Robert Presserhttp://www.themetropolitain.ca/articles/author/21enghttp://www.themetropolitain.ca/articles/view/872http://www.themetropolitain.ca/articles/view/872There are two figures readers need to keep in mind as they contemplate the possibility of boarding a 250 km/h train between Montreal and Toronto: 511 and 19.  The 511 is the number of kilometers of High Speed Rail (HSR) that Brazil plans to build to link its largest cities, Sao Paulo and Rio de Janeiro via Campinas.  The 19 is the number of billions of US dollars this project is likely to cost.  The Brazilians deserve a great deal of credit for not hiding the truth from their population as to the cost and complexity of the project.  Creating HSR in Brazil is essential to relieving pressure from Brazil’s overcrowded airports and its decaying roads, which are overwhelmed by crowded buses that fight with the truck traffic between the two massive population hubs.Robert PresserThu, 09 Sep 2010 17:30:00 -0400http://www.themetropolitain.ca/articles/view/854http://www.themetropolitain.ca/articles/view/854 Dear G20 leaders, First of all, congratulations are in order for emerging with anything resembling a commitment to fiscal restraint at all, given the differing economic environments you are all facing.  The message was simple and direct: cut deficits in half by 2013 and stabilize debt to GDP ratios by 2016.  Boy, are you lucky that the majority of populist journalists ran to file the story before they read the fine print, because otherwise the solidarity you displayed in the group photo would look more like Swiss cheese.  Japan gets an exemption from the debt level targets because they are still fighting deflation leftover from the last recession, and the US federal government is busy spending more, not less, to compensate for state budgets that are being slashed to the bone.  Robert PresserThu, 22 Jul 2010 16:30:00 -0400http://www.themetropolitain.ca/articles/view/834http://www.themetropolitain.ca/articles/view/834Visiting Shanghai in 2010 is the ultimate experience in Modern urban infrastructure.  At the nearly-new international airport, you can take a MagLev (magnetic levitation) train that whisks you into Pudong at a top speed of 430 km/h.  You then transfer to a modern subway system with 400 kilometers of track, 200 of which opened within the last year.  Or, if you prefer, you can grab a cheap, new taxi from Pudong and travel into Shanghai across modern six-lane expressways and impressive new bridges that cross the river, one every few kilometers.  This is the kind of town that big money, government money, buys for its citizenry when the state is wealthy and wants to show off to the world for the 2010 Shanghai Expo, the world’s fair now underway.Robert PresserThu, 10 Jun 2010 08:30:00 -0400http://www.themetropolitain.ca/articles/view/811http://www.themetropolitain.ca/articles/view/811After a year and a half of misery, things are looking up for the Canadian and U.S. economies.  The stock markets are up over 70 per cent from their lows of March 2009, both economies put out five per cent annualized growth rates in the last quarter of 2009, and consumer spending is on a tear.  In Canada, consumer spending rose at a four per cent annualized rate in Q4 2009 and in the U.S., spending was up 1.6 per cent month to month in March, including a whopping one per cent due to sales of autos and parts alone.  Economists and governments are now debating the sustainability of such encouraging results as they plan monetary and fiscal policy for the year to come.Robert PresserFri, 23 Apr 2010 18:30:00 -0400http://www.themetropolitain.ca/articles/view/794http://www.themetropolitain.ca/articles/view/794The game changing 1995 federal budget slashed transfers to the provinces and set in place five years of spending restraint.  The resulting limited growth in federal government spending, coupled with falling interest rates that reduced the interest burden on Canada’s existing debt, allowed the federal government to move into surplus before the millennium and post a decade of surpluses which ended in 2009.  The great shame of this period of fiscal nirvana is that it could have been even better for the Canadian taxpayer.  The Liberals consistently under-estimated their surpluses and even after an orgy of last-minute spending in the final quarter of every fiscal year up until their defeat in 2006, they still exceeded their surplus predictions.Robert PresserThu, 25 Mar 2010 09:30:00 -0400http://www.themetropolitain.ca/articles/view/777http://www.themetropolitain.ca/articles/view/777Canadians can rarely feel smug when comparing themselves to their US neighbors, but when it comes to our banking sector our airs of superiority are justified.  While the Obama administration contemplates an overhaul of financial industry regulation and punitive taxation of banking executives’ bonuses, Prime Minister Harper announced in Davos that Canada has no intention of “micro-managing” Canada’s banks. Robert PresserThu, 11 Feb 2010 11:00:00 -0500http://www.themetropolitain.ca/articles/view/753http://www.themetropolitain.ca/articles/view/753Plutôt que d’analyser tous les détails de l’accord, l’objectif de cet article sera d’adopter une perspective à plus long terme fondée sur l’hypothèse que l’accord non-contraignant conclu à Copenhague doit être transformé en un accord contraignant et vérifiable pour la réduction des émissions à long terme. L’entente conclue entre les États-Unis, la Chine, l’Inde, le Brésil et l’Afrique du Sud contient des engagements pour que la réduction des émissions limite le réchauffement climatique à un maximum de 2 degrés Celsius, mais que veut dire cela en termes de vraies cibles ?Robert PresserThu, 07 Jan 2010 15:00:00 -0500http://www.themetropolitain.ca/articles/view/735http://www.themetropolitain.ca/articles/view/735This year has been a seesaw for the Canadian Dollar.  Plunging to the 80 cent USD range during the onset of financial crisis of 2008 and retesting those lows in March of this year, our currency has recovered to trade in a relatively tight range of 92 to 97 cents US over the past two months.  The recovery in our dollar has paralleled the recovery in stock markets and commodities, especially oil.  Sadly, Canadians don’t look at the broader currency picture – while our Loonie is stronger against the US greenback, the USD continues to fall to ever deeper lows against a broader index of international currencies.  The US is pursuing a weak dollar policy despite public statements to the contrary and Canada is along for the ride.Robert PresserThu, 03 Dec 2009 17:00:00 -0500http://www.themetropolitain.ca/articles/view/716http://www.themetropolitain.ca/articles/view/716In 1976, French President Valery Giscard d’Estaing decided that it would be a good idea to invite the leaders of the major western economic powers (Canada, France, Germany, Italy, Japan, the United Kingdom and the United States of America) to an informal summit at a chateau outside of Paris to discuss their current common economic problems, giving birth to the G7.  Later expanded to include Russia (G8) this intimate grouping of world powers dominated the international economic and trade agenda until the Asian currency crisis of 1997 had ripple effects around the world, making a broader consultative forum a priority to encourage cooperation with the developing world.  That body was christened the G20, and today it represents nearly 85% of worldwide economic output (GDP) though 90% of the world’s countries are not at the table.Robert PresserWed, 04 Nov 2009 16:00:00 -0500http://www.themetropolitain.ca/articles/view/696http://www.themetropolitain.ca/articles/view/696According to the latest statistical data, the Canadian recession ended sometime over the summer and we will see slow growth in the third and fourth quarters of 2009.  While this is likely to be a jobless recovery until sometime in 2010, Canadians believe that our conservative banking culture coupled with greater financial market regulation spared us the mortgage melt-down and destruction of consumer wealth that devastated other first world economies.  While that may be the case, it does not mean that Canada is perfect on all major economic and government policy issues.  This article takes a look at some major issues facing western economies and what international organizations like the World Bank have to say about Canada’s success in managing them.Robert PresserThu, 01 Oct 2009 14:00:00 -0400http://www.themetropolitain.ca/articles/view/669http://www.themetropolitain.ca/articles/view/669Since Montreal is apparently flush with cash to undertake new infrastructure projects, a study by engineering consortium Genivar-Systra was commissioned to demonstrate the viability of a 12 kilometre tramway network for Montreal.  The cost is estimated at $500-$750 million dollars, depending on the scope of secondary infrastructure work that is included in the study.  But what would a trip on a Montreal tramway really look like?  Imagine if we could take a ride on the Guy Street to Jean Talon line?Robert PresserWed, 02 Sep 2009 21:00:00 -0400http://www.themetropolitain.ca/articles/view/660http://www.themetropolitain.ca/articles/view/660One could be forgiven for being optimistic these days.  The stock markets are up 30% from their lows of March 2009, even taking into account the recent correction; housing starts and new home purchases showed surprising strength in Canada in June; job losses in the US and Canada seem to be slowing; lower mortgage rates and gas prices have freed up cash in consumer’s pockets and allowed more people to keep their homes; auto sales seem to be bottoming outRobert PresserThu, 06 Aug 2009 11:00:00 -0400http://www.themetropolitain.ca/articles/view/639http://www.themetropolitain.ca/articles/view/639Visitors to Havana marvel at the American automobiles of the 1950’s that have survived five decades of revolutionary communist rule to continue to ply its streets.  Some are still running due to modified Russian auto parts, while other have had their lives extended by craftsmen who lovingly reproduce each fallen piece of chrome so that the autos appear as pristine as they did on Batista’s last day in the Presidential Palace...Robert PresserThu, 02 Jul 2009 11:00:00 -0400http://www.themetropolitain.ca/articles/view/644http://www.themetropolitain.ca/articles/view/644Last October this column reviewed the possibility of a trade war between the US and Canada if Obama were to take the White House.  While the exact form of the dispute was not known at the time, some form of economic nationalism was inevitable as the US rustbelt demanded payback for delivering the electoral votes required to secure a decisive victory in the Electoral College.  Congress crafted a stimulus package designed to create US jobs related to infrastructure and manufacturing, and in their expedient haste to curry political favour with their constituents they created the Buy American (BA) provision that related to municipal investment projects...Robert PresserThu, 02 Jul 2009 06:00:00 -0400http://www.themetropolitain.ca/articles/view/625http://www.themetropolitain.ca/articles/view/625Late last week, General Motors and Ford announced a combined third quarter loss of $7.2 billion US.  In other years, this would be considered catastrophic as an annual loss figure, but in the current economic context it was expected since new car purchasing in the US has fallen to a 25 year low with no sign of immediate recovery.  GM has put its potential acquisition of Chrysler on hold and now all three major US automakers are appealing to the US government for $25 billion in low interest loans on top of the $25 billion handout they were previously offered for retooling their product lines...Robert PresserThu, 18 Jun 2009 04:15:00 -0400http://www.themetropolitain.ca/articles/view/549http://www.themetropolitain.ca/articles/view/549Relaxing the mark-to-market rules means we will never know what the banks are really worth The Federal Reserve’s stress test results are in and to no one’s surprise, all the big US Bank Holding Corporations (BHCs) passed.  Getting a passing grade in the stress test, more formally known as the Supervisory Capital Assessment Program (SCAP) was a lot like getting a passing grade in gym class – just because everyone gets by, this does not mean that all the subjects are equally capable and robust.  The SCAP report indicates that 10 of the 19 largest US banks should collectively raise an additional $75 billion USD in tier-one capital in order to bolster their reserves to face a protracted recession.  The report outlines the various types of assets held by the banks, including toxic assets like securitized mortgages, commercial loans and mortgages originated in-house, consumer loans and revolving credit card debt.Robert PresserThu, 28 May 2009 11:00:00 -0400http://www.themetropolitain.ca/articles/view/527http://www.themetropolitain.ca/articles/view/527International Trade Minister Stockwell Day has returned from a goodwill trade tour of China making all the right gestures and remarks; a commitment to fight protectionism, two new Canadian trade offices to promote our goods and services in China, and kind words for Chinese officials in an effort to improve bilateral relations.  There is even talk of a visit by Prime Minister Harper at a later date, a change of heart from his failure to attend the 2008 Olympics...Robert PresserWed, 06 May 2009 15:00:00 -0400http://www.themetropolitain.ca/articles/view/510http://www.themetropolitain.ca/articles/view/510After the conclusion of what is probably the most important G20 meeting ever held, one can be forgiven for feeling optimistic.  While unemployment in the US is at a quarter-century high at 8.3% and first world economies continue to contract, G20 leaders looked past their local economic miseries, resulting in an remarkable level of international commitment expressed in London.  This solidarity was truly exceptional given the divergent opinions held by many going into the meeting.Robert PresserThu, 09 Apr 2009 13:00:00 -0400http://www.themetropolitain.ca/articles/view/491http://www.themetropolitain.ca/articles/view/491 Investors around the world could be forgiven for expressing some optimism given the stock market results for the week ending on March 13th 2009: US markets posted the biggest gains in twenty years, with the Dow up over 9%, with similar gains on the broader S&P 500 index and the Canadian TSX.  One of the catalysts for this surge of optimism was an announcement by Citigroup that after receiving $45 billion in government assistance, the bank was able to post an $8 billion dollar profit in their current fiscal quarter...  Robert PresserThu, 19 Mar 2009 14:00:00 -0400http://www.themetropolitain.ca/articles/view/458http://www.themetropolitain.ca/articles/view/458As the world collectively suffers the hangover of economic excesses propagated by excessive debt, greed and deregulation, many wonder if all or any of this could have been avoided.  Fans of Nikolai Kondratieff will tell you that this era of falling prices, deleveraging of excessive debt and increased unemployment was both predictable and unavoidable.  We are suffering through the Winter, or final season of an economic long wave that lasts from forty to sixty years, and that we can expect that it will last for years to come...Robert PresserThu, 26 Feb 2009 09:00:00 -0500http://www.themetropolitain.ca/articles/view/435http://www.themetropolitain.ca/articles/view/435Many around the world celebrated  as they watched the inauguration festivities in Washington DC.  Barack Obama warned Americans that the challenges they face as a nation are numerous and grave, requiring individual sacrifice and difficult choices to plot a path back to prosperity.  While he spent a few minutes speaking to the world, he avoided asking them for their contribution to America’s renewal; the purchase of $5 trillion of new US debt to cover a half decade of enormous budget deficits.,,Robert PresserThu, 05 Feb 2009 06:00:00 -0500http://www.themetropolitain.ca/articles/view/381http://www.themetropolitain.ca/articles/view/381Many Quebeckers remain fixated on the economic problems in the United States and their spillover effect into Canada, notably the potential bankruptcy of one or more of the Big Three US automakers and the devastation this would wreak on central Canadian manufacturing...Robert PresserThu, 15 Jan 2009 08:00:00 -0500http://www.themetropolitain.ca/articles/view/124http://www.themetropolitain.ca/articles/view/124What a difference two weeks makes; our federal government has moved from calling a budget deficit in fiscal 2009-2010 “irresponsible” to “likely”.  Mr. Harper and Mr. Flaherty divulged ever more pessimistic prognostications for our economic future in order to soften up the public for what is likely going to happen whether we plan for it or not: a couple of years of federal deficits...Robert PresserThu, 27 Nov 2008 14:00:00 -0500http://www.themetropolitain.ca/articles/view/141http://www.themetropolitain.ca/articles/view/141Late last week, General Motors and Ford announced a combined third quarter loss of $7.2 billion US.  In other years, this would be considered catastrophic as an annual loss figure, but in the current economic context..Robert PresserThu, 13 Nov 2008 07:00:00 -0500http://www.themetropolitain.ca/articles/view/399http://www.themetropolitain.ca/articles/view/399There is not enough money in the world to give everyone who is suffering through hard times some kind of bailout.  Be they individuals, small businesses or corporations, some will have to be allowed to fail...Robert PresserThu, 30 Oct 2008 17:00:00 -0400http://www.themetropolitain.ca/articles/view/191http://www.themetropolitain.ca/articles/view/191Those readers old enough to remember the oil shock of the early 1970’s and the resulting surge in inflation across most of the world’s economies will greet with skepticism the notion of inflation as a solution to the international economic crisis.  In reality, we are already well on our way to inflation with the injection of trillions of dollars worldwide into the banking system to prevent it from seizing up – every dollar created by central banks to cover massive financial losses on the banks’ balance sheets debases the value of the issuing currency, and that’s the road we’re on...Robert PresserThu, 16 Oct 2008 09:00:00 -0400http://www.themetropolitain.ca/articles/view/205http://www.themetropolitain.ca/articles/view/205Much has been written over the past week concerning the US Federal Government’s $700 billion rescue plan for the nation’s financial firms.  As of this writing no plan has been passed, but in the meantime the US Federal Reserve and most central banks in the developed world have been flooding the markets with US dollar loans to meet the demand for funds from banking institutions...Robert PresserThu, 02 Oct 2008 16:00:00 -0400http://www.themetropolitain.ca/articles/view/217http://www.themetropolitain.ca/articles/view/217This November will mark 20 years since the historic election of 1988, when free trade with the United States dominated the debate. The Conservatives emerged from that election with a reduced minority and proceeded to enact the agreement that had been negotiated with the US...Robert PresserThu, 18 Sep 2008 16:00:00 -0400http://www.themetropolitain.ca/articles/view/233http://www.themetropolitain.ca/articles/view/233Perhaps it seems foolish to suggest that oil will head to $200 US in the wake of a $4 per barrel decline in the price of oil (to $110) on Monday, since Hurricane Gustav caused less damage than expected to offshore oil rigs in the Gulf of Mexico...Robert PresserThu, 04 Sep 2008 15:00:00 -0400http://www.themetropolitain.ca/articles/view/284http://www.themetropolitain.ca/articles/view/284Compared to many North American cities, Montreal is an easy place to own a car. Insurance rates are relatively low, our traffic congestion problems, although growing, are not at the levels of New York, Los Angeles, Atlanta or Toronto. The baby boomer generation can remember driving downtown and finding street parking with ease; today, the parking is still available, though we are paying for it at expensive rates...Robert PresserThu, 10 Jul 2008 06:30:00 -0400