PMJT: The First 100 Days

[The Bread Guy]

Well, since the Info-machine has seen fit to share three out of the four speeches from earlier this week (PMJT, Dion and Bibeau -- but not the Defence Minister's - yet?), let's see what a word cloud of their speech  highlights (top 100 words), shall we?

First, using the text of all three speakers we have transcripts for ...

... and this from just the PM's text:

Discuss  ;D

 

[Colin Parkinson]

Question as to the importance of having a "Gold Reserve".  Is it really that important?


Reproduced under the Fair Dealings provisions of the Copyright Act.




What affect will the Trudeau Government's selling off of these Gold Reserves have on our National Debt, our economy and GDP?

1.3 tonnes? That's about the same amount of gold as 10 well off high caste East Indian ladies in Surrey have.  8)

 

[Kirkhill]

If I read that chart right then we have MacKenzie King storing gold,  St-Laurent filling the coffers hand over fist, Diefenbaker selling gold, early Pearson going back to St-Laurent's policy with late Pearson commencing a sell off that continued through early Trudeau up to the oil shock of 73 at which point Trudeau held.  Mulroney then sold off during his tenure, depleting the horde and Chretien sealed the deal.  Harper initiated a very modest buy when the dollar was strong and immediately sold off when the dollar was week.  Trudeau seems to have increased the rate of sell off.

Gold can act as surge tank, or buffer, for the economy, allowing plans to proceed independently of the Just In Time economy.

 

[Cloud Cover]

Isn't the RBC tower in Toronto window filmed with gold? I wonder how much privately held gold there is in the country. 

 

[Oldgateboatdriver]

If I read that chart right then we have MacKenzie King storing gold,  St-Laurent filling the coffers hand over fist, Diefenbaker selling gold, early Pearson going back to St-Laurent's policy with late Pearson commencing a sell off that continued through early Trudeau up to the oil shock of 73 at which point Trudeau held.  Mulroney then sold off during his tenure, depleting the horde and Chretien sealed the deal.  Harper initiated a very modest buy when the dollar was strong and immediately sold off when the dollar was week.  Trudeau seems to have increased the rate of sell off.

Gold can act as surge tank, or buffer, for the economy, allowing plans to proceed independently of the Just In Time economy.

You may read the chart that way, Chris, but you have to take into consideration the following when reading it (and it will also answer in part people wondering what happened to the money generated by the deal:

To understand the apparent huge acquisition of the 1940-55 period and sell off beginning in about 1980, you have to understand the world monetary system at the time. We are then in an international economy based on what is known as the gold standard, that is countries money is guaranteed by gold reserves, and in theory you could actually "cash" your money for its gold reserve value. This explains why between 1940-55 our reserves go up so much: European countries are using their gold to pay back their debts to the government of Canada and our huge industrialization during the war has greatly boosted the size of our economy, which is reflected in the supply of Canadian money in the economy.

However, starting with WWII, the US dollar becomes so prevalent that it is easier to use it in international money exchange as the "reference". Thus, shortly after the war, the Bretton-Woods accord is struck and we enter a period known as the gold exchange standard. In that period, gold's value is set at a US $ price and all other moneys set their values in relation to the US$, at a fixed rate subject to revision from time to time.

This system did not provide much flexibility and as the US economy went into a huge valuation, its stressed the fixed value of gold and the fixed value of other countries money. So in the 70's the values started to strain and some changes in the fixed rates started to occur, ultimately leading to completely floating rates for foreign exchange in relation to the US $. To avoid depletion and the transmission of economic downturn from countries entering recession into the US economy trough the gold reserve/floating mechanism, the US finally decided in 1976 to abandon the gold standard altogether and from that point on the US$ became the international standard on its own merit without supporting reserve.

Therefore, starting in 1976, the holding of gold reserves as an international monetary support ceased to matter. What mattered were the reserves in US$ that a country held. It took a few years for all that to sink in to the central banks that were holding the countries gold reserve but basically, starting a few years later, they all began to sell off gold to the US in exchange for US$ in order to build up their US$ reserves instead. If you pull the Bank of Canada US$ account graphs, you can see the correlation.

All of this, Btw, is controlled by the Bank of Canada in Canada, and we should not necessarily see the hand of the Government of Canada directly in the decision making process, even though the Bank takes into consideration the policy decisions made by the Department of Finance.

So to answer the "where did the money go" question, it simply went from the Bank of Canada gold holdings account to their US$ holdings. After that, I suspect that the Bank used some of these US$ to buy Canadian dollars on the international market as a  mean of stabilizing the swings it has been suffering lately with the volatile oil market. So, no, that money is not budgetary money for the Government of Canada and won't affect the up coming budget deficit.

Everything is connected in the international monetary system.
   

 

[Edward Campbell]

...
All of this, Btw, is controlled by the Bank of Canada in Canada, and we should not necessarily see the hand of the Government of Canada directly in the decision making process, even though the Bank takes into consideration the policy decisions made by the Department of Finance.

So to answer the "where did the money go" question, it simply went from the Bank of Canada gold holdings account to their US$ holdings. After that, I suspect that the Bank used some of these US$ to buy Canadian dollars on the international market as a  mean of stabilizing the swings it has been suffering lately with the volatile oil market. So, no, that money is not budgetary money for the Government of Canada and won't affect the up coming budget deficit.

Everything is connected in the international monetary system.
 

Exactly right!

The premise of the original post, that, somehow, Justin Trudeau has done something (else) wrong, is silly.

 

[PuckChaser]

The premise of the original post, that, somehow, Justin Trudeau has done something (else) wrong, is silly.

Absolutely. There's plenty of ammo out there instead of stretching at this. I mean, we only have to wait for the gongshow that will be his budget in a few weeks.

 

[Edward Campbell]

OK, the first 100 days are done.

My take:

First: On balance, he has done quite well, or, at least, well enough.

Despite my personal reservations about some of his decisions ~ the CF-18 thing ~  and about some of his choices ~ I really think Harjit Sajjan was selected to be MND because he is a political lightweight, a novice, a nobody, who will be a loyal lapdog, always more grateful for being in cabinet than concerned about the "rightness" of policy, I think that he, PM Trudeau, has not made any really serious missteps. Such polling data as we have seems to indicate that he remains popular, and Canadians, mostly (50% of them), still have confidence in what he is doing.

Second: It seems to me that he has managed two “crises,” both of his own making I hasten to add, well enough:

    1. The refugee (numbers) fiasco; and

    2. The CF-18s/war against Da’esh/ISIL/ISIS problem.

Both, it seems to me, have been resolved to Canadians’ general satisfaction, but the unintended consequences of the Da’esh/ISIL/ISIS “solution” (if there are any, especially on the international stage) remain to be seen.

Third: The Liberals have decided to remain in campaign mode for as long as they possibly can … maybe even until 2019 if they can manage it. I think that’s smart politics ~ Butts, Telford and, indeed, Prime Minister Trudeau himself, are formidable campaigners and “happy warriors” in the political campaign sense, too. It is less clear, to me, that any of that top level troika have much in the way of a “will to govern,” which is much more difficult.

That third issue might allow the Conservatives to drive wedges between this government and the electorate.

But, on balance, Prime Minister Justin Trudeau has had an uneventful ~ which means successful ~ first 100 days. Congratulations to him.

Now it is up to Rona Ambrose and the Conservatives to force Prime Minister Trudeau to govern for the good of all Canadians … I suspect that’s his weak spot.

 

[Kat Stevens]

The rot is already starting to set in for at least two western provinces, led by the Saskatchewan premier.  The sentiment that JT has dusted off his dad's middle finger to the west, and displays is prominently, is widespread, justified or not.  The west fed and clothed this country for decades, and suddenly nobody is returning our calls.

 

[Kirkhill]

The rot is already starting to set in for at least two western provinces, led by the Saskatchewan premier.  The sentiment that JT has dusted off his dad's middle finger to the west, and displays is prominently, is widespread, justified or not.  The west fed and clothed this country for decades, and suddenly nobody is returning our calls.

There does seem to be a sense of piling on these days Kat.  Justin, Coderre and now Christie Clark's recent gratuitous comments in her throne speech.  The sense of isolation is starting to creep into the discourse again.

 

[Jed]

There does seem to be a sense of piling on these days Kat.  Justin, Coderre and now Christie Clark's recent gratuitous comments in her throne speech.  The sense of isolation is starting to creep into the discourse again.

I do not think Alberta and Saskatchewan will go off into the night not nearly as quietly as they did after Trudeau Sr., Chretien et al.

Highly unlikely you will see serious talks of Western Canada separation but IMO, you will see very noisy and verbal push back and possibly long term alienation with the Centre.

 

[Kirkhill]

Exactly right!

The premise of the original post, that, somehow, Justin Trudeau has done something (else) wrong, is silly.

Silly indeed lads.

The latest data, published last week by the Department of Finance, show the total Canadian gold reserves have now dropped to 0.62 tonnes. That’s less than 0.1 per cent of the country’s total reserves, which also include foreign currency deposits and bonds. In comparison, the U.S. holds 8,133 tonnes of gold, while the United Kingdom weighs in at 310 tonnes.

The decision to sell came from Finance Minister Bill Morneau’s office.

“Canada’s gold reserves belong to the Government of Canada, and are held under the name of the Minister of Finance,” explained a spokesperson for the Bank of Canada on Wednesday. “Decisions relative to gold holdings are taken by the Minister of Finance.”

http://globalnews.ca/news/2508940/canada-sells-nearly-half-of-all-its-gold-reserves/

:cheers:

PS I admit to having misread the original tables.  Where I read a drop of 44 BUSD from 102 to 58 it was actually 44 MUSD at which point this does become something of a tempest in a teapot.

 

[PuckChaser]

Not even a month in office, and he sells half of the gold reserves. As we don't back currency with gold anymore, is this a slush fund to weather against global economic collapse, or used for something else?

 

[a_majoor]

In my bookshelf (yes I am old enough to appreciate a dead tree library) are "The New Canada", and "The Big Shift". I get a sense from that and travelling to parts of both Eastern and Western Canada that the Liberal government is using its time in office to try and reverse the decline in the fortunes of the "Laurentian Elites" and the Toronto-Montreal corridor that the shift in economic power and demographics since the 1980's. Preston Manning was a man ahead of his time, and the Laurentian elites hated Stephen Harper because he showed that it was possible to create a majority government without having to carry Quebec.

While we should "never say never", I suspect that it is ultimately a quixotic quest, and will lead to pathologies in the body politic similar to the BQ/PQ and the rise of demagogues (Hello Donald Trump and the Ford Brothers) in response. Attempts to create a permanent ruling class through trickery (like ramming some form of PR through the system without public input or debate) will only hasten this rather than suppress it.

 

[quadrapiper]

There does seem to be a sense of piling on these days Kat.  Justin, Coderre and now Christie Clark's recent gratuitous comments in her throne speech.  The sense of isolation is starting to creep into the discourse again.

No idea about east of the Rockies, but my impression is that Christie Clark represents no one but Christie Clark; certainly not any sort of BC zeitgeist.

 

[jmt18325]

From reading this thread, all I sense is a lot of mild paranoia.

 

[PuckChaser]

From reading this thread, all I sense is a lot of mild paranoia.

Did you live through the 90s? Or the 70s? You'd distrust the Liberals too.

 

[PPCLI Guy]

Did you live through the 90s? Or the 70s? You'd distrust the Liberals too.

Your profile says that you are 31.  I doubt that you were all that politically aware from the ages of 5-15 in the 90s, and you sure didn't live through the 70s.....

 

[PuckChaser]

Your profile says that you are 31.  I doubt that you were all that politically aware from the ages of 5-15 in the 90s, and you sure didn't live through the 70s.....

I lived in a military household, who suffered because of the pay freezes during the decade of darkness. I also never claimed to speak for the 70s generation, nor even for the 90s generation, simply pointing out 2 decades where most of the political distrust of the Liberals comes from. My age has absolutely no bearing on political commentary, for all you know I might have a masters in political science and studied Canadian Politics in the 1970s in university (I did not, I took something useful).

I do thank you for another post immediately after mine, trying to pick apart my arguments, even if I'm getting pretty tired of it. If you have a personal issue with me, my PM inbox isn't full.

 

[PPCLI Guy]

I do thank you for another post immediately after mine, trying to pick apart my arguments, even if I'm getting pretty tired of it. If you have a personal issue with me, my PM inbox isn't full.

You are right.  On reflection, I rise to the bait of your relentless Liberal-bashing and general negativity every time, and I do not know why.  My reaction adds nothing to the conversation, and is relatively undignified for all of that.  I will refrain from now on.