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New GIC Interest Rates
December 23, 2017
11:37 am
Bill
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Personally I think telling every kid in Canada that in a few years they'll get a guaranteed income for life is one of the most crackpot ideas ever. I don't dispute the numbers, what's being ignored is the impact on incentive - I've seen enough wealthy as well as welfare-receiving families to know the effect on not all but a large % of people when they discover they really never need to work. And legal pot too........get a few buddies together to share the rent and the party need never end!

December 23, 2017
3:46 pm
Jon
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Bill, losser is always going to be losser. There is no need to set rules that make most people suffer just to try to make them not a losser, not to mention these types of measure generally don't work.

UBI depends on how the system is set up. It can become a replacement of current welfare system or an enhancement of current welfare system. It is the devil in the detail that really determine the nature of a particular type of UBI system. However, it's biggest selling point is that it does not create disincentive to work for people that receive welfare because there is no clawback as everyone get the same amount.

December 23, 2017
3:53 pm
Jon
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Doug, I don't think what you suggest is UBI as the distinctive feature of UBI is no clawback. Implying billionaire and homeless people will get the same amount, although billionaire is going to pay way more in tax back to the government.

Personally, my limited judgement also inform me that the system you suggest is exceedingly bad as it is equal to 100% clawback on earned income, which strongly discourage people to work.

Peter: I think we may need a new thread here as we go way off topic.

December 23, 2017
4:01 pm
Doug
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Jon said
Doug, I don't think what you suggest is UBI as the distinctive feature of UBI is no clawback. Implying billionaire and homeless people will get the same amount, although billionaire is going to pay way more in tax back to the government.

Personally, my limited judgement also inform me that the system you suggest is exceedingly bad as it is equal to 100% clawback on earned income, which strongly discourage people to work.  

I thought that's how the best UBI systems worked? You've got to have some sort of clawback, just like we should have an OAS clawback. And, a billionaire's son or daughter receiving no financial assistance from his or her parent(s) would still receive the same sort of UBI entitlement. I've structured in such a way similar to B.C.'s MSP Premium Assistance program, based on one's previous year's adjusted Net Income, or the Canada Child Benefit. It's meant to be able to provide an income "top up" to ensure everyone gets the same guaranteed minimum income without being disincentivized from working and being penalized for bringing in income. The current limits for income assistance/welfare before assistance is clawed back are far too low and the reporting requirements are onerous and filled with bureaucracy. The system I proposed, as I understand it, would basically be there to allow people to start their own businesses without having to worry about rent + basic food and other essentials (i.e., clothing) whilst their business is not bringing in any or much income. It would also encourage more self-employment in more liberal arts fields, fields that, incidentally, are difficult to be replaced by robots. Yes, a robot can write a news story; the question is how well it can write it. 🙂

Cheers,
Doug

December 23, 2017
4:20 pm
Rick
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Doug said

another, long-term Canadian recession (perhaps even a depression). It's funny that Stephen Poloz came from the Export Development Canada Crown corporation so he obviously has an international trade background and even earlier on in his BoC tenure, he consistently "talked down" the Canadian dollar, a move which I lauded. Now, he seems to be "cow towing" (spelling?) to the Canadian financial markets community (i.e., Canadian banks) and to government in trying to get the rates up. 🙁

Be careful what you wish for, Mr. Poloz. We are not in normal economic times where "runaway inflation" is in any danger. 🙁

Cheers,
Doug

Wasn't aware of his background.
That could be another reason the CDN dollar took a downturn almost immediately after Carney left and Poloz took over? Help out his exporting buddies? Country hasn't been the same since he took over.
kowtow
intransitive verb
1 : to show obsequious deference : fawn
kowtows to the boss

December 23, 2017
4:28 pm
Jon
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Doug, I think you are mixing Universal Basic Income, which function like a refundable tax credit for every citizen, with Guarantee Mininum Income, which top up people's income until their income reach a minimum amount.

December 23, 2017
5:06 pm
Doug
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Jon said
Doug, I think you are mixing Universal Basic Income, which function like a refundable tax credit for every citizen, with Guarantee Mininum Income, which top up people's income until their income reach a minimum amount.  

Ah, okay. Thanks for clarifying the different, Jon! I thought mine was sometimes referred to as a "partial universal basic income". I didn't realize UBI couldn't have a means test.sf-cool

Still, you have to admit, it's pretty sad that in this day and age, we don't even have a guaranteed minimum income! 🙁

Cheers,
Doug

December 23, 2017
5:13 pm
Doug
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Rick said
Wasn't aware of his background.
That could be another reason the CDN dollar took a downturn almost immediately after Carney left and Poloz took over? Help out his exporting buddies? Country hasn't been the same since he took over.
kowtow
intransitive verb
1 : to show obsequious deference : fawn
kowtows to the boss  

Yep, I think that's exactly why the Canadian dollar dipped immediately after his appointment and then it continued its downward trajectory due, in part, to that but also his policy actions. Up until this year, he made exporting & economic growth policy priorities, despite an overheated housing market in certain urban areas. I still feel what he was doing was correct, until this summer, given the aging demographics and rapid technological change, innovation and a tendency for companies just to increase dividends & buy back shares instead of investing in their businesses for growth. As for our housing markets, I felt that the moves made by the provincial and municipal governments, as well as OSFI and CMHC, were the correct ways to deal with the situation rather than a broad interest rate hike (or series of them), which is an overly blunt instrument that affects, among other things, many parts of the country not experiencing the same housing price appreciation. sf-cool

Thanks for giving me the correct spelling of "kowtow"! Didn't realize it was an actual verb, I wonder what an "intransitive" verb would be, could you give me another example? Sounds like I used it correctly but just had the spelling and spacing wrong. It's a good word. 😉

Cheers,
Doug

December 23, 2017
11:20 pm
Rick
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Doug said

Yep, I think that's exactly why the Canadian dollar dipped immediately after his appointment and then it continued its downward trajectory due, in part, to that but also his policy actions. Up until this year, he made exporting & economic growth policy priorities, despite an overheated housing market in certain urban areas. I still feel what he was doing was correct, until this summer, given the aging demographics and rapid technological change, innovation and a tendency for companies just to increase dividends & buy back shares instead of investing in their businesses for growth. As for our housing markets, I felt that the moves made by the provincial and municipal governments, as well as OSFI and CMHC, were the correct ways to deal with the situation rather than a broad interest rate hike (or series of them), which is an overly blunt instrument that affects, among other things, many parts of the country not experiencing the same housing price appreciation. sf-cool

Thanks for giving me the correct spelling of "kowtow"! Didn't realize it was an actual verb, I wonder what an "intransitive" verb would be, could you give me another example? Sounds like I used it correctly but just had the spelling and spacing wrong. It's a good word. 😉

Cheers,
Doug

Thank Merriam Webster. I always thought it was cow-towing..LOL. Dropping the dollar that far was like throwing gasoline on the real estate bonfire by giving the foreign investors a bonus discount on our dollar. Moves by Provincials just lowered the heat in Van, and eventually TO, and moved it outside the major metro areas into places like Kamloops, Victoria, the condo market, even Seattle saw a spike after the foreign buyers tax kicked in - and they brought it in far too late... after the majority of the damage had already been done.What I worry about is how fast/far rates will have to go up for the market to absorb the the shock when mortgages start to come due at the new rates and people can't afford their payments. New rules that start in Jan will help, but once again, too late for everyone that's renewing in the next few years.
Not sure about how you focus on export and the economy when you sign deals with Mexico, and other countries, that allow free trade. How can you compete with economies with low wages and little or no regulation? Decimated the manufacturing sector in Canada (read Ontario). Not even a cheap dollar can compete with the Peso. How's the auto industry doing in Canada since NAFTA? Thriving in Mexico. Geez...they even make Dairybox chocolates in Mexico. No matter what you think of Trump, I agree with him on that point. Maybe not his solution, but can see his point. Don't think Trudeau does.
Intransitive verb
In grammar, an intransitive verb does not allow a direct object. This is distinct from a transitive verb, which takes one or more objects. (stole that from Wikipedia sf-laugh ) ie you can kowtow to the boss without actually putting your lips on his butt.
What was the title of this thread again?? Oh yeah...did I mention Motive hit 3% again? Love the tangents that grow around here.

December 24, 2017
7:51 am
Bill
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Essentially either you believe in engaging fully with all humans, global village thinking, or in being a locavore. Trudeau appears to be the former. Many Canadians appear to want to have it both ways, interact with the world in areas where they "win" and put up protective measures where they don't, we'll see how that goes. Nothing wrong with a little tangent every now and then to take us away from our money counting, especially this time of year....................

December 24, 2017
1:13 pm
Bill
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Rick, once you dig beyond the mainstream media sensationalist negativity it may make you feel better to know that despite rising house prices (awesome for owners - capital gains tax-free!) and trade deals involving Mexico, etc, there's a fair bit of data out there indicating, using pretty well every measure used, that life continues to get better and better for most of us. Here's just one example from CPA magazine a couple of years ago:
https://www.cpacanada.ca/en/connecting-and-news/cpa-magazine/articles/2015/october/are-you-richer-or-poorer

And anecdotally I can tell you what I see with my own eyes every day re how "average" people live today compared to when I was young certainly confirms for me that data. So most of us have a lot more to be thankful for at this time of year than our pop culture would have us believe. And I like to think, despite the complaining and envy, we all secretly know it.

December 24, 2017
10:40 pm
Loonie
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I have no concerns about anyone being so enthralled with an income of about 20K that they will sit on their backsides. Almost everyone wants "more", more choices, better standard of living, interesting vacations, a comfortable bed, ownership of real estate, whatever.

My anecdotal (and other) evidence tells me that what is termed "lazy" is often thinly veiled despair. People do notice if, no matter how hard they work, they can never get ahead. Some give up; some get sick, some get drunk, some try to see if they can run even faster, etc. In fact, working at low wage dead end jobs makes it virtually impossible for them to get anywhere, especially if they have families. If they weren't stuck in crappy jobs, and had a basic income, they could take courses or do volunteer work or whatever was needed to let them have a better chance. They might need to learn some basic business skills before becoming entrepreneurs. Most small businesses fail, statistically, about 80% last time I looked.
I think Bill must live in an interesting microcosm, where most people are doing better and better. Every forecast I have seen lately says the people entering the work force now and who are at the beginning of their working years should expect to be less well off than their parents. There is also a widening gap between rich and poor with less in the middle, a big concern for social stability.
While I'm in favour of a guaranteed living income, it will need to be tweaked, which I am sure we are capable of working out if there is the will to do so.

December 25, 2017
9:52 am
Jon
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Loonie, Bill is right in the sense that the living standard of every past generation have been improving. However, it appears to stop in my generation, which I think is what you are talking about.

December 25, 2017
12:41 pm
phrank
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All this talk of minimum income, but no talk of maximum? We are just beginning to feel the brunt of the failed ideologies of continuous growth and unlimited resources in the more developed countries now. The more you hoard the less everyone else has. It doesn't matter if you feel you earned it or not.

We take so many things for granted. It's not that long ago that it used to be illegal to make profit from lending currency, for example. One way the idea of making money from interest was developed by lending money in one currency and taking payment in another to benefit from exchange rates in order to hide the fact a profit was being made in a manner seen as unethical.

Now we're in a time where the elites have discovered how to inflate profits through the creation of instability. People are just too greedy to do anything about it though, so let's keep the party going and raise those rates.

December 25, 2017
6:16 pm
GR
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For the past four days, almost all postings here have had absolutely nothing to do with Motive Financial GIC interest rates!!

December 26, 2017
5:00 am
Koogie
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GR said
For the past four days, almost all postings here have had absolutely nothing to do with Motive Financial GIC interest rates!!  

+1 There are lots of other forums for people to go to in order to express their half baked political and socio-economic theories.

December 26, 2017
11:32 pm
Loonie
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Interesting discussion, as nothing is happening with banking anyway during the holiday.

voodoo is raising really important questions that everyone with a bank account and a stake in the future of their country should care about. If you're just concerned about where you can move your money to squeeze out another few bps, you run the risk of a rude awakening when it all falls down later. However, they are such big questions that they are beyond the scope of this forum to deal with adequately.

I will just make a couple of specific and relatively brief points which relate to what was said. Those who are not interested in this should skip to next post or thread.

People who are allowed to accumulate mountains of money cannot be relied upon to plough it back into economically productive activities which will benefit their country. There are a lot of lazy people who are rich, and they always want lower taxes, no matter how low they already are; they always oppose public expenditures for the good of all (except maybe roads and sewers if they are connected to a public system); they always oppose improvements in the minimum wage; and they like to store their money offshore once they get enough of it. They evidently plan to live increasingly isolated from everyone else in gated fiefdoms and/or private islands. Lots of evidence of this but no space here for it obviously.

Loaning money for interest has always been prohibited in Islam, and still is. They have developed some workarounds but I can't remember what they are at the moment.

"Growth" often seems to mean producing more and more crap that nobody really needs, and using up valuable resources to produce, ship and dispose of it. There are certainly limits to that way of life, sooner or later, take your pick. Later will be much more painful - for those of you who are left.

Case in point emerged this week. Stores in Rhode Island and elsewhere selling make-up kits for girls about age six which contain asbestos, which is lethal, but may not cause cancer for up to several decades. An alert mother who works for a law firm had the stuff analyzed when she became suspicious. Repeat tests have been positive, and product belatedly removed from shelves. No child on earth needs a make-up kit. Somebody is (or was until now) getting rich making this garbage and selling it. Not only a threat to the children but to the adults around them, and a huge problem for disposal. It only takes a sliver of asbestos to cause mesothelioma. I don't have a link for this handy, but it came from a lawyer I know who has worked diligently on the asbestos file for many years.

The banks will be open again in the morning and we can all return to our regularly scheduled programming... so to speak.

December 27, 2017
7:56 am
Koogie
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You gotta be kidding me.

6 months from now someone who wants to read about Motive Financial has to wade through pages of verbal diarrhea because the banks were closed for a few days and bored people feel like venting their spleen about b*s* in the wrong threads ??!!

HIGH INTEREST SAVINGS forum.

If you want a political sub forum, ask Peter for one. Otherwise, don't assume the rest of us want to read this drivel in a thread about MOTIVE FINANCIAL.

December 27, 2017
8:00 am
Peter
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That's my fault for not splitting off the discussion into its own thread. I'll close this one now! Please open new threads to discuss any further GIC changes.

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