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Globe and Mail
3 days ago
- Business
- Globe and Mail
The stock market is booming. Our economies are busting. What's going on?
John Rapley is a contributing columnist for The Globe and Mail. He is an author and academic whose books include Why Empires Fall and Twilight of the Money Gods. Stock markets are probing fresh heights. Among the G7 economies, only Italy's isn't in record territory and even Japan, which looked to have entered terminal decline after its 1990 crash, is now back within touching distance of those long-ago highs. House prices as well are near their all-time highs in most places, slightly off their recent peaks but still far above where they ever were before. And that's nothing compared with crypto and gold – bitcoin is up more than a quarter this year, gold nearly a third. In short, we're getting richer by the day. Which is kind of strange, because our economies are barely moving. Of the major economies, only the United States has shown any significant expansion recently and even that is now slowing rapidly. Reflecting this new deceleration, the corporate-earnings season now under way in the United States is turning out to be a dud, with profit growth coming in well below the rate of share-price increases. In short, the strength of market rallies doesn't reflect what's happening in economies, which are weak and getting weaker. So what's going on? Some of it is rebalancing. Talk of all-time highs in the U.S. stock market cloud the reality – the U.S. is the laggard, it's stock market up a mere 5 per cent since President Donald Trump took office and 8 per cent for the year, a far cry from Germany's 22 per cent or Hong Kong's 28 per cent. Currency effects make the discrepancy even more dramatic, leaving the U.S. market down in euro and peso terms, and pretty much flat in Canadian dollars. Lofty U.S. stock valuations bank on tech-heavy market's earnings strength For years the U.S. stock market sucked the air out of the world's markets. At its peak, it accounted for more than half of the world's publicly traded capital, the Magnificent Seven tech stocks alone having a combined value bigger than any other stock market on the planet. But now, money has begun returning home. That explains the weakening of the dollar. Given how much smaller than the U.S. these markets are, flows of this scale have an outsized impact on prices. As a result, the laggards of the past decade, such as Spain, Hong Kong, South Africa and Britain, have become winners, with a small share of repatriated investment making for big rallies. This rebalancing was always bound to happen at some point, but Mr. Trump's policies are accelerating it. Though presenting the trade 'deals' he's now rolling out as wins, because other countries have to 'pay' higher tariffs than the U.S., it's an odd victory when your consumers must pay more for their goods than foreigners. After Mr. Trump announced his trade deal with Japan this week, Toyota's share price shot up 15 per cent, but Ford's barely budged. That's because the price of a Toyota car will increase by 15 per cent, but Ford's will probably rise more, since the company must pay tariffs on all its inputs. The same is happening in bond markets, where the spread between U.S. government bonds and those of other countries, especially emerging markets, is narrowing. As the U.S. looks less investable, other countries lure capital back away from it. To this reallocation of investment one can add the massive amount of stimulus now entering the global pipeline – the tax cuts in Mr. Trump's Big Beautiful Bill, Germany's big stimulus program, NATO's rearmament, Japan's fiscal loosening: There's a lot of bond issuance coming, which will pump money into the world economy. The monetary tightening that had followed the 2021-22 inflation spike has now given way to an increase in global money supply that's running at an annual rate of more than 7 per cent. Opinion: The triple contradiction of Trumponomics could crash the world economy But what's good for markets isn't necessarily good for the economy. In the U.S., first-time homebuyers are spending a higher share of their income on mortgage payments today than they were before the 2008 crash, leaving less to spend or invest on other things, while squeezing future demand. The same is happening in Canada, and as we know one consequence of the rising cost of living is that voters are demanding a reduction in immigration. If voters don't always favour the harsh measures being taken against immigrants in the U.S., nonetheless virtually all Western countries are starting to clamp down on inflows. That is cutting off one of the few remaining sources of growth in Western economies, namely the rise in labour supply. Sooner or later, in short, markets will realign with the economy. Unless the latter picks up, the former are sure to fall. At the moment, a slowdown looks the more likely scenario. Whatever stimulus effects come from government's fiscal largesse, the impact of tariffs and slow growth in the labour market owing to immigration cutbacks will drag down growth. Investors are still pricing shares as if the good days will keep rolling. But this fall may bring a chill to markets.
Toronto Star
5 days ago
- Business
- Toronto Star
Our shoebox condo market is finally crumbling. Mark Carney should be the least surprised of all of us. Now he needs correct the errors of the past
As the condo market's vital signs fade with each passing month, the developer lobby is stepping up the pressure on all levels of government to do something, anything, to prop up a job-producing industry now described as critical to an already vulnerable Canadian economy. It seems the Liberal government is very much alive to this message. 'We're looking at what tools and actions we can take federally to kickstart the market,' housing minister Gregor Robertson told The Globe and Mail last week. 'We've got to look at how to best support and intervene where needed.' The question is whether Ottawa should 'intervene' in a sector that been held aloft by a speculative investment bubble which has finally burst. The answer, I'd argue, is absolutely not. Opinion articles are based on the author's interpretations and judgments of facts, data and events. More details
Economic Times
6 days ago
- Business
- Economic Times
TD Bank tells employees: Get ready to work four days in office! Following trend among largest Canadian banks
Toronto-Dominion Bank (TD) is the latest major Canadian lender to require more in‑office days, following similar moves from RBC, BMO, and Scotiabank, as per a report. The bank informed its staff that starting from November 3, most TD employees will be expected to work four days a week from corporate headquarters on a more full-time basis, with executives to begin as early as October 6, as reported by The Globe and Mail. In an internal memo shared with staff, TD's Chief Human Resources Officer Melanie Burns emphasized the benefits of in-person work like development opportunities and strengthens the bank's culture, according to the report. Burns said that, 'TD has made strong progress over the last several months and there is clear momentum in our business as we advance an ambitious agenda,' as quoted in the report. Burns also highlighted that, 'We've seen that when we work together in person, we collaborate more effectively, make better decisions more quickly, learn from each other, and deliver stronger outcomes,' as quoted in The Globe and Mail report. ALSO READ: Netflix's The Hunting Wives sets the stage for Season 2! Cast, plot, spoiler, ending explained, and all details you need to know The Toronto-Dominion Bank also revealed that many of its locations will be prepared to accommodate the new work-from-office mandate by November, but it may also need to take some more time to ensure others are ready, according to the report. To have everyone on board, the new requirement may take effect at a later date for certain teams, as per The Globe and Mail new office requirements are already causing a stir in downtown Toronto's corporate towers as employees were reportedly scrambling to secure desks during the hybrid work era, leading to concerns about how even before the November rollout, space is becoming a precious commodity, as per the Toronto-Dominion Bank also justified its new move by highlighting that it recognizes that workplace flexibility allows workers to manage personal and professional priorities, as reported by The Globe and even said in the internal memo that, 'If from time to time you need additional flexibility to work from home, please check with your people manager and we will work with you to support your needs,' as quoted in the report. ALSO READ: Paid too much for 'The Outer Worlds 2'? Microsoft says sorry and starts sending refunds The Toronto-Dominion Bank joins RBC, BMO, and Scotiabank, all of which implemented or plan to implement four-day-office mandates recently, according to The Globe and Mail report. Those three banks will start the four-day rule as early as September 15, as per the report. RBC and Scotiabank are even planning to expand their office space to accommodate the shift, The Globe and Mail reported, citing sources familiar with the big banks, which are some of the county's largest employers, with hundreds of thousands of staff across the six largest lenders, are now spearheading a wider corporate move back to the office, as per The Globe and Mail report. The latest move is a milestone for companies hoping to bring employees back to corporate offices more frequently, as reported by The Globe and trend mirrors the approach of the United States, where US banks like JPMorgan Chase, the country's largest lender, have begun requiring all employees to work five days a week onsite since this year, as per The Globe and Mail will TD bank's new work-from-office rule start?Most employees will be required to work from the office four days a week starting November 3. Executives begin October 6. Will I still have one day to work remotely? Yes, the policy is four days in-office, so you can still work remotely one day a week and get more day if approved by managers.
Global News
21-07-2025
- Politics
- Global News
Canada's international student program to face auditor general probe
The federal auditor general is planning to conduct a review of Canada's international student program, which has seen a surge in admissions that critics say the country was ill-prepared to handle. A report from the planned audit is expected to be tabled in Parliament in 2026, a spokesperson for Auditor General Karen Hogan's office told Global News on Monday. 'As the audit is in the planning phase, providing information on scope and timelines is premature,' Claire Baudrey said in an emailed statement. The Globe and Mail first reported on the upcoming probe, which was also confirmed by The Canadian Press. Critics, including the opposition Conservatives, have argued Canada's rapid increase in international student admissions over recent years drove up youth unemployment and worsened the housing crisis. Conservative Leader Pierre Poilievre said last week that 'we need more people leaving than coming' into Canada for the next couple of years, after calling in June for 'severe limits' on the country's population growth. Story continues below advertisement He did not specifically mention international students in his comments, but blamed temporary foreign workers for high youth unemployment rates. He said 'very hard caps on immigration levels' would let the country's housing market, health-care systems and domestic employment 'catch up.' 1:54 Canada needs 'more people leaving than coming,' Poilievre says Prime Minister Mark Carney told his cabinet ministers in a mandate letter shortly after the federal election that he wants to return 'overall immigration rates to sustainable levels.' Get breaking National news For news impacting Canada and around the world, sign up for breaking news alerts delivered directly to you when they happen. Sign up for breaking National newsletter Sign Up By providing your email address, you have read and agree to Global News' Terms and Conditions and Privacy Policy At the same time, there has been a steady increase of international students seeking to gain permanent residency by applying for asylum, rather than through regular immigration streams. Global News reported in May that international students filed a record 20,245 asylum claims last year, with 2025 on track to surpass that number, according to federal immigration data. The data from Immigration, Refugees and Citizenship Canada shows the number of international students seeking asylum last year was nearly double the 2023 figures and six times higher than in 2019. Story continues below advertisement Even as Ottawa moves to cut the number of study permits it issues, asylum claims by foreign students rose 22 per cent in the first three months of 2025 compared to the same period last year, with 5,500 claims filed. The federal Liberal government put a cap on study permit applications last fall and plans to consult on future student intake levels this summer. The permit cap has led to a cash crunch for many universities and colleges, with some responding with layoffs and hiring freezes. — with files from Global's Sophall Duch, Touria Izri and Marc-André Cossette, and The Canadian Press
Hamilton Spectator
10-07-2025
- Business
- Hamilton Spectator
Defence expected to find operational savings even as its budget balloons
OTTAWA - The Department of National Defence will not be spared from Prime Minister Mark Carney's cost-cutting drive — even though overall defence spending is set to balloon in the coming years. Finance Minister François-Philippe Champagne sent letters to cabinet ministers Monday asking them to find savings of 7.5 per cent in their budgets starting in fiscal 2026, a spokesperson for the minister confirmed. That savings target rises to 10 per cent the following year and 15 per cent in 2028. The Globe and Mail first reported on the plan to sharply reduce program spending across the government. A spokesperson for the Treasury Board Secretariat told the Canadian Press that the Department of National Defence, the Canada Border Services Agency and the RCMP will instead be tasked with total cost reductions of two per cent over three years. The government is taking a 'broad and balanced approach' to the spending review that recognizes 'the importance of maintaining key investments in critical areas,' spokesperson Rola Salem said in an email. Champagne's spokesperson Audrey Milette said the policy speaks to Carney's promise to balance the operating side of Ottawa's budget in the coming years while rapidly increasing defence spending to meet NATO targets. An internal message from Chief of the Defence Staff Gen. Jennie Carignan and Deputy Minister of National Defence Stefanie Beck to defence personnel, which was sent out Wednesday afternoon, said the department's target for spending cuts is 'lower than most organizations.' Spending reduction proposals that are approved by Treasury Board will appear in the 2026–27 Main Estimates. 'This target does not impact the funding received following the prime minister's announcement in June of new investments in the Canadian Armed Forces, and we will continue to invest more in the CAF year-over-year than any proposals brought forward to reduce spending on day-to-day operations,' the internal message said. 'Our focus will be on prioritizing and streamlining activities, reallocating where possible and reducing unnecessary duplication of effort.' Carney's defence announcement in early June amounts to an extra $9.3 billion in spending this year. He made that announcement before NATO allies pledged at last month's summit to ramp their defence and security budgets up to five per cent of GDP by 2035. Defence Minister David McGuinty confirmed for journalists Monday that he received Champagne's letter but offered little indication of where cuts could be made in his department. 'I haven't had a chance to talk to my colleague, but I have been part of no discussions with respect to, for example, significant social services cuts at a federal level in order to achieve our defence priorities,' he said at a press conference at CFB Trenton. 'The question of redistribution of expenditures is one I would much rather leave with the minister of finance.' Ottawa is preparing to present its 2025 budget in the fall after forgoing a traditional spring fiscal update. Since taking over the Liberal leadership earlier this year, Carney has touted plans to 'spend less' and 'invest more' to build Canada's economy in the face of U.S. trade aggression. The Liberal platform in April's federal election projected a deficit of $62 billion this year and promised to balance the operating budget by 2028 while continuing to run a deficit in capital spending. In the absence of a spring budget or specific outlines for cuts, the parliamentary budget officer and other critics have argued the federal budgetary deficit could grow beyond that level this year, thanks to Ottawa's recent spending announcements. The union representing public service workers warned Tuesday of widespread job losses and reduced services if Ottawa's planned cuts materialize. The Public Service Alliance of Canada said in a media statement that while it's ready to work with the federal government to find savings across the public sector, the cuts as proposed could lead to shuttered programs and longer wait times for things like passports. Meanwhile, on Wednesday, Treasury Board President Shafqat Ali announced a new review to cut red tape across the public service. Ministers are expected to review regulations in their portfolios and propose actions to remove outdated rules, reduce duplication with provinces and generally make it easier to deliver services. Ministers' reports on next steps for cutting regulation are due within 60 days. Michael Sabia, tapped last month to head the Privy Council Office in Ottawa, said in a letter to public servants on Monday that the federal bureaucracy must streamline its operations because 'internal processes have become quite complicated.' 'Trying to simplify processes is going to be a priority. I know it is easier said than done. But it has to be addressed,' he wrote. — with files from Kyle Duggan This report by The Canadian Press was first published July 7, 2025. Error! Sorry, there was an error processing your request. There was a problem with the recaptcha. Please try again. You may unsubscribe at any time. By signing up, you agree to our terms of use and privacy policy . This site is protected by reCAPTCHA and the Google privacy policy and terms of service apply. Want more of the latest from us? Sign up for more at our newsletter page .
