Category: Gradually Then Suddenly

Gradually, Then Suddenly

Gradually Then Suddenly New Governor The Libranos 26 Comments


Race to the bottom: Glencore said on Tuesday it has suspended nearly $1 billion of planned investments at Horne Smelter, Canada’s largest copper metal-producing operation, after failing to secure regulatory certainty from the provincial government of Quebec.

No Retirement For You!

Children R Our Future entitlement generation Gradually Then Suddenly It's Probably Nothing 10 Comments

While most of these youngsters can see a problem, my guess is that only about ten percent of them can understand why it exists: it’s the inevitable outcome of an exponentially rising debt burden colliding with demographics.

A report by BMO published on Monday showed 73 per cent of millennials surveyed believe retirement planning will be more difficult than it was for their parents, followed by generation X at 67 per cent, generation Z at 61 per cent and boomers at 60 per cent.

If Wishes Were Mortgages…

Gradually Then Suddenly Great Reset It's Probably Nothing 7 Comments

Mortgage broker Ron Butler goes off on the concept of “blanket appraisals” in the Canadian mortgage market. Basically, they’re a form of fraud that allows lenders to pretend that mortgages on their balance sheets are worth much more than they actually are.

“…I bought it for a million… My lender says it’s only worth 820 and I don’t know what to do. Oh, don’t worry. Don’t worry. We have this… uh, developer loan bank. Yeah. No, no, we can get it done. Don’t worry…”

That Sinking Feeling

Gradually Then Suddenly It's Probably Nothing New Governor 18 Comments

My advice to the Conservative Party of Canada: just be patient. Your time in the sun may be coming.

Statistics Canada says the economy stalled in November and early estimates suggest a decline in real gross domestic product for the final quarter of 2025.

November saw manufacturing of durable goods hit its lowest levels since 2011, outside the COVID-19 pandemic.

Update: Even the mainstream financial media is noticing that something is not right.

Canada’s main stock index fell 1,092.61 points or 3.3 per cent on Friday.

That Sinking Feeling

Gradually Then Suddenly It's Probably Nothing 34 Comments

The bad news just keeps popping up for the Canadian economy.

General Motors Co. on Friday will eliminate the third shift at its assembly plant in Oshawa, Ont., cutting about 700 jobs inside the plant, plus another 300 to 500 workers at parts companies that supply the facility, according to Unifor, the labour union representing the workers.

Update: Those workers can just transition to building Korean EV batteries, apparently. An “agreement” has been reached.

It says the the countries plan to co-operate on advancing a Korean automotive industrial footprint in Canada and to create domestic electric vehicle manufacturing opportunities.

Is This Elevator Going Down?

Gradually Then Suddenly It's Probably Nothing New Governor There Goes The Narrative 18 Comments

I’m not so sure that central banks have much of a choice when it comes to cutting interest rates, given the dynamics of fiat currencies with an exponentially growing debt load, but the fact that the mainstream financial media is even publishing Pelletier’s analysis is, in itself, a warning sign.

The issue now is that central banks appear close to implementing yet another round of QE, not to stabilize markets but simply to absorb the massive issuance of government debt. That’s where the real danger emerges: currency debasement. When a central bank prints money to finance deficits, the purchasing power of that currency erodes rapidly.

Now is an ideal time to revisit your portfolio. Start by examining your government bond exposure, especially in jurisdictions such as Canada, where the federal government holds no gold reserves and where 10‑year yields near three per cent offer little compensation for the level of risk.

Golden Opportunity?

Gradually Then Suddenly Great Reset It's Probably Nothing 17 Comments

Gold (and silver’s) near meteoric rise in terms of dollar price over the past few months periodically rekindles interest in “monetizing” the gold stock that sits in the vaults of a number of central banks, in the belief that this will usher in a financial bonanza. In my most recent Substack article, I demonstrate why such a move won’t do anything of the sort.

…the proposal that the Treasury can unlock over a trillion dollars of capital, and borrow against it, by correcting a bookkeeping error…might work if the Treasury had not undertaken to rack up $36 trillion in debt in the period since 1973, but that’s clearly not the case today. Simply put, the gold stock has already been borrowed against. Creditors have lent this sum of money to the US government with the knowledge that the gold stock is already implicitly underpinning the debt, even though today it can only underpin a small portion of it.

Shooting Your Own Foot

Gradually Then Suddenly It's Probably Nothing 4 Comments

There’s a lot of talk these days about how the European Union is going to “stick it” to the US by potentially selling trillions of dollars worth of US treasury bills. But there’s a problem. Since every currency on earth is just a derivative of the US dollar, and has been since the Bretton Woods agreement of 1944, Europe wouldn’t be “dumping” US dollars. Whatever financial instrument they get in return, they all share the same root: the US dollar.

One of my favorite financial commentators, Rafi Farber, explains the problem fully in this short video.

Elbows Way Down

2025 Federal Election Gradually Then Suddenly It's Probably Nothing New Governor 32 Comments

I’ll go out on a limb and suggest that Canadians need to be less concerned about Trump and more concerned that voters essentially opted for a continuation of the Trudeau years with a few tweaks.

“Businesses aren’t panicking, but they aren’t betting big either,” Patrick Gill, vice-president of the business data lab at the Canadian Chamber of Commerce, said.

“Pessimism about the next 12 months is now at its highest point in several years,” he said. “In that environment, firms are holding back on major expansion and taking a clear wait-and-see approach as they look for more clarity on U.S. trade policy and demand conditions.”

 

Gating Your Capital

Gradually Then Suddenly It's Probably Nothing New Governor Shiny Pony 8 Comments

I like Jeff Snider’s podcasts and in this one he spends the first half talking about Canadian real estate investment funds that are starting to restrict payouts. Given that Canadian real estate values are crashing, if they don’t halt outflows the funds could quickly become insolvent. The Bloomberg article he quotes is behind a paywall, but he conveniently scrolls through it so you can read the whole thing.

“Stung by a deep downturn in the country’s housing market, many of the funds have restricted cash distributions, client withdrawals, or both in a process the industry calls gating. Often the companies don’t say when access will resume, and about 30 billion Canadian, about 21.7 billion US equivalent. Almost 40% of the 80 billion Canadian invested in such funds is now locked up.”

Tough Times

Gradually Then Suddenly It's Probably Nothing 14 Comments

It looks like it’s not just a matter of people being unable to afford coffee at MacDonald’s anymore. The high end consumer looks to be tapped out as well. Maybe they should have hedged with some silver purchases.

The owner of Saks Fifth Avenue is seeking bankruptcy protection, buffeted by rising competition and the massive debt it took on to buy its rival in the luxury sector, Neiman Marcus, just over a year ago.

On a personal note, a salesman from a manfacturing input vendor told me yesterday that one of his clients, a well know agricultural equipment manufacturer in western Canada, is bracing for a 40% decline in sales this year.

Tax Trouble

47 Art Of The Deal Gradually Then Suddenly It's Probably Nothing 8 Comments

If the US is going to eliminate income taxes or fund all the things that the administration is proposing, the revenue stream seems to be going in the wrong direction. What’s more is that reliance on tariffs for tax revenue offers a very obvious escape route: if you can produce something with inputs sourced solely in the US, you don’t pay tariffs at all. As that option broadens, tax revenue will logically go down, not up.

The release brings the total revenue collected in 2025 to $264.05 billion. It’s a historically high annual total — but also the second straight monthly decline after Trump dialed back key tariffs last November.

The peak for the year was October’s monthly haul of $31.35 billion. The first decline then came in November, with $30.76 billion in customs duties collected that month.

Hard Times

Gradually Then Suddenly It's Probably Nothing 10 Comments

You know things are getting tough when McDonald’s freezes the price of a small coffee and value meals. In a sagging economy, producers simply can’t jack up prices in the face of consumers without the means to afford them.

She announced Tuesday that McDonald’s Canada will freeze the price of a small cup of coffee at $1 for at least a year and drop the price of its McValue meals to $5 for the same duration.

“Canadians are facing challenges and are insecure financially. What we are doing is listening and giving them what they want,” she said.

 

Elbows Down!

Gradually Then Suddenly It's Probably Nothing New Governor 12 Comments

More evidence of Canadian exceptionalism. But not something to cheer about.

The unemployment rate rose to 6.8 per cent in December, StatCan said, up from 6.5 per cent in November.

What’s really notable is where the losses are occurring:

The professional, scientific and technical services sector meanwhile shed 18,000 positions to end the year, and the accommodation and food services industry also faced losses.

 

The Zero Percent Interest Miracle

Gradually Then Suddenly It's Probably Nothing nannystate 11 Comments

Back in the 1980’s it was fashionable to proclaim that Japan, with an allegedly superior mixture of central planning and free markets, would soon own the world. It now looks like they can’t even maintain their own world, let alone anyone else’s. Decades of embracing Keynesian economics have resulted in a very bitter harvest.

Once famously derided for building bridges to nowhere, Japan’s government is now struggling to maintain them.

Even before the quake, Suzu was struggling to carry out routine maintenance of infrastructure due to money and manpower shortages. Over the past 25 years, its municipal tax revenue dropped 43% as the working-age population nearly halved. In the Noto region, the labor force fell by about 30% in the 15 years through 2020, compared to the roughly 10% drop nationwide…

 

Sparky Car Blues

Climate Cult Gradually Then Suddenly It's Probably Nothing Y2Kyoto 22 Comments

I suspect the reasons for Tesla’s sales slump have less to do with Elon’s political views and more to do with the fact that the EV market has generally been stoked by hype as opposed to tangible value.

Tesla said that it delivered 1.64 million vehicles in 2025, down 9% from a year earlier.

For the fourth quarter, sales totaled 418,227, falling short of the 440,000 that analysts polled by FactSet expected. The sales total was impacted by the expiration of a $7,500 tax credit that was phased out by the Trump administration at the end of September.

Bad Advice

Canada’s Bolsheviks entitlement generation Gradually Then Suddenly 6 Comments

Who knew that Canada’s problems are the result of not paying people enough not to work?

At the heart of the issue, he said, is Canada’s eroded social safety net, particularly employment insurance (EI), which, along with other social programs, isn’t keeping up with today’s economy.

EI benefits have mostly stayed the same in value and replace roughly 55 per cent of a person’s wages. The benefits are higher than in the United States, but they lag far behind European countries such as Denmark, where they replace 90 per cent of a person’s wages, the Netherlands (70 per cent) and Sweden (80 per cent).

Ready For What? Defeat?

Gradually Then Suddenly I, Napoleon Military 13 Comments

Canada’s top general might want to start a new career in standup comedy. She’s got a few one-liners that are guaranteed to get some laughs.

And like all the militaries in the world … especially when we’re looking at our allies, we’re going to be ready to go as-is.

All of our services right now are crafting and positioning themselves to be able to take the additional number of people coming in. …Everybody is all-hands-on-deck in doing that. It’s quite exciting, I have to say.

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