Oil-price drop leads to higher bank rate in Canada

   Canada column for Sunday, Jan. 25/15

   THE CANADIAN REPORT

   (c) By Jim Fox

   The rapid collapse of oil prices has prompted the Bank of Canada to cut its trendsetting interest rate to stabilize the economy.

   “The drop in oil prices is unambiguously negative for the Canadian economy,” central bank governor Stephen Poloz said as the rate fell to 0.75 percent from one percent where it has been for four years.

   As an oil-producing nation – selling more crude to the U.S. than any other country – the economic impact of cheap fuel threatens Canada’s economic rebound and a return to a balanced federal budget.

  So far, Canada’s commercial banks have made no move to lower their prime-lending rate that is still three percent.

   The rate cut immediately caused the Canadian dollar to fall by about three cents from a week ago to the 80-cent US range but it boosted stock markets.

   The Conference Board of Canada predicted plummeting oil prices would cause a loss of $4.3 billion in the federal government’s current-year income and a loss of $10 billion in royalties and tax revenues for the provinces.

   The federal government is also delaying its budget until April to assess the situation.

   ---

Economy ailing over risky low oil prices

   Canada column for Sunday, Jan. 18/15

   THE CANADIAN REPORT

   (c) By Jim Fox

   The Canadian economy’s post-recession recovery is at risk over low oil prices that could ruin the government’s promise of a pending budget surplus.

   Alberta – in the heart of Canada’s oil-patch – could even be looking at implementing a provincial sales tax or higher income taxes to counter the crisis.

   With the price oil plummeting to near $45 a barrel, half of what it was six months ago, Suncor said it will cut 1,000 oil sands’ jobs and reduce its spending by $1 billion.

   Shell Canada announced layoffs of up to 300 workers at the Albian Sands north of Fort McMurray.

   TD Bank said slumping oil prices could cause a $2.3-billion federal budget shortfall in the 2015-16 fiscal year instead of a predicted $1.6-billion surplus.

   Continued low crude prices would significantly discourage investment in the oil sector, Timothy Lane, the Bank of Canada’s deputy governor said.

   As billions of dollars are being lost in oil-rich Alberta, Premier Jim Prentice said implementing a sales tax – the only province that doesn’t have one – is up for discussion.

   “I'm not embracing a sales tax,” Prentice said, adding that he “wants to hear” what Albertans think about it.

   ---

Fantino moved out of Veteran Affairs posting

   Canada column for Sunday, Jan. 11/15

   THE CANADIAN REPORT

   (c) By Jim Fox

   Julian Fantino has been removed as Veteran Affairs Minister after months of demands for his firing by military retirees and opposition politicians.

   Prime Minister Stephen Harper demoted Fantino, a former chief of the Ontario Provincial Police, after a series of controversial issues.

   Veterans said Fantino wasn’t looking out for their best interests and it was recently learned about cutbacks in jobs and the closing of some service offices.

   One of the most compelling arguments against Fantino was that his department let more than $1 billion in funding lapse since 2006 as wait times to process veterans' applications grew.

   He returns to his old position as Associate Minister of National Defense.

   Taking over from Fantino is Erin O’Toole, a lawyer and Royal Military College graduate who served 12 years with the Canadian Forces.

   ---

Gunman takes eight lives in Edmonton; one in Calgary

   Canada column for Sunday, Jan. 4/15

   THE CANADIAN REPORT

   (c) By Jim Fox

   A suicidal man with a criminal history killed six adults and two children in Edmonton in an act that police said was fueled by domestic problems.

   Also in Alberta, a New Year’s Eve party in Calgary turned deadly when a gunman shot seven people, with one of them dying of his wounds.

   Police called the Edmonton slayings a “planned and deliberate” act of domestic violence.

   Sources say Phu Lam, 53. then took his own life at an Asian restaurant in Fort Saskatchewan where he worked.

   His first victim was Cyndi Duong, 37, a married mother of three, at her home in southwest Edmonton.

   A few hours later, police discovered seven bodies in a northeast Edmonton home owned by Lam. They were two men, three woman and a young boy and girl.

   Police said they were awaiting autopsy results before releasing their names and relationship to the shooter.

   In Calgary, gunshots were reported at a house party attended by about 50 people.

   Abdullahi Ahmed, 26, a native of Somalia, was shot in the head and died while six others were wounded. Police said that so far they have established no motive.

   ---