Box office bonanza helps Cineplex buck recession November 11, 2009
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Cineplex Galaxy Income Fund posted higher revenue and profits based on heightened demand for movies in the third quarter.
Cineplex Galaxy Income Fund saw record attendance at its cinemas in the third quarter of 2009.(Canadian Press)
Revenue totalled $257.5 million, up 7.7 per cent or $18.4 million from $239.1 million in the same period last year.
Attendance at movies in Canada hit 18.8 million, up four per cent from 18 million last year.
Cineplex said its box office sales for the quarter, reported at $155.9 million, was the highest-ever box office revenue for any given quarter.
“From a box office perspective, [the recession] has been fantastic,” Cineplex Entertainment CEO Ellis Jacob said.
The Toronto-based income trust also reported higher net income of $20.4 million for the third quarter, up from year-ago profit of $18.4 million.
Revenue met a consensus estimate of four analysts compiled by Thomson Reuters.
That a screener of movies would fare well during a recession even as other businesses dependent on discretionary income have suffered is not necessarily surprising, economists note.
Three-month stock chart for Cineplex Galaxy Income Fund on the TSX.(CBC)
“People still spend money during recessions; they just spend it on different things,” TD Economist Derek Burleton said.
“The entertainment sector has done well in general, and for people who are used to going to restaurants and spending $100 or $150, [movies] are a cheaper alternative.”
The company attributed the box office bonanza to screening a wider variety of films.
Cineplex said the quarter was boosted by films catering to a wider range of audiences, including premium-priced 3D features like Ice Age: Dawn of the Dinosaurs and IMAX products like Harry Potter and the Half Blood Prince.
The company was buoyed by a strong lineup of family films, because such films often lead to increased purchases of concessions. But the company is well positioned to keep customers even if the calibre of releases slip, Jacob said.
‘We set the table; we don’t serve the steak.’? Cineplex CEO Ellis Jacob
“I always tell people, we set the table; we don’t serve the steak,” he said.
For comparison’s sake, the third quarter of 2008 included the release of The Dark Knight, the second-highest-grossing movie of all time in North America.
The company earned an average of $4.15 worth of concessions from every paying customer during the quarter. That was up 4.5 per cent over last year and set a new record, but it wasn’t achieved by jacking up prices, Jacob said.
“One thing we’ve been very conscious of during the past year is we have not raised any of the prices on concessions,” Jacob said.
Cineplex is the largest motion picture exhibitor in Canada with about 10,000 employees at 1,328 screens and annual attendance of 63.5 million.
With files from The Canadian Press (more…)
GDP growth suggests end to U.S. recession November 3, 2009
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The U.S. economy grew 3.5 per cent in the third quarter, slightly better than the market forecast of 3.2 per cent, and its best showing in two years.
The report by the U.S. Department of Commerce suggests that the worst recession since the 1930s has ended, at least by the technical definition, and a new phase of fragile recovery has begun.
Economists define a recession as two consecutive quarterly declines in GDP growth. The U.S. economy has posted negative quarterly GDP growth since the third quarter of 2008.
Though other indicators such as industrial output, jobs and consumer spending remain worrisome, the growth in GDP means that in technical terms, the recession has ended in the United States.
Fuelled by government-supported spending on cars and homes, the growth in GDP was the strongest signal yet the economy has entered a new phase of recovery.
The report “suggests the U.S. has finally shaken off the shackles of the deep economic recession and is beginning the economic recovery process,” Millan Mulraine, an economist strategist at TD Securities, said in a commentary. However, with so much of the growth coming from government stimulus, he said, “we expect GDP growth in the coming quarters to be less robust.”
Also, the U.S. government says the number of people claiming jobless benefits for the first time dropped slightly last week, evidence that the labour market remains weak even as the economy is recovering.
The Labour Department said Thursday its tally of newly laid-off workers seeking unemployment insurance fell by 1,000 to a seasonally adjusted 530,000 last week. Analysts expected a steeper drop to 521,000.
Still, the four-week average, which smooths out volatility, fell for the eighth straight week to 526,250, its lowest level since early January. Claims are slowly declining as companies lay off fewer workers.
The number of people continuing to claim benefits, meanwhile, has dropped sharply by 148,000 to 5.8 million, below analysts’ expectations.
With files from The Associated Press (more…)
Great Recession? This time it’s different October 28, 2009
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People gather outside a bank in 1933 during the Great Depression. (Reuters)
As the 80th anniversary of Black Monday approaches, comparisons have been made between the Great Depression that struck the world in the 1930s and the economic slowdown underway today.
A look at the facts, however, shows some subtle yet important differences between the two scenarios.
One key difference is the geographic range affected. While the Great Depression was certainly global in scope, North America was disproportionately hard-hit.
“I don’t think it could have been any worse among industrial nations,” Canadian economic history professor Joe Martin tells CBC News of the 1930s. “Canada suffered far worse than anyone, including the U.S.A.”
In 1932, long line of jobless and homeless men wait to get free dinner at New York’s municipal lodging house. (Associated Press)
Canadian GDP per capita went down by 25 per cent, on average, during the Great Depression, he notes, and by 1933 more than a quarter of Canadian workers were officially unemployed. Between the stock market crash of October 1929 and the spring of 1933, Canada’s national income fell by almost half. Even then, the recovery was uneven, and the slump began anew in 1937. It wasn’t until 1940 that the economy began a sustained rally.
In Europe, the Great Depression wasn’t nearly as bleak. German GDP per capita declined by 17 per cent at its lowest point, and in the United Kingdom, GDP fell by only five per cent. It was during the Great Depression that the British economy surpassed the U.S. as the world’s largest, Martin notes.
Contrast that with the current situation 80 years on. The global economy is a lot more interconnected, and the pain is a lot more evenly distributed. A mortgage on a home in Scottsdale, Ariz., gets securitized and sold to investment banks across the world, spreading the pain of that real estate collapse across numerous countries.
The dust has yet to settle, but it’s already clear that the economic slowdown of 2008 and 2009 is certainly geographically widespread. With the notable exception of China (where GDP growth slowed to six per cent) and Australia, virtually every developed economy in the world experienced some sort of recession over the past year.
‘Canada suffered far worse than anyone, including the U.S.A.’?Economic history professor Joe Martin
Compared with double-digit declines throughout the 1930s, Canada posted three quarters of negative GDP growth, and the Bank of Canada expects the Canadian economy to emerge from recession during the current quarter.
“I’ve said from the beginning it will not be as bad,” Martin says. “I don’t think, when the final numbers are in, it will even be as bad as the early 1990s [recession.]“
The sectors most affected were also quite different, then and now. In Canada, much of the pain in the current recession has occurred in the battered manufacturing sector. The woes befalling auto manufacturers and other heavy industries have hit hard in Ontario, where the provincial deficit is forecast to soar to $22 billion this year.
In the 1930s, it was the resource-dependent West that bore the brunt of the pain. Saskatchewan’s gross domestic product shed some 75 per cent in 1930, Martin notes. Canada’s main export at the time was wheat, and as demand dried up, grain prices hit their lowest prices in more than 300 years. And the export prices of farm products, fish, lumber and base metals fell far more steeply than those of manufactured goods.
As a result, municipalities in the four westernmost provinces were unable to pay the interest on their debts, and Ottawa had to step in. No matter how the current economic slowdown shakes out, Canadian governments are a long way from defaulting on their debts.
An unemployed man leans against a vacant store in 1935. (Reuters)
The differences don’t end there. Current economic problems have been pinned, in broad terms, on financiers creating obscure financial instruments that allowed them to take unnecessary risks. Terms such as collateralized debt obligations, asset-backed commercial paper, subprime mortgages and mortgage-backed securities have all been blamed for exacerbating, if not causing outright, the financial collapse.
In the Great Depression, Martin notes, the financial system was much more closely regulated. “Banks weren’t allowed in the mortgage market, for example,” Rotman School of Management professor Lawrence Booth tells CBC News. “And [they weren't] allowed into the insurance market either.”
Many financial firms collapsed, to be sure, and the survivors were much less nimble, but the economy eventually recovered. Governments and regulators today appear to be adopting that model, having already moved to put tighter controls on the industry to mitigate speculative activity.
“We can criticize Canadian bankers for being too cautious and conservative, but in the long run, I think you want your banks to be cautious and conservative,” Martin says.
In fairness, none of the actions governments and regulators took in the 1930s was enough to truly shake the economy out of its doldrums. It took the Second World War to do that.
Indeed, Canada emerged from the Great Depression quicker than the United States did in part because it joined the war effort sooner, Martin says ? one week after the United Kingdom did in 1939. The United States did not formally join the war until December 1941, after the attack on Pearl Harbor.
This current economic slowdown is still waiting for a catalyst to signal its end. Governments have pumped billions worth of stimulus spending from public coffers to try to pump up demand. Nobody knows, however, what the impact will be when those taps are ultimately turned off ? nor what ballooning federal deficits might do to the global economy down the line.
Small firms more recession-proof: CIBC October 6, 2009
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Small businesses have outperformed their larger competitors during the recession, a new CIBC report suggests.
According to government data, the number of small enterprises across the country increased during the year ending March 2009. Despite there being periods of economic contraction, some small businesses blossom during recessions, as laid-off workers venture out on their own as entrepreneurs.
That appears to have happened this time around, as overall employment at small enterprises stayed steady, even as larger companies slashed payrolls by an average of 10 per cent during the first six months of 2009, the bank found.
In a report entitled Bruised But Not Battered, released Monday, economists at the bank offered numerous explanations for the discrepancy. Smaller firms tend to sell to domestic consumers, whose finances have remained in better shape than their American counterparts. Whereas larger firms have borne the brunt of the suddenly spendthrift U.S. consumer more directly, the bank said.
Similarly, the inward focus of Canadian small business has made small businesses as a whole comparatively insulated from the soaring loonie. Larger companies are more likely to be export-dependent, and as such more vulnerable to the impact of the stronger dollar.
“At the same time, the increase in the value of the dollar means cheaper imports ? a clear positive for small firms that import raw materials,” the bank said.
And small businesses are poised to outperform the big boys again during the recovery, the bank argues.
Small firms have advantages
Technology is driving a transition “from boardrooms to basements,” the bank said, allowing small business owners to be that much more nimble and able to accomplish more with less.
The bank also cites a structural shift to a strong culture of individualism in the Canadian business community as being a factor that will spur Canadian entrepreneurialism.
The demographics of Canada’s population tilt in favour of small enterprise, as those in the 35 to 55 age group are most likely to become self-employed, the bank notes.
Regionally, Alberta was identified as the most promising for small business growth in the coming five years, boosted by above average economic growth and a favourable industry mix.
Activity in the Prairie provinces will be held back by the area’s rural focus, and a dearth of immigrants. And lower economic growth and an unenviable sectoral mix will be the main factors limiting small business growth in Atlantic Canada, the bank said.
The bank estimates that businesses with between six and 50 employees currently have a 65 per cent chance of staying in business for more than three years.
Recession prophet sees slow recovery September 7, 2009
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An economist credited with predicting the global financial crisis said Friday he expects a slow recovery for advanced economies, with quicker, robust growth in the developing world.
New York University Prof. Nouriel Roubini said he doesn’t expect a “V-shaped” recovery, where the recovery phase is just as dramatic as the descent. Instead, he predicts a slower, “U-shaped” economic recovery with the risk of a relapse recession (also known as a “W-shaped” recovery) if governments don’t time the end of stimulus packages correctly.
New York University economist Nouriel Roubini, shown in April speaking at the Council on Foreign Relations in New York, forecasts a slow economic recovery for the developing world.(Mark Lennihan/Associated Press)
“I believe that the basic scenario is going to be one of a ‘U-shaped’ economic recovery, where growth is going to remain below trend ? especially for the advanced economies, for at least two or three years,” he said at the Ambrosetti Forum on Italy’s Lake Como. The annual conference brings together top political and business figures.
“Within that ‘U’ scenario I also see a small probability ? but a rising probability ? that if we don’t get the exit strategy right we could end up with a relapse of growth and therefore with a double-dip recession,” he said.
Roubini said that “it is very tough not to make a policy mistake” between the opposite risks of ending the stimulus too soon ? and sending the economy back into recession ? or too late, which could mean unsustainable budget deficits. Of the two, he said, waiting too long seemed riskier.
“Whether that’s highly likely or not, I don’t know. I think it certainly is a rising risk,” said the prominent economist, among the few experts to predict the current crisis. In April, Roubini said the Canadian economy was likely to fare better than others. “Canada may recover sooner than others, but it will be painful even [here],” he told CBC News at the time.
He credited the country’s sound banking system for his optimism. It’s a theory that’s gained prominence as Canada’s economy has shown signs of improvement over the summer. Shares in Canada’s major lenders have just about doubled since a trough in March.
‘The road ahead is going to be at best bumpy, if not worse than that.’?Economist Nouriel Roubini
In April, he still saw no end to the recession. “Not any time soon, certainly not this year,” he told CBC News. “We may get out of it by the end of next year, if we are lucky.”
Even now, amid the cautious optimism being spread by some politicians and economists, Roubini warned against expecting the end of the economic crisis too soon.
“There is now this belief that the crisis is over, the conditions in financial markets are fine, that banks are doing OK,” he said. “I think too many people are hopeful that everything is fine, and unfortunately the road ahead is going to be at best bumpy, if not worse than that.”
Roubini is widely credited with being among the first economists to predict the credit crisis that stifled worldwide business activity, doing so as far back as 2005.
His pessimism amid a sea of optimism earned him the moniker “Dr. Doom.” He is also credited with foreseeing the stock market crash of 1987.
With files from The Associated Press (more…)
‘I’m busy doing my job’, Flaherty says of recession, $50B deficit May 28, 2009
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The $50-billion deficit Canada is facing this fiscal year is necessary to help Canadians weather the worst economic recession since the Second World War, Finance Minister Jim Flaherty said Thursday, rejecting calls from the opposition to resign.
“I’m busy doing my job. There’s a global recession going on,” Flaherty told CBC News.
Flaherty announced Tuesday the deficit will rise by more than $16 billion in 2009-10 from the $34 billion he forecast in January’s budget.
The announcement prompted calls from the opposition on Wednesday for him to step down. Liberal Leader Michael Ignatieff called Flaherty’s handling of the global recession “incompetence on a historic scale.”
Flaherty said Thursday the projected deficit only represents about 3.3 per cent of Canada’s gross domestic product. That pales compared to the 10 per cent and greater deficits Japan, the United Kingdom and the United States are facing, Flaherty said.
“None of these economists, I can tell you, predicted this recession. And none of these economists predicted the depth of this recession. I have to deal with the reality of it — not the speculation surrounding it — and that’s what we’re doing,” he said.
‘Right thing to do’
The Conservative government is being responsive to the needs of Canadians with respect to unemployment and preserving jobs in the auto sector, Flaherty said.
“These are expensive — billions of dollars — and that’s why we have an additional deficit. But it’s the right thing to do.”
More than half of the additional spending is aimed at preserving the ailing auto industry, he said.
“But that’s saving an industry and that’s saving thousands of jobs in our country during a recession. I hope the opposition will recognize that’s the right thing to do actually.”
Can afford to do more: Flaherty
Flaherty said recent reports from the International Monetary Fund indicate Canada can afford to take more action to address the recession.
The finance minister also maintained Canada is still on track to be out of a deficit position by 2013.
“As the economy recovers, as we run surpluses, we’ll use that money to pay off the deficits we’re going to incur,” he said.
January’s federal budget predicted five years of deficits with a shortfall of $64 billion over the next two years — a figure that will now climb to more than $80 billion.
Just two months before that, the Conservative government was touting years of surpluses in its fall economic update.
The three opposition parties have accused the Conservative government of failing to get stimulus money into the economy in the 120 days since the budget was tabled.
The Liberals, NDP and Bloc Québécois have also demanded the government expand the threshold of EI benefit qualification, arguing those hurt most by the recession aren’t able to get help.
Golf courses hope to weather recession April 13, 2009
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Golf-course revenues are difficult to forecast because unknowns like weather can dampen profits.(Scott Halleran/Getty Images)
With the Masters underway, Tiger Woods back on centre stage, and the weather finally warming up, the forecast should be sunny for the game of golf.
But, like everything these days, the dark cloud of the recession looms. So are Canadian golf courses in for a stormy summer?
“I don’t think anybody’s expecting the golf business to grow this year,” says ClubLink president and CEO Rai Sahi, whose company is Canada’s largest owner/operator of member golf clubs, with some three dozen properties in Ontario and Quebec under its control. “The question is how much slower [business] will be.”
The answer for ClubLink, according to Sahi, is not much. He says about 3½ per cent of its 18,000-odd members declined to renew for this season, but that’s only a hair higher than the typical dropout rate of three per cent.
“It was a pleasant surprise for us,” Sahi says.
As the CEO points out, though, ClubLink has some unique advantages in the golf-course business. Apart from its sheer size, the company draws on a diverse set of revenue streams, including membership dues ? the largest at roughly $65 million per year ? corporate events, food and beverage service, and even wedding receptions.
That’s not to say the picture is all rosy. Sahi expects his company will take a hit in the number of corporate functions it hosts ? though the damage won’t show up until 2010 because most of this season’s events were booked last year, before the economy nosedived.
He also anticipates food and beverage sales will fall as customers tighten their belts, contributing to an estimated drop of four to five per cent in ClubLink’s overall revenues.
Sweet deals
That’s not horrible compared to the 10 to 15 per cent loss Sahi expects public courses to suffer ? though those businesses are notoriously difficult to predict given that they don’t rely as heavily on upfront membership fees, making them more vulnerable to poor weather.
“There should be price pressure on the public courses,” says Sahi, adding that ClubLink’s exposure is limited because it owns just two such businesses. “They’ll be offering all kinds of deals.”
Blair Wiseman can attest to that. The 52-year-old Toronto-area resident says he banded together with a half dozen fellow golfers to coax a course owner into selling them a package of 120 rounds at a substantial discount.
The guys, who had to pay cash, split up the rounds and ended up shelling out just $42.50 per round with a cart included ? peanuts for a good course in the Toronto area.
‘We’ll keep our fingers crossed.’?Barry MacLeod, CEO, Golf PEI
And the bargains didn’t end there. Wiseman is also part of a large group that was able to talk a prominent Las Vegas hotel and casino into giving them a deep discount on their annual golf excursion. Whereas last year, the 140 or so vacationers stayed in low-end rooms at the three-star Flamingo and had to find their own way around town, this year Caesars Palace promised them swanky suites at its four-star hotel plus free transportation to and from the course ? all for the same price.
“That’s a really telling tale,” Wiseman says. “Because at one time there’d be no way Caesars would even look at giving us that type of deal.”
The x-factor
Of course, Vegas, like the rest of the U.S., has been hit harder by the economic meltdown than Canada has. How are courses north of the 49th that rely on so-called “destination” golfers feeling about the summer?
Pretty good, according to Barry MacLeod, CEO of Golf PEI, an industry association that represents 18 courses in the province.
A damp summer in 2008 threw cold water on an area that leans on tourism, but MacLeod envisions a bounce-back.
“If we get any kind of weather,” he says, “we’re anticipating going over last year.”
MacLeod says that over the last two years, Golf PEI has been “more aggressively” offering package deals ? players get a seafood dinner or a day at the spa with their rounds ? but suggests that golf’s generally well-off clientele could make the sport at least partially recession resistant.
The x-factor, MacLeod admits, is whether tourists will continue flocking to Prince Edward Island ? or anywhere for that matter ? in a down economy.
“That’s the big unknown,” he says. “A lot of our destination golfers that come to the Island are empty nesters with higher-than-average income. We’re hoping they’re in the income bracket that’s isn’t as heavily affected as some of the lower-income brackets.
“We’ll keep our fingers crossed.”
Recession a ‘relatively mild’ challenge for Canada: Flaherty April 7, 2009
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Finance Minister Jim Flaherty, speaking in London, England, on Friday, said this is “a mild economic recession.”(Matt Dunham/Associated Press)
Finance Minister Jim Flaherty said Friday the country is in a mild recession and that Canada will come out of it strongly.
Flaherty delivered his upbeat message in London, England, to a meeting of the Canada-U.K. Chamber of Commerce.
“Relatively speaking, this is a mild economic recession,” Flaherty said.
“These are relatively mild challenges for us,” he said, comparing the economic situation to the challenges early immigrants faced in taking transatlantic voyages and arriving in Canada with nothing.
He said the governments of Canada and the provinces are in strong fiscal positions, “having run surpluses for a time.”
“We are able to withstand this. We are taking the necessary steps so that Canada, in a monetary and fiscal policy sense, will accelerate out of this recession as we move forward.”
Separately, Prime Minister Stephen Harper said more big job losses are expected.
“We all know that we have a massive and growing employment problem,” he said.
“We’ve seen dramatic drops in output, dramatic rises in unemployment in the last four months,” Harper said on the Business News Network. “We anticipate more big job losses.”
However, the prime minister echoed Flaherty’s comments in that he sees the country in line for a strong recovery.
Earlier this week, Bank of Canada governor Mark Carney told an audience in Yellowknife that growth may not return until 2010. He said Wednesday that Canada’s economic contraction in the first quarter of 2009 now appears likely to be the worst on record since 1961.
Canada’s economy contracted at an annualized rate of 3.4 per cent in the fourth quarter of 2008, and some private sector economists are projecting a first-quarter contraction at annualized rates ranging up to almost six per cent.
Canada heading into 9-month recession: Conference Board January 15, 2009
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Canada’s economy will get swamped by the global economic tsunami this year as the national GDP contracts in the first nine months, according to a new outlook released by the Conference Board of Canada Wednesday.
The Ottawa-based business think-tank said Canada’s gross domestic product will shrink for the first three quarters of 2009, a drop that will result in an overall economic contraction of 0.5 per cent for the entire year.
“Lower resource prices, combined with waning consumer and investor confidence and the bleak U.S. outlook, will bring a recession to Canada in 2009,? said Pedro Antunes, director for the Board’s national economic forecast.
Canada has avoided some of the worst financial fallout in the United States so far because of the relative health of the country’s banking sector and its more buoyant job market.
In recent weeks, however, flagging consumer confidence and rising unemployment have crimped Canada’s chances of sidestepping the fallout from the troubled American economy.
The Conference Board said Canada will sell fewer goods to the all-important U.S. market, hurting the export picture, while growing concern over jobs will have consumers zippering their wallets on this side of the border.
The last time Canada saw this type of GDP drop was 1992, when the country’s national income slipped by almost 0.7 per cent.
Still, while Canada’s GDP will condense half-a-percentage-point, this country’s economic stumble will not come close to the American financial train wreck in 2009.
The Conference Board now forecasts that the U.S. economy will post negative GDP growth in the range of 1.7 per cent for the year.
In the United States, the culprits are collapsing housing prices and falling household spending, the Board said.
Recession? Depression? It may depend how you count January 10, 2009
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A long line of jobless and homeless men wait outside to get a free dinner at New York City’s municipal lodging house in 1932. At the peak of the Great Depression, 27 per cent of Canadians and 25 per cent of Americans were out of work. (Associated Press)
U.S. president-elect Barack Obama had a gloomy warning for his audience at George Mason University in Virginia on Friday.
“For every day we wait or point fingers or drag our feet, more Americans will lose their jobs,” Obama said. “More families will lose their savings. More dreams will be deferred and denied. And our nation will sink deeper into a crisis that, at some point, we may not be able to reverse.”
Sinking deeper into an irreversible crisis sounds a lot like depression with a capital D.
But most economists say comparing today’s economy to the grinding hopelessness of the 1930s is not viable.
In Canada, Depression unemployment peaked in 1933; 27 per cent of Canadians were out of work. In the U.S., unemployment hovered around 25 per cent. Compare that with the Canadian unemployment rate of 6.6 per cent in December, and 7.2 per cent in the U.S.
Times are surely tough, but not dire.
Counting the jobless
Many things have changed since the ’30s, including the way we count the jobless. Everyone who needed a job but didn’t have one was counted as unemployed during the Depression.
Now, people who want to work but have given up on searching for a job are considered by Statistics Canada to be discouraged ? not unemployed. To be unemployed, a person must be looking for work, have a job lined up, or only be temporarily laid off.
“Factoring in discouraged workers, unemployment [in the United States] is closer to 9.4 percent,” says Professor Peter Morici of School of Business at the University of Maryland and former Chief Economist at the U.S. International Trade Commission.
“Add workers in part-time positions that cannot find full-time employment and the hidden unemployment rate is 14.5 per cent.
“Unemployment will rise again and continue at unacceptable levels indefinitely without successively larger stimulus packages and huge federal budget deficits. The economy is [in] a depression, not a recession,” he says.
Since being unemployed feels much the same in a recession as a depression, should we care?
Depressions aren’t self-correcting
“Recessions are like stock market corrections, after a time, equity prices rebound without government intervention,” says Morici.
“A depression is not self-correcting. The current economic slowdown has two structural causes: bad management practices at the large money centre banks and the huge foreign trade deficit. These problems are not self-correcting.”
Still, not everyone is convinced we’re in a depression, despite the lousy job numbers.
“The bad news is that we are in a recession, and a fairly deep one at that,” says Jeff Rubin, CIBC World Markets chief economist, in his latest Canadian Portfolio Strategy Outlook Report.
“The good news is that the stock market has already discounted a depression. That’s why no matter how severe the recent non-farm payroll losses are, or how dismal the manufacturing index numbers get, the stock market soon shrugs it off.”
Depressed or recessed, discouraged or employed, 2009 could be a tough year for many to shrug off.
