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Canada's economy unexpectedly shrank from April to June this year – CBC News: The National



Kolačiće i podatke koristimo za sljedeće:

  • pružanje i održavanje Googleovih usluga
  • praćenje prekida rada i zaštitu od neželjenog sadržaja, prijevara i zloupotrebe
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Ako odaberete Prihvati sve, kolačiće i podatke koristit ćemo i za sljedeće:

  • razvoj i poboljšanje novih usluga
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  • prikazivanje prilagođenog sadržaja, ovisno o vašim postavkama
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Ako odaberete Odbij sve, nećemo upotrebljavati kolačiće u te dodatne svrhe.


Na neprilagođeni sadržaj i oglase utječu čimbenici kao što su sadržaj koji trenutačno gledate i vaša lokacija (posluživanje oglasa temelji se na općoj lokaciji). Prilagođeni sadržaj i oglasi mogu uključivati i stvari kao što su preporuke videozapisa, prilagođena YouTubeova početna stranica i prilagođeni oglasi na temelju prethodne aktivnosti, primjerice videozapisa koje gledate i sadržaja koje tražite na YouTubeu. Kolačiće i podatke upotrebljavamo i kako bismo prilagodili dobnu primjerenost doživljaja, ako je to relevantno.

Odaberite Više opcija da biste vidjeli dodatne informacije, uključujući pojedinosti o upravljanju postavkama privatnosti. Možete posjetiti i kad god želite.

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Will Canadian Banks Cut Dividends? The Pending Recession + Good Reads From The PF Community



Hi everyone, I just realized that it’s been a while since I put together a good read from the personal finance community post, probably because it takes me a while to put together such articles. Anyway, it’s time to resurrect the good reads articles again.

People have been talking about the pending recession for over a year now. Some people believe that high inflation and high interest rates will trigger the global economy to slow down. Somehow, both the US and Canadian economy remain resilient so far in 2023.

As a reminder, some factors that can trigger a recession include:

  • high inflation
  • increasing interest rates
  • reduced consumer confidence
  • higher unemployment rate
  • reduced spending and investment activities

The biggest question is if the economy can continue to grow at a modest rate, instead of shrinking.


Despite the US and Canadian economies remaining quite resilient, we’re seeing some signs that a recession may be coming…

  • Companies are trimming forces – my company included
  • Overall economic outlook softness
  • A slowdown in consumer spending… many retailers have reported this in their earnings
  • A higher percentage of household income is going toward paying off debt

For people that are still in the accumulation phase, a recession may not necessarily be a bad thing – it will create buying opportunities; for people that are retired or close to retirement, a recession can be more problematic. This is why increasing your cash reserve, reducing equities exposure, and increasing bond exposure are recommended if you are retired or close to retirement.

Many dividend investors are curious whether or not Canadian banks will cut dividends. The Canadian banks have not been performing all that well the past year due to concerns over the Canadian real estate market and mortgages.

Canadian Big Five banks performance

In preparation for a potential economic slowdown, Canadian banks have been boosting provisions for bad loans. This is exactly what the Canadian banks did during the early days of the COVID-19 pandemic.

If a recession does happen and people default on their mortgages, will the Canadian banks cut dividends?

Difficult to say.

My view? Canadian Big Five banks didn’t cut dividends during the financial crisis, they also didn’t cut dividends during the COVID-19 pandemic. Chances are, they will hold off on any dividend increases until the dust settles.

I believe the Canadian banks won’t cut dividends. Instead, I believe they’ll simply hold the payout steady.

But my prediction can only be 50% correct at best. I can be completely wrong!

So, what can dividend investors do? First, don’t put all your eggs in one basket. Make sure you are not over-exposed to Canadian banks. Diversification is important.

Since the Canadian economy is heavily tied to the financial and oil & gas sectors, it’s important to invest in other sectors like consumer staples, high tech, and consumer discretionary. Investing outside of Canada, therefore, is extremely important.

Good reads from the PF community

Here are some fantastic personal finance/investing related articles that I came across recently.

Mark at My Own Advisor wondered, Should you have 100% of your portfolio in stocks? – “DIY investors, readers and passionate investors know from my site that there is no universal answer for every investor, so it’s important to think through both the upsides and downsides when it comes to your investing plan… While a 100% equity investment portfolio could make sense for younger investors, decades away from retirement, keeping 100% of your portfolio in stocks as you enter retirement or remain in retirement could introduce unnecessary risk.

Joseph Carlson discussed things that you need to do before you sell a stock

GYM recently turned 40 and shared 40 Financial Lessons She has learned in 40 years – “Time IN the market is better than timing the markets. Stay invested, stick to your plan. This Visual Capitalist chart illustrates the pitfalls of timing the market. If your money wasn’t invested in the 10 best days of the market, you could lose more than half of your overall return on investment. From 2003 to 2022, $10,000 invested in the S&P500 would yield almost $65,000 but if you missed the 10 best days (which were mostly in 2008 and 2009), you would miss out on more than half of your investment returns than if you kept your money invested.” Congrats GYM on turning 40, you certainly shared similar 40 lessons that I’ve learned.

Risk and Reward of Timing the Market

Mike at The Dividend Guy Blog came up with an interesting Retirement Withdrawal Strategy to avoid panic and enjoy life – “It’s no secret that utilities, REITs, and communications companies, especially telcos, are generous dividend providers. Utilities and telcos are usually mature businesses with stable streams of income, making wealth distribution logical. REITs are obligated to distribute most of their income. Add a few Canadian banks in the mix, you’d already have enough sectors to invest easily 60% of your portfolio, while complying with the “don’t exceed 20% in one sector” rule.

I really like the 17 Questions That Changed My Life from Tim Ferris – “The question I found most helpful was, “If I could only work two hours per week on my business, what would I do?” Honestly speaking, it was more like, “Yes, I know it’s impossible, but if I had a gun to my head or contracted some horrible disease, and I had to limit work to two hours per week, what would I do to keep things afloat?

I thoroughly enjoyed The paradox of the “perfect life” from Rad Reads – “Consider this thought experiment. You and I both aspire to lead rich and fulfilling lives. Good lives. Some might even say perfect lives. Let’s imagine that you worked assiduously to get that perfect life. You have the perfect job. Impactful, high-paying and the ability to be hybrid. You had the perfect home. Massive square footage, impeccably furnished and immaculately clean. You had the perfect spouse. Smart, sexy and a wonderful co-parent. You had the perfect body. Low BMI, 6-pack abs and a full head of hair. Things are perfect. Or are they? Just like the guy with $70 million who’s scared that he’ll have to fend off gold diggers – have you created a new set of worries?

With GIC rate at 5% or higher, is it a good idea to “invest” in GICs? Ben Felix explained why cash is a terrible long-term investment

Katie at Money With Katie explained How to avoid lifestyle creep, don’t live beyond your assets – “It wasn’t until I found myself in a peculiar economic position that a more helpful version of this rule emerged for me: Don’t live beyond your assets.Once I found myself graduating from a median income to a higher one, I straddled the line between two worlds: Do I maintain my exact same lifestyle and invest everything extra, or do I recognize that I can afford a little lifestyle creep?The hard part? There’s no rule of thumb for how to handle such a situation. I felt silly skimping on brand name orange juice, but I was also terrified of backsliding into the old, spend-y habits that used to drain my checking account every month.Just because I was making more money didn’t mean I was wealthy, and I struggled to find balance.


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Autoworkers can still expand their strike against carmakers



Even after escalating its strike against Detroit automakers on Friday, the United Auto Workers union still has plenty of leverage in its effort to force the companies to agree to significant increases in pay and benefits.

Only about 12 per cent of the union’s membership is so far taking part in the walkout. The UAW could, if it chose to, vastly expand the number of workers who could strike assembly plants and parts facilities of General Motors, Ford and Stellantis, the owner of the Jeep and Ram brands.

Yet the UAW’s emerging strategy also carries potentially significant risks for the union. By expanding its strike from three large auto assembly plants to all 38 parts distribution centres of GM and Ford, the UAW risks angering people who might be unable to have their vehicles repaired at service centres that lack parts.

The union’s thinking appears to be that by striking both vehicle production and parts facilities, it will force the automakers to negotiate a relatively quick end to the strike, now in its second week. To do so, though, some analysts say the union might have to act even more aggressively.


“We believe the next step for UAW is the more nuclear option — going for a much more widespread strike on the core plants in and around Detroit,” said Daniel Ives, an analyst with Wedbush Securities. “That would be a torpedo.”

Sam Abuelsamid, an analyst at the consulting firm Guidehouse Insights, suggested that with so many workers and factories still running, the union has a number of options with which to squeeze the companies harder.

“They could add more assembly plants to the list,” Abuelsamid said. “They could target more of the plants that are building the most profitable vehicles.”

As examples, he mentioned a plant in Flint, Mich., where GM builds heavy-duty pickups, and a Stellantis factory in Sterling Heights, Mich., that produces Ram trucks.

All three companies said that talks with the union continued on Saturday, though officials said they expected no major announcements.

In Canada on Saturday, Ford workers began voting on a tentative agreement that their union said would increase base pay by 15 per cent over three years and provide cost-of-living increases and $10,000 ratification bonuses. The tentative deal was forged earlier this week, hours before a strike deadline.

The union, Unifor, said the deal, which covers 5,600 workers, also includes better retirement benefits. If the deal is ratified in voting that will end Sunday morning, the union will use it as a pattern for new contracts at GM and Stellantis plants in Canada.

In the United States, the UAW began its walkout more than a week ago by striking three assembly plants — one each at GM, Ford and Stellantis. In expanding the strike on Friday, the UAW struck only the parts-distribution centres of GM and Stellantis. Ford was spared from the latest walkouts because of progress that company has made in negotiations with the union, said UAW president Shawn Fain.

Striking the parts centres is designed to turn up pressure on the companies by hurting dealers who service vehicles made by GM and Stellantis, the successor to Fiat Chrysler. Service shops are a profit centre for dealers, so the strategy could prove effective. Millions of motorists depend on those shops to maintain and repair their cars and trucks.

“It severely hits the dealerships, and it hurts the customers who purchased those very expensive vehicles in good faith,” said Art Wheaton, a labour expert at Cornell University. “You just told all your customers, ‘Hey we can’t fix those $50,000 to $70,000 cars we just sold you because we can’t get you the parts.'”

The more combative union has declined to discuss its strike strategy publicly. Fain has said repeatedly that a critical part of its plan is to keep the companies guessing about the UAW’s next move. Indeed, the union has shown unusual discipline in sticking to its talking points.

On a picket line Friday, Fain was asked whether striking against the spare-parts centres would hurt — and potentially alienate — consumers.

“What has hurt the consumers in the long run is the fact the companies have raised prices on vehicles 35% in the last four years,” he shot back. “It’s not because of our wages. Our wages went up 6%, the CEO pay went up 40%. ”

Selling parts and performing service is highly profitable for car dealers. AutoNation reported a gross profit margin of 46% from service shops at its dealerships last year. The problem for the companies is that dealerships and other repair shops typically have lean inventories and depend on receiving parts quickly from the manufacturers’ warehouses.

Mike Stanton, president of the National Automobile Dealers Association, said his members want to avoid anything that would impair customer service, “so we certainly hope automakers and the UAW can reach an agreement quickly and amicably.”

To make up for the loss of striking workers, the automakers are weighing their options, including staffing the parts warehouses with salaried workers.

“We have contingency plans for various scenarios and are prepared to do what is best for our business and customers,” said David Barnas, a GM spokesman. “We are evaluating if and when to enact those plans.”

Similarly, Jodi Tinson, a Stellantis spokeswoman, said, “We have a contingency plan in place to ensure we are fulfilling our commitments to our dealers and our customers.” She declined to provide additional details.

In negotiating with the companies, the union is pointing to the carmakers’ huge recent profits and high CEO pay as it seeks wage increases of about 36 per cent over four years. The companies have offered a little over half that amount.

The companies have said they cannot afford to meet the union’s demands because they need to invest profits in a costly transition from gas-powered cars to electric vehicles. They have dismissed out of hand some of the demands, including 40 hours’ pay for a 32-hour work week.


Associated Press writer Alexandra Olson in New York contributed to this report.


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Canadian Ford autoworkers ratify Unifor deal with 54% approval



A transport truck turns into the Ford entrance way.
More than 5,600 Ford employees in Canada are represented by Unifor, most of them working in Ontario at production plants in Oakville and Windsor. (Dax Melmer/CBC News)

Canadian autoworkers have narrowly approved a new three-year contract with automaker Ford, according to Unifor.

The union said that 54 per cent of their members voted in favour of a new deal that sees wage increases, signing bonuses and reactivates a cost-of-living allowance.

Ford, in a statement released on Sunday, called the deal “historic” as it announced the company had agreed to the largest wage increase in the company’s Canadian history.

The automaker has about 5,600 unionized employees in Canada, mainly in Oakville, Ont., and Windsor, Ont.


“I believe when people see and look at it in its entirety, it is such a comprehensive set of improvements for workers,” said Unifor president Lana Payne.

Ford employees last went on strike in 1990 for six days.

This deal will now be used to bargain a contract with either Stellantis or GM. Panye said they will announce which company the union will negotiate with next on Monday.

Deal ratified with 54 per cent approval

Payne said the narrow ratification speaks to workers expectations.

“This is the environment we’re living in and working in. Working people are feeling that they have not been keeping up,” said Payne.

She said that they were clear with Ford the expectations were high and the deal they brought back to workers would need to be the “richest deal ever negotiated in the history of auto negotiations in Canada.”

Unifor talks Ford autowoker contract that nets 54% ratification vote

Unifor’s national president Lana Payne details what she calls a life-changing agreement that was narrowly ratified by Ford autoworkers on Sunday and what she would say to the people who voted against the deal.

“I know that this is an incredible deal and I know that people’s lives will change as a result of what’s here,” said Payne.

She said people who voted against the agreement will notice the changes on their first paycheque.

“We’re going to have to have many conversations with our members going forward,” she said.

What members voted on

The Ford Motor Co. of Canada offered a 10 per cent wage increase in the first year of its tentative agreement with Unifor, followed by increases of two per cent and three per cent for the second and third years, the Canadian union said on Saturday.

The deal also changed the pay grid. Under the negotiated deal, a newly hired production worker will make $29.67 an hour and reach the top of the pay grid in four years rather than eight, earning $42.39 an hour.

The agreement also includes a $10,000 productivity and quality bonus to all permanent employees on the active roll of the company and a $4,000 bonus for temporary employees.

Unifor said the deal also contains an increase in the monthly basic benefit and special allowance in all class codes across defined benefit and hybrid pension plans.

For some senior employees, the wage increases over the life of the contract vary from 19 per cent to 25 per cent, depending on the type of job, according to the details of the contract released by Unifor.

It also includes a cost-of-living allowance and secured expansion and upgrades at the engine plant in Windsor. Unifor also said that Ford reconfirmed its commitments to transform its Oakville operation to an electric vehicle assembly plant expected to start production in 2025.

The contract was reached on Tuesday night after Unifor’s bargaining committee extended the negotiations by 24 hours when Ford sent what union leadership called a “substantive offer.”

UAW strike enters Day 10

Meanwhile, thousands of autoworkers with the United Auto Workers (UAW) union continue strike action in the United States.

There are nearly 13,000 people on strike at three auto plants and 5,600 people on strike at 38 parts distribution centres across the U.S.

The UAW is targeting Chrysler’s parent company Stellantis, Ford and General Motors in their picket action.

Unifor uses a pattern bargaining format in Canada that sees the union negotiate a deal with one automaker to set the standard for the other two.

UAW president Shawn Fain has previously called on the Detroit Three to boost wages by 36 per cent over the life of a four-year deal, a four-day work week, and to end tiered wages inside plants that allows automakers to hire new employees at $15 an hour, well below what more tenured employees make.

Some suppliers stretched to the limit

Fain said on Friday that Ford has improved its offer to the union and said that there are “serious issues” with the Stellantis and GM offers.

U.S. President Joe Biden is expected to attend a picket line on Tuesday in Michigan to support the strike.

The UAW job action at the distribution centres is expected to disrupt dealerships and repair centres in the United States but not in Canada.

However, if pickets continue to stop production at the three auto plants then parts suppliers manufacturing in Canada may idle some of their plants.

‘Tremendous strain’ on automotive parts suppliers as UAW strike continues

Supply chain expert and Gravitas Detroit founder Jan Griffiths tells the CBC’s Chris Ensing some automotive suppliers are in a tough position with ongoing strike action in the United States, a tight labour market, and thin cash reserves. Griffiths, who was a global lead at a tier one supplier for decades, said open communication between suppliers could help companies survive.


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