Forecast says economy will grow in 2021 if there isn't another national shutdown

EVERYTHING IS COMING UP ROSES 
EXCEPT WHEN IT'S NOT

The Canadian Press June 22, 2020


OTTAWA — Canada may have already begun to recover from the deepest recession on record, assuming the country can avoid another national COVID-related shutdown, a private sector forecast said Monday.

The Conference Board of Canada report estimates the economy will shrink 8.2 per cent this year, then return to growth with a 6.7-per-cent rise in 2021 and 4.8-per-cent in 2022 — provided there are no more national shutdowns.

The outlook is at the optimistic range of the Bank of Canada's most recent estimates, but is based on 1,200 variables and the expertise of its analytical team, said Alicia Macdonald, associate director of economic forecasting for the Conference Board.

Macdonald also warned that there won't be a sharp "V" recovery but said a gradual "U" recovery is likely.

Meanwhile, Bank of Canada governor Tiff Macklem said in a webcast speech Monday that the bank expects economic growth will resume in the third quarter. Even so, it also warned the recovery period "will likely be prolonged and bumpy, with the potential for setbacks along the way."

The Conference Board cautions that its forecast depends on "the country’s ability to avoid a second severe outbreak of the COVID-19 virus" that would require another national shutdown. It expects many companies can weather the storm of additional outbreaks, however.

"I think we've learned a lot of lessons from our experience from the first lockdown," Macdonald said in an interview.

Businesses have more techniques and tools — such as plastic barriers to separate customers from staff — and more guidelines from governments in how to operate safely, she said.

"So we think that, should a second wave come in the fall, they'll be better prepared to handle it this time around."

The Conference Board projects the unemployment rate will peak at 13.7 per cent in the second quarter ending June 30, the highest since comparable data was first recorded in 1976.

But the report says the addition of nearly 300,000 jobs in May and continued easing of restrictions in June probably indicate the pandemic's worst impact on the labour market has passed.

It's projecting the addition of another 1.3 million jobs in the July to September quarter, dropping the national unemployment rate to 10.5 per cent.

The Conference Board says that if the country can avoid a second national shutdown, Canada's economy could grow by 6.7 per cent in 2021 and by 4.8 per cent in 2022.

— By David Paddon in Toronto with a file from Jordan Press in Ottawa.

This report by The Canadian Press was first published June 22, 2020.

The Canadian Press

Black (AFRO AMERICAN) bird watchers draw attention to racial issues outdoors
Terry Tang The Canadian PressJune 23, 2020

Jason Ward fell in love with birds at age 14 when he spotted a peregrine falcon outside the homeless shelter where he was staying with his family.

The now 33-year-old Atlanta bird lover parlayed that passion into a YouTube series last year. One of the guests on his first episode of “Birds of North America” was Christian Cooper, a Black bird watcher who was targeted in New York City’s Central Park by a white woman after he told her to leash her dog.

A video capturing the encounter showed the woman, Amy Cooper (no relation), retaliate by calling the police and clearly referencing his race to raise the threat level.

Ward, who is Black, said the video, even now, is “jarring” to watch. Butting heads with dog owners is common among birders but he'd never seen it take such a turn.

“Especially knowing Christian and how confident he is, hearing his nervousness and trembling, it shed light on how dangerous that situation could have been,” Ward said.

It didn't culminate in any arrests, and Amy Cooper later issued an apology. But it has brought attention to how the great outdoors can be far from great for Black people. Worries about discrimination, racial profiling and even subtle aggression keep some away. Furthermore, those fears can perpetuate the stereotype that hiking, camping and bird watching are “white” activities.

Christian Cooper's encounter, which happened on May 25, the same day as George Floyd's death at the hands of a white Minneapolis police officer, has been cited in nationwide protests against systemic racism and white privilege.

For Black people, the incident was not surprising, said Carolyn Finney, author of “Black Faces, White Spaces: Reimagining the Relationship of African Americans to the Great Outdoors."

“Systemic racism doesn’t stop at the park gates,” Finney said. “I’ve backpacked all over the world. ... There are places in this country I would never go on my own. It is my loss. I just don’t trust the public.”

Birding can take participants to parks, woods and suburban streets. Depending on the setting, Ward said he adjusts his demeanour so he doesn't seem threatening. He makes sure his face isn't covered even if it's cold. He always has his binoculars in plain sight rather than pulling them out of his bag.

“Just simple stuff like that I have to pay attention to that other people might say, 'What? Come on dude! They're just binoculars,'" Ward said. “If someone easily recognizes them as binoculars, it's still a case in which I have to prove that I'm actually looking for birds occasionally.”

Mike Parr, president of the American Bird Conservancy, is white but his three sons are half-Black. His youngest, who is 12, has gotten into birding. Cooper's experience is now in the back of his mind.

"We personally haven’t come across anything like that, but as a parent, I am concerned about things that could happen to him. Birding isn’t all that well understood by people," Parr said. “Rare birds sometimes show up around crazy places. I’m concerned he might face this sort of thing."

Keith Russell, 63, an urban conservation program manager for the National Audubon Society's Philadelphia-based chapter, said as a Black person, he has his guard up if he's searching for birds with binoculars near homes. But he's never felt unsafe among fellow birders and hopes Cooper's close call doesn't scare off others.

“I think it’s very very important to be clear for anyone who might not understand this and take a superficial view of this. ... It’s not dangerous to be a birder if you’re a person of colour," Russell said. But, he added: “There have been historical problems with access.”

He thinks for some Black families, past discrimination and segregation at parks and other recreation sites may have set them on a path away from nature. That lack of connection to the outdoors then continues with the next generation.

“It can take a while to make that internal culture go away. I think it’s definitely starting to,” Russell said.

The misconception that most Black people aren't outdoorsy may get bolstered by history books. Finney, the author, said too often the history of U.S. conservation centres on white figures like naturalist John Muir. Meanwhile, less attention is paid to the hundreds of Black soldiers who protected national parks after the Civil War.

The same goes for Hispanic communities. Many are unaware that Hispanics have connections with public lands going back generations, said Liz Archuleta, a county board supervisor in Flagstaff, Arizona, and co-founder of Hispanics Enjoying Camping, Hunting and the Outdoors.

“My mother tells stories about how at least twice a month on a Saturday, the entire Hispanic pioneer community of Flagstaff used to get together and go through the forest and have picnics,” Archuleta said. “It's foreign to me when people say we have to get Hispanics to enjoy the outdoors more.”

The shift in support toward Black Lives Matter after Floyd's death has every corporation and non-profit re-evaluating how they can elevate Black and brown voices.

In the bird-watching world, there's already been an effort in recent years to do that. The National Audubon Society, which was established in 1905 to preserve birds and their habitat, has 1.8 million members. Only 45,000 identify as people of colour.

“Obviously, that’s not reflective of where the U.S. population is,” said Rebeccah Sanders, senior vice-president of the organization's state programs.

The group is trying to recruit more minorities. Staff training now includes ways to intervene if a team is restoring a habitat and one member is mistreated because of race or another trait. In the last year, they have set up chapters at dozens of colleges, including historically Black ones. In 2019, Audubon offered nearly 100 internships and fellowships. Almost half were filled by people from diverse backgrounds or communities.

“As our staff and our membership base become more representative, it changes who you are,” Sanders said. “Those perspectives make us ask different questions and change some of our decisions.”

Environmental organizations are making universal statements that the outdoors belong to everyone but, Finney said, they have to address that it's simply not the same for Black communities.

“The National Park Service and others want to engage diverse communities and often are bringing kids in," Finney said. “How are they supposed to feel if a Black man who went to Harvard and sits on the board of the Audubon Society is getting accosted? How is some Black teenager going to feel about their ability to feel safe and welcome?”

Since Christian Cooper's video, several Black professionals have reached out to Ward via social media to inquire about birding.

“‘We're definitely getting feedback from a lot of people who are saying 'You know what? I definitely want to get a pair of binoculars now,'” Ward said. "'I thought this was boring and for people who didn't look like me.'"

___ Tang reported from Phoenix and is a member of The Associated Press’ Race and Ethnicity team. Follow her on Twitter at https://twitter.com/ttangAP

Terry Tang, The Associated Press

Supreme Court Narrows Power of SEC to Recoup Illegal Gains

Greg Stohr Bloomberg June 22, 2020


(Bloomberg) -- The U.S. Supreme Court limited the power of the Securities and Exchange Commission to recoup illegal profits from wrongdoers, putting new curbs on one of the agency’s most potent legal weapons.

The 8-1 ruling Monday preserved the SEC’s power to win “disgorgement” in federal court so long as the money is used to reimburse defrauded investors and doesn’t exceed the wrongdoer’s net profits. But the court also suggested that federal law bars awards from going further, blunting a legal tool that critics say the agency has abused.

The SEC typically wins more than $1 billion a year in disgorgement orders in federal court. Disgorgement is a traditional tool used by judges to return wrongful gains to the victims. It’s distinct from SEC fines, which the agency is allowed to use as punishment.

Writing for the court, Justice Sonia Sotomayor said Congress had prohibited the SEC from seeking disgorgement “in excess of a defendant’s net profits from wrongdoing.” She said courts must subtract “legitimate expenses” before ordering disgorgement.

The ruling is a partial victory for a California couple ordered to pay $27 million after being found to have defrauded investors.

Distribute to Investors

Sotomayor also said disgorgement awards must be geared toward compensating investors, rather than simply stripping wrongdoers of their profits. She said it was an “open question” whether the SEC can deposit recouped money in the Treasury when it’s not feasible to distribute it to investors.

Disgorgement “must do more than simply benefit the public at large by virtue of depriving a wrongdoer of ill-gotten gains,” she wrote.

In addition, Sotomayor suggested that awards generally must track individual wrongdoing and not try to make one wrongdoer give back benefits an associate received.

Although federal law doesn’t explicitly say the SEC can seek disgorgement, the 2002 Sarbanes-Oxley Act says judges hearing SEC enforcement actions can award “any equitable relief” they deem appropriate to protect investors. Courts have traditionally viewed disgorgement as an “equitable” measure, which means judges make awards based on fairness rather than strict legal rules.

The ruling “will provide defendants strong ammunition for battling back against the SEC’s tendency to seek aggressive disgorgement remedies,” said Howard Fischer, a former SEC trial lawyer and now a partner at Moses & Singer in New York.

‘Existential Threat’

But even with the limits, some agency veterans said they see the decision as a victory for the SEC because it formally preserves the enforcement program’s ability to obtain disgorgement. Banning the remedy would have been a major setback for its policing efforts.

“That was the existential threat” that the commission feared, said Stephen Crimmins, a former agency enforcement attorney who is now a partner at Murphy & McGonigle. “This is a big win for the SEC.”

The ruling didn’t directly affect the SEC’s separate authority to seek disgorgement through administrative proceedings.

The couple, Charles Liu and Xin Wang, had asked the justices to go further and bar the SEC from seeking court-ordered disgorgement at all. Liu and Wang said that tool isn’t one of the remedies Congress has authorized the SEC to seek against people who violate the nation’s securities fraud laws.

Sotomayor rejected that contention, saying Congress incorporated the traditional courtroom rule that judges may “strip wrongdoers of their ill-gotten gains.”

Justice Clarence Thomas was the court’s only member who said he would have barred the SEC from seeking disgorgement at all in federal court.

Returning Funds

President Donald Trump’s administration and the SEC defended the disgorgement power, saying Congress authorized it three times, including in the Sarbanes-Oxley Act.

SEC spokeswoman Chandler Costello said the decision “allows us to continue to strip wrongdoers of their ill-gotten gains and return money to its rightful owners, following the court’s direction to ensure that our efforts embody principles of equity and fairness.”

The SEC says it tries to return disgorged funds to injured investors when possible. The agency says it collected $1.5 billion in disgorgements and penalties in 2019 and paid out $1.2 billion to investors that year.

Liu and Wang were found to have defrauded people seeking to take advantage of a visa program for foreigners who make large U.S. investments. The SEC said Liu and Wang falsely told investors their money would be used for a cancer treatment center.

Liu and Wang said the order in their case went well beyond the $8 million the trial judge found they had gained from their scheme.

The case is Liu v. Securities and Exchange Commission, 18-1501.

(Updates with lawyer reaction starting in 10th paragraph)

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The advertising business incentivizes segregation: industry veteran

AD BIZ STILL IN THE MAD MAN ERA

Jennifer Shanker Segment Producer Yahoo Finance June 23, 2020

The senseless killing of George Floyd by three members of the Minneapolis Police Department has sparked a wave of protests across the globe, shining a light on systemic racism in the U.S. Many businesses across the country have taken a stand in the Black Lives Matter movement, with some brands going as far as changing long-standing logos and slogans with problematic, racial implications. Brands like Aunt Jemima (PEP), Mrs. Butterworth (CAG), and Uncle Ben’s have announced that they will be rebranding and replacing their racist brand names and logos.

Ending systemic racism may prove especially difficult for the advertising industry, which has “not led the notion of changing perspective,” said long-time ad and music industry executive Steve Stoute, founder and CEO of Translation and UnitedMasters, on The First Trade. Stoute said the industry incentivizes segregation.

“The advertising industry, in general, puts people into boxes,” he said. “If you're Black, 18 to 24, white, Hispanic, they use these targeting tactics to then send specific messages to certain people with the assumption that there is no shared value.”


MIAMI, FL - JUNE 18: A product image as The parent company of Uncle Ben's rice said Wednesday that "now was the right time to evolve" the brand, including visually, but did not release details of what exactly would change or when. The move follows a similar announcement earlier in the day by Quaker Oats, the company that owns Aunt Jemima's syrup on June 18, 2020 in Miami, Florida. Credit: mpi04/MediaPunch /IPX

So, the advertising business looks at Blacks and whites “like we are two different worlds. They don’t see that there may be things we share in common,” he said. “The industry thrives on finding ways to separate us and segment us.”

There has always been a lack of transparency in diversity data in the ad business, according to Stoute. “The change needs to come from the top. This has been spoken about for years, and they [advertising executives] just keep putting band aids on it,” said Stoute, referring to major ad agencies like IPG and Omnicom. “Hopefully new leaders come in and do something different.”

Jennifer Shanker is a producer for Yahoo Finance.

https://plawiuk.blogspot.com/search?q=AUNT+JEMIMA

After Years of Angst, Canada’s Oil Pipeline Problem May Be Over

Kevin Orland and Robert Tuttle Bloomberg June 23, 2020



(Bloomberg) -- The shortage of pipeline space that has hamstrung Canada’s oil producers for years may finally be over -- just not in the way they had hoped.

The pandemic-induced oil crash prompted Canadian companies to cut about 1 million barrels of daily crude output, freeing up space on the country’s previously congested pipelines. With that production likely slow to return and as many as three new conduits slated to be built in the next three years, the industry may have years of cheap, plentiful shipping capacity ahead.

That’s a significant turnabout for a country where, until Covid-19 hit, the lack of pipelines out of Western Canada was a central political and economic issue, often pitting the oil-rich province of Alberta against the government of Prime Minister Justin Trudeau.

But the pipeline relief came only because oil producers had to adapt to a dramatic drop in demand and low prices that are causing mounting financial losses. Some had spent heavily to ramp up their ability to ship crude by rail and now find themselves stuck with idled tanker cars and loading terminals.

The industry “achieved the dream of going long pipeline in Western Canada but for all the wrong reasons,” said Kevin Birn, IHS Markit’s director of North American crude oil markets.

Enbridge Inc., which typically has to ration space on its Mainline pipeline system, had spare capacity in recent months, a rare occurrence. Shipments of crude by train, the main alternative to pipelines, have plunged as well. April crude-by-rail exports fell 55% to about 156,000 barrels a day, according to the Canada Energy Regulator. That trend appears to have continued into May, with about 49,000 barrels a day moving by rail, according to Genscape.

Until recently, the problem had been just the opposite. The lack of enough shipping capacity forced producers to sell their crude at wide discounts to benchmark U.S. prices, hurting Alberta’s economy. The industry accounts for about a 10th of Canada’s gross domestic product and a fifth of its exports.

Trudeau’s approach to the issue has varied. On one hand, he shelled out C$4.5 billion ($3.3 billion) to buy the Trans Mountain pipeline and save a key expansion from being scrapped. On the other, he rejected Enbridge’s proposed Northern Gateway project 

THIS WAS A SAFER BETTER ECOLOGICAL ROUTE THAN KITIMAT, THOUGH IT TOO IS OPPOSED BY FIRST NATIONS, ENVIRONMENTALISTS, IT FITS WITHIN THE PLANS FOR A DEEP WATER PORT OFF PRINCE RUPERT THE PIPELINE WOULD BE BUILT ALONG THE EXISTING YELLOWHEAD HWY https://plawiuk.blogspot.com/search?q=NORTHERN+GATEWAY

implemented regulations that industry groups have said will make it impossible to build new pipelines. Those moves contributed to Trudeau’s Liberal party losing all of its parliament seats from Alberta and Saskatchewan in an election last year.

But through all the turmoil, and many delays, three major pipeline projects are expected to enter service by the end of 2023: TC Energy Corp.’s Keystone XL, Enbridge’s expansion of its Line 3, and the Canadian government’s expansion of the Trans Mountain line. The projects would add a combined 1.79 million barrels of daily shipping capacity out of Alberta, an almost 50% increase.

For now, with producers reducing output because of the pandemic, the current pipeline system should be able to handle flows, Birn said. Oil-sands companies will be slower to bring production back online until they have more certainty that a recovery is underway, bridging the gap until the new lines are running, he said.

The need for the pipelines in the immediate term has been deferred or delayed because of the dramatic reduction in demand,” he said. “Covid-19 may have bought the industry some time.”

To be sure, those start dates are by no means certain. Line 3 already was stalled by a year because of permitting delays, and the project continues to face opposition in Minnesota. Keystone XL, after more than a decade since it was first proposed, is still facing legal challenges in Montana, and Trans Mountain also continues to face resistance from some indigenous communities in British Columbia.

In the meantime, some companies are stuck with investments in rail that they won’t need.

Cenovus Energy Inc., which suspended crude-by-rail shipments in March, had signed three-year deals in 2018 to transport 100,000 barrels of oil a day, and it also owns the Bruderheim rail-loading facility near Edmonton. Executives said on their first-quarter conference call that the idled crude-by-rail program costs them about C$18 million a year, including the expense of storing unused rail cars.


Rail continues to be a part of the company’s “portfolio approach” to transporting its crude over the long-term, said Sonja Franklin, a Cenovus spokeswoman. The majority of the costs associated with the rail program are variable, she said.

Exxon Mobil Corp.’s Canadian unit, Imperial Oil Ltd., is in a joint venture on a rail terminal next to its Strathcona refinery in Edmonton. The roughly C$170 million facility can load trains with 100 to 120 cars, for about 210,000 barrels of daily shipping capacity. Imperial executives said on the company’s first-quarter earnings call in May that rail volumes for April had plummeted to 10,000 barrels a day, less than 5% of the facility’s capacity.

Imperial declined to comment.

With crude demand and oil-sands production likely to remain reduced until new pipelines come online, those rail facilities could stay underused for some time, barring a major technological advancement that makes oil-sands crude cheaper to produce, said Fernando Valle, an analyst at Bloomberg Intelligence.

“We could be pretty much set for most of this decade unless there’s a breakthrough,” Valle said.

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CANADA PRIDE PIN

CANADA HAS ISSUED AN OFFICIAL PRIDE MONTH PIN PICTURED HERE 

NEW RULE 

WE NO LONGER CALL 

THE ORIGIN OF A PANDEMIC 

TYPHOID MARY 

CHANGE IT TO

 CORONAVIRUS TRUMP

German region in new lockdown after slaughterhouse outbreak

CLOSE ALL GLOBAL MEATPACKING PLANTS FOR SIX WEEKS! ALL MEATPACKERS RELY ON MIGRANT LABOUR
PAY ALL THE WORKERS 

Frank Jordans And Geir Moulson The Canadian Press June 23, 2020

BERLIN — German authorities slapped new lockdown measures Tuesday on a western region that has seen hundreds of coronavirus infections linked to a slaughterhouse, trying to make sure the cluster doesn't race into the wider community.

Authorities initially said more than 1,550 people had tested positive for coronavirus at the Toennies slaughterhouse in Rheda-Wiedenbrueck, but by Tuesday afternoon they said the exact number was still being verified.

Thousands of workers, many of them migrants from Eastern Europe, and family members have been put under a quarantine to try to halt the outbreak.The governor of North Rhine-Westphalia state, Armin Laschet, said people in Guetersloh county for the next week will face some of the same restrictions that existed across Germany during the early stages of the pandemic in March.

These include limiting the number of people who can meet in public to those from a single household or two people from separate households, Laschet said.

“We will order a lockdown for the whole of Guetersloh county," he told reporters Tuesday. “The purpose is to calm the situation, to expand testing to establish whether or not the virus has spread beyond the employees of Toennies.”

"We will get a better picture of the situation through intensive testing, and can then see more clearly within seven days what the situation is,” Laschet said.

Cinemas, fitness studios and bars will be closed, but stores will remain open and restaurants can still serve customers from the same household. Previously, the western county had only closed schools and daycare centres, sparking anger from parents who said their children were being punished for failings at the slaughterhouse.

Similar restrictions are being imposed in neighbouring Warendorf county, where many Toennies workers also live, the state government said later Tuesday. Guetersloh county has about 360,000 inhabitants and Warendorf has some 277,000.Prior to the Toennies outbreak, Germany had been widely praised for its handling of the pandemic. Intensive testing, tracing and hospital preparation measures kept Germany’s death toll five times smaller than Britain’s. Germany has seen over 8,900 confirmed virus deaths and about 192,000 cases.

Toennies Group, a family-owned company, has been criticized for using subcontractors for parts of its operation. The practice, which is common in the German meat industry and which the government now wants to ban, often involves migrant workers living in cramped communal housing and being transported to slaughterhouses in minibuses, heightening the risk of infection.

A video circulating on social media also showed workers at the plant seated close together during break times, although the company has disputed how recent the video is.

Laschet expressed his frustration Tuesday at the company's handling of the outbreak, saying authorities had to order Toennies — Germany's biggest meat processing company — to release the names of its employees.

“The readiness to co-operate could have been greater,” he said.

Laschet said the measures will be lifted June 30 if the situation has improved, but declined to provide specific parameters for success. He also urged other regions in Germany not to discriminate against people from Guetersloh.

The German news agency dpa reported that 14 people on vacation, some of them from Guetersloh, were told Monday to leave the northeastern island of Usedom, a popular Baltic Sea resort. And Bavaria issued a ban on hotels renting rooms to people from Guetersloh or other counties with more than 50 new cases per 100,000 inhabitants. Exceptions will be made for people who can present a negative coronavirus test.

Separately, virus cases also were reported Tuesday at another slaughterhouse in Wildeshausen, in northwestern Germany. Twenty-three workers at the PHW Group site tested positive, and more than 1,100 people working there were to be tested, officials said.

The head of Germany's disease control centre said Tuesday the exact reasons why slaughterhouses in Germany, the United States and elsewhere have become coronavirus infection hubs are still being investigated.

“It's certainly the case that if you live in cramped conditions and small rooms then that's a situation where the virus can spread more easily,” said Lothar Wieler, chief of the Robert Koch Institute.


But he added that low temperatures in parts of the plant, intended to keep the meat cool, could also play a role.

“Another factor, which we don't think is small, is the development of aerosols,” said Wieler, referring to tiny droplets that can linger in the air and potentially contain viruses.

Wieler said the outbreak at the slaughterhouse and others linked to religious gatherings could certainly spread to other people in Germany.

“That's why it's so important that we remain careful,” he said. “The virus is still in the country and if we give it the chance to spread, then it will take that chance."

But he expressed hope that Germany could avoid a second wave of the pandemic if people followed government advice on social distancing and hygiene.

Dr. Ute Rexroth, a senior Robert Koch Institute official involved in Germany's pandemic response, noted that poverty seems to play a significant role in who gets infected, calling it “the root of the problem.”

___

Follow AP pandemic coverage at http://apnews.com/VirusOutbreak and https://apnews.com/UnderstandingtheOutbreak

Frank Jordans And Geir Moulson, The Associated Press

U.S. Set to Announce Aluminum Tariffs on Canada by End of Week

TRUMP AMERICA HAS NO ALLIES

Joe Deaux and Jenny Leonard Bloomberg June 22, 2020


(Bloomberg) -- The Trump administration is considering re-imposing tariffs on aluminum imports from Canada and an announcement could come by the end of the week, according to people familiar with the matter.

If Canada refuses to impose export restrictions on aluminum, the U.S. will announce Friday the re-imposition of 10% tariffs on aluminum from the country and implement the tariffs by July 1, according to the people, who asked not to be identified because the information isn’t public.

That would be just days before the new U.S.-Mexico-Canada trade deal enters into force on July 1. U.S. Trade Representative Robert Lighthizer has expressed concern about recent struggles by American aluminum producers, which have seen sales drop and all-in prices sink as demand evaporated amid the global pandemic.

Lighthizer told the Senate Finance Committee in a hearing last week that recent surges in metal imports from North American neighbors are “of genuine concern to us now,” and that his office was looking at the issue.“I would say there have been surges on steel and aluminum, substantially from Canada, some from Mexico, and it is something that we’re looking at and talking to both Mexico and Canada about,” he told the panel’s top Republican, Senator Chuck Grassley from Iowa.

A spokesman for the USTR didn’t immediately respond to an emailed request for comment outside office hours.

Under the May 2019 agreement, which resulted in initial tariffs being lifted, Canada has to limit its retaliation to the U.S. metals sector and cannot hit American agriculture, Lighthizer told Grassley.

Ironically, the only three U.S. aluminum producers -- Alcoa Corp., Century Aluminum Co. and Magnitude 7 Metals LLC -- disagree whether tariffs should be reimposed.
The American Primary Aluminum Association, which represents Century Aluminum Co. and Magnitude 7 Metals LLC., has asked Lighthizer to reimpose a 10% tariff on imports of Canadian aluminum, saying a rise in metal coming from the country has caused the price to collapse.

The Aluminum Association of the U.S., which represents Alcoa Corp., Rio Tinto Group and dozens of other aluminum parts makers, argues that imports are virtually unchanged since 2017.

Alcoa CFO William Oplinger said at a virtual bank conference in June that China’s overcapacity subsidized by the government is the real problem, and that he supports free trade with “those who trade freely, especially the Canadians.”

©2020 Bloomberg L.P.

COVID-19 to leave some lasting economic damage, Bank of Canada chief saysThe Canadian Press June 22, 2020


NEW GOVENOR OF THE BANK OF CANADA WEARING 

A CANADIAN FLAG PRIDE PIN

OTTAWA — The COVID-19 pandemic will leave some long-term economic damage that will only become clearer as the country moves further along a "prolonged and bumpy" course to recovery, Canada's top central banker says.

In his first speech as governor, Tiff Macklem said the central bank expects to see growth in the third quarter of this year as people are called back to work and households resume some of their normal activities as restrictions ease.

But he quickly warned Canadians not to expect the short and sharp economic bounce-back expected over the coming months to last.

The combination of uneven reopenings across provinces and industries, the unknown course of consumer confidence, and unemployment rates will "likely inflict some lasting damage to demand and supply," Macklem said in a speech Monday.

The exact extent of the damage in terms of the number of lost jobs and business closings won't become clear until the country is further along the reopening phase.

And even when things start looking up, he said there is the potential for setbacks from new outbreaks.

"As we get through that reopening phase, though, we do think that the pace of the recovery will slow and that will reflect the reality that not everybody's job is coming back," Macklem said at a midday press conference.

"Some companies aren't going to make it to the other side of this. New companies will form, existing companies will seize new opportunities, but that takes some time and that's going to be a slower, bumpier process that is going to require ongoing support."

The central bank's support against the economic shock caused by the pandemic has been a drop to its policy interest rate to 0.25 per cent, which Macklem says is as low as it will go.

The Bank of Canada has also launched a purchasing program of bonds and government debt to help markets function and make borrowing cheaper for households and businesses. Such purchases, known as quantitative easing, also send a signal that the bank's key rate "is likely to remain low for a long period," he said in his speech.

The bank has a number of other tools it can use to deliver some monetary stimulus beyond the interest rate, Macklem said, including scaling its purchasing programs or providing more direct forward guidance on activities as other central banks have done.

"Going forward, the types of measures we take will depend on the circumstances. Different measures have different effectiveness in different circumstances. And they will be guided by the achievement of our inflation target," he told reporters.

"We'll be flexible, we'll be resolute, we're going to be innovative and we're going to be determined."

For the Bank of Canada, the impact of structurally low interest rates and the scale of the shock are having what Macklem said is "a profound impact" on the inflation-rate target.

The central bank targets an annual inflation rate of two per cent as measured by Statistics Canada's consumer price index.

The basket of goods used to form the index has been shaken by a shift in consumer spending habits during the pandemic. People are spending less on gasoline, which usually receives a heavier weight in calculating inflation, as its price has plunged and the frequency of car travel has dropped. Spending is also down on travel, while grocery spending is up.

Last week, Statistics Canada reported the annual pace of inflation was -0.4 per cent in May, marking the second consecutive month for negative annual inflation after a reading of -0.2 per cent in April.

In his speech, Macklem said the bank expects supply to be restored faster than demand, which could put downward pressure on inflation. BMO's Benjamin Reitzes wrote in a note that Macklem's message suggests bank policy remaining easy for some time.

Next month, the Bank of Canada will provide "a central planning scenario" for the economy and inflation to help guide bank policy, as well as related risks — such as local, but not national, lockdowns.

"The central scenario would embody the reality that there probably will be some more local flair-ups," Macklem said.

"Hopefully, with each flair-up we get better at targeting it, isolating it, and closing it down faster than the one before."

This report by The Canadian Press was first published June 22, 2020.

Jordan Press, The Canadian Press

Macklem Sees Long Road Ahead for Canada’s Economic Recovery

Shelly Hagan Bloomberg June 22, 2020



(Bloomberg) -- Canada’s economy will take a long time to fully recover from the Covid-19 lockdowns, requiring the central bank to continue purchases of government bonds to keep interest rates at historical lows indefinitely, according to Tiff Macklem.

In his first public speech as governor, Macklem said Canada’s economy should resume growth in the third quarter as containment measures are lifted. He cautioned, however, that any recovery will be “prolonged and bumpy” and the central bank will be “laser-focused” on supporting the rebound with stimulus.

“It will be a very long period before we start discussions about removing stimulus,” Macklem said in response to questions after his speech, which he gave via video-conference to Canadian Clubs and Cercles canadiens. “It’s not a discussion we’re engaged in right now.”

The economy will get an immediate boost as containment measures are lifted, people are called back to work, and households resume some of their normal activities,” Macklem said. “But it will be important not to assume that these growth rates will continue beyond the reopening phase.”

The Bank of Canada, under Macklem’s predecessor Stephen Poloz, took unprecedented actions to make sure businesses, institutions and consumers had access to credit. The bank cut interest rates by 175 basis points to 0.25% and launched a series of programs to inject hundreds of billions of cash into the economy. That includes its first ever large scale asset purchase program to buy government debt -- known as quantitative easing.

The central bank will continue to buy government bonds until a rebound is “well underway,” Macklem said, adding that policy makers are worried that demand will be slow in recovering, which could put downward pressure on inflation without the stimulus.

Long and Gradual

Macklem’s comments echo those of Deputy Governor Lawrence Schembri, who said last week the second phase of the recovery will be long and gradual because of the lingering uncertainty around the virus. The bank sees the economy rebounding quickly during the first phase after governments allow normal activities to resume. But after that, the growth trajectory may be uneven and slow, since not all industries will be able to operate until a vaccine is created.

“The expected long road back indicates that the Bank will need to provide more stimulus, likely in the form of a more aggressive quantitative easing program,” Royce Mendes, an economist at CIBC World Markets, said in a report to investors.

The Bank of Canada has bought almost C$400 billion ($296 billion) in assets since the crisis began to inject liquidity into financial markets. Macklem highlighted on Monday how the purpose of that cash injection has been changing, with the focus now on keeping interest rates low rather than ensuring markets are functioning properly. That’s meant more of the liquidity is targeted at buying up government debt, rather than short-term money market instruments held by banks.

Macklem reiterated the bank will continue to purchase at least C$5 billion of Canadian government bonds a week to help lower long-term borrowing costs for households and businesses and signal that rates will remain low for a long period.

The bank continues to express concern around the potential for lower inflation. Although businesses are reopening, millions of Canadians remain out of work and spending has dropped. The bank expects supply to be restored faster than demand, which could put downward pressure on prices.

“Our main concern is to avoid a persistent drop in inflation by helping Canadians get back to work,” Macklem said.

Macklem isn’t a fan of negative rates. The governor made sure to highlight in his speech that low rates could lead to distortions in the behavior or financial institutions, while reiterating policy makers will using asset purchases until a recovery is underway. He didn’t specify when he expects that will happen.

Next month, the bank will deliver its July Monetary Policy Report which will contain a central planning scenario for output and inflation. Still, the bank says the pandemic has created a ‘fog of uncertainty’ which has made it difficult to give a clear outlook.

“The course of the coronavirus is the biggest source of uncertainty,” Macklem said. “Beyond that, we don’t know how global trade and supply chains will evolve, or what will happen with domestic supply and demand,” or even how spending habits will change or confidence rebounds.

Yet, the economy is showing signs of stabilization and as the data comes in, the bank feels more comfortable in its ability to answer some of those questions.

(Updates with Macklem’s comments throughout.)

©2020 Bloomberg L.P.