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View Full Version : Economy in 2008: A stunning reversal of fortunes



Slow
01-01-2009, 10:55 AM
"At this time in 2007, Canadians had every reason to feel economically smug.

CTV News' top story of 2007 was the high-flying loonie. It was a byproduct of our surging economy, which was being driven by global demand for our commodities. It was the only economic story on the list.

On Dec. 31, 2007:

* the Canadian dollar was worth US 99.13 cents
* a barrel of oil could be had for US$91.75
* the S&P/TSX composite index closed at 13,155.1
* the unemployment rate was 6 per cent (in the fall, unemployment dropped to 5.8 per cent, a 32-year low)

The loonie would rise slightly higher to reach about $1.03 U.S. on Feb. 28, and on July 11, oil peaked at a price of US$147.27 per barrel.

On June 18, the stock market hit a record high -- 15,073.1.

As 2008 ended, those indicators look much, much worse:

* the Canadian dollar was worth US 82 cents (it dipped to a low of US76.88 cents on Dec. 5)
* Oil sold for US$44.60 per barrel -- it went for US$32.40 on Dec. 19, the lowest price since January 2004
* the S&P/TSX composite index closed at 8,987.7 on Dec. 31. It had declined to 7,724 on Nov. 20
* in November, the unemployment rate jumped to 6.3 per cent, with Ontario losing 66,000 of the 71,000 jobs lost across the country.

Consumer confidence has plunged to a level not seen since the 1982 recession. Analysts said the stock market lost 35 of its value in 2008, the worst performance since the Great Depression.

"I think one of the most startling things for Canadians is just how stunning the reversal of fortunes has been," Patricia Croft, chief economist of the investment firm Phillips Hager and North, told CTV.ca.

"It wasn't that long ago that we were told everything was fine. I wouldn't say we were smug..."

http://www.ctv.ca/servlet/ArticleNews/story/CTVNews/20081224/YE_economy_090101/20090101?hub=TopStories

You wouldn't? Why not? You were.

Striker
01-01-2009, 11:16 AM
I'm not sure how well you know RW,but for several months we could not get him to understand America (followed by Canada) was heading for a recession.I guess a point came where he could no longer refuse to accept the truth and then he vanished.

Maybe you should contact him and let him know we are in a recession.Countless on here tried to convince him but had little luck doing so.The reasons why he didn't believe are no longer important.What is important is that he knows the truth.

Thanks Slow

Chester Field
01-01-2009, 12:58 PM
30 cents on the dollar difference is a good thing for the Canadian dollar during recession. We buy less and export more. The banks are in relatively good shape, but employment will suffer for a drawn out period as it always does. We are slow to recover from recession, just as we are hesitant to admit it's arrival.

Barry Morris
01-01-2009, 01:21 PM
Isn't that the way our economy SHOULD work?? What kind of panic in the markets would there be if, at the first indication of a problem our leaders began to cry that the sky is falling??
I don't really believe our leaders are hesitant to take action, they just don't show it early on.

D0bb3r
01-01-2009, 03:43 PM
This IMO is not as bad as its being made out to be ..

YES there will be some loss of jobs in the short term [auto sector] but in the long run when companies
like chev and dodge fall .. other stronger companies like toyota, nissan, ford, and honda will buy up the
factories retro fit them to build their cars and re employ out of work ppl to run the factory !!
Its not going to happen over night, we are going to have to watch our spending for a little while.

This isnt a recession as much as a leveling of the playing field .. the auto sector and oil companies have been
inflating prices for decades. Other companies have lived in their shadow, and are now being forced to stand on their own !!
Let them pull from their over stuffed pockets to stay afloat.
keep my tax dollars where they will work best for my future, secure my pension and my RRSP's !!

Anapeg
01-01-2009, 03:55 PM
Daryn the only constant is change. Your views make sense. As with the dinosaurs you change or die off and make room for the more pliable, adaptable to pick up where you left off.

Barry Morris
01-01-2009, 06:07 PM
In my business, we continually get more bang for the buck. I can quote a customer now on a complete sound system for his church or hall, and be guaranteed the price will be the same OR less next year, AND the equipment will do more.

Why can't cars be like that?? The price should not increase year by year.

Hans
01-01-2009, 07:25 PM
The problem with cars is very simple : they keep changing models every year. But is that what the consumer wants?

Striker
01-01-2009, 08:40 PM
The problem with cars is very simple : they keep changing models every year. But is that what the consumer wants?

I believe the consumer wants quality which is the #1 reason for the strong sale of imports over many decades.The big 3 had decades to work on their quality problems as well as improving their R&D and reduced time implementing new ideas and development of new models.

They chose to ignore the threat and continued pleasing share holders.We can only hope the point has been driven home.I'm afraid greed will continue to play the lead role in the big 3.It led them into this and unless that one element changes they will never find their way out.

Huggy85
01-02-2009, 04:06 PM
I'm not sure how well you know RW,but for several months we could not get him to understand America (followed by Canada) was heading for a recession.I guess a point came where he could no longer refuse to accept the truth and then he vanished.

Maybe you should contact him and let him know we are in a recession.Countless on here tried to convince him but had little luck doing so.The reasons why he didn't believe are no longer important.What is important is that he knows the truth.

Thanks Slow

I recall where, the week before Christmas, RW stated that America had enetered a recession just the week before. This was a couple weeks after the media started reporting that the US had been in recession since last December.

So, although he seems to have accepted that the US is in recession, he seems not to understand the depth of it yet. Maybe you can talk to him about that, Slow.

Slow
01-02-2009, 05:59 PM
There was no recession until last month. There can be signs a recession is coming, but that is not the same as a recession officially happening.

Once again, RWGR was right, and you guys owe him thanks.

Huggy85
01-02-2009, 06:25 PM
There was no recession until last month. There can be signs a recession is coming, but that is not the same as a recession officially happening.

Once again, RWGR was right, and you guys owe him thanks.

http://money.cnn.com/2008/12/01/news/economy/recession/

"It's official: Recession since Dec. '07
The National Bureau of Economic Research declares what most Americans already knew: the downturn has been going on for some time.


The National Bureau of Economic Research said Monday that the U.S. has been in a recession since December 2007, making official what most Americans have already believed about the state of the economy ."

Do some research, perhaps with what you learn you might be able to enlighten both of you.

Slow
01-02-2009, 06:40 PM
Sadly, your lack of education is blindingly apparent here.

A recession is marked by two quarters of negative growth. That did not occur until last month. What you are drooling over is 'signs of recession'.

RWGR was right...he should have been given a stipend for the education he imparted here. It is a never-ending job.

The Berean
01-02-2009, 06:55 PM
"The National Bureau of Economic Research said Monday that the U.S. has been in a recession since December 2007, making official what most Americans have already believed about the state of the economy ."

who to believe? i dont think we believe Slow

Slow
01-02-2009, 06:59 PM
"The National Bureau of Economic Research"

And who are they??

Huggy85
01-02-2009, 07:50 PM
The National Bureau of Economic Research


"The NBER is the nation's leading nonprofit economic research organization. Sixteen of the 31 American Nobel Prize winners in Economics and six of the past Chairmen of the President's Council of Economic Advisers have been researchers at the NBER. The more than 1,000 professors of economics and business now teaching at universities around the country who are NBER researchers are the leading scholars in their fields. These Bureau associates concentrate on four types of empirical research: developing new statistical measurements, estimating quantitative models of economic behavior, assessing the effects of public policies on the U.S. economy, and projecting the effects of alternative policy proposals."

http://www.nber.org/info.html


Stick around, Slow, we'll educate you here.

Huggy85
01-02-2009, 07:58 PM
Sadly, your lack of education is blindingly apparent here.

A recession is marked by two quarters of negative growth. That did not occur until last month. What you are drooling over is 'signs of recession'.

RWGR was right...he should have been given a stipend for the education he imparted here. It is a never-ending job.

http://money.cnn.com/2008/12/01/news/economy/recession/

"Many people erroneously believe that a recession is defined by two consecutive quarters of economic activity declining. That has yet to take place during this recession."

When I see you or RW quoted in the national media, I might give you some credibility.

Barry Morris
01-02-2009, 08:10 PM
RWGR hated facts like that!!!

Striker
01-02-2009, 08:38 PM
"The National Bureau of Economic Research"

And who are they??

The NBER is the nation's leading nonprofit economic research organization. Sixteen of the 31 American Nobel Prize winners in Economics and six of the past Chairmen of the President's Council of Economic Advisers have been researchers at the NBER. The more than 1,000 professors of economics and business now teaching at universities around the country who are NBER researchers are the leading scholars in their fields. These Bureau associates concentrate on four types of empirical research: developing new statistical measurements, estimating quantitative models of economic behavior, assessing the effects of public policies on the U.S. economy, and projecting the effects of alternative policy proposals."

I bet you're sorry you asked that question..............lol


THE DEFENSE RESTS

Huggy85
01-02-2009, 08:40 PM
"Recession: The Newspaper Definition
The standard newspaper definition of a recession is a decline in the Gross Domestic Product (GDP) for two or more consecutive quarters.

This definition is unpopular with most economists for two main reasons. First, this definition does not take into consideration changes in other variables. For example this definition ignores any changes in the unemployment rate or consumer confidence. Second, by using quarterly data this definition makes it difficult to pinpoint when a recession begins or ends. This means that a recession that lasts ten months or less may go undetected.

Recession: The BCDC Definition
The Business Cycle Dating Committee at the National Bureau of Economic Research (NBER) provides a better way to find out if there is a recession is taking place. This committee determines the amount of business activity in the economy by looking at things like employment, industrial production, real income and wholesale-retail sales. They define a recession as the time when business activity has reached its peak and starts to fall until the time when business activity bottoms out. When the business activity starts to rise again it is called an expansionary period. By this definition, the average recession lasts about a year."

http://economics.about.com/cs/businesscycles/a/depressions.htm

Striker
01-02-2009, 08:40 PM
RWGR hated facts like that!!!


Good thing we're talking to Slow............shouldn't see any hurt feelings

Huggy85
01-02-2009, 08:50 PM
http://www.telegraph.co.uk/finance/financetopics/recession/3917367/Definition-of-a-recession-drawn-up-on-back-of-an-envelope.html



"The technical definition of a recession was drawn up on the back of an envelope and was a piece of political spin, a former ambassador to the US has claimed."

"Peter Jay, who was Britain's envoy to Washington between 1977 and 1979, said that the definition - two consecutive quarters of negative growth - had no basis in economic theory and was created by the US Government in 1967 to aid the re-election prospects of President Lyndon Johnson.

Mr Jay, who said he was "in the room" when the definition was established, said that Art Okun, the chairman of Johnson's economic council, acted upon "indications that there might be a recession that year", which he feared would dent the President's popularity.

He said: "Art had the neat idea that if we had a definition of recession which meant that people could say we are not actually in a recession, not technically, that would get the president out of a difficulty.

"So on the back of an envelope he invented the idea that in order to call it a recession you had to have had two consecutive quarters of negative growth."


Now I see why this "2 quarters of negative growth definition works so well for RW and Slow

"Mr Jay, who went on to become the BBC's economics editor, said: "This was completely arbitrary - there was absolutely nothing scientific or in the economic theory that requires that a recession be defined in that way. It was just a neat device by a clever economist trying to help his chief who was faced with a political challenge. "

Barry Morris
01-02-2009, 08:57 PM
Good thing we're talking to Slow............shouldn't see any hurt feelings

Off topic.

Barry Morris
01-02-2009, 08:58 PM
....It was just a neat device by a clever economist trying to help his chief who was faced with a political challenge. "

Well, whaddya know!!!

Slow
01-03-2009, 11:10 AM
Well, whaddya know!!!

Must be why Harper said "We are fine!" and "I fear a Depression" within seven days time! :)

Huggy85
01-03-2009, 11:16 AM
Feeling the need to change the subject all of a sudden?

Slow
01-03-2009, 11:22 AM
Not at all. I responded to the issue of double-talk. If that was a change in subject, you'll need to address it to the person I responded to.

Barry Morris
01-03-2009, 02:14 PM
Feeling the need to change the subject all of a sudden?

Le pauvre type perdu encore.

Huggy85
01-03-2009, 02:16 PM
Le pauvre type perdu encore.

huh?

Huggy85
01-03-2009, 02:17 PM
Thats true!!! He might even come back and say, "I guess you guys are right!!"

Not likely

Barry Morris
01-03-2009, 02:27 PM
Not likely

Seulement un vrai homme pourrait.

The Berean
01-03-2009, 05:48 PM
Feeling the need to change the subject all of a sudden?

Theres no beginning to his understanding

Anapeg
01-03-2009, 06:49 PM
Slow, Harper says whatever is politically expedient and beneficial to him and his party. While we common folk where experiencing the recession he chose to not mention he was counting non existent votes in an ill planned election called solely to boost his bloody ego.

Slow
01-03-2009, 06:52 PM
Harper's sentiments were echoed in here last fall.

Huggy85
01-03-2009, 07:18 PM
Harper's sentiments were echoed in here last fall.

Harper was saying what he figured he had to to get elected. What is your excuse for maintaining your denial of the US recession?

Hans
01-03-2009, 07:21 PM
I have never seen Slow deny the US recession.

Anapeg
01-03-2009, 07:31 PM
Non farm payroll employment fell sharply (-533,000) in November, and
the unemployment rate rose from 6.5 to 6.7 percent, the Bureau of Labor
Statistics of the U.S. Department of Labor reported today. November's
drop in payroll employment followed declines of 403,000 in September and
320,000 in October, as revised. Job losses were large and widespread
across the major industry sectors in November.

Unemployment (Household Survey Data)

Both the number of unemployed persons (10.3 million) and the unemploy-
ment rate (6.7 percent) continued to increase in November. Since the start
of the recession in December 2007, as recently announced by the National
Bureau of Economic Research, the number of unemployed persons increased by
2.7 million, and the unemployment rate rose by 1.7 percentage points. (See
table A-1.)
You are right Hans that was RW who wasn't as agreeable as Slow. You might wish to read the last paragraph as this will prove that RW was wrong.

Huggy85
01-03-2009, 07:31 PM
I have never seen Slow deny the US recession.

True; but his "buddy" RW has denied it until late December and Slow believes, like RW, and contrary to the experts, that it started just in December.

He needs to educate RW then before either of them squawk abut the recession in Canada

Huggy85
01-03-2009, 07:35 PM
A recession is marked by two quarters of negative growth. That did not occur until last month.

A reminder, Hans, of what Slow said just yesterday

Hans
01-03-2009, 07:36 PM
Well, I must have missed that one. so I stand corrected.

Anapeg
01-03-2009, 07:47 PM
In case you ALL missed it this is from the U.S. government themselves, not me, hans, or Barry.


"Since the start of the recession in December 2007, as recently announced by the National Bureau of Economic Research, the number of unemployed persons increased by 2.7 million, and the unemployment rate rose by 1.7 percentage points."