked at how Canada has slipped in the development of new resources (mining production and processing) to support the EV battery industry. Much of that appears to be due to regulatory obstacles and some no doubt due to lack of bold vision and risk taking by both lenders and investors. All investors see in the windshield looks to be a headwind than facilitation. The window of opportunity to mine the minerals and produce vehicle batteries is fading fast. We will be lucky to see Lion Electric and NFI Group succeed (over American rivals) in producing heavy EVs, e.g. transit and school buses, coaches, waste management trucks, etc.
12:07 pm
April 14, 2021
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AltaRed said
The window of opportunity to mine the minerals and produce vehicle batteries is fading fast.
Why so? Any mineral resources will remain in situ until there is a more business-friendly regime. Whether that takes years, decades, or centuries, those minerals will simply sit until someone is willing to come and extract them.
12:38 pm
October 21, 2013
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Bill said
... an acquaintance told me a few weeks ago. He's looking to sell his main business and he's found that a significant % of the investment groups, pension funds, etc who come kicking tires quickly delete it from their list because one of their check boxes is no investments in Canada. Apparently many foreign (mainly USA in this case) investors do not want to put their money here. So increasing (foreign) business investment might be harder than we think.
There must be more to it than that. If they weren't doing any Cdn investment, they wouldn't have come kicking tires in the first place. Perhaps their Cdn quota was filling up with better options.
12:56 pm
October 27, 2013
Online
HermanH said
AltaRed said
The window of opportunity to mine the minerals and produce vehicle batteries is fading fast.Why so? Any mineral resources will remain in situ until there is a more business-friendly regime. Whether that takes years, decades, or centuries, those minerals will simply sit until someone is willing to come and extract them.
Once mines get developed and into production elsewhere, along with their shipping logistics, the economics of expansion (if available) of those for more production is less than investing in greenfield projects. It's like oil refineries (and oil sands mining projects). It is rare for a new one to get built, but existing ones get expanded from time to time.
There is always a window of opportunity for preferentially positioning oneself in the value chain. Harder, but not impossible, to do it later. Obviously less of a concern if there is a major supply deficiency and metal prices are sky high.
12:57 pm
October 21, 2013
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AltaRed said
It is really a different subject from inflation but foreign investment in Canada is becoming less attractive each passing year, especially since the imposition of a range of new costs put on business, e.g. carbon taxes, higher payroll costs such as covid paid leave, inability to undertake new developments on a timely basis, etc. Death by a thousand cuts.
I'm not sure what the root cause of some of these problems is but there have been many reasons why Canada has been a good place for such investment in the past, and many of those still apply despite efforts to undermine them by some provincial govts. They have always liked the fact that we have a healthy dependable educated and educable work force, health care etc. Despite many bad decisions, we have managed covid better than most countries, including the US and UK. We are still one of the most sought-after countries to move to, despite our weather. Foreigners are still buying up our land. It's still a great place to invest. Maybe some temporary hitches as the whole world learns to adjust to the implications of climate change, pandemics etc. They will learn that it's cheaper to provide paid leave than to have their workforce exposed to more disease and death by people who can't afford to stay home and to have to find hire and train new workers. These adjustments take time.
1:06 pm
September 11, 2013
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No, not really more to it, guy has hired a USA firm, on a commission basis, to flog his business (valuation is crazy high, thanks to virus), he's looking to sell for around $US 200M, and the feedback he's got from the firm is that as soon as many potential buyers find out it's Canadian-based (i.e. pretty well right off the hop) they say "no thanks", that's one of our checkboxes. The feedback so far is there's not usually a specific reason, it's just that Canadian society is seen by these folks as pro-socialist, anti-business in general, so that's why the no-Canada checkbox is there, easier to put money where you're going with the flow, I guess. Having said that, while we're talking about a significant % there are still some who remain interested, are not deterred due to the Canada connection.
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