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Monday, September 26, 2011

Canada warns of worldwide economic meltdown unless tough action is taken in Europe

   Canada column published Sunday, Sept. 25/11


   (c) By Jim Fox

   Canada’s finance minister has issued a stern economic warning to the world as Canadian stock markets plunged and the dollar dropped below parity with the U.S. greenback.
   Jim Flaherty said another financial meltdown similar to what happened in 2008 will happen if action isn’t taken to deal with the world debt crisis, particularly in Europe.
   Uncontrolled government debt could sink the economies of Greece, Italy, Spain and Portugal and “there’s been a lack of political decisiveness in Europe,” he said.
   The Canadian government vows to eliminate its deficit by 2014 and cut $4 billion in annual spending through program reductions and efficiencies.
   Prime Minister Stephen Harper and other world leaders have called for strong action at Cannes G20 summit in November to boost economic stability and growth.
   Christine Lagarde, head of the International Monetary Fund, said growing debt problems in Europe and the United States are “entering a dangerous phase.”
   After a major selloff on the Toronto Stock Exchange and lower oil prices, Canada’s dollar dropped three cents to 97 cent U.S., its lowest level in almost a year.


   Opposition politicians criticized Canada’s Conservative government for not having a “job strategy” when Parliament resumed.
   “Where is the job plan?” New Democratic Party Leader Nycole Turmel asked.
   Prime Minister Stephen Harper said there is a plan and more people are working now than before the last recession.
   Noting Turmel’s unionist past, Finance Minister Jim Flaherty said small businesses create jobs and not the government.
   Issues expected before the Commons this fall include the government's planned justice bill, anti-terrorism measures, human smuggling, Internet snooping, Senate reform, House of Commons seat redistribution, scrapping the long-gun registry and the Wheat Board.


   News in brief:
   - A retired Air Canada pilot and his wife were among 10 people killed when a Second World War-era plane crashed during an air race in Reno, Nevada. George Hewitt, 60, and Wendy, 57, were in the stands when the P-51 Mustang crashed nearby. They had moved to Arizona last year from British Columbia when Hewitt retired after 39 years as a pilot.
   - The rich aren’t getting richer in the case of the co-chief executives at Waterloo, Ontario’s Research in Motion. The BlackBerry founder’s plunging share price dropped the net worth of Mike Lazaridis and Jim Balsillie with their five-percent shares to $640 million from $1.9 billion.


   Facts and figures:
   Canada’s dollar has retreated to 97.46 cents U.S., while the U.S. greenback gained to $1.0261 Canadian, before bank exchange fees, on Friday.
   The Bank of Canada’s key interest rate is unchanged at 1 percent while the prime lending rate is 3 percent.
   Stock markets were lower Friday with the Toronto exchange index at 11,484 and the TSX Venture Exchange at 1,562 points.
   Lotto 6-49: (Wednesday) 1, 23, 30, 38, 45 and 48; bonus 3. (Sept. 17) 15, 17, 19, 23, 27 and 38; bonus 7. Lotto Max: (Sept. 16) 12, 18, 22, 24, 28, 43 and 49; bonus 21.


   Regional briefs:
   - Child killer Clifford Olson, 71, who has continued to taunt his victims’ families from prison, is near death in a Quebec hospital. The serial killer who has been in prison for 30 years for the deaths of 11 children in the Vancouver area is dying of cancer, a parole officer said.
   - Ontario Premier Dalton McGuinty, seeking reelection on Oct. 6, said his Liberal government, in power the last eight years, can now find savings in health-care costs without making cuts to hospitals. He warns that his rivals, the Conservatives who threaten to form the next government, will cut many programs and even hospitals, if elected.
   - Zahir Rana, a Calgary “exotic” car dealer, has become famous after crashing his one-of-a-kind Ferrari worth $2.3 million into a Newfoundland river. He was taking part in a car rally when the V-12 Edo Enzo Ferrari landed in a tidal river near Marystown. Video of the crash has been watched more than a million times on YouTube. Rana said the car wasn’t that badly damaged.


Jim Fox can be reached at canadareport@hotmail.com

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