Taxes are going up, TO condo prices are going down and recreational property up 15% to 40% in the Canadian market.

Canadian real estate and government, March 29

The latest Canadian real estate and government news. Risk of collapse, end of QE and rate rise are some of the issues discussed. Also the governments poor foreign policies on Ukraine are covered.
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FIRE report January 12th

Indigenous banking part 2 a continuation of earlier discussion of First Nations Bank. Other news:-Inflation-M&A under scrutiny-RBC has eyes on Europe
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BOC and reconciliation with Indigenous people

The Bank of Canada and other central banks, in conjunction with indigenous leaders want reconciliation and better economic outcomes for individuals. This video explores what is happening, gives the back story and sets the stage for a more in-depth analysis.
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Nov 26 FIRE report

Inflation and tariffs hit Trudeau in the face. Oil route as new strain goes viral. BNPL benefits questioned and investors open their wallets to receive dividends.
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FSIM FIRE report Nov 23

Duobank/Fairstone merger & Amozon boycott of Visa along with recent banking, insurance and real estate news from Canada.
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Nov 18th FIRE report

The latest financial news from the financial services industry monitor. Insurance companies should know that in 1990 BC flooding devastated the same flood plains as today. This report features coverage of insane inflation, interest rates hikes and the ongoing real estate melt-up.
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Poloz debunked, Nov 12 FIRE report

Poloz is wrong about inflation, university pension funds are out of their league, Home Capital run away, real estate wars and more from the financial services industry monitor.
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Central bank digital currencies: foundational prin

Central bank digital currencies: foundational principles and core features
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Nov 5th FIRE report

Topics todayDividends are backHigher interest rates are comingCOP26: Central bankers making miners richTO real estate melt-up
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FIRE report November 2nd

The latest Canadian FIRE news covering inflation risk and opportunities, Canadian Western bank expansion, governance and stablecoins.
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Canadian real estate February 24

Recap of recent real estate news in Canada. Tiff Macklem and market exuberance, cottage country price appreciation and the rise of lumber prices.
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Real estate: Feb 9, bulls vs bears

Bulls versus the bears, this week in the Canadian real estate industry.
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Feb 1, The Dumb Money Real Estate Vid

We a living a ponzi real estate market and the economy is at risk. Yet Doug Porter, economist BMO, is on record as saying Candian\'s want to pay more for houses. Yes, you can\'t make this stuff up. This video discusses the issues related to Porter\'s statement and explains why he is wrong.
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January real estate report 2021

2020 was a record year, except for condos. Montreal REM sites the exception to this rule. This video shares insights regarding the Canadian real estate segment.
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December 4th real estate report

Taxes are going up, TO condo prices are going down and recreational property up 15% to 40% in the Canadian market.
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Real estate, mortgage debt to income ratio improve

The mortgage debt to income ratio declined despite the pandemic. In this issue I discuss real estate stalling and immigration's impact on home prices.
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Real estate: fiscal conservatism/ponzi neoliberali

This video is intended to give viewers an understanding of the economic ideas behind Canada's potential housing bubble. This video also explains why Siddal, President and CEO of the CMHC, was likely pushed from his post.
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Caution for real estate investors, Oct 14th report

October 14th real estate report describing the issues in the market the last two weeks.
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Canadian bank industry overview - part 1

Overview of Canadian banking industry. This multi-part series looks at issues facing Canadian banks from a variety of angles. Part 1 examines the types of banks and scale using ROE and EBITDA as measures.
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Why insurance should partner with flood-claim.com

'Pros on the Go', a Fierce Tartan company are seeking insurance partners to pilot its new solution for streamlining the claims process.
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Canadian large bank comparison

Using financial data, Mark Sibthorpe compares the performance of TD bank to its rivals. TD grew faster in 2017 than its rivals, but was cited for aggressive sales practices.
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Current state of fintech in Canada

Mr. Michael R. King, Tangerine Chair in Finance and Co-Director, Scotiabank Digital Banking Lab / Ivey Business School at Western University
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XE.com explains their Big Data and AI strategy.

This video covers XE.com's presentation at the AI, Big Data and Analytics event which took place in Toronto February 7/8, 2018. Cecelia Tamez and Jean Louis provide insights into their evolution and winning strategy.
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Greenpeace urges TD bank boycott

Greenpeace's campaign to stop TD financing the oil sands is delusional. Trillions of dollars are at stake for the banks and the Canadian economy. This video explores the related financial issues.
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Insurance flood US vs Can comparison.

This video provides an overview of the main differences between Canada's approach to overland flooding versus the US approach.
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Canadian bank industry overview part 5

Canadian bank overview part 5, medium-large banks. Banks include Manulife, Tangerine and Laurentian Bank.
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Canadian banking industry overview part 4

Canadian banking industry overview of Canadian Tire Bank, Presidents Choice Financial, Equitable Bank, B2B Bank
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Part 3 Canadian bank industry overview

Overview of small-medium size banks in Canada. Banks covered include Versabank, Hollis Bank, Equity Bank and Caisse Populaire Acadienne.
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Canadian banking overview - part 2

Review of small banks including Bridgewater,Vancity Bank, Concentra, Wealth One, Zag...
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Death to bitcoin, long live bitcoin

Jamie Dimon calls bitcoin a fraud used by criminals, yet he has jumped into the blockchain with both feet.
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RBC to integrate Wave Technologies

RBC invested $24 million into Wave Technologies and now they will roll out Waves accounting, invoicing, reporting and billing platform to SMEs.
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Deposits have skyrocketed since the start of the p

Canadian banks have increased their deposits by $127 billion since the start of the pandemic. This video uses charts to show which banks gained the most and how.
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About

About BankNews TV: financial services industry monitor (FSIM), analytics and research

Latest news and events for Canadian financial service companies, analytics, fintech and AI. BankNews.TV provide the latest technology news and reports for banks and insurance companies looking to compete in a rapidly changing market.

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Research

abcd

Real estate report: October 30th, 2020  

fsim.ca/docs/Oct30rereportv1.pdf

Mark Sibthorpe

The big buzz in real estate recently is Mark Carney being scooped up by Brookfield. This means more juice for riskier borrowers. Brookfield, a huge player in real estate, both residential and commercial, recently bought its remaining shares from Sagen (Genworth MI Canada), which values the company at $3.8 bn.


VersaBank’s New High-Security VPN Proving Especially Valuable During COVID-19 Pandemic  

fsim.ca/docs/TailscaleReleaseMarch30FINAL.pdf

Press Release

VersaBank (TSX:VB) (“VB” or the “Bank”) today announced the implementation of its new high security Virtual Private Network (VPN) remote access software solution, developed in partnership with Tailscale, a leading provider of secure network connectivity solutions. The software enables VersaBank employees to securely and directly connect to all the Bank’s servers across multiple offices and cloud providers, using two factor authentication and with every connection encrypted. The Tailscale-based solution uses the Office 365 setup and Windows client/server applications that the Bank already had in place.


2014 FSIM when Bernanke visited Montreal  

fsim.ca/docs/MockBernanke.pdf

Mark Sibthorpe

Considering Bernanke is hated by the Republicans and hated even more by the Democrats, and is currently under scrutiny for saving AIG but not Lehman, (in hindsight) with respect to issues over solvency vs liquidity, the Montreal lovefest attended by 1,100 people yesterday must have been a welcome respite. Click the link to read the entire 2014 report.


Eisman's big Canadian bank short  

fsim.ca/docs/eisman2.pdf

Mark Sibthorpe

I have been reporting on Steve Eisman's short position for quite some time.  As the analyst reaction to Eisman shows (link below), Eisman has taken a lot of heat for shorting Canadian banks. Instead of capitulating, in September 2019 he publicly disclosed the fact that he added Canadian Tire to his position, He explains the rationale for this in a BNN interview late 2019. Essentially, his big concern with respect to banks was non-performing loans in Alberta. He feels Canadian bank CEOs are not prepared for a credit cycle. He specifically referenced ATB (a private bank) in discussing his concerns. Looking at the numbers today, my guess is that he has made off like a bandit.


VersaBank Beta-Testing Its New, High Volume Mortgage Finance App   

fsim.ca/docs/VBCortelMortFinanceAppFeb62020.pdf

Press Release

VersaBank announces it is initiating beta-testing on its newly developed high-volume mortgage software app with the Cortel Group, one of Canada’s largest home and condominium builders. The app, named “Direct Connect”, was designed to facilitate and significantly reduce the lengthy finance approval process typically experienced by home buyers when visiting home and condo pre-construction sales offices.


How and why you need to defend your brand against disruptors  

Mark Sibthorpe

Technology, and being open to opportunities, has preempted transformation in banking. At the top of change are Mint, PayPal and ApplePay; three examples of transformative solutions that are now ubiquitous. On the horizon: Uber and Google, both having recently announced partner based banking services. Further down in the plumbing is Duca Impact Labs, Versabank, and Revolut. This report shows how cost conscious FIs can, not only stay relevant in the face of adversity, but punch well above their weight. All thanks to creative thinking and the ongoing commoditization of technology.


Kick the can(nomics)  

fsim.ca/docs/Kick.pdf

Mark Sibthorpe

Canada has used consumer debt to provide life support to the economy. This strategy which basically pushed the day of reckoning to the next government was old back in 2014, and now is well past its sell-by-date. Recognizing this, and desperate to keep the economy out of a recession, Trudeau is spending more money now than any government in Canadian history. This report disusses a possible alternative.


ScoreCard Bill Morneau, Canada's Minister of Finance  

fsim.ca/docs/ScoreCardMorneau.pdf

Mark Sibthorpe

This report is a scorecard I designed in order to rank the performance of the current Minister of Finance, Bill Morneau. I do regular rankings because, otherwise, I cannot measure the performance in a meaningful way. The scoring is based on a variety of metrics as detailed on the ‘score-table’ on page 3. Examples of the criteria and weighting include:

 


Observations and overview of 2018 NB flood support from government and insurance companies.  

fsim.ca/docs/Observations and overview of 2018 NB flood support from government and insurance companies..pdf

Mark Sibthorpe

 


Flood aftermath is linked to post traumatic stress. Here are some findings from a study conducted by Queensland University following a flood:

"The findings showed that aftermath stress contributed to poor mental health outcomes over and above the flood itself, prior mental health issues and demographic factors," Ms Dixon said.

 

"Aftermath stress was the strongest predictor of post-traumatic stress symptoms with 75 per cent of people saying the most difficult aspect was the aftermath and dealing with insurance companies," she said.

 

With this in mind, I felt it was important to understand how New Brunswick flood victims were treated.

 


Update Argentina: a sign of the times  

fsim.ca/docs/Update Argentina_ a sign of the times.pdf

Mark Sibthorpe

Argentina is in the news daily because the situation is dire, and may be an indication of further contagion. The most dramatic story that speaks of the a leading cause of its troubles was the recent arrest of the public works secretary, Jose Lopez. June 15th he was caught hiding millions in cash in a monastery. No this is not a plot for a comedy.


Summary of Canada's flood news, 2017 to present  

fsim.ca/docs/Summary-of-flood-news-2017-present.pdf

Mark Sibthorpe

This report covers flood news in Canada from 2017 to present and highlights the relevent issues for home-owners and the insurance industry.


Banking on Pot  

fsim.ca/docs/c10191_banking-on-pot.pdf

SBS

As states across the US legalize marijuana for both medicinal and recreational purposes, it has fueled a growing industry of marijuana related businesses (MRBs).


Canadian banking industry overview  

Mark Sibthorpe

The industry overview is divided into 5 parts:

Introduction
Small banks
Small medium sized banks
Medium sized banks
Medium large banks


2014 Mobile payments the Apple pay way  

fsim.ca/docs/Mobile_Payments_Apple_Pay_2014.pdf

Mark Sibthorpe

With Walmart Pay about to userp Apple Pay, I thought I would share my 2014 book on mobile payments and loyalty. The guilde was written for Merchants that want to understand loyalty, credit, mobile payments and Apple Pay, but anyone involved with credit and loyalty might find it useful.
The book is a prelude to Walmart leaving MCX, and chronicles the evolution that led to Walmart Pay. There is an extensive case study of Walmart that looks into its efforts to become an ILC and to avoid paying credit card transaction fees ('merchant discount').
It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and industry facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives. 


Death to bitcoin, long live the blockchain   (See full report)

Mark Sibthorpe

Jamie Dimon calls bitcoin a fraud used by criminals, yet he has jumped into the blockchain with both feet.


TD bank industry conduct  

fsim.ca/docs/tdind2.pdf

Mark Sibthorpe

TD’s share price recently collapsed by $7 bn in one day due to CBC’s allegations of aggressive selling tactics. A huge fall from a bank that was trading at a premium as recently as January. This was even before the most recent allegation of TD attempting to avoid paying taxes on advertising.
This report chronicles the events leading up to the collapse, shows TD's performance, analyses other related issues.


Book review: Back from the Brink  

fsim.ca/docs/backbrink.pdf

Mark Sibthorpe

This is a book review of the book Back from the Brink by Paul Halpern, Caroline Cakebread, Christopher C. Nicholls and Poonam Puri.


Footnote 151  

fsim.ca/docs/footnote151.pdf

Mark Sibthorpe

Footnote 151 implies an important regulatory change related to derivative contracts. It means that US Banks will not be required to hold as much capital against commodities. If you want to understand the implications of this regulatory change in more detail, see the enclosed related article detailing the changes. For contextual purposes, I have also included two Rolling Stones Magazines reports from 2010 and 2014 that chronicle the role large US banks have played in manipulating commodities. You might question the credibility of these sources, but rest assured, these reports are based on United States Senate hearings which outline the issues in a 396 page report related to the implied risks. 


Save the Canadian economy now  

fsim.ca/docs/helecopter-money.pdf

Mark Sibthorpe

Consumer debt spending appears to have insulated Canada from the worst of the credit crisis, but now the alarming magnitude of consumer debt ($1.92-trillion) could exacerbate a day of reckoning.
This report assesses the issues at hand and recommends the solution to get Canada's economy on track.


Reasons financial service companies should consider gamification  

fsim.ca/docs/GamingEventProposal-printsample--en-final.pdf

Mark Sibthorpe

Gamification of business processes resulted on Mint.com growing to 10 million users within 4 years. This report explains how.


National Bank Special Report  

fsim.ca/docs/NatBSpec.pdf

Mark Sibthorpe

According to Bloomberg, National Bank of Canada will take a C$64 million ($48 million) restructuring charge in the fourth quarter and said its investment in Maple Financial Group Inc., which is being probed by German regulators, may be at risk of a “substantial loss.”


Will Canadian banks charge companies for deposits?  

fsim.ca/docs/depgrowthimpact2.pdf

Mark Sibthorpe

In light of today’s possible rate cut, this report discusses how a bank rate cut and capital ratio pressure could precipitate negative corporate deposit interest rates in Canada.


Canadian Tire's (CTC) - Canadian Tire Financial Services (CTFS) Scotia deal overview and risk assess  

fsim.ca/docs/ctfsfinal.pdf

Mark Sibthorpe

Review of the Canadian Tire Financial Services deal with Scotiabank, risks, opportunity and benefits.


Finance minisiter scorecard August 26, 2015  

fsim.ca/docs/Scorejo-August-2015.pdf

Mark Sibthorpe

This report looks at Joe Oliver, minister of finance’s progress to date, and assigns a grade to his government’s performance to date.


Xtreme Branch  

fsim.ca/docs/xbranch.pdf

Mark Sibthorpe

Branches are evolving to meet the digital age. This documents tracks the evolution with real-world examples.


Canadian Nudge  

fsim.ca/docs/nudge.pdf

Mark Sibthorpe

Whether he knew it or not, Tom Reid, a senior vice-president at Sun Life, made a case for the behavior modification concept ‘Nudging’ when he recently proposed auto-enrolling Canadians in his company’s pension plans. Sun life cover 1.2 million Canadians, about 60% of the eligible employees.
According to Reid,


CWB cause for concern  

fsim.ca/docs/cwbupdate.pdf

Mark Sibthorpe

In an earlier report BankNews.TV expressed concerns about CWB. Here are 5 charts that show cause:
1. First earnings drop in years;
2. Deposits dropping which will increase cost of funds in the future.


BNTV Overview  

fsim.ca/docs/overviewpdf.pdf

BNTV

BankNews.TV Publishing Corp services overview document:

  • Analytics
  • Financial services industry monitor (FSIM) industry briefings and developments reports
  • Research


Challenger banks not a threat to big banks  

fsim.ca/docs/challenger.pdf

Mark Sibthorpe

This report looks at Canadian challenger banks (apart from merchant led banks) and explains why they have not threatened larger institutions. It also looks at ways in which these upstarts have achieved success.


Gamification of financial data project  

fsim.ca/docs/GamingEventProposal-printsample--en-final_original.pdf

Mark Sibthorpe

This document contains details on how BankNews.TV is helping kids learn programming via gamification of financial data.


The impact a rate rise will have for Canadian banks  

fsim.ca/docs/irr-f.pdf

Mark Sibthorpe

Canadian banks have made money throughout the credit crisis, but this trend may be about to reverse. The rational supporting this prediction is that revenue has grown despite a declining net interest margin (NIM). It has grown in spite of this fact because Canadian debt (loan lease volume) has risen significantly, as shown in chart 2.

This report looks at the issues facing Canadian banks in the event of a Bank Rate rise.  


FIFA: the new goldenballs  

fsim.ca/docs/goldenballs.pdf

Mark Sibthorpe

Yesterday, the Attorney General of Switzerland (OAG) opened criminal proceedings related to the FIFA scandal. This report outlines some of the events related to the criminal investigation, with a particular focus on banking.


Scorecard Minister of Finance: JIm Flaherty  

fsim.ca/docs/Scorecard Min Fin Flaherty April 8 2014.pdf

Mark Sibthorpe

March 18, Finance Minister Jim Flaherty resigned from cabinet after having endured a difficult year due to health issues. This report looks at his legacy and attempts to grade his government’s performance to date.


Sample RFP for a Loyalty Program  

fsim.ca/docs/sample RFP for a loyalty program.pdf

Mark Sibthorpe


Merchants extend financial services  

fsim.ca/docs/merchantfs.pdf

Mark Sibthorpe

Merchant led financial services are growing in importance once again. This is exemplified in the ongoing UK rivalry between ASDA, Sainsbury and Tesco. Together these merchant/financial service companies provide the backstop for three different approaches for merchants looking to extend their financial services.


Hot Money: real-estate  

fsim.ca/docs/hotmoney.pdf

Mark Sibthorpe

Canadian and London real estate, like Macau, may also be a convenient means for China’s elite to move money offshore; with the deleterious effect of driving up home values. Louise Shelley`s research concurs. In a published paper written for the National Defense University, Shelley argues that money laundering in real estate (MLRE) increases prices.


Currency Cheat Sheet: a guide for the rest of us  

fsim.ca/docs/currencycheatsheet.pdf

Mark Sibthorpe

Readers of this document will be presented with monetary policy issues and facts
that show the USD will likely remain the dominant reserve currency, despite
questionable Chinese practices, record US debt levels, and a shaky economy.


Riches to Rags? Summary of possible risks for Genworth MI CANADA, INC.  

fsim.ca/docs/gq4risk.pdf

Mark Sibthorpe

Genworth had its Q4 2014 earnings call. Genworth own about 30% of the mortgage default insurance in Canada. Not surprisingly, the earnings call became focussed on Alberta; and for good reason, with 20% of its outstanding insured mortgage balance in Alberta, sensitivity to the oil shock and how Genworth plan to manage related risks were discussed in detail.


Canadian Western Bank Competitive Forecast  

fsim.ca/docs/cwbf.pdf

Mark Sibthorpe

Based on historical financial data (see detailed charts pages 5-8), the oil based recession in Alberta, and comparison against two of its peers, this document outlines my observation with respect to CWB’s future performances.


Liquid Canada: the tipping point  

fsim.ca/docs/Liquid.pdf

Mark Sibthorpe

This report examines liquidity issues in the Canadian financial service industry.


Bank Fees  

fsim.ca/docs/Bank fees.pdf

Mark Sibthorpe

Recently the CBC and The Globe and Mail both reported on what has been referred to as a consumer “bank fee outcry”. CBC compares banks to cable and phone companies, standing accused of trying to gouge customers with service fees. The backlash appears to have originated in conjunction with the NDP and the Consumers Council of Canada which argues that there is anxiety ‘among consumers about banking fees’.


Cheap Oil Report  

fsim.ca/docs/co2.pdf

Cheap oil has pushed the Bank of Canada's governor, Stephen Poloz onto a slippery slope. For some background on this, take October 22nd, when Poloz bid farewell to forward guidance, resulting in yesterday's surprise rate cut. A cut that has enraged TD and other banks, which see this as eroding profits.
 


Canada's Economy, a strategic solution  

fsim.ca/docs/ces.pdf

This report explores Canada's strategies to compete globally. The report begins with an analyses of the housing market, because housing is the canary in the coal mine; explores what happens in the event of collapse; and analyses the underlying problem causing Canada to be uncompetitive.
 


Complete loyalty RFP  

fsim.ca/docs/booksample.pdf

Merchants that want to understand loyalty, credit and mobile payments should read this book. It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives.
 


Mobile Payments Blueprint: guide to credit and loyalty transformation for merchants  

fsim.ca/docs/booksample.pdf

Merchants that want to understand loyalty, credit and mobile payments should read this book. It offers readers a step-by-step methodology for evaluating and transforming credit and loyalty programs. The strategies are based on proven examples and facts. The Nectar, Target, Canadian Tire and Walmart case studies are examples of the practical approach I have taken, written with the intent that merchants can use them as blueprints for their own initiatives.
 


Report on merchants extending financial services  

fsim.ca/docs/

Special report explaining why some merchants in the UK, U.S. and Canada are expanding their financial services. The paper discusses the structural and regulatory pressures facing merchants and explains the rational behind key decisions. This is an 8 page high level report
 


Guide to system selection  

fsim.ca/docs/gssnow.pdf

Read sample report: Guide to system selection. This sample would normally cost $99 but is available free as a sample. Click here view sample report.


News feed

BANNER YEARS FOR INVESTMENT BANKS AT RISK AS PANDEMIC DEALMAKING COOLS SIGNIFICANTLY

G&M - Tim Kiladze (2022-07-07)

The banner years for equity financings and mergers and acquisitions driven by the pandemic are at risk of disappearing, with deal activity slowing significantly in the first quarter – particularly for Canadian share sales.

The value of Canadian equity financings tumbled 81 per cent in the first quarter of 2022 to $3.9-billion, according to Refinitiv, down from $20.9-billion during the same period last year. While the year-over-year comparison is a tough one, because early 2021 was when markets soared, the total value of share sales hasn’t been this low in more than a decade.

Central banks slashed interest rates to their lowest levels possible early in the pandemic to shore up the economy, sending stock prices soaring, and spurring share sales.

Much of the cooling stems from a recent dearth of technology financings. Last year, the sector accounted for roughly one-quarter of all share sales – and tech initial public offerings were particularly popular. So far this year, technology deals have been virtually non-existent because of a market rout in the sector. The tech-heavy Nasdaq Composite is down 12 per cent year to date.

Merger and acquisition (M&A) activity has also cooled in Canada, with US$66.6-billion worth of deals announced during the first quarter, including debt, according to Refinitiv, down 45 per cent from the same quarter last year.

The trend is playing out around the world, with the global value of M&A deals down 23 per cent, according to Refinitiv. However, the pace of mergers and acquisitions is still relatively healthy compared to prepandemic years.

Macroeconomic pressures are the leading factors behind the recent changes. “We are living with heightened volatility and uncertainty,” said Nitin Babbar, global co-head of equity capital markets at RBC Dominion Securities.

Inflation sparked the uncertainty last fall, which led to a growth-stock selloff that pummelled the tech sector. Those fears haven’t abated, and now geopolitical concerns hover over everything. Minutes from the latest meeting of the U.S. Federal Reserve were released on Wednesday, and they showed that Fed officials wanted to start hiking interest rates aggressively, but decided to go slow because of the economic ripple effects from Russia’s attack on Ukraine.

Despite the growing uncertainty, many of the share sales that launched in the first quarter of this year were successful. Bank of Montreal 

BMO-T -0.96%decrease  

 recently sold $2.7-billion worth of stock to help pay for its acquisition of Bank of the West, for one, and the deal was well-received by investors. “We haven’t seen issuers who really want to [raise money] and we have to say, ‘you can’t,’” RBC’s Mr. Babbar said. “It’s just a question of issuer need.”


HOME SALES AND PRICES IN TORONTO AND VANCOUVER PLUNGE FROM LAST YEAR’S HIGHS

G&M - Rachelle Younglai (2022-07-06)

Home sales in Toronto and Vancouver plunged in June from last year’s highs and property prices declined further as higher borrowing costs made it harder for would-be buyers to get into the country’s two priciest real estate markets.


SHOPIFY DELAYS COMPENSATION OVERHAUL, LAYS OFF 50, AS FALLEN STOCK PRICE COMPLICATES PLANS

G&M - Temur Durrani (2022-07-06)

Shopify Inc. 

SHOP-T +9.94%increase    is putting off a compensation overhaul that would give its employees more choice in how they are paid, as the Ottawa-based company addresses the challenges posed by its fallen stock price and the persistent sell-off pummelling the technology sector.


SUBPRIME LENDER FISGARD SUSPENDS RESIDENTIAL CONSTRUCTION LOANS IN SEVERAL PROVINCES

G&M - Rachelle Younglai (2022-07-06)

Fisgard Asset Management Corp. has suspended residential construction loans in Ontario, British Columbia, Alberta and Manitoba, becoming the latest subprime mortgage lender to hit pause this year.


FAKE FILET MIGNON, WOOD CREDIT CARDS: INSIDE EUROPE'S LARGEST CLIMATE TECH VC FUND

Yahoo Finance - Jeff Lagerquist (2022-07-06)

Billing itself as Europe's biggest climate tech venture capital fund, World Fund launched last October with the goal of raising €350 million ($472 million) to back startups that can cut emissions. The companies it funds are chiefly determined by what it calls Climate Performance Potential (CPP), a score developed by a top mathematician from the University of California at Berkeley and the University of Bonn in Germany.


OIL PLUMMETS BELOW $100 AS RECESSION RISKS COME TO FOREFRONT

Yahoo Finance - Julia Fanzeres (2022-07-06)

“Crude oil prices have slumped as weakening demand concerns are starting to outweigh fears about tight supply,” said Fawad Razaqzada, market analyst at City Index. “A growing number of analysts are expecting that many of the world’s leading economies will suffer negative growth in the next few months, and this will drag the US into a recession.”


FUNDS ARE FURIOUSLY SELLING RISKY EMERGING MARKET CURRENCIES

Yahoo Finance - Karl Lester M. Yap and Ruth Carson (2022-07-06)

All of the 23 major emerging-market currencies tracked by Bloomberg have weakened over the past month as the Federal Reserve has raised its benchmark rate by a combined 125 basis points at its latest two meetings. Chair Jerome Powell has said the central bank may hike by either 50 basis points or 75 basis points at its July gathering.


TORONTO HOME SALES FALL 41% AS BORROWING COSTS WEIGH

FP - Tara Deschamps (2022-07-06)

About 6,474 homes changed hands last month, down from 11,053 during the prior June, the Toronto Regional Real Estate Board said. June sales were also down compared to May.


BOE'S BAILEY: UK BANKS REMAIN STRONG DESPITE TIGHTER GLOBAL CONDITIONS

Reuters (2022-07-06)

"Since the last FSR (Financial Stability Report), which we published in December last year, the global economic outlook has deteriorated markedly. Global financial conditions as a whole have tightened significantly," Bailey told a news conference.


NATURAL GAS SOARS 700%, BECOMING DRIVING FORCE IN THE NEW COLD WAR

Bloomberg - Gerson Freitas JR (2022-07-06)

One morning in early June, a fire broke out at an obscure facility in Texas that takes natural gas from US shale basins, chills it into a liquid and ships it overseas. It was extinguished in 40 minutes or so. No one was injured.


CITI SAYS OIL MAY COLLAPSE TO $65 BY THE YEAR-END ON RECESSION

Bloomberg - Serene Cheong (2022-07-06)

Crude oil could collapse to $65 a barrel by the end of this year and slump to $45 by end-2023 if a demand-crippling recession hits, Citigroup Inc. has warned.


CANADA’S MOST EXPENSIVE REAL ESTATE MARKET IS DROPPING AN AVERAGE OF $2,200 PER DAY

Better Dwelling - Stephen Punwasi (2022-07-06)

Oakville, a posh Toronto suburb and Canada’s most expensive market, led the dollar drop. The price of a typical home peaked at $1,645,900 in February 2022, up 65.0% ($648,100) since March 2020. Just the increase made over the two years is the equivalent of 3 homes across Canada in 2005. And people say it’s a totally normal market, eh?


CIBC PARTNERS WITH ONLINE WILL PLATFORM

Investment Executive - Daniel Calabretta (2022-07-06)

“Canadians want simple online financial solutions to help them manage their finances today and plan for the future,” said David Attard, senior vice-president of digital banking and enablement, personal and business banking at CIBC, in a press release.


COINBASE-BACKED VAULD HALTS WITHDRAWALS AS CRYPTO CREDIT CRISIS INTENSIFIES

FT - Adam Samson (2022-07-05)

Vauld, a crypto lender backed by Coinbase and investor Peter Thiel, has halted withdrawals and trading on its platform as the credit crisis in the digital asset market intensifies.
The company, which offered clients annualised returns of up to 40 per cent to lend out their crypto tokens, said on Monday clients had yanked almost $200mn from its platform in the past three weeks as high-profile failures ricochet through the industry. It had appointed advisers to look at all potential options, including a restructuring, Vauld said in a statement on Monday. The Singapore-based group’s decision to suspend redemptions is the latest sign of how a powerful pullback in digital asset prices in recent months has severely caught out what was once a flourishing market for lending digital tokens. Companies have been hit by the aftershocks of the collapse of digital token luna in May. Last month, lenders BlockFi and Celsius both said they would have to halt withdrawals and hedge fund Three Arrows Capital — one of the market’s biggest investors — failed, ensnaring other parties. Vauld said on June 16 that it did not have any exposure to Celsius or Three Arrows Capital. “We remain liquid despite market conditions. Over the past few days, all withdrawals were processed as usual and this will continue to be the case in the future,” it said. But it noted on Monday that Three Arrows’ collapse had been a factor in triggering a stream of client withdrawals. “We are facing challenges despite our best efforts,” Vauld said on Monday. “This is due to a combination of circumstances such as the volatile market conditions, the financial difficulties of our key business partners inevitably affecting us and the current market climate.” It has hired Kroll as a financial adviser and Cyril Amarchand Mangaldas and Rajah & Tann Singapore as legal advisers as it weighs its options.


CRYPTO EVANGELISTS KEEP THE FAITH AS PRICES FALL

FT - Elaine Moore (2022-07-05)

In June, San Francisco held the biggest web3 event that the city had ever seen.


CRYPTO COLLAPSE REVERBERATES WIDELY AMONG BLACK AMERICAN INVESTORS

FT - Taylor Nicole Rogers (2022-07-05)

The widespread losses caused by the cryptocurrency crash are even broader among black investors.


LIQUIDITY STRAINS IN MARKETS NEED STRUCTURAL FIXES

FT - Eric Pan (2022-07-05)

While high inflation is making the headlines, another potentially worrisome development for markets this year has been the deterioration of liquidity in trading.


GULF OIL CASH BECOMES A MAGNET FOR GLOBAL MONEY MANAGERS

FT - Simeon Kerr, Laurence Fletcher (2022-07-05)

Global asset managers have their sights set on the Gulf as the oil-rich region emerges as a rare source of spare capital in a market laid low by the war in Ukraine, Covid lockdowns and inflation.


ECB TO WARN EUROZONE COUNTRIES OVER CRYPTO REGULATION

FT - Laura Noonan (2022-07-05)

The European Central Bank will this week warn eurozone countries of the dangers of national regulators getting ahead of pending EU cryptocurrency rules, highlighting the difficulties of introducing efficient oversight of the rapidly evolving “wild west” sector. The European Commission last week agreed a sweeping package of standards for the crypto industry. But the central bank is concerned about a messy patchwork of national regulations governing the overlap between banks and crypto companies before the package’s full implementation 18 months after it is set to become law next year. It will raise the urgent need for “harmonisation” at a meeting of its supervisory board on Tuesday, people familiar with the discussions said. “It’s very challenging,” said a national regulator in one eurozone country. “With Mica [the EU’s digital regulation package] 18 months away, are you better to say, ‘until it’s in, do what you like, there’s no regulation’ or are you better to try to get a handle on it?” Germany has been the most proactive in its efforts to tame digital currencies. It used the EU’s 2020 anti-money laundering directive to require companies that hold and facilitate trading of crypto assets on behalf of clients to apply for special licences under German banking law. Other eurozone countries such as the Netherlands initially focused their efforts on registrations for anti-money laundering compliance, but several have been considering broader measures after Russia’s invasion of Ukraine highlighted the potential for crypto to be used for illicit means such as evading sanctions. Concerns over consumer protection have also increased as the value of bitcoin, the biggest cryptocurrency, has plunged more than 70 per cent from its peak. Another country-level regulator said national authorities “that are pressed by their industry need to come up with answers”. Some banks have been clamouring for clarity on which activities they can safely pursue, while some crypto companies have pushed for regulation to boost their sector’s credibility, though others have argued for a lighter touch. The ECB has concerns about potentially adjudicating on crypto-related licences pursued by banks when there is no pan-European framework in place, one person familiar with the matter said. It will discuss that issue — and the broader need for harmonisation of eurozone approaches — with regulators from its 19 member states at tomorrow’s supervisory board meeting. Andrea Enria, chair of the ECB’s banking supervisory board, last week told MEPs in Brussels that the central bank was seeing “differences in national regimes around crypto” and that a level playing field “would be important”. He said it would be “focusing on internal principles to ensure you have a smooth authorisation [and] licensing process for banks engaging in these areas”. The intervention may face resistance from countries that want to go further on their own, but some are likely to support the ECB’s effort. “There is clearly an issue of both harmonisation and timing; the full application of Mica will take quite some time, so it is important to act soon,” said a person familiar with discussions at a third national supervisor.


CRYPTO ‘THE BIGGEST PONZI SCHEME IN HUMAN HISTORY’—CHINA BLOCKCHAIN EXECS BACK BILL GATES AND WARREN BUFFETT AFTER HUGE BITCOIN PRICE CRASH

Forbes (2022-07-05)

The bitcoin price has crashed under the psychological $20,000 per bitcoin level it first crossed in late 2017 before entering a bruising three-year bear market that saw the bitcoin price fall to under $3,000.
Now, with some expecting the crypto crash to reveal the world's future technology giants, executives at China's Blockchain-based Service Network (BSN)—a state-backed initiative designed to drive the commercial adoption of blockchain technology—have branded bitcoin and cryptocurrency "the biggest Ponzi scheme in human history."


WHY WOULD ANYONE COUNTERFEIT THE LOWLY TOONIE? THE ANSWER MAY LIE IN CHINA

G&M - J.P. Moczulski (2022-07-04)

The RCMP’s recent discovery of thousands of counterfeit toonies has raised concerns about the integrity of Canada’s banking system, through which they circulated with apparent ease.


NEW BANKING RULES TO PROTECT CONSUMERS COME INTO EFFECT TODAY

FP - Denise Paglanawan (2022-07-04)

The Financial Consumer Agency of Canada said the framework, which took effect Thursday, “holds banks to a higher standard” and requires them to take greater responsibility for consumer outcomes.


EU AGREES TO TAME 'WILD WEST' WITH NEW CRYPTO MARKET RULES

Reuters - Huw Jones, Tom Wilson (2022-07-04)

Cryptocurrency companies will need a licence and customer safeguards to issue and sell digital tokens in the European Union under groundbreaking new rules agreed by the bloc to tame a volatile "Wild West" market.


THE WORST STOCK SELLOFF IN HALF A CENTURY MIGHT NOT BE DONE YET

Reuters - Sagarika Jaisinghani, Jess Menton, and Jan-Patrick Barnert (2022-07-04)

It’s been a chaotic, and costly, time for many investors. But 2022 is only half over and the stocks tale will probably have more twists and turns before the year is up.


TORONTO-DOMINION BANK EXPLORES TAKEOVER OF US BROKERAGE COWEN

Bloomberg - Ed Hammond, Jan-Henrik Foerster, and Aaron Kirchfeld (2022-07-04)

Cowen’s shares have declined by about a third this year, valuing the New York-based firm at about $668 million. The shares, which rose 1.5% to $24.04 on Friday, jumped as much as 19% after the close of regular trading.


JOHNSON WEIGHS 50-YEAR MORTGAGES THAT CHILDREN CAN INHERIT

Bloomberg - Emily Ashton (2022-07-04)

Home sales are falling and price increases slowing as the cost of living crisis cools a market that boomed following a stamp duty sales tax cut and lower mortgage rates. The government is keen to boost demand and is also considering 30-year fixed rate home loans, mortgages worth almost 100% of the property and ways to blend renting and owning a property, Bloomberg News reported last month.


POWELL: ‘NO GUARANTEE’ FED CAN TAME INFLATION, SPARE JOBS

Investment Executive - Paul Wiseman (2022-07-04)

ECB President Christine Lagarde echoed the “major impact” of energy shocks, which are rippling worldwide but felt acutely in Europe because of its reliance on Russian oil and natural gas. She also pointed to Europe’s proximity to the war in Ukraine and said how “energy was vastly underestimated” in the bank’s assessment of inflation.


THE BATTLE BETWEEN ASIA’S FINANCIAL CENTRES IS HEATING UP

Economist (2022-07-04)

Another one!” was how a Singaporean manager of serviced apartments greeted your correspondent, fresh off the plane from Hong Kong. The response tells you which of the two cities is currently enjoying an influx of people and business. The latest impetus has been their contrasting approaches to the pandemic. Singapore began opening up to the rest of the world last year; by comparison, although the quarantine periods for arrivals to China and Hong Kong have been shortened, there is no sign yet of their end.


THE CASE FOR STRONG AND SILENT CENTRAL BANKS

Economist (2022-07-04)

Late on june 13th, a curious article appeared in the Wall Street Journal. It said that the Federal Reserve was “likely to consider” raising interest rates by 0.75 percentage points at its meeting on June 15th.
The article was unusually silent about its sources. And it proved uncannily prescient. Two days later the Fed did indeed raise interest rates by that amount, its biggest increase in 28 years. Many investors believe the central bank had used the press to warn financial markets about what it would do in advance (albeit not very far in advance). That would make the 
Journal story an unconventional example of “forward guidance”.


BANK OF CANADA SURVEYS SHOW RISING INFLATION EXPECTATIONS, INCREASING CHANCE OF HEFTY RATE HIKE

G&M - Mark Rendell (2022-07-04)

Canadian consumers and businesses expect inflation to remain high for several years, adding pressure on the Bank of Canada to announce another oversized interest rate increase next week to prevent rapid consumer price growth from becoming entrenched.


BANKS BLOCK ONLINE SALE OF CASH ETFS THAT COMPETE WITH BANK SAVINGS PRODUCTS

G&M - Clare O'Hara (2022-07-04)

Some of Canada’s largest banks are blocking online investors from buying high-interest-savings exchange traded funds, which compete with the banks’ own lucrative deposit accounts.


CANADIAN PENSION PLANS SEE IMPROVED FINANCIAL HEALTH, DESPITE VOLATILE MARKETS

G&M - David Milstead (2022-07-04)

In a time of market turbulence, the typical Canadian pension plan is actually getting healthier.

Consulting firm Mercer Canada Ltd. said its Mercer Pension Health Pulse, which tracks the median solvency ratio of the defined benefit (DB) pension plans of Mercer clients, increased from 108 per cent on March 31 to 109 per cent by June 30. The measure was 96 per cent at the end of 2020 and 103 per cent at the end of 2021.

A DB plan’s solvency funding is the ratio of its assets to its liabilities, which are the estimated total costs of paying the benefits the plan has promised. A fully funded plan is at 100 per cent. Plans at more than 100 per cent have a funding surplus, while plans under 100 are not fully funded.

Aon PLC 

AON-N +1.57%increase    said its pension risk tracker, which measures the aggregate solvency of DB pension plans of companies in the S&P/TSX Composite Index, increased from 100.5 per cent to 101.5 per cent during the past three months. It has risen all the way from 89.4 per cent at the end of 2020 and 97.2 per cent at the end of 2021.


CEOS AT CANADA’S LARGEST COMPANIES SAW 23-PER-CENT PAY INCREASE IN 2021

G&M - David Milstead (2022-07-04)

There is one group of Canadian workers who have received pay gains that definitely beat raging inflation: CEOs.


EMERGENCIES ACT INQUIRY MUST EXAMINE THE FALLOUT FOR BANKS AND THEIR TRUCKER CLIENTS

G&M - Rita Trichur (2022-07-04)

Participants in the self-described “freedom convoy” protests risk becoming financial martyrs.


CHINESE DEVELOPER SHIMAO DEFAULTS ON $1 BILLION DOLLAR BOND

Yahoo Finance - Linda Lew and Rebecca Choong Wilkins (2022-07-04)

Shimao’s delinquency is among the biggest dollar payment failures so far this year in China and the firm has about $5.5 billion in outstanding offshore bonds. The luxury builder’s bonds have priced in deep levels of distress since the beginning of the year, with most notes falling to record lows of below 15 cents on the dollar after the firm missed repayment on a private note.


CAPITAL SPENDING NOT INCREASING AS FAST AS PROFITS, BOC SURVEY FINDS

FP - Meghan Potkins (2022-07-04)

Canada’s central bank used its latest quarterly business survey to consult energy companies about how they intended to spend the windfall from triple-digit oil prices, and found that producers are setting aside just 40 per cent of estimated cash flow for capital expenditures, compared with an average above 100 per cent in the years prior to the pandemic.


CANADA’S ECONOMY STALLS SLIGHTLY ON OIL-PRODUCTION SLOWDOWN

Bloomberg - Randy Thanthong-Knight (2022-07-04)

Canada’s economic expansion suffered a minor setback last month after a robust start to the year, driven by a drop in oil production.


HOME SELLERS ARE SLASHING PRICES IN SUDDEN HALT TO PANDEMIC BOOM

Bloomberg - Prashant Gopal (2022-07-04)

The turn in the US housing market has been sharp and swift. Just ask Karlyn and Jack Stenhjem, would-be downsizers who dropped the asking price for their home near Seattle by almost $100,000 since May.


DUBAI IS THE NEWEST HEDGE FUND HOTSPOT

Bloomberg - Nicolas Parasie, Archana Narayanan, and Nishant Kumar (2022-07-04)

 After attracting crypto firms, property investors and Russian billionaires, Dubai is drawing a new crowd: hedge fund managers. 


CANADIAN HOUSEHOLDS TO CUT SPENDING AND PAY DOWN DEBTS IF RATES RISE: BOC

Better Dwelling (2022-07-04)

Many households shared doubts the central bank is able to control inflation. In Q2 2022, 11.7% of households felt the central bank can’t control inflation ever. Another 46% believe the BoC can control inflation sometimes. That’s 57.8% of households doubting the BoC’s ability to control inflation most of the time. It’s relatively flat from the 55% in Q4 2019, but that’s a lot of people doubting Canada’s monetary system can be effectively managed. 


CLOSET INDEXING CLASS ACTION FAILS

Investment Executive - James Langton (2022-07-04)

“The damage to [investors] resulting from this strategy and [TDAM’s] unjustified fees for purportedly active management has been substantial,” the plaintiff in the case alleged.


CANADA’S ACCOUNTING REGULATOR TO REVIEW EY AFTER COMPANY FINED IN ETHICS EXAM CHEATING SCANDAL

G&M - David Milstead (2022-06-30)

Canada’s audit regulator will ask Ernst & Young if its employees cheated on exams and training courses after the firm was handed a record penalty for allowing hundreds of its workers to do so in the U.S.


ONTARIO JUST APPROVED THE LARGEST RENT HIKES IN A DECADE, FURTHER ENTRENCHING INFLATION

Better Dwelling (2022-06-30)

The guideline applies to a large share of private dwellings, possibly the majority. This includes rented homes, apartments, basement apartments, and condos. Exclusions exist, including new buildings occupied for the first time after November 2018. These units have no controls, and ditto with the rent a new tenant pays when occupying a new rental. The guideline only applies to existing tenants remaining in place.  


CANADIAN REAL ESTATE PRICES ARE ON TRACK TO DROP $68K BY MID-SUMMER

Better Dwelling (2022-06-30)

If you’ve ever heard the terms sellers’ or buyers’ market, this is the measure typically used to determine it. An SNLR above 60% is a sellers’ market (prices tend to rise) and below 40% is a buyers’ market (prices fall). Between 40% and 60% is balanced, where the market is priced just right for demand. Since markets are self-balancing without state intervention, prices fall until demand returns.


BITCOIN SET FOR BIGGEST QUARTERLY DROP IN MORE THAN A DECADE

Bloomberg - Joanna Ossinger (2022-06-30)

The 58% drawdown in the biggest cryptocurrency is the largest since the third quarter of 2011, when Bitcoin was still in its infancy, data compiled by Bloomberg show. 


MARKETS ARE SIGNALING A PYRRHIC INFLATION VICTORY

Bloomberg - John Authers (2022-06-30)

Inflation almost seems passe. The worry of the moment is now economic growth. That’s not unreasonable, as the latest update shows US gross domestic product declined at an annualized rate of 1.6% in the first quarter. With the huge exceptions of the Covid-scarred first two quarters of 2020, this was the weakest US growth since the spring of 2009:


JPMORGAN EXITS NICKEL SAGA AS TYCOON SHRINKS ‘BIG SHORT’

Bloomberg - Alfred Cang and Jack Farchy (2022-06-29)


ALMOST NO ONE BELIEVES A SOFT LANDING FOR THE ECONOMY IS STILL POSSIBLE: BMO

Better Dwelling (2022-06-29)

Policymakers have been telling the public that a soft landing is still possible. However, virtually no one believes it, according to BMO Capital Markets. BMO chief economist Douglas Porter recently explained that market expectations are eroding. Yields and commodity prices are cratering against a backdrop of higher inflation. This isn’t typical unless serious doubts have begun to materialize about future growth.


CANADA’S BANK REGULATOR IS PREPARING MORTGAGE LENDERS FOR REAL ESTATE PRICE DECLINES

Better Dwelling (2022-06-29)

Today you’ll need to know two key terms to understand the impact, with the first being loan-to-value (LTV). The LTV is the size of the loan represented as a percent of the value of the asset used to secure the loan, in today’s case, a home. Higher LTVs mean more debt is outstanding relative to the asset value. Lower LTVs mean less debt in relation to the debt outstanding. Pretty straightforward so far, right? 


HEDGE FUND MANAGER JIM CHANOS’ NEXT ‘BIG SHORT’ IS DATA CENTRES

FT - Harriet Agnew (2022-06-29)

Short seller Jim Chanos is betting against “legacy” data centres that now face growing competition from the trio of tech giants that have been their biggest customers. Chanos, who remains best-known for predicting the collapse of energy group Enron two decades ago, is raising several hundred million dollars for a fund that will take short positions in US-listed real estate investment trusts. “This is our big short right now,” Chanos said in an interview. “The story is that although the cloud is growing, the cloud is their enemy, not their business. Value is accruing to the cloud companies, not the bricks-and-mortar legacy data centres.” Data centres owned by groups such as Digital Realty Trust and Equinix are vast warehouses of servers that power large swaths of the internet. The growth in demand for data centres has been a big theme for institutional investors, who are seeking to tap into the global expansion of cloud computing. Last year $915bn alternatives manager Blackstone bought QTS Realty Trust for around $10bn, at the time the largest deal in data centre history. “The real problem for data centre Reits is technical obsolescence,” said Chanos. “Their three biggest customers are becoming their biggest competitors. And when your biggest competitors are three of the most vicious competitors in the world then you have a problem.” Chanos has built a career out of trying to identify corporate disasters-in-the making. In 2020 he made $100mn from shorting the Germany payments company Wirecard, which filed for bankruptcy that year after admitting that €1.9bn of its cash probably did “not exist”. But he has also been burnt by a high-profile short position in Elon Musk’s electric carmaker Tesla, whose share price has soared. The past decade has been a challenging one for short sellers, as trillions of dollars of central bank stimulus turbocharged a bull market for US equities and lifted asset prices indiscriminately across the board. Chanos has struggled to raise money in this environment: the firm’s assets peaked at around $7bn after 2008 when its short-only Ursus fund — named after the Latin for “bear” — gained 44 per cent net of fees, and have been slowly declining since then. The firm now runs around $500mn. In 2020 Chanos sold a minority stake in the management company to boutique investment firm Conlon & Co. Since then he has hired a team of options traders to help structure its short positions and rebranded Kynikos Associates, the investment firm he launched in 1985, as Chanos & Company. Chanos said that years of soaring equity valuations have made investors complacent. “One of the things that amazes me is how sanguine inventors are,” he said. “People just shrug their shoulders and don’t seem to notice where equity valuations are today versus historically and that there are so many flawed business models. It’s a little bit baffling that no one seems to think they need financial insurance because it’s pretty cheap. It’s another reason to be more cautious — no one is beating down the door of short sellers these days.” 


STRESS TESTS DRIVE HIGHER CAPITAL REQUIREMENTS AT 3 BIGGEST US BANKS

FT - Joshua Franklin (2022-06-29)

JPMorgan Chase, Bank of America and Citigroup have been hit with higher capital requirements by the Federal Reserve following stress tests from the central bank that probed the lenders’ ability to weather a severe recession.


BANKMAN-FRIED WARNS: SOME CRYPTO EXCHANGES ALREADY “SECRETLY INSOLVENT”

Forbes - Steven Ehrlich (2022-06-29)

Earlier this month, Singapore-based Three Arrows Capital (3AC), a highly levered crypto trading firm with $200 million of exposure to Luna revealed that it was nearly insolvent. Three Arrows’ had borrowed large sums from numerous crypto firms including New Jersey’s Voyager Digital and New York-based BlockFi. In order to survive Three Arrows default, the two digital asset exchanges turned to billionaire Sam Bankman-Fried, founder of FTX and the richest person in crypto, worth some $20.5 billion. Between FTX and his quantitative trading firm Alameda, he provided the companies with $750 million in credit lines. There is no guarantee that Bankman Fried will recoup his investment. “You know, we're willing to do a somewhat bad deal here, if that's what it takes to sort of stabilize things and protect customers,” he says.


U.S. ECONOMY CONTRACTS IN FIRST QUARTER; OUTLOOK MURKY AS UNSOLD GOODS ACCUMULATE

G&M - Lucia Mutikani (2022-06-29)

The U.S. economy contracted slightly more than previously estimated in the first quarter as the trade deficit widened to a record high and a resurgence in COVID-19 infections curbed spending on services like recreation.


WORLD BANK’S CARMEN REINHART ‘SKEPTICAL’ GLOBAL RECESSION CAN BE AVOIDED

G&M - Andrea Shalal (2022-06-29)

World Bank chief economist Carmen Reinhart said she is skeptical that the U.S. and global economies can dodge a recession, given spiking inflation, sharp hikes in interest rates and slowing growth in China.


SENIOR CIVILIAN MOUNTIE REBUKES RCMP COMMISSIONER FOR ‘APPALLING’ BEHAVIOUR DURING NOVA SCOTIA SHOOTING INVESTIGATION

G&M (2022-06-29)

A senior civilian Mountie sent a strongly worded letter to RCMP Commissioner Brenda Lucki last year, accusing her of bowing to political pressure and displaying “unprofessional and extremely belittling” behaviour to officers investigating the worst mass shooting in Canadian history.


EXPLOSIVE DEVICES FOUND IN VEHICLE OF B.C. BANK ROBBERS KILLED BY POLICE

CBC (2022-06-29)

Two suspects were killed and six members of the Greater Victoria Emergency Response Team were injured when shots broke out outside the bank late Tuesday morning. Witnesses described hearing dozens of shots back to back just after 11 a.m. PT.


RBC SEES ‘THE STRONGEST FUNDAMENTAL OIL MARKET SET UP IN DECADES, MAYBE EVER’

Yahoo Finance - Jeff Lagerquist (2022-06-29)

“Recession or not, we believe that the oil complex remains in a structural, multi-year tightening cycle that will go as far as demand will take it,” Tran and his team wrote. “Absent a recession, the tightening cycle clearly points higher, potentially significantly higher. US$150/bbl, US$175/bbl, US$200/bbl? Pick a number.”


SHOPIFY SHARES SLIDE AFTER COMPLETING 10-FOR-1 STOCK SPLIT

Yahoo Finance - Stefanie Marotta (2022-06-29)

Shopify’s shares fell 5.8% Wednesday to C$42.47 in Toronto. The stock has plunged about 76% this year as e-commerce traffic slows and investors flee growth stocks, particularly sensitive to rising borrowing costs.


UBS TO PAY $25 MILLION SEC PENALTY OVER COMPLEX OPTIONS STRATEGY

Yahoo Finance - Matt Robinson (2022-06-29)

The firm, which didn’t admit or deny wrongdoing, agreed to pay a $17.4 million penalty plus more than $7 million in disgorgement and interest. “UBS is pleased to have amicably resolved this matter,” it said in a statement. “UBS appreciates the SEC’s acknowledgment that in early 2017, UBS voluntarily remediated the issue by enhancing its risk control framework and strengthening its training program for the strategy.”


PRO-CHINESE AGENTS POSE AS ACTIVISTS ON SOCIAL MEDIA TO PROTEST CANADIAN RARE EARTH MINE

fp - Margi Murphy (2022-06-29)

The fake Twitter and Facebook accounts were created to give China, the largest producer of rare earth minerals, a competitive advantage, cybersecurity research company Mandiant disclosed on Tuesday.


WHY OSFI IS INCREASING THE MARGIN OF SAFETY FOR REAL ESTATE SECURED LENDING

FP - Peter Routledge (2022-06-29)

I head the Office of the Superintendent of Financial Institutions (OSFI), an organization whose supervisory and regulatory powers can and do have a significant influence on the Canadian housing market. More to the point, OSFI’s influence in the housing market may have left some observers with the impression that OSFI is Canada’s housing market regulator. We are not.


MANULIFE FINANCIAL MOVES STEP CLOSER TO FULL CONTROL OF CHINA FUND, AS US$3.8 TRILLION MARKET BECKONS

FP - Selena Li and Samuel Shen (2022-06-29)

Manulife, Canada’s largest life insurer, is seeking to bolster its presence in China’s US$3.8 trillion funds market. China’s securities regulator officially accepted an application from Manulife’s asset management arm recently to increase its stake in the joint venture to 100 per cent from the current 49 per cent, said the sources.


NY FED BEGINS PUBLISHING CORPORATE BOND MARKET DISTRESS INDEX

Reuters - Davide Barbuscia (2022-06-29)

The Federal Reserve of New York will publish monthly updates on the U.S. corporate bond market to help identify signs of market distress similar to those seen during the global financial crisis and in early 2020.


WORLD BANK'S REINHART 'SKEPTICAL' GLOBAL RECESSION CAN BE AVOIDED

Reuters - Andrea Shelal (2022-06-29)

World Bank chief economist Carmen Reinhart said she is skeptical that the U.S. and global economies can dodge a recession, given spiking inflation, sharp hikes in interest rates and slowing growth in China.


OSFI SPARES HELOC LOVERS IN LONG-ANTICIPATED REGULATORY UPDATE

G&M - Robert Mclister (2022-06-29)

Some feared Canada’s banking regulator would put the smackdown on home equity lines of credit (HELOCs) in its long-anticipated regulatory update on Tuesday.


INDIA PROPOSES TOUGHER IT OUTSOURCING RULES FOR BANKS

Finextra - Finextra (2022-06-28)

"Regulated Entities (REs) have been extensively leveraging Information Technology (IT) and IT-enabled services (ITeS) in their business, products and services with increasing dependence on third parties," states the RBI. "Such reliance on IT/ITeS provided by third parties exposes the REs to various risks."


CANADIAN BANKS TEAM ON KYC SOLUTION

Finextra - Finextra (2022-06-28)

The Bank of Montreal, Scotiabank, The Canadian Imperial Bank of Commerce, The National Bank of Canada and The Royal Bank of Canada are backing the offering, with the tech infrastructure set to be ready by the end of the year. TD Bank is not involved.


CREDIT SUISSE FOUND GUILTY OVER BULGARIAN DRUG MONEY FAILINGS

FT - Sam Jones (2022-06-28)

Credit Suisse has become the first domestic bank to be found guilty of a corporate crime by Swiss authorities after a court found the lender failed to stop the laundering of Bulgarian drug money.


‘WE WILL HUMBLE THEM’: FOUR FUEL TRADERS TOOK ON WALL STREET AND SAVED $1.2BN

FT - Steff Chavez (2022-06-28)

Southwest Airlines flies alone among the four biggest US carriers in hedging the cost of jet fuel. Its stubborn commitment to the policy is paying off as oil prices hover above $100 a barrel.


QATAR PLEDGES $100 MILLION TO ESTABLISH PLATFORM TO RECOVER DISTRESSED ASSETS

Reuters (2022-06-28)

The Qatar Financial Center (QFC) said on Monday that it has pledged $100 million to fund a new platform aimed at recovering distressed assets.


MARK CARNEY SAYS GLOBAL RECESSION RISK IS ‘UNCOMFORTABLY HIGH,’ BUT CANADA LIKELY TO FARE BETTER THAN MOST OTHER COUNTRIES

G&M - Jeffrey Jones (2022-06-28)

The former governor of the central banks of Canada and England says the risk of a recession in the United States and globally is “uncomfortably high,” but that Canada is likely to fare better in a slowdown than most other countries.


OSFI TAKES SMALL STEP TO LIMIT HOME-EQUITY BORROWING

G&M - Rachelle Younglai (2022-06-28)

Canada’s bank regulator plans to better protect the country’s financial system by limiting how much homeowners can borrow against the value of their homes.


COMPANIES PAUSE HOCKEY CANADA SPONSORSHIPS IN WAKE OF SEX ASSAULT ALLEGATION

CBC - Joshua Clipperton (2022-06-28)

Scotiabank said Tuesday the pause will last until it's confident the right steps are taken to improve the culture within the sport.


WE'RE STILL WAITING FOR THIS WAGE PRICE SPIRAL CENTRAL BANKERS FEAR COULD SEND INFLATION SOARING SOCIAL SHARING

CBC - Don Pittis (2022-06-28)

...evidence that 1960s- and 1970s-style wage demands are driving current price rises to near eight per cent is simply absent.


FTC SUES WALMART FOR SCAMMERS' USE OF MONEY TRANSFER UNIT

Yahoo Finance (2022-06-28)

In its lawsuit, the agency alleged that for years, Walmart failed to properly secure the money transfer services offered at its stores. The agency said Walmart didn't properly train its employees, failed to alert customers, and used procedures that allowed fraudsters to cash out at its stores. The FTC is asking the court to order Walmart to return money to consumers and to impose civil penalties on the company.


BIS WARNS ECONOMIES ARE APPROACHING ‘TIPPING POINT’ WHERE HIGH INFLATION BECOMES ENTRENCHED

G&M - Mark Rendell (2022-06-27)

Many economies are approaching a tipping point where high inflation becomes normal while economic growth slows sharply, the Bank for International Settlements warned in its annual report published Sunday.


FORD GOVERNMENT’S APPOINTMENT OF HEATHER ZORDEL AS OSC CHAIR PROMPTS RESIGNATIONS

G&M (2022-06-27)

The Ford government’s appointment of a Bay Street lawyer and Tory fundraiser to chair Ontario’s securities regulator has prompted two high-profile resignations, as well as concerns about her conduct and her dissenting views in her decisions regarding the laws that govern the capital markets.


CANADIAN INSURANCE FIRMS IN U.S. MOVE TO EXTEND HEALTH BENEFITS AFTER ROE V. WADE OVERTURNED

G&M (2022-06-27)

Two of Canada’s largest insurers have joined the growing number of employers in the United States that are extending health benefits for their employees after a ruling by the U.S Supreme Court that will soon make abortion illegal in some states.


GLOBAL RECESSION FEARS WREAK HAVOC ON INDUSTRIAL METALS, BUT INDUSTRY BETTER POISED FOR LONG DOWNTURN, STRATEGISTS SAY

G&M - Niall McGee (2022-06-27)

Fears over a pending global recession are causing carnage in the industrial metals market, but the sector is better prepared than in the past to withstand a prolonged downturn, strategists at Morgan Stanley say.


WHAT WE LEARN FROM CAISSE’S BAD BET ON THE CRYPTO BANK CELSIUS

G&M - Ethan Lou (2022-06-27)

 hate to be the guy who keeps saying I called it, but for a long time, I’ve had a funny feeling about the Celsius Network Ltd., the New Jersey company that shut down services abruptly on June 12 and sparked the recent cryptocurrency crash. And I can prove it.


EVERGRANDE SUED BY INVESTOR

Yahoo Finance (2022-06-27)

Top Shine has requested that Evergrande honour its agreement to repurchase the shares, the executive told Reuters on Monday, declining to be named due to the sensitivity of the matter.


RECESSION VS. STAGFLATION: RATE HIKES TO DETERMINE ECONOMIC FATE

FP - Larysa Harapyn (2022-06-27)

Craig Alexander, chief economist at Deloitte Canada, speaks to the Financial Post’s Larysa Harapyn about his economic forecast amid high inflation and aggressive central bank interest rate increases.


'WE HAVE A STRUCTURAL SHORTAGE': RECORD HIGH JOB VACANCIES UNLIKELY TO REVERSE ANY TIME SOON, ECONOMISTS SAY

FP (2022-06-27)

The latest numbers, released by Statistics Canada on Tuesday, showed a job vacancy rate of 5.6 per cent, continuing an upward trend since the first quarter of 2016.


GLOBAL M&A BRACES FOR DRY SPELL AS BOARDROOMS PUT EXPANSION ON HOLD

Reuters - Pamela Barbaglia and Anirban Sen (2022-06-27)

Global dealmaking is entering an arid season as raging inflation and a stock market rout curb the appetite of many corporate boards to expand through acquisitions.


U.S. CONGRESSIONAL PANEL CALLS FOR CRACKDOWN AFTER 'MEME-STOCK' SAGA

Reuters (2022-06-27)

The report by the U.S. House of Representatives' Financial Services Committee singled out Robinhood's (HOOD.O) trading app for "troubling business practices" and urged regulators to step up scrutiny of retail brokers.


RUSSIA DEFAULTS ON FOREIGN DEBT FOR FIRST TIME SINCE 1918

Bloomberg - Giulia Morpurgo and Libby Cherry (2022-06-27)

For months, the country found paths around the penalties imposed after the Kremlin’s invasion of Ukraine. But at the end of the day on Sunday, the grace period on about $100 million of snared interest payments due May 27 expired, a deadline considered an event of default if missed.


CRYPTO’S HIGH IDEALS ABOUT FREEDOM TAKE A BEATING

Bloomberg - Jonathan Levin (2022-06-27)

Earlier this year, the crypto community went into an uproar over news that Canadian banks had frozen financial accounts tied to protesting truck drivers who had been blockading a key boarder crossing. The truckers were angry about vaccine mandates and other Covid-19 measures, but as the narrative went, you didn’t have to agree with them to recognize that Prime Minister Justin Trudeau had used the financial system to punish political adversaries, an episode that reinforced the need for cryptocurrencies that were fully resistant to any interference.


A $2 TRILLION FREE-FALL RATTLES CRYPTO TO THE CORE

Bloomberg - Emily Nicolle and Olga Kharif (2022-06-27)

For a generation of alienated techies, crypto's all-for-one ethos was its biggest draw. Now panic is spreading across this universe — and that same ethos is posing what may be the biggest threat yet to its survival.


FINANCIAL SECTOR OUTLOOK STEADY DESPITE GROWING GLOBAL GLOOM

Investment Executive - James Langton (2022-06-27)

The relative stability in sector outlooks defies a significant shift in underlying conditions, with an increase in economic uncertainty and rising downside risks, the report noted.


ROTHSCHILDS HIRES RBC’S GRAHAM TO RUN CANADIAN INVESTMENT BANK

G&M - Andrew Willis (2022-06-27)

Rothschild & Co is scaling up its Canadian business, hiring veteran Royal Bank of Canada dealmaker Alex Graham to lead domestic expansion at a global investment bank with a two-century family pedigree.


CANADA ISN’T PREPARED TO DEAL WITH LARGE INVESTORS’ GROWING INTEREST IN SINGLE-FAMILY HOMES

G&M - Brian Milner (2022-06-27)

Rising borrowing costs, dimming economic prospects and stricter lending rules are taking some of the air out of housing bubbles in Canada, the United States and other markets in which strong demand, tight supply and speculative fever have driven prices to record levels and deepened an already serious affordability crisis.


THE WEALTHY BARBER AUTHOR TALKS INFLATION, RECESSION FEARS AND MORE

CBC - Podcast (2022-06-27)

David Chilton, author of The Wealthy Barber, looks at how high gas prices and grocery bills amid stagnant wages have hit low-income Canadians the hardest.


MINING FIRMS POISED TO LEAD CAPITAL RAISINGS IN CANADA, TSX CEO SAYS

Yahoo Finance - Divya Rajagopal (2022-06-27)

Mining companies seeking to accelerate exploration of scarce critical minerals are set to lead capital raisings in Canada this year, the chief executive officer of the Toronto Stock Exchange said on Monday, as sectors such as technology take a back seat amid market volatility.


CENTRAL BANKS IN ASIA SPEND BILLIONS TO SLOW CURRENCY DECLINES

Yahoo Finance - Karl Yap (2022-06-27)

Thai reserves slid to $221.4 billion as of June 17, in data released late last week. That was the lowest in more than two years. Monthly figures show that Indonesia’s stash is at the smallest since November 2020. Reserves in South Korea and India are at their lowest in more than a year. Malaysia’s stockpile, meanwhile, has fallen the most since 2015.


INFLATION DRIVES CANADIAN CONSUMER CONFIDENCE TO CRISIS-ERA LOWS

Bloomberg - Theophilos Argitis (2022-06-27)

Canadian consumer confidence levels have fallen to near crisis-era lows in an ominous sign for the nation’s economic outlook.


GOLD RISES AS SOME G-7 NATIONS TO BAN NEW IMPORTS FROM RUSSIA

Bloomberg - Emily Ashton, Jordan Fabian, and Josh Wingrove (2022-06-27)

The US, UK, Japan and Canada plan to announce a ban on new gold imports from Russia during a summit of Group of Seven leaders that’s getting underway Sunday. Prices of the precious metal climbed Monday.


US PENDING HOME SALES DOWN 13% FROM LAST YEAR, INDUSTRY FORECASTS SLOWER SALES

Better Dwelling (2022-06-27)

Slowing home sales isn’t surprising anyone at NAR, who’s forecasting fewer sales. Their forecast shows existing-home sales making a year-over-year drop of 4.7% in Q2 2022. It’s then followed by a decline of  13.0% in the following quarter, with negative annual growth through 2023. Higher rates to cool inflation is the primary reason for the anticipated slowdown.


BIS PUTS CBDCS AT CENTRE OF FUTURE MONETARY SYSTEM

Finextra (2022-06-24)

In the cross-border context, the BIS Innovation Hub (BISIH) has been leading practical experiments to show how central bank digital currencies (CBDCs) could help deliver faster, cheaper and more transparent international payments.


BANK OF CANADA NEEDS MORE RESTRICTIVE INTEREST RATES TO CONTROL RUNAWAY INFLATION

G&M - DAVID PARKINSON (2022-06-23)

With every new inflation report, the job facing the Bank of Canada gets that much harder.


TSX-LISTED CRYPTO COMPANY VOYAGER DIGITAL WARNS OF US$655-MILLION LOAN DEFAULT, SHARES PLUMMET 53 PER CENT

G&M - Tim Kiladze (2022-06-23)

TSX-listed Voyager Digital Ltd.’s VOYG-T stock lost half its value in a single day after management warned of a potential default on a US$655-million loan to a troubled hedge fund, as investors continue to fear financial contagion owing to the crypto sector’s recent crash.


AIR MILES HITS TURBULENCE AFTER SOBEYS AND SAFEWAY PULL OUT OF PROGRAM

CBC - Anis Heydari (2022-06-23)

"Losing the Sobeys and Safeway partnership is very much a major blow, and it's only the latest in a series of major blows that they've suffered in recent years," said Zhang. Those blows include losing the Liquor Control Board of Ontario and Lowe's hardware stores from the Air Miles network in 2021. As well, Staples Canada will no longer offer Air Miles as of July 2022.


FED AIMS TO AVOID RECESSION BUT SAYS IT'S POSSIBLE

Yahoo Finance (2022-06-23)

“We do think it’s absolutely essential that we restore price stability, really for the benefit of the labor market as much as anything else,” Powell said on the first of two days of testimony as part of the Fed’s semiannual report to Congress.


GERMANY WARNS OF LEHMAN-LIKE CONTAGION FROM RUSSIAN GAS SQUEEZE

Yahoo Finance - Arne Delf, Vanessa Dezem (2022-06-23)

Europe’s largest economy faces the unprecedented prospect of businesses and consumers running out of energy. For months, Russian President Vladimir Putin has gradually reduced supplies in apparent retaliation over sanctions imposed over the invasion of Ukraine. The standoff escalated last week after steep cuts to the main gas link to Germany, putting reserves for the winter at risk.


TRANS MOUNTAIN PIPELINE NO LONGER A 'PROFITABLE UNDERTAKING': PBO

Yahoo Finance - Jeff Lagerquist (2022-06-23)

Jeff Lagerquist    

A pipe yard servicing government-owned oil pipeline operator Trans Mountain is seen in Kamloops, British Columbia, Canada June 7, 2021. REUTERS/Jennifer Gauthier


BANK OF CANADA DEPUTY GOVERNOR TIMOTHY LANE TO RETIRE IN SEPTEMBER

FP - CP (2022-06-23)

Lane joined the central bank in August 2008 as an adviser to the governor after 20 years at the International Monetary Fund.


FULL BREXIT YET TO PLAY OUT ON BRITISH FINANCE, LAWMAKERS SAY

Reuters - Huw Jones (2022-06-23)

Britain should avoid major, hasty reforms to make its financial sector more globally competitive following the industry's separation from the European Union by Brexit, a parliamentary report said on Thursday.


INFLATION HITS CANADA METALS, MINING STOCKS, ERASING 2022 GAINS

Bloomberg - Geoffrey Morgan (2022-06-23)

Canadian mining, metals and lumber stocks dropped Wednesday, wiping out their 27% gain for this year as hotter-than-expected inflationrising interest rates and slowing global growth weigh on the companies.


SNUBBING REGULATOR COSTS CRYPTO FIRMS MILLIONS

Investment Executive - James Langton (2022-06-23)

In its ruling, the panel found that crypto contracts and crypto futures meet the definition of securities as they are “investment contracts”.


CANADA NEEDS 5.8 MILLION NEW HOMES BY 2030 TO BRING PRICES DOWN TO AFFORDABLE LEVELS, CMHC SAYS

G&M - Rachelle Younglai (2022-06-23)

Canada needs an additional 5.8 million homes by the end of the decade to help lower average home costs and ensure households are not spending more than 40 per cent of their disposable income on shelter, according to a new government report.


BLACKROCK’S LARRY FINK WARNS OF YEARS OF RISING INFLATION, URGES COMPANIES TO DIVERSIFY GEOGRAPHIC EXPOSURE

G&M - Clare O'Hara (2022-06-23)

Investors across the world should prepare for years of rising inflation as globalization wanes, says Larry Fink, chief executive officer of global investment giant Blackrock Inc.


CANADA'S BIG BANKS PLUNGE OVER 20% FROM RECORD HIGH ON RECESSION FEARS

FP - Stefanie Marotta (2022-06-23)

The S&P TSX Financials Sector Index and the S&P/TSX Commercial Banks Index, which tracks the country’s eight largest lenders, both dropped Thursday, adding to another day of losses after inflation in Canada surged to a four-decade high and U.S. data pointed to rising unemployment and slumping manufacturing and services activity.


OSC METES OUT PENALTIES, MARKET BAN IN PAIR OF CRYPTO TRADING CASES

FP - Barbara Schecter (2022-06-23)

The Ontario Securities Commission reeled in two successful enforcement cases in a crackdown on “non-complaint” crypto asset trading platforms: a settlement with Bybit Fintech Ltd., and a Capital Markets Tribunal ruling against KuCoin imposing a permanent market ban and “substantial” monetary sanctions.


WHAT'S NEW WITH THE FED'S BANK STRESS TESTS IN 2022

Reuters - Pete Schroeder (2022-06-23)

The U.S. Federal Reserve is due to release the results of its annual bank health checks on Thursday. Under the "stress test" exercise, the Fed tests banks' balance sheets against a hypothetical severe economic downturn, the elements of which change annually.


EUROPE IS MAKING IT MUCH HARDER FOR RUSSIA TO SHIP OIL ANYWHERE

CNN - Julia Horrowitz (2022-06-23)

"Targeting the insurance side of things is the best shot at halting Russian crude flows instead of just redirecting them," said Matt Smith, lead oil analyst at Kpler, a market intelligence firm.


‘COAST TO COAST’ HOUSING CORRECTION IS COMING, SAYS MOODY’S CHIEF ECONOMIST

Bloomberg - Kriston Capp (2022-06-23)

A housing correction will reach from “coast to coast” in the US, but it will fall short of a crash, according to Mark Zandi, chief economist at Moody’s Analytics.


THE AGE OF CREDIBILITY FOR CENTRAL BANKS IS OVER

Bloomberg - John Authers (2022-06-23)

Monetary regimes don’t fall often. Half a century ago, in 1971, Richard Nixon ended the Age of Gold by formally eliminating the dollar’s peg to the precious metal. Since then, the dollar and other currencies have rested on fiat—they’re worth something because governments say they are. You could call this the Age of Credibility. In place of gold, currency’s anchor is the trust in the central banks that issue them. Now credibility appears to be at an end. With central banks desperately ripping up their playbooks to try to rein in inflation that’s veered far beyond target, they’re admitting they’ve been wrong, and giving up on trying to steer the markets on their plans for the future.


QUANT HEDGE FUNDS PROFIT FROM CRYPTOCURRENCY TURMOIL

FT - Laurence Fletcher (2022-06-23)

A small group of hedge funds are profiting from turmoil in the digital asset market that has already wiped trillions of dollars off the total value of cryptocurrencies.


MONTHLY PAYMENTS ON VARIABLE-RATE MORTGAGES COULD INCREASE AS BORROWERS NEAR THEIR ‘TRIGGER RATE’

G&M - Rachelle Younglai (2022-06-22)

An obscure feature of variable-rate mortgages may push up the monthly payments for an increasing number of borrowers as the Bank of Canada aggressively hikes interest rates.


FOUNDERS OF MORTGAGE INVESTMENT FIRM FORTRESS REAL DEVELOPMENTS INC. CHARGED WITH FRAUD

G&M - Greg Mcarthur (2022-06-22)

The co-founders of the failed Fortress Real Developments Inc., one of the first Canadian companies to offer higher risk, syndicated mortgage products to retail investors, have been charged with fraud.


FROM STARTUP TO BIG BANK: BMO BOUGHT THEIR COMPANY, NOW THEY RUN ITS GLOBAL TRADING DESKS

G&M (2022-06-22)

Like many American bankers, Dan Goldman and Levent Kahraman are back working most days of the week at the New York offices where they run Bank of Montreal’s global markets business, now that COVID-19 lockdowns have lifted. What may be more surprising is that they still have offices at BMO BMO-T at all.


WHO ARE CANADA’S MOST TRUSTED FINANCIAL BRANDS?

G&M - Rob Carrick (2022-06-22)

Financial companies rarely star in those surreys where people are asked to rate the corporations they trust most. Tim Hortons topped a recent survey of Canadians, Band-Aid led in the United States, Toyota in Japan, Google in India and Samsung in South Korea.


MONEY FUNDS MAY BE NEXT TARGET IN FIGHT AGAINST GREENWASHING

Yahoo Finance - Tim Quinson (2022-06-22)

Money funds are considered among the least risky investments available because they traditionally hold only the safest government and corporate-bond securities. The average yield for money funds has risen above 0.3% in Europe from about negative 0.6% at the start of the year. Yields are now at the highest level since 2014.


CENTRAL BANK DIGITAL CURRENCIES POISED TO BE THE FOUNDATION OF THE FINANCIAL SYSTEM, BIS SAYS

FP - Stephanie Hughes (2022-06-22)

“The technology and the technical issues are not that difficult, but once you have more than one jurisdiction involved, there are the policies and the regulations that of course, need to be reconciled,” said the BIS’s Hyun Song Shin. “What are some of the legal differences across jurisdictions that might mean that smooth flows might be impeded? So, there are more of these policy challenges that actually rear their heads in the wholesale application.”


CRYPTO'S LATEST MELTDOWN LEAVES PUNTERS BRUISED AND BEWILDERED

Reuters (2022-06-22)

For Jeremy Fong, U.S. crypto lender Celsius was an ideal place to stash his digital currency holdings - and earn some spending money from its double-digit interest rates along the way.


THE WORLD’S BUBBLIEST HOUSING MARKETS ARE FLASHING WARNING SIGNS

Bloomberg - Enda Curran (2022-06-22)

It’s a sharp reversal from years of surging prices fueled by rock-bottom mortgage rates and government stimulus, along with a pandemic that popularized remote work and sent homebuyers on the hunt for bigger spaces. An analysis by Bloomberg Economics shows that 19 OECD countries have combined price-to-rent and home price-to-income ratios that are higher today than they were ahead of the 2008 financial crisis — an indication that prices have moved out of line with fundamentals.


CANADIAN REAL ESTATE COOLDOWN IS JUST GETTING STARTED: BMO

Better Dwelling - Daniel Wong (2022-06-22)

The slowdown from higher interest rates is far from over, with more rate hikes expected. “Looking ahead, another drop in home sales in May and the potential for even more aggressiveness from the BoC should cool the housing market further in the coming months,” said Kaushik. 


POWELL FACES RISING CRITICISM FOR INFLATION MISSTEPS

Investment Executive - Christopher Rugaber (2022-06-22)

Inflation has proved higher and far more persistent than he or the Fed’s staff economists had foreseen. And at a policy meeting last week, Powell announced an unusual last-minute switch to a bigger interest rate hike than he had previously signaled — and then followed with a news conference that many economists described as muddled and inconsistent.


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BANNER YEARS FOR INVESTMENT BANKS AT RISK AS PANDEMIC DEALMAKING COOLS SIGNIFICANTLY

G&M - Tim Kiladze (2022-07-07)

The banner years for equity financings and mergers and acquisitions driven by the pandemic are at risk of disappearing, with deal activity slowing significantly in the first quarter – particularly for Canadian share sales.

The value of Canadian equity financings tumbled 81 per cent in the first quarter of 2022 to $3.9-billion, according to Refinitiv, down from $20.9-billion during the same period last year. While the year-over-year comparison is a tough one, because early 2021 was when markets soared, the total value of share sales hasn’t been this low in more than a decade.

Central banks slashed interest rates to their lowest levels possible early in the pandemic to shore up the economy, sending stock prices soaring, and spurring share sales.

Much of the cooling stems from a recent dearth of technology financings. Last year, the sector accounted for roughly one-quarter of all share sales – and tech initial public offerings were particularly popular. So far this year, technology deals have been virtually non-existent because of a market rout in the sector. The tech-heavy Nasdaq Composite is down 12 per cent year to date.

Merger and acquisition (M&A) activity has also cooled in Canada, with US$66.6-billion worth of deals announced during the first quarter, including debt, according to Refinitiv, down 45 per cent from the same quarter last year.

The trend is playing out around the world, with the global value of M&A deals down 23 per cent, according to Refinitiv. However, the pace of mergers and acquisitions is still relatively healthy compared to prepandemic years.

Macroeconomic pressures are the leading factors behind the recent changes. “We are living with heightened volatility and uncertainty,” said Nitin Babbar, global co-head of equity capital markets at RBC Dominion Securities.

Inflation sparked the uncertainty last fall, which led to a growth-stock selloff that pummelled the tech sector. Those fears haven’t abated, and now geopolitical concerns hover over everything. Minutes from the latest meeting of the U.S. Federal Reserve were released on Wednesday, and they showed that Fed officials wanted to start hiking interest rates aggressively, but decided to go slow because of the economic ripple effects from Russia’s attack on Ukraine.

Despite the growing uncertainty, many of the share sales that launched in the first quarter of this year were successful. Bank of Montreal 

BMO-T -0.96%decrease  

 recently sold $2.7-billion worth of stock to help pay for its acquisition of Bank of the West, for one, and the deal was well-received by investors. “We haven’t seen issuers who really want to [raise money] and we have to say, ‘you can’t,’” RBC’s Mr. Babbar said. “It’s just a question of issuer need.”


HOME SALES AND PRICES IN TORONTO AND VANCOUVER PLUNGE FROM LAST YEAR’S HIGHS

G&M - Rachelle Younglai (2022-07-06)

Home sales in Toronto and Vancouver plunged in June from last year’s highs and property prices declined further as higher borrowing costs made it harder for would-be buyers to get into the country’s two priciest real estate markets.


SHOPIFY DELAYS COMPENSATION OVERHAUL, LAYS OFF 50, AS FALLEN STOCK PRICE COMPLICATES PLANS

G&M - Temur Durrani (2022-07-06)

Shopify Inc. 

SHOP-T +9.94%increase    is putting off a compensation overhaul that would give its employees more choice in how they are paid, as the Ottawa-based company addresses the challenges posed by its fallen stock price and the persistent sell-off pummelling the technology sector.


SUBPRIME LENDER FISGARD SUSPENDS RESIDENTIAL CONSTRUCTION LOANS IN SEVERAL PROVINCES

G&M - Rachelle Younglai (2022-07-06)

Fisgard Asset Management Corp. has suspended residential construction loans in Ontario, British Columbia, Alberta and Manitoba, becoming the latest subprime mortgage lender to hit pause this year.