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IMF's forecast at odds with Ottawa's

From Thursday's Globe and Mail

Ottawa's projection of a robust economic rebound undermined by report that the global slump will stretch into 2010 ...Read the full article

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  1. First Name: Last Name: from Canada writes: .
    What Mr. Dodge isn't keeping in mind is that Mr. Harper is an economist and has his own analysis and Flaherty's to back him up.
  2. Catherine Wilkie from Canada writes: Harper's gov't has not grasped the gravity of the slumping global economy.

    Hard to manage what you don't grasp.
  3. Roger Cooper from Canada writes: And even the IMF report may be somewhat optimistic. Canada's economy will be as flat as commodity prices, and will not see much growth until about 6 months after the U.S. economy picks up. That will put the recovery out to 2011/2012.
  4. kevin o'connor from Canada writes: I've seen no good argument that the economy will recover robustly. 3.8% in 2010? Stagnation at 0-2% for years seems more likely. The previous two growth cycles were built on the back of bubbles, one based on a real technological advance (internet,, the other almost totally artificially created by monetary policy and finance (housing). What is the next growth cycle going to to be based on? Oil? Commodities? A double edged sword in Canada, and mostly a negative in our giant economic partner, the USA. A green revolution? It would be great, but is it likely to create growth in the medium term, or still be in the development stages? Government spending? I agree with a large stimulus package (we're likely to need more) to prevent deflation and depression but long term spending like this is unsustainable. I don't see how we have strong growth for a few years yet.
  5. Rob McCleave from Canada writes: As GB Shaw said, If you lined up all the economists in they world they would not reach a conclusion.
    Harper's track record is not stellar. He only figured out there was recession in December. But now that he's a born again Keynesian, I'm sure we'll all be farting through silk before the Vancouver Olympics(registered trademark).
  6. Mickey Hickey from Toronto, Canada writes: David Dodge is a straight shooter, Iggy would be well advised to recruit him as Minister of Finance and failing that as an adviser, the country needs people of integrity in leading positions. We have too many lightweights in Ottawa now.
  7. Homeless Bob from Lunenburg,NS, Canada writes: I am reminded of the two old chestnuts about economists:

    If you laid all the economists in the world end to end, they'd all be pointing in different directions.

    If you laid all the economists in the world end to end, they'd never reach a conclusion

    With that in mind, you can choose to believe whichever economist you like. There's bound to be one who supports your position.

  8. Evelyn Campbell from Canada writes: David Dodge has more credibility than Harper/Flaherty in my opinion. It was only a short time ago H/F were telling us there would not be a recession when there clearly was.
  9. G H from Canada writes: King Stephen and lawyer Flabberty ... analysis - the King got his degree like 30 years ago and hasn't seen a real job untill now. Flabberty is a failed lawyer that couldn't win a case if it was handed to him. My analysis is that both will continue to screw up and play games untill there is such a storm and huge fight in Ottawa that we end up going to the polls spending another half billion or so on an election. and out of this things will remain much the same. The cons of the Libs will end up with a minority and the economy will still tank
  10. lord cross of Blacks Harbour from blacks harbour NB, Canada writes:
    Homeless Bob from Lunenburg,NS, Canada writes:

    Agree totally with your characterisation of economists. The best one I've seen, to date, was offered by Art Carney's son, Mark, governor of the Bank of Canada, who has expressed the, I believe highly delusional opinion, the economy will enjoy an 'uptick' commencing in the second half of '09.

    Based on that opinion, and, noting Uzbekistan will enjoy expanded growth of 8.8%, I immediately sent an e-mail to Borat, Tony Clement and StockYard Day, in the earnest hope they will make a serious attempt to improve the Canuckistan / Uzbekistan border crossing point to relieve any impediment to the free flow of goods in a frantic trading environment.
  11. a l from Toronto, Canada writes: Not to worry, Harper's an economist, don't you know.
  12. Matthew Wulfman from Fort McHurry, Canada writes: The only question is whether the Cons are more delusional or dishonest. Take a traumatised public with a high percentage of dented to destroyed credit ratings that have been knocked on their keester. Combine them with a government that has thrown a high percentage of its revenue and a whole lot of new debt at it and you will have an exhausted country people will be afraid to spend if they're even able, afraid to go into debt if they are even able with a government that has exhausted any ability to pick things up.

    Wiley Coyote hasn't hit the bottom yet and probably still has some undiscovered, lit stick of dynamite tucked in his shorts. We haven't even had our price collapse in Fort Mac real estate. Those of us who are lucky enough (I can't claim much talent) to be debt free when this hit are sitting on our wallets waiting for the collapse... thereby guaranteeing it will happen.
  13. garlick toast from Canada writes: Harper delivered a one year plan for a five year problem.Carney designed the I.T. debacle and supported his stance with 18 pages of blacked out documents. Now with the Libs. firmly under Harper's thumb we have a coalition gov't..
    The I.M.F is releasing their bad news in controlled doses. If they exposed the truth in one fell swoop, there would be blood in the streets.
  14. charles ANTHONY from Canada writes: IMF and their economists are useless bureaucrats like most gatekeepers? A day late and dollar short. MIA. Here no evil see no evil. Negligent! Too many stupid fools in this world highly educated and no smarts.
  15. Ed Long from Canada writes: David Dodge is very much in line with international policy makers and corporate CEOs.

    At Davos, the International Economic Forum, there a major concerns regarding protectionism. India is already threatening measures in retaliation to perceived rejection of low cost Indian products being shipped to other countries, i.e. generic drugs to Brazil. The U.S. Congress is currently discussing a " Buy America " policy. Think of the implications for Canada.

    Global air freight, an indicator of the movement of goods, dropped 22% in December compared to '07.

    And Price Waterhouse released a December survey of 1100 global CEOs. 21% saw revenue increased in 12 months. 34% saw increases in 36 months. And most troubling for Canada, only 1 in 10 saw a shortage of natural resources.
  16. Ed Long from Canada writes: I have checked local real estate price history and after a recession, it takes 8 - 9 years for prices to begin a significant rise and the 10th year begins a new cycle.

    We have just come through 5-6 years of historical growth. A lengthened "flattening" is overdue.

    The Government is not stupid but for whatever reason is not talking the same language as the rest of the world.
  17. garlick toast from Canada writes: Ed Long, the gov't.'s push for tax cuts and increased consumer spending is stupid.It's like an airplane ditching fuel to make it fly further, what happens if the nearest airport is closed?
  18. Politicians are Fascist Pigs from Canada writes: Garlick Toast is right; We should be wary of private bankster globalist economists; the truth is out there- we just don't know it yet.
  19. Glynn W from Canada writes: Tell em Ottawa that we are the hand that feeds it (IMF) and that they shouldn't bite. Or we might just go set up another world institution that will come to see things our way!
  20. Brian C from Canada writes:
    For all you Monday morning quarterbacks who always know better than the economists, perhaps you should read the article.

    "The IMF's revisions show just how difficult it has been for even the most well-equipped forecasters to get a handle on how fast the world economy is collapsing. Yesterday's report marked the third time since October the fund has cut its outlook for the global economy."

    Everybody in the industry realize that forecasting an event that has never before happened in history cannot be done accurately. We were joking last week at an finance sector association dinner about our forecasts from a year ago. Not one single person out of the 400 there was even close to predicting where the TSX would be. Every single economist, whether working in the private or public sectors, have had to drastically revise their outlooks. No one predicted that resetting ARMs would eventually effect the price of oil.

    So, for you people who know better than the experts, please tell us where the TSX, the DOW, and oil futures will be next year at this time, and
    the rest of us can mock you for how far off you are.
  21. Flander Jones from Canada writes: Glynn W from Canada writes: Tell em Ottawa that we are the hand that feeds it (IMF) and that they shouldn't bite. Or we might just go set up another world institution that will come to see things our way!

    Excellent advice. The message sucks. Shoot the messenger! Lets make up our own message. It is all good. We will be fine. Buy stocks now.....Ohmmmmm.....
  22. Ed Long from Canada writes: Garlick ... If you read Dodge's comments, he says debt has to be reduced.

    And when are we going to talk about international finance regulation and transparency? That was a hot topic back in October when panic was everywhere.

    Obama's stimulus is based upon returning to status quo .... people spending either with real dollars or debt they are confident they can pay. The insanity continues.

    Meanwhile Davos is debating the rise of the "frugal American". What happens if Obama's stimulus does not stimulate anything? There are already indications that Americans are saving. One scenario has over $4 Trillion USD going into saving accounts/money markets in a year.

    That throws a wrench into the spend theory.
  23. garlick toast from Canada writes: Brian C from Canada writes:
    For all you Monday morning quarterbacks who always know better than the economists, perhaps you should read the article.

    Here's a couple of clues you might have missed. US personal savings went negative about three years ago. The ''normal'' rate of increase for housing prices is the inflation rate plus a couple of % points.By that measure, US prices have to lose 30% from their peak.
    There's no shortage of economists who saw this coming years ago. The trouble is, they were dismissed as kooks, like the guy [Talbott] who correctly predicted the US housing meltdown and wrote a book about it back in '03.
    Then there's the Enrons et al where the lack of due dilligence was a tip-off.
    75% of our exports go to the US. When your major customer goes t!ts up, what does that do for your business?
    BTW, it's Friday :-)
  24. garlick toast from Canada writes: Ed Long from Canada, yes the ''savers'' are throwing a monkey wrench into the works.They realize there isn't enough real money to spend our way out of this mess. Harper is saying ''spend''. Anyone following his advice is in for a shock when they run out of dough and there is still no relief in sight.
    I had my wake up call in the early '80s. Now when I get a ''wind fall'' it goes to essentials, land or durable goods. My bucket just isn't big enough to bail out the economy.
  25. Brian C from Canada writes:
    Thanks garlick toast. But I missed your prediction for the TSX, DOW and oil. Shouldn't be hard for someone as smart as you.

    BTW, it's Thursday where I am, which isn't even Newfoundland/Labrador.

  26. garlick toast from Canada writes: Ah yes, it's Friday in what passes for my brain.
    Where will oil be in a year? Who knows? Demand will be down but OPEC wants to cut production. Can they? they are as addicted to consumer consumption as we have been.I think the question is how long will the USD be the global currency. They sure are printing a lot of it, backed by what, good intentions?
    I think the TSX is headed to the 6000 range with significant ''sucker rallys'' on the way. In the end, the only investors left will be those who have to be in it, pension plans and institutional investors.
    I don't know anything about the DOW, however, stockmarkets always lead economic recoveries.Based on how long it will take the US housing market to get back to ''normal'' I'd say recovery is five years away.
  27. gar gurr from Canada writes: When has the IMF ever been right?
  28. Don Komenda from Thunder Bay, Canada writes: Ottawa's prediction??? If what is being referred to is Harper's and Flaherty's foresight on the economy, all I can say is that these two clowns couldn't tell you today what the weather was yesterday.
  29. Ed Long from Canada writes: garlick ... It is interesting you mention the 1980's recession. If you lived through that, and the early 1990's recession, you will know this is not a one or two year deal.

    I accept your five year projection as a general return to the prices and growth of eighteen months ago. However, some sectors will not return for a time much longer than five years and we will have a new economy with different priorities and growth patterns.

    Harper and Obama are saying they can stimulate a resuscitation of the status quo. It's dead, deceased, gone to the great hereafter ...

    And saving is the first sign of acceptance that we are making a transition as people prepare for the long hunker down.
  30. wayne arthur from Canada writes: In the late 1980's Japan went through a period of easy monetary policy, low interest rates and a bubble in real estate prices along with their stock exchange (sound familiar?). The bubble collapsed around 1991 and neither real estate prices nor the stock market have returned to their highs.

    In response to the bursting of the bubble, the Bank of Japan lowered interest rates to near zero, bailed out banks and spent billions on public works projects (sound familiar?) and still their average GDP growth has been around 1.5% - 2% for the past 17 years.

    Unlike the USA, they started with a positive trade balance and a budget surplus. Until the USA airs out all the bad debt and lets banks and companies that are technically bankrupt go under, this recession (correction, depression) will drag on for a decade or more and like it or not, Canda will be dragged along for the ride.
  31. My Name is Jack and Iggy Can't Be Trusted from Black Mud Creek, Canada writes: Don Komenda from Thunder Bay, Canada writes: Ottawa's prediction??? If what is being referred to is Harper's and Flaherty's foresight on the economy, all I can say is that these two clowns couldn't tell you today what the weather was yesterday

    In October of 2008 In trying to figure out how to save for retirement faster I purused all the economic forcasts by so called economists.

    For example Merrill Lynch Canada, TD Bank chief economist Scotiabank chief economist Warren Jestin, Don Drummond, CIBC World Markets senior economist Avery Shenfeld, Sherry Cooper of BMO Capital Markets they all had different and varying opinions some like Don Drummond missed the mark completely.

    So I listened to my neighbor who said "screw economists buy gold."
  32. PC Montreal from Canada writes: I'm with you Evelyn Campbell, Dodge is the only one of the three with a ounce on integrity and no perceivable conflict of interest. As Matthew Wulfman wrote, "The only question is whether the Cons are more delusional or dishonest." The IMF has a tainted history and many hidden agendas; definitely biased.

    However, Dodge has had a lot of experience and has a much more practical view of things. I think Flaherty would do well to heed Dodge's remarks and move forward accordingly.

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