Tuesday, July 27

Executive Summary

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Posthaste: A third of Canadians feel’house poor’, but are ready to take on more debt as economy reopens

Good morning!While the pandemic certainly improved the financial situation of many Canadians, not everyone has been fortunate enough to build a'wall of wealth'.Despite surging home prices that have left many Canadians look fiscally stable at least on paper, many are struggling to make ends meet, according to a new survey.The latest MNP Consumer Debt Index shows the number of Canadians concerned they cannot make ends meet without going into further debt has reached its highest level in three years.Almost half (45 per cent, up 6 points since March) are not confident they will be able to cover all living and family expenses in the next 12 months without taking on more credit, according to the quarterly poll conducted by Ipsos on behalf of MNP Ltd, released this morning."In fact, the propor...
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Posthaste: Canadians built a $2 trillion’wall of wealth’ during the pandemic — and it’s not just a housing story

Good morning!The global pandemic, tragic and horrible as it has been, has had the surprising effect of creating wealth for Canadians. Not only did many Canadians see their home prices reach new highs, but they also saw their non-residential assets soar during one of the worst health and financial crisis seen in more than a generation.A new report by BMO Capital Markets shows Canadian households' net worth rose an astonishing $2 trillion during the pandemic.“That represents a titanic 17 per cent increase to $13.7 trillion, equal to 933 per cent of disposable income — up 50 ppts from 2019 levels, and double the ratio thirty years ago,” wrote Douglas Porter, BMO's chief economist, who crunched the numbers "US household wealth has also seen a big boost in the face of the past year's tough e...
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Posthaste: Canadians say the country is more divided than before the pandemic — and it’s getting worse

Good Morning!We have been in this pandemic more than a year now and what do we have to show for it? A society that is more divided than ever.That's according to a new study by the Pew Research Centre that polled almost 20,000 people in 17 advanced economies. Six in 10 of those surveyed reported that national divisions had worsened since COVID-19 began.In almost all of the countries, these feelings of division increased significantly between 2020 and 2021, in some cases by as much as 30 percentage points.Canada is one such case. In 2020, 66% thought the country was more united than before the pandemic; by 2021, 61% thought it was more divided.The United States is even more extreme, with 77% on the divided side in 2020 rising to 88% by 2021.Not surprisingly, one source of these divisions ...
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Posthaste: Canadian millionaires are multiplying in the weirdest recession ever

Good Morning!We have all heard how the pandemic recession was unlike any we have ever seen.Now a new report affirms just how deeply weird this crisis has been.The Credit Suisse Global Wealth Report, which claims to be the most comprehensive source of information on global household wealth, says as far as the world's wealth goes it is almost as if the worst recession in recent memory had never happened.“The contrast between what has happened to household wealth and what is happening in the wider economy can never have been more stark,” says the report."Stranger still, countries most affected by the COVID-19 pandemic have often been those recording the greatest gains in wealth per adult."Total global wealth grew 7.4% in 2020, with wealth per adult climbing 6% to reach a record high of US$...
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Posthaste: Working Canadians are showing the strain of 7 months of pandemic, not only in our state of mind, but on the job

Good Morning!Seven months into the pandemic and working Canadians are showing the strain, not only in our state of mind, but on the job.After a brief upturn during the summer, the mental health of working Canadians has now sunk to near the lowest point seen at the onset of the pandemic in April, finds the Morneau Shepell's Mental Health Index for October.This level of mental health is concerning, the report says, because it shows the working population is now as distressed as the most distressed 1% of working Canadians before the pandemic.Nearly half of working Canadians say they need mental health support, the study found. Most are getting it from family and friends, co-workers or mental health professionals. But 9% of those surveyed reported they needed help, but had not sought it, an...
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Posthaste: Why this Canadian bank believes the loonie may hit 80 US cents as early as next year

Good morning!The Canadian dollar has been on a tear over the past week or so, hitting a two-year high against the US dollar on news of a coronavirus vaccine, higher oil prices and rising investor appetite for riskier currencies.The loonie paused at 1.3032 to the US dollar, or 76.73 US cents Tuesday, reversing slightly from its strongest intra-day level in more than two years on Monday at 1.2928, according to Reuters.The loonie has regained all the ground it lost before the US election and is trading near its pre-pandemic level of about 1.30 to the greenback, and has also appreciated against other G7 countries currencies. The domestic economy also remains well-supported.On the other side of the ledger, the US election result has also set up a weaker US dollar, especially if some kind of ...
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Posthaste: Oil got a shot in the arm — but a dark winter lies ahead for the commodity

Good morning!Oil prices jumped around 8 per cent on Monday and are trending higher still this morning, triggering a rare relief rally this year for the battered commodity.News of Pfizer Inc. and BioNTech SE developing an effective vaccine to stub out COVID-19, sent oil and the wider markets surging higher.Western Canada Select jumped 7.79 per cent to $30.16 per share, with Canadian oil stalwarts Suncor Energy Corp., Canadian Natural Resources Ltd., Cenovus Energy Inc. and MEG Energy Corp. all posting 20 per cent plus gains on the day.But the Royal Bank of Canada thinks investors should not rejoice just yet.“Despite the knee jerk reaction higher, we are hesitant to call a further rally through year-end,” Michael Tran, commodity strategist. “However, we believe that the calculated de-risk...
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Posthaste: No Blue wave, but there has certainly been the revenge of the Red

Good morning!The final tally is still not in but prospects of a Democratic Blue Wave, with former vice-president Joe Biden flipping the key states of Florida and Texas and the Democrats storming the Senate, dissipated early on in the night.In fact, the Republicans have launched their own assault with a vengeance, with many motivated by the Democrats' very-left leaning policies. It was their revenge. As it stands, the Republican voters have delivered 48 per cent of the votes for US President Donald Trump, with Democrats voters making up 50 per cent — so it's not exactly a blowout either way, no matter who emerges as the president.Regardless of who wins from here, we will be in for gridlock that could hurt US economic growth, slow a response to the virus and leave political divisions fest...
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Posthaste:’Non-event of the century’?: Why investors should faze out Nov. 3 and pay attention to a more significant vote later this week

Good morning!Investors were a ball of anxiety last week, dumping stocks and booking profits, as they feared the worst possible fallout from the US presidential elections.Investors weren't really taking sides and were less concerned about either a US President Donald Trump or former vice-president Joe Biden victory, but they were more concerned about chaos, election uncertainty, and even riots or some kind of civil unrest post elections that could interrupt economic activity.Worries about a contested election, combined with rising coronavirus cases around the world, is a recipe for short-term political and economic decline that could affect corporate earnings.And that's what the market cares about the most — not the ideology of the two candidates or about the state of democracy.Based on ...
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Posthaste: Attention shoppers, it’s going to be a very different Black Friday this year

Good Morning!Black Friday and Cyber ​​Monday, that four-day bargain binge that shoppers around the world wait for every year, is fast approaching, but this Nov. 27 is going to be a very different shopping experience.Gone will be door busters, mobbed aisles and frenzied shoppers. The Centers for Disease Control and Prevention in the United States has classified “shopping at crowded stores just before, on or after Thanksgiving” on a list of higher-risk activities to avoid, reports USA Today.Walmart has already announced it will stay closed on Thanksgiving day, a first since the late 1980s. Target, Best Buy and other big brands have followed suit.Nor will Canadians be flocking over the border to swarm the stores down south.Nonetheless, the pandemic has not dulled shopper's interest in Blac...