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Jack Maggiore

North American Union: US & Canada in play?

Diane Francis, National Post Editor-at-Large and Bestselling Author of Merger of the Century, toyed with the idea of merging the US and Canada. In fact, Ms. Francis states that “a merger between the two countries isn’t just desirable but inevitable”. She goes on to say that the US and Canada are culturally compatible on all fronts from lifestyles, to values, and aspirations. According to Ms. Francis, over the last several decades, “Canada has become more like America and America more like Canada”. For instance, the US has become more progressive on civil, gay, and women's rights; and even recently universal health care. On the Canadian side, we have contemplated a hybrid health care system with more private sector elements. If the idea seems a bit farfetched, consider the following. After the birth of NAFTA and the EU (created by the Maastricht Treaty) there was speculation about the formation of a North American Union between (Canada-US). By 2005 discussions were already on their way by US officials regarding the best approach to North American integration between the US and Canada. It was noted that many Canadian economists supported the ambitious goals of a single market like that of the EU. As of March ‘05, North American leaders founded the Security and Prosperity Partnership of North America (SPP). Set up to provide greater cooperation on security and economic issue. In May, the Task Force published a report praising the SPP initiative and pushing for greater economic integration by 2010. The report also stipulated that the so-called “merger initiative” should not target a grand scheme of confederation or union; and most importantly did not suggest a supranational government or a common currency/monetary policy. The focus was mainly on developing a North American common market and security perimeter (SPP initiative ended in ‘09; however most of the working… Read More

Lousy, Lousy & Lousy

Stock declines of 20% or more are not reason enough to signal an up and coming recession. Although we have seen losses in equity in these previous months, we must consider other factors than just index declines to declare a recessionary period. The summer months were spotted with speculative decline and volatility far greater than what the market commonly accommodates. Recent political crises and economic doom-and-gloom have given investors good incentive to be skittish.Yet we must disassociate from these emotional tendencies and rely on core fundamental analysis for market perspective. Corporate balance sheets have strengthened through the 2009 and 2010 recovery Corporate balance sheets have strengthened through the 2009 and 2010 recovery, and are looking healthy entering Q4 this year. Many companies have more than an adequate amount of cash on hand from retained earnings and profitable operations. Coincidently, this and mediocre but positive earnings in Q2 through Q3 of this year provide most companies the requisite cushion to survive a mild economic shock, and face at worst a minor contraction in the business cycle.The summer of 2011 demonstrated on a global scale how politics can impede, rather than manifest, good economic management. The Street hates ambiguity, and in times when uncertainty prevails we should expect the markets to account for this. Hence the reduction of the present future value of most stocks and indexes.In particular the possibility of a Greek sovereign default has caused investors to witness trillions of dollars in equity vanish. The S&P 500 is now in correction mode, having declined 20% thus far, with all sectors in the red. Now is the time to move portfolios back into equities so as to take advantage of strong corporate balance sheets, now overwhelmingly at a significant discount.In the wake of the August market tumble, I expect a recovery… Read More