The Fiscal Cliff explained
By Chris Sorensen and Jaime J. Weinman - Wednesday, January 2, 2013 - 0 Comments
Saul Loeb/Getty
1. The 11th-hour deal to limit the damage from the U.S. from driving over the “fiscal cliff” on Dec. 31 is being hailed as a success insomuch as it averts an immediate crisis (pushing the world’s largest economy into recession) and represents a rare bipartisan agreement in Washington (although a deal was inevitable given the dire consequences). Under the bill, which is expected to be made retroactive to Jan. 1, income and capital gains taxes raised on the wealthiest Americans for the first time in decades. However, a payroll tax holiday will also be allowed to expire for all American workers. What the deal didn’t address is the other half of the so-called cliff: hundreds of billions worth of planned spending cuts and the debt ceiling.
2. The fiscal cliff was a totally manufactured term referring to a self-manufactured crisis on the part of the U.S. government. It started during another self-manufactured crisis, the debt ceiling crisis of 2011, when as an attempt to kick the can down the road on that fake crisis, the Congress decreed that a “supercommittee” would have to come up with a mix of tax increases and spending cuts. If the supercommitee did nothing by Jan. 1, 2013, a mix of heavy spending cuts and tax increases totaling an estimated $600 billion would happen automatically. Inevitably, the supercommitee turned out not to be so super, and the Congress was faced with trying to pass a law to avoid the problems they could have avoided by simply raising the debt ceiling cleanly in 2011.
3. The fiscal cliff follies are simply a trial run for the next fake crisis, which will occur this year when Congress has to raise the debt ceiling again. Traditionally, the debt ceiling was simply a fait accompli, since it’s just a formality that most countries don’t even have. But during the Obama administration, the Republican House has decided to use the debt ceiling to extract concessions on taxes and spending. Their supporters argue that the U.S. has a spending crisis that needs to be dealt with before the debt ceiling is raised; their detractors accuse them of holding the full faith and credit of the U.S. hostage. But one thing is for certain: this is the new normal, at least while the Republicans control the House – and thanks to gerrymandered districts, they are expected to control the House for the next decade. The “fiscal cliff” was just a preview of things to come.
-
The Canadian jet-setter knows to board her plane down south
By The Canadian Press - Wednesday, October 3, 2012 at 2:31 PM - 0 Comments
(Gary Wiepert/Reuters)
OTTAWA – A new report finds that a soaring number of jet-setting Canadians are border-hopping to catch cheaper flights.
The Conference Board of Canada report, issued Wednesday, said that about five million Canadians now cross the U.S. border by land every year to fly out of American airports.
Higher airfares and fees and taxes in Canada, as well as differences in wages, aircraft prices and industry productivity makes it 30 per cent cheaper to fly out of the U.S.
The Conference Board says fees and taxes make up about 40 per cent of the cost of an airplane ticket in Canada.
The report suggests that while other factors are beyond government control, small reductions in the airfare differential could lead to traffic gains for Canadian airports and carriers.
It estimates that changes to Canadian policies alone could bring more than two million passengers a year back to Canadian airports.
Federal Finance Minister Jim Flaherty told reporters Wednesday that Ottawa is “concerned” about the issue and that federal Transport Minister Denis Lebell “has been working on a consultation project with the airlines, with the airport authorities in Canada to try to see what we can accomplish.”
The Conference Board analysis focused on Vancouver International Airport, Pearson International Airport in Toronto, and Montreal-Trudeau International Airport, along with their cross-border competitors.
-
BlackBerry ranked near the bottom among global brands
By Hugh McKenna, The Canadian Press - Tuesday, October 2, 2012 at 6:17 PM - 0 Comments
(David Manning/Reuters)
TORONTO – The BlackBerry brand that once dominated the smartphone landscape has plummeted nearly to the bottom of the latest ranking of global brands by an international consultancy.
Interbrand said Tuesday that Research In Motion’s BlackBerry is now 93rd on its list of 100 most valuable global brands, down from 56th in 2011. It put the brand’s value at $3.9 billion, down 39 per cent from a year ago.
The top three spots on Interbrand’s Best Global Brands report for 2012 are held by Coca-Cola, valued at almost $78 billion; Apple at more than $76 billion, and IBM at more than $75 billion.
Both Coca-Cola and IBM were unchanged from the positions they held in 2011, while Apple jumped to No. 2 from No. 8 “thanks to stellar sales in both developed and emerging markets,” Interbrand said in a release.
The big drop for BlackBerry, the brand name for products produced by Waterloo.,Ont.-based RIM (TSX:RIM), followed a drop last year to the 56th spot from 54 in 2010. BlackBerry placed 63rd in 2009.
Interbrand noted that BlackBerry shipments are down 41 per cent in the past year and the brand’s market share now stands at 4.8 per cent globally, compared with 11.5 per cent a year ago.
“In order to survive, the brand must clearly demonstrate its relevance and value in today’s crowded smartphone market,” said Alfred DuPuy, managing director, Interbrand Canada.
“If BlackBerry can deliver a truly innovative experience designed for today’s mobile professional, it will send the message that the brand is committed to the (business to business) market on which it had originally built its success.”
-
Touchscreen BlackBerry 10 could save RIM—or at least delay its death
By LuAnn LaSalle, The Canadian Press - Friday, September 28, 2012 at 6:33 PM - 0 Comments
(Robert Galbraith/Reuters)
“Hardcore BlackBerry lovers” might have to wait up to two months after the release of the BlackBerry 10 touchscreen device to get their hands on one with a physical keyboard, a strategic play by Research In Motion that analysts say reflects what customers want.
RIM chief executive Thorsten Heins, who had already indicated a touchscreen model would launch first, said Friday that the keyboard version — known in the tech community as Qwerty — will come about “30 to 60″ days later.
Heins said the company needs to gain market share in the touch phone segment, especially to address a trend in which employers are allowing staff to use their preferred smartphone for work.
“People… and enterprises love a full touch device, and, you know, we had to make a choice and finally we decided really to bring both versions to market very, very close to each other,” he said in an interview with MSNBC.
“The BlackBerry lovers, the hardcore BlackBerry lovers, they love this physical keyboard … so make no mistake we are fully, fully committed to Qwerty.”
The physical keyboard is popular often with BlackBerry business users, and the company — in its advertising — has positioned that as an advantage over Apple and Android phones that rely solely on touchscreens.
-
RIM posts loss, but there’s hope
By David Friend, The Canadian Press - Friday, September 28, 2012 at 7:49 AM - 0 Comments
TORONTO – Even though it posted another round of losses and weakened revenue, BlackBerry-maker Research In Motion delivered a surprisingly positive second-quarter earnings report on Thursday that wasn’t as bad as many analysts expected.
The technology company, which is based in Waterloo, Ont. and reports in U.S. dollars, posted a quarterly loss of US$235 million or 45 cents per diluted share.
The results compare with a profit of $329 million or 63 cents per share a year ago.
For many companies these results would be dismal, but for RIM — which has been struggling with numerous obstacles including the delay of its new smartphones and BlackBerry 10 operating system and massive layoffs — the fact that its bad news wasn’t worse proved encouraging to some.
Much of the optimism was gleaned from adjusted earnings per share, which filter out one-time costs like expenses related to job reductions and cost cuts.
RIM’s adjusted loss was $142 million or 27 cents per share, better than analyst expectations of a loss of 47 cents per share, according to a poll from Bloomberg.
Despite impressing investors, RIM still has many challenges ahead. Its revenues were notably weaker, down 31 per cent to $2.87 billion from $4.17 billion a year ago.
RIM said it shipped about 7.4 million BlackBerrys during the quarter, down from 7.8 million in the first quarter, showing that interest in its existing models is starting to wane.
-
Canned: Campbell Soup readying for over 700 layoffs
By Candice Choi, Michelle Chapman, The Associated Press - Thursday, September 27, 2012 at 2:50 PM - 0 Comments
(Jeff J Mitchell/Getty Images)
NEW YORK, N.Y. – Campbell Soup Co. is closing two U.S. plants and cutting more than 700 jobs as it looks to trim costs amid declining consumption of its canned soups.
The world’s largest soup maker said Thursday that it will close a plant in Sacramento, Calif., that has about 700 full-time workers. The plant, which makes soups, sauces and beverages, was built in 1947 and is the company’s oldest in the country. That also means it has the highest production costs of Campbell’s four U.S. soup plants.
Campbell also plans to shutter a spice plant in South Plainfield, N.J. that has 27 employees. Production will be shifted to the company’s other spice plant in Milwaukee.
Employees at the two closing plants were notified that there would be a meeting at 6 a.m. local time Thursday; about 400 workers showed up in California, where they were told of the closure.
“It’s always difficult, even when there’s a business case that is compelling,” said Anthony Sanzio, a Campbell spokesman. “You’re dealing with people, and this is going to impact 700 employees who’ve worked together closely for many years.”
CEO Denise Morrison, who was been on the job for about a year, was not present at the meeting.
-
Myspace tries another revamp with the help of Justin Timberlake
By Barbara Ortutay, The Associated Press - Wednesday, September 26, 2012 at 5:21 PM - 0 Comments
NEW YORK, N.Y. – “Who am I to say I want you back? When you were never mine to give away.”
Those are the opening lines of a song that accompanies a “New Myspace” promotional video. The once-mighty social network is trying to stage yet another comeback with the help of Justin Timberlake.
The new site, for which people can request an invitation, looks a bit like an entertainment-focused version of Pinterest, with a dash of Twitter and Facebook thrown in.
But Myspace has tried redesigns before, to no avail. Will it work this time?
“If you break my heart a second time, I might never be the same,” continues the song, “Heartbeat,” by the group JJAMZ.
From the sound if it, Myspace wants to win the hearts and minds of tech-savvy hipsters. Founded in 2003 and initially a fast-rising star, Myspace attracted mostly teenagers and twentysomethings, offering them a place to express themselves online. It peaked in 2008 with some 76 million U.S. visitors in October.
The site lost its footing as the fun of customizing profile pages began to bore its users and the site’s heavy use of banner advertisements slowed the speed at which pages loaded.
At the same time, people were already migrating to Facebook, which counted users 35 and older among its fastest-growing demographic.
-
Remembering Sam the Record Man
By The Canadian Press - Monday, September 24, 2012 at 4:50 PM - 0 Comments
TORONTO – Sam Sniderman’s influence on Canadian’s burgeoning music industry will be felt for generations, long after the man and his legendary Sam the Record Man music store have gone, his grieving relatives and supporters said Monday.
The charismatic businessman who built his career on championing Canadian performers died peacefully in his sleep on Sunday in Toronto, his family said.
The 92-year-old held on to his trademark stubbornness and fierce independence — the very traits that helped propel his music empire — until the end, his son Jason said.
“He never really retired, he was always interested in what was going on,” he said in a phone interview.
“He believed in Canadian music because it was something that spoke to him from inside…Because his belief in Canadian music was so strong, he was tireless in how he pursued its success and I think that’s his true legacy.”
The Toronto-born entrepreneur played a key role in cementing the country’s artistic identity, efforts that led many to consider him the godfather of Canada’s music industry.
He pushed for then-controversial Canadian content broadcast regulations established in 1970 and helped organize the first Juno Awards to celebrate the country’s musical talent.
While always eager to shine a spotlight on his musical work, he kept a low profile in his philanthropic endeavours, toiling behind the scenes for “countless hours” to save the music building at the Canadian National Exhibition when it was slated to be torn down, his son said.
Sniderman also founded a music archive and musical manuscript library at the University of Toronto.
He went on to support cancer research at Toronto’s Princess Margaret Hospital and the Queen Elizabeth Hospital in Charlottetown, P.E.I., a province where he lived part of the year.
His influence was remembered Monday in Ottawa.
In offering condolences on behalf of the federal government, Heritage Minister James Moore said Sniderman left his mark through his “constant support of Canadian talent and concern for the preservation of our cultural heritage.”
Meanwhile, New Democrat Andrew Cash paid tribute in the House of Commons to the man he called “an iconoclast, pioneer and staunch believer in the greatness of Canadian music.”
“You went to Sam’s searching for clues — you went there to get close to and be part of an emerging, exciting Canadian music scene,” he said.
Known widely as Sam the Record Man, Sniderman and his brother Sid opened a small store on College Street in Toronto in 1937 and together they built a chain of Sam the Record Man stores that spanned the country.
Sniderman opened his flagship store on Toronto’s Yonge Street in 1959.
It grew into a haven for artists and music lovers of all stripes, building a particularly loyal customer base and a knowledgeable staff that could hold their own against any music fan that walked through the door.
The warehouse-like store was known for having the most extensive catalogue in the country.
Its walls were lined with gold records, artifacts and photographs of countless music greats touched by the family’s efforts to champion Canadian music, among them Randy Bachman, Burton Cummings, Gordon Lightfoot and Rush.
“Sam took great pride in being the best friend of Canadian musicians,” Rush frontman Geddy Lee said in a statement Monday.
“I remember the first time we were awarded a Canadian Gold Record; it was presented to us by Sam at a dinner arranged at Sam the Chinese Food Man restaurant,” he said, a reference to one of Sniderman’s other ventures.
“Sam truly helped change the way Canadians view homegrown talent.”
The iconic store with its huge flashing red neon record sign closed in 2007, seven years after Sniderman officially retired and handed over ownership to his sons Jason and Bobby.
It was a difficult time for Sniderman, who maintained a steady presence at the beloved family business, said Jason Sniderman.
“He was always really sad about it,” and struggled to come to terms with the sudden shift toward digital music, which ultimately led to the store’s collapse, he said.
The building was later sold to Ryerson University, which also claimed the store’s signature sign.
Ryerson’s president Sheldon Levy called Sam Sniderman “a wonderful friend and neighbour” to the school, one who “brought excitement and energy to Yonge Street” and built “a magnet for young people.”
Jason Sniderman said the store still has a franchised outpost in Belleville, Ont.
A major promoter of Canadian music, Sam Sniderman was a Member of the Order of Canada, an inductee of the Canadian Music Industry Hall of Fame and the Canadian Country Music Hall of Fame.
He also received a Governor General award and honorary doctorates from Ryerson and the University of Prince Edward Island.
“Sam was the last of the great Canadian showmen that were able to establish themselves as household names purely through the force of their personality”, said Brian Robertson, a close family friend and Chairman Emeritus of the Canadian Recording Industry Association.
“He was a mentor to literally hundreds of Canadian artists and musicians and the Yonge Street record store and Sam’s presence there was the centre of the Canadian music industry’s universe for over three decades.”
Always energetic, Sniderman threw himself into his hobbies with the same vigour that fuelled his work, his son said.
An avid tennis player, he was “as aggressive on the court as he was in business,” and wasn’t above the odd trick shot, he said.
“That was how he let off steam,” Jason Sniderman said.
As his involvement with the business wound down, he channelled his energy into cooking and filling the fridges of his loved ones with home-cooked meals, his son said.
“He would spend all day cooking for me and my family and then bring it to the house … it was his way of sharing his love with all of us,” he said.
“He was an obsessive guy, you know. If he was going to do something, he would do it to the nth degree.”
Sniderman’s death sparked an outpouring of grief and nostalgia from legions of music lovers across the country.
Mike Wilkomirsky, 29, grew up in a suburban Toronto neighbourhood and spent much of his teen years browsing the racks of the city’s musical mecca.
When his fledgling band sought to bring its work to the masses, Sam’s was the only major retailer willing to carry their CD, said Wilkomirsky, who now works in a bank.
With Sniderman gone, “it’s like a nail in the coffin of (my) youth,” he said.
Karen Bowler, 42, remembered the monthly treks she and her father made to the downtown store from his home in the nearby city of Brampton.
“It was our big trip together,” said Bowler, who moved to Edmonton roughly 15 years ago. “It’s a childhood memory.”
Though she hadn’t been to the store since the early 1990s, she was sad when it closed. “It was the last original record store.”
Sniderman’s family said a service will be held Tuesday and a memorial service will be held next month.
-
Lowe’s withdraws plans for Rona takeover
By Ross Marowits, The Canadian Press - Monday, September 17, 2012 at 11:09 AM - 0 Comments
Photograph by Cole Garside
MONTREAL – Rona Inc. has some breathing room to build its Canadian home-improvement chain now that U.S. rival Lowe’s has abandoned its controversial plan to acquire the Quebec-based chain for about $1.8 billion.
But Rona’s continued independence will come at a cost to its investors, with its shares dropping more than 10 per cent following the announcement that Lowe’s is no longer contemplating an offer of $14.50 per share cash.
Rona stock dropped $1.37 to $11.40 in early trading Monday on the Toronto Stock Exchange, following the pre-open announcement from Lowe’s Companies Inc. Lowe’s shares (NYSE:LOW) slipped three cents to US$29.37 in New York.
The U.S. chain’s withdrawal Monday comes seven weeks after Rona, the Quebec government and others objected to the U.S. company’s overtures, which had begun privately in late 2011 and became public in late July.
-
Bell’s final pitch to CRTC: We will not dominate
By LuAnn LaSalle, The Canadian Press - Friday, September 14, 2012 at 3:12 PM - 0 Comments
Bell President and CEO George Cope (left) looks at Astral Media Inc. President and CEO Ian Greenberg on September 10, 2012. (Christinne Muschi/Reuters)
MONTREAL – Telecom giant Bell is making its final pitch to the CRTC about why it should be allowed to buy specialty TV and radio company Astral Media.
CEO George Cope says Bell will not dominate the market, as critics have charged, and will have 33.5 per cent of Canada’s English-language TV viewing market.
That’s under the 35 per cent threshold set by the CRTC.
Cope also says Bell is not denying its content to competitors.
Astral CEO Ian Greenberg says Canada needs its own online TV and movie service to compete with Netflix and the merger of the two companies will allow this.
Greenberg adds that competition won’t disappear because of the transaction and independent players will continue to emerge.
Earlier Friday, several small TV, film and media companies spoke up in favour of Bell’s $3.4-billion deal to by Astral Media, saying bigger is better to compete with online entertainment companies like Netflix and to get Canadian content a bigger audience.
-
Meat processor sues ABC News, Diane Sawyer for $1.2 billion
By Grant Schulte, Kristi Eaton, The Associated Press - Thursday, September 13, 2012 at 5:30 PM - 0 Comments
The beef product critics call "pink slime," or lean finely textured beef, is frozen on large drums as part of the manufacturing process at the Beef Products Inc. plant in South Sioux City, Nebraska. (Nati Harnik/Pool/Reuters)
NORTH SIOUX CITY, S.D. – Beef Products Inc. sued ABC News, Inc. for defamation Thursday over its coverage of a meat product that critics dub “pink slime,” claiming the network damaged the company by misleading consumers into believing it is unhealthy and unsafe.
The Dakota Dunes, S.D.-based meat processor is seeking $1.2 billion in damages for roughly 200 “false and misleading and defamatory” statements about the product officially known as lean, finely textured beef, said Dan Webb, BPI’s Chicago-based attorney.
The lawsuit filed in a South Dakota state court also names several individuals as defendants, including ABC News anchor Diane Sawyer and the Department of Agriculture microbiologist who coined the term “pink slime.”
The company’s reporting “caused consumers to believe that our lean beef is not beef at all — that it’s an unhealthy pink slime, unsafe for public consumption, and that somehow it got hidden in the meat,” Webb said before the company’s official announcement.
ABC News, owned by The Walt Disney Co., denied BPI’s claims.
“The lawsuit is without merit,” Jeffrey W. Schneider, the news station’s senior vice-president, said in a brief statement Thursday. “We will contest it vigorously.”
-
iPhone 5 bigger, faster and 4G: live coverage
By Business Blog - Wednesday, September 12, 2012 at 12:57 PM - 0 Comments
-
Sept. 12, the new iPhone 5
By Anick Jesdanun, The Associated Press - Wednesday, September 12, 2012 at 6:49 AM - 0 Comments
Apple's invitation to the Sept. 12 event featured the number "12" casting the shadow of the number "5", likely a hint to the launch of the new iPhone 5.
Watch our site for live coverage of the launch at 1 p.m.
NEW YORK, N.Y. – After weeks of speculation, anticipation and a dose of hype, Apple is widely expected to announce a new smartphone at an event in San Francisco on Wednesday.
Apple isn’t saying anything about the topic of the event, but the email invitation it sent to reporters contains a shadow in the shape of a “5” — a nod to the iPhone 5. It is being held in San Francisco at Yerba Buena Center for the Arts Theater, where Apple has held many product launches.
The new model is expected to work with fourth-generation, or 4G, cellular networks. That capability is something Samsung’s Galaxy S III and many other iPhone rivals already have. A bigger iPhone screen is also possible. The new model will likely go on sale in a week or two.
Apple Inc. also plans to update its phone software this fall and will ditch Google Inc.’s mapping service for its own, as a rivalry between the two companies intensifies.
In a related development, Google said Tuesday that it is releasing a new YouTube app for the iPhone and the iPad. The changes come amid the expiration of a five-year licensing agreement that had established YouTube as one of the built-in applications in Apple’s mobile devices.
-
Bell pitches Astral deal as key to take on Netflix, Apple, Google
By LuAnn LaSalle, The Canadian Press - Tuesday, September 11, 2012 at 7:49 AM - 0 Comments
Bell Canada Enterprises (BCE) president and chief executive officer George Cope (left) and Ian Greenberg (right), president and chief executive officer of Astral Media Inc. (Christinne Muschi/Reuters)
MONTREAL – Bell will launch a “made-in-Canada” competitor to Netflix and other big U.S. online TV and entertainment providers, CEO George Cope said Monday as part of his pitch for the company’s $3.4-billion acquisition of Astral Media.
The service would be available on demand on any device, and showcase Canadian and international movies from Astral’s pay TV services, such as HBO Canada and The Movie Network, as well as news, sports and entertainment content from Bell Media.
“(It’s) a made-in-Canada service — available in English and French everywhere we have rights — to all Canadians through the cable, satellite or IPTV provider of their choice,” Cope told a CRTC hearing into the acquisition.
More than 10 per cent of Canadians now subscribe to Netflix, which accounts for more than 11 million hours of TV viewing per week, Cope said.
“The Canadian system needs companies with the scale to compete against foreign content companies like Netflix, Apple, Google and Amazon,” he said.
-
Shareholders rejoice: Canada’s five biggest banks delivered $7.8 billion in profits
By David Friend, The Canadian Press - Friday, August 31, 2012 at 10:50 AM - 0 Comments
Mark Blinch/Reuters
TORONTO – Canada’s biggest banks posted a stunning $7.8 billion of cumulative profit in the third quarter, as consumers maintained their borrowing habits and domestic banking results propped up weakness in some other divisions.
The performance left analysts’ restrained predictions in the dust, marking an increase of 45 per cent from net income of $5.38 billion a year ago.
All five banks delivered a surprise boost to their dividends paid to shareholders. Royal Bank (TSX:RY) also boasted that its profits rose 73 per cent to a new record high.
It was quite a contrast from concerns that lending would subside during the period, while banks looked for ways to cut their costs. But several analysts say they’re not convinced these bombastic results are sustainable into next year.
“Earnings from Canada face a lot of headwinds,” said National Bank analyst Peter Routledge in an interview.
