Money Matters Toronto

Goodbye GM By Michael Moore

I received a great e-mail yesterday with commentary from Flint Michigan native Micheal Moore on the closing of GM. It is well worth a read.

Monday, June 1st, 2009
Goodbye, GM ...by Michael Moore

I write this on the morning of the end of the once-mighty General Motors. By high noon, the President of the United States will have made it official: General Motors, as we know it, has been totaled.

Global Banking: Better Rules, More Money

 

The cover story on the May 16th edition of the The Economist  reads "Three Trillion Dollars Later..."  Traditionally considered a pro free-market/laissez faire  magazine, it discusses remedies for our flawed global banking systems. Among the solutions, it proposes better rules and more capital. It's an insightful read. It's my pick for the read of the day.

The article starts out "Could there be a better time to be a bank?" and proceeds to strip down our current banking system to its bare bones. Tax-payers around the world have poured $3 trillion to keep the banking system afloat and the banks and bankers get to keep on doing the same sort of risky business they have always done to get us into this mess! The author duly notes ... "It should be obvious by now that in banking and finance the twin evils or excessive risk and excessive reward can poison capitalism and ravage the economy".

New Dehli News Hits Close To Home - Obama Praises Canadian Banking

I love the internet! How cool is this? Browsing through Toronto Mortgage articles on Google I come across an article posted by Thaindian News agency in New Delhi about Obama praising the Canadian banking industry. I am beaming with Canuck pride (not the hockey team) as I share this link

A Glimmer Of Hope?

  I subscribe to The Economist magazine and in this week's issue the cover story echos my sentiments and caution about the economy and the advice I give my clients when they ask me about my thoughts on the housing market.

The gist of the article is this... in the past few weeks the markets and media have been cautiously signaling that the worst is over and we are coming out the recession. Over the last 6 weeks the majority of the world's largest stock markets have risen by 20% and economic indicators from different parts of the world are brighter.

The Author warns that these faint glimmers of hope shouldn't be misinterpreted as the beginnings of a strong recovery when all they really show is that the rate of decline is slowing. An interesting fact that the author brings to light is that between 1929 and 1932, the Dow Jones Industrial Average soared by more than 20% four times, only to fall back below its previous lows. Today’s crisis has seen five separate rallies in which share prices rose more than 10% only to subside again.

At the end of the article the author predicts that we shouldn't think in terms of "Next year when the economy gets better..." but rather "Next decade when the economy gets better..." Folks we are in this for the long haul if my experiences in 1989 are anything to go by I think the worst is yet to come for us.

Be sure to read the full Economist Article here.