Looking for more tools that the Bank of Canada can use to help our COVID-stricken economy recover, some observers argue for “going direct,” having the Bank of Canada “print money” and deliver it directly to households as transfers. In our view, that is a bad idea. Broadly speaking, the Bank of Canada can “go direct” in two ways. One is to transfer extra funds directly to the general public — a technique often described as a “helicopter drop.” Imagine squadrons of helicopters flying over the country dropping cash out their loading bays. In fact, neither helicopters nor, for the most part, cash would be involved: rather, the Bank of Canada would send people cheques or make direct deposits into their bank accounts — a one-for-one, dollar-...
Je me méfie de l’or qui provoque des poussées de fièvre chez les spéculateurs. Mais avec les taux d’intérêt cloués au plancher, certains investisseurs sérieux considèrent maintenant le métal jaune pour remplacer partiellement les obligations dans leur portefeuille, car celles-ci ne parviennent plus à jouer pleinement leur rôle stabilisateur. En début de carrière, lorsque je faisais mes dents dans le journalisme économique, j’ai probablement trop rencontré de petits promoteurs miniers et de gold bugs, ces adorateurs du métal précieux qui, bien avant les furieux adeptes du bitcoin, voient dans l’or, les conserves et les armes à feu, des moyens de survie après l’effondrement de la civilisation et de la monnaie. Jamais on...
We knew the number would be big. Just how big was the question. Statistics Canada released its initial estimate of second-quarter GDP on Friday. Output dropped by 11.5 per cent compared with first-quarter GDP and by a little over 13 per cent compared with the second quarter of 2019. This is the largest recorded quarterly decline since Statistics Canada began reporting quarterly GDP numbers in 1961. The estimate was scary enough but the way it was reported may have caused either unnecessary panic or unnecessary pessimism. Media reports emphasized the “annualized” change in GDP, which was a drop of 38.7 per cent, which is worse than scary. Does this mean Canadian GDP will actually wind up falling almost 40 per cent, as it did in the...