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Canadians too anxious about the future to enjoy the vibrant present, say economists – CBC News

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Even as Canada’s central bank was announcing its biggest rate increase in 20 years, headlines in the U.S. were filled with warnings from the Bank of America about an impending “recession shock.”

Certainly, Bank of Canada governor Tiff Macklem told reporters at Wednesday’s news conference that there is plenty to worry about.

“Russia’s unprovoked invasion of Ukraine is causing enormous human suffering,” said Macklem in an opening address. “The war has also introduced a major new source of uncertainty to the global outlook and it is boosting already high inflation in many countries, including Canada.”

U.S. inflation hit 8.5 per cent this week. The COVID-19 pandemic has led to a simultaneous shortage of supply and unsatisfied demand. Shortages of oil and food from Russia and Ukraine are causing new price distortions.

More expensive loans 

In an effort to crush inflationary expectations and force us to spend less, Macklem has launched what he says will be a series of rate hikes that will make all our loans more expensive.

So is now the time to move to the bush and stock up on food?

While some will want to prepare for the worst case, interviews with people who have studied Canada’s economic history — and also lived through a lot of it — suggest we should take a moment to put things in historical context.

“We’re the richest anybody’s been in the history of the universe,” said professor emeritus Jon Cohen with the hyperbole permitted to an 82-year-old economic historian who says he’s seen it all. “That doesn’t mean we necessarily stay that way, but right now, yeah, it’s the best of times.”

Shortly after Macklem’s rate announcement, Canadian banks said they were raising the cost of borrowing money. (Evan Mitsui/CBC)

Cohen, who has “been teaching at the University of Toronto, like, forever,” has been thinking about why Canadians have been so gloomy lately.

“It’s like we’re climbing a wall of worry at this point,” he said on the phone on Wednesday.

And it’s not just a Canadian phenomenon.

“People’s perception of the economy does seem to be way out of line with how bad things really are,” said Nobel Prize-winning economist and columnist Paul Krugman in a podcast Monday.

‘A media failure’

Krugman said he’d seen polls of people in the U.S. convinced the country was losing jobs. Instead, the North American economy is in a time of record-low unemployment.

The U.S. economist called that “a media failure.” He also said that U.S. self-identified conservatives were the ones most convinced the economy is in terrible shape, “worse than it was in 1980 when we had eight per cent unemployment and 14 per cent inflation.”

WATCH | Record-low unemployment gives workers more options:

Canada’s unemployment rate falls to record low as 70,000 jobs added in March

6 days ago
Duration 1:50

New jobs numbers are pointing toward a robust pandemic recovery for the Canadian economy, which saw more than 70,000 jobs added in March as the unemployment rate hit a record low. Economists say companies are under increasing pressure to offer higher wages to attract talent. 1:50

Bad things are often seen as more newsworthy than happy news. So while affordability and the costs of everyday living — housing, in particular — are soaring, it isn’t the whole story.   

In Canada, the unemployment rate last Friday hit 5.3 per cent. That is the lowest rate on record. And while that number is higher than the U.S. rate of 3.6 per cent, a difference in the way the data is collected means those numbers are closer than they appear.

And that low rate of unemployment makes a real difference to those who face challenges getting into the job market, said Tim Lang, president and CEO of Ontario’s Youth Employment Services, a provincially funded group that trains and finds jobs for people between the ages of 15 and 29. 

Work for all who want it

At the height of the pandemic entry-level jobs plunged, Lang said, sending youth unemployment rocketing to 30 per cent. But not any more.

“You could almost say anyone who wants to work can work,” Lang said. That includes what Lang describes “at-risk youth,” people with mental illness or other challenges that, in the past, may have affected their job prospects. The current shortage of workers is showing employers what great employees they can be.

Lang said that for any young person, but especially for those at-risk, getting on the employment ladder is “life changing” in a way that not only helps them but helps their families and the entire economy long into the future.
Workers in personal protective equipment unload groceries from a truck before distributing them to local residents under the COVID-19 lockdown in Shanghai, China, last week. The effects of the pandemic are not over and may still affect the Canadian economy. (Chinatopix/The Associated Press)

Macklem made it very clear that a few rate hikes will by no means strangle the booming job market or the wider economy, as the bank predicts a growth rate of 4.5 per cent this year and 3.5 per cent next — both of which are very healthy rates for a mature developed economy.

The governor and his senior deputy, Carolyn Rogers, cited other economic indicators that are a reason for confidence. Many people have money to spend.

Businesses say they are planning new investment. Exports are good. The reopening of the economy is moving consumer spending away from consumer goods that are in short supply and back toward services. Interest rates, while higher, remain “accommodative” — in other words, borrowing at the new rate is still an exceptionally good deal. 

Not only that, but while the world suffers from a shortage of oil and gas, potash and wheat due to the war in Ukraine, Canada has plenty of all those things to use or to produce and sell. And unlike in previous times of rising resource prices, the loonie is not rising this time — something that in the past has made Canadian non-resource goods harder to export.

Strong fundamentals

Ian Keay, who teaches economic history at Queen’s University in Kingston, Ont., calls himself an empiricist: “I collect data — I’m not a social historian or anything like that.” 

And what Keay sees right now in the Canadian economy is encouraging. 

“The fundamentals are really strong, right? Productivity is pretty good. Resources prices are strong,” said Keay in an interview this week. He said indicators show the structure of the economy is flexible with lots of innovation.

“It’s a pretty positive view, but that doesn’t mean people aren’t scared, that there’s not uncertainty about moving forward.”

From his many years of watching economic ups and downs, Cohen agrees. Battered by bad news, he said it’s not unreasonable to worry that things like the war in Europe or the pandemic could cause more economic trouble. But he said his own long historical view allows him to worry less.

“Things slow a little bit, and then we get going again,” said Cohen.

It may not be as exciting a story as doom and gloom, but barring an unexpected catastrophe, he said, Canadians have every reason to foresee a bright future.

“We’re again in a period of very rapid technological change and innovation, which makes us more productive and actually richer,” said Cohen. “That’s a big deal and that’s one good reason to be optimistic.”

Follow Don on Twitter @don_pittis

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STD epidemic slows as new syphilis and gonorrhea cases fall in US

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NEW YORK (AP) — The U.S. syphilis epidemic slowed dramatically last year, gonorrhea cases fell and chlamydia cases remained below prepandemic levels, according to federal data released Tuesday.

The numbers represented some good news about sexually transmitted diseases, which experienced some alarming increases in past years due to declining condom use, inadequate sex education, and reduced testing and treatment when the COVID-19 pandemic hit.

Last year, cases of the most infectious stages of syphilis fell 10% from the year before — the first substantial decline in more than two decades. Gonorrhea cases dropped 7%, marking a second straight year of decline and bringing the number below what it was in 2019.

“I’m encouraged, and it’s been a long time since I felt that way” about the nation’s epidemic of sexually transmitted infections, said the CDC’s Dr. Jonathan Mermin. “Something is working.”

More than 2.4 million cases of syphilis, gonorrhea and chlamydia were diagnosed and reported last year — 1.6 million cases of chlamydia, 600,000 of gonorrhea, and more than 209,000 of syphilis.

Syphilis is a particular concern. For centuries, it was a common but feared infection that could deform the body and end in death. New cases plummeted in the U.S. starting in the 1940s when infection-fighting antibiotics became widely available, and they trended down for a half century after that. By 2002, however, cases began rising again, with men who have sex with other men being disproportionately affected.

The new report found cases of syphilis in their early, most infectious stages dropped 13% among gay and bisexual men. It was the first such drop since the agency began reporting data for that group in the mid-2000s.

However, there was a 12% increase in the rate of cases of unknown- or later-stage syphilis — a reflection of people infected years ago.

Cases of syphilis in newborns, passed on from infected mothers, also rose. There were nearly 4,000 cases, including 279 stillbirths and infant deaths.

“This means pregnant women are not being tested often enough,” said Dr. Jeffrey Klausner, a professor of medicine at the University of Southern California.

What caused some of the STD trends to improve? Several experts say one contributor is the growing use of an antibiotic as a “morning-after pill.” Studies have shown that taking doxycycline within 72 hours of unprotected sex cuts the risk of developing syphilis, gonorrhea and chlamydia.

In June, the CDC started recommending doxycycline as a morning-after pill, specifically for gay and bisexual men and transgender women who recently had an STD diagnosis. But health departments and organizations in some cities had been giving the pills to people for a couple years.

Some experts believe that the 2022 mpox outbreak — which mainly hit gay and bisexual men — may have had a lingering effect on sexual behavior in 2023, or at least on people’s willingness to get tested when strange sores appeared.

Another factor may have been an increase in the number of health workers testing people for infections, doing contact tracing and connecting people to treatment. Congress gave $1.2 billion to expand the workforce over five years, including $600 million to states, cities and territories that get STD prevention funding from CDC.

Last year had the “most activity with that funding throughout the U.S.,” said David Harvey, executive director of the National Coalition of STD Directors.

However, Congress ended the funds early as a part of last year’s debt ceiling deal, cutting off $400 million. Some people already have lost their jobs, said a spokeswoman for Harvey’s organization.

Still, Harvey said he had reasons for optimism, including the growing use of doxycycline and a push for at-home STD test kits.

Also, there are reasons to think the next presidential administration could get behind STD prevention. In 2019, then-President Donald Trump announced a campaign to “eliminate” the U.S. HIV epidemic by 2030. (Federal health officials later clarified that the actual goal was a huge reduction in new infections — fewer than 3,000 a year.)

There were nearly 32,000 new HIV infections in 2022, the CDC estimates. But a boost in public health funding for HIV could also also help bring down other sexually transmitted infections, experts said.

“When the government puts in resources, puts in money, we see declines in STDs,” Klausner said.

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The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Science and Educational Media Group. The AP is solely responsible for all content.

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World’s largest active volcano Mauna Loa showed telltale warning signs before erupting in 2022

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WASHINGTON (AP) — Scientists can’t know precisely when a volcano is about to erupt, but they can sometimes pick up telltale signs.

That happened two years ago with the world’s largest active volcano. About two months before Mauna Loa spewed rivers of glowing orange molten lava, geologists detected small earthquakes nearby and other signs, and they warned residents on Hawaii‘s Big Island.

Now a study of the volcano’s lava confirms their timeline for when the molten rock below was on the move.

“Volcanoes are tricky because we don’t get to watch directly what’s happening inside – we have to look for other signs,” said Erik Klemetti Gonzalez, a volcano expert at Denison University, who was not involved in the study.

Upswelling ground and increased earthquake activity near the volcano resulted from magma rising from lower levels of Earth’s crust to fill chambers beneath the volcano, said Kendra Lynn, a research geologist at the Hawaiian Volcano Observatory and co-author of a new study in Nature Communications.

When pressure was high enough, the magma broke through brittle surface rock and became lava – and the eruption began in late November 2022. Later, researchers collected samples of volcanic rock for analysis.

The chemical makeup of certain crystals within the lava indicated that around 70 days before the eruption, large quantities of molten rock had moved from around 1.9 miles (3 kilometers) to 3 miles (5 kilometers) under the summit to a mile (2 kilometers) or less beneath, the study found. This matched the timeline the geologists had observed with other signs.

The last time Mauna Loa erupted was in 1984. Most of the U.S. volcanoes that scientists consider to be active are found in Hawaii, Alaska and the West Coast.

Worldwide, around 585 volcanoes are considered active.

Scientists can’t predict eruptions, but they can make a “forecast,” said Ben Andrews, who heads the global volcano program at the Smithsonian Institution and who was not involved in the study.

Andrews compared volcano forecasts to weather forecasts – informed “probabilities” that an event will occur. And better data about the past behavior of specific volcanos can help researchers finetune forecasts of future activity, experts say.

(asterisk)We can look for similar patterns in the future and expect that there’s a higher probability of conditions for an eruption happening,” said Klemetti Gonzalez.

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The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Science and Educational Media Group. The AP is solely responsible for all content.

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Waymo’s robotaxis now open to anyone who wants a driverless ride in Los Angeles

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Waymo on Tuesday opened its robotaxi service to anyone who wants a ride around Los Angeles, marking another milestone in the evolution of self-driving car technology since the company began as a secret project at Google 15 years ago.

The expansion comes eight months after Waymo began offering rides in Los Angeles to a limited group of passengers chosen from a waiting list that had ballooned to more than 300,000 people. Now, anyone with the Waymo One smartphone app will be able to request a ride around an 80-square-mile (129-square-kilometer) territory spanning the second largest U.S. city.

After Waymo received approval from California regulators to charge for rides 15 months ago, the company initially chose to launch its operations in San Francisco before offering a limited service in Los Angeles.

Before deciding to compete against conventional ride-hailing pioneers Uber and Lyft in California, Waymo unleashed its robotaxis in Phoenix in 2020 and has been steadily extending the reach of its service in that Arizona city ever since.

Driverless rides are proving to be more than just a novelty. Waymo says it now transports more than 50,000 weekly passengers in its robotaxis, a volume of business numbers that helped the company recently raise $5.6 billion from its corporate parent Alphabet and a list of other investors that included venture capital firm Andreesen Horowitz and financial management firm T. Rowe Price.

“Our service has matured quickly and our riders are embracing the many benefits of fully autonomous driving,” Waymo co-CEO Tekedra Mawakana said in a blog post.

Despite its inroads, Waymo is still believed to be losing money. Although Alphabet doesn’t disclose Waymo’s financial results, the robotaxi is a major part of an “Other Bets” division that had suffered an operating loss of $3.3 billion through the first nine months of this year, down from a setback of $4.2 billion at the same time last year.

But Waymo has come a long way since Google began working on self-driving cars in 2009 as part of project “Chauffeur.” Since its 2016 spinoff from Google, Waymo has established itself as the clear leader in a robotaxi industry that’s getting more congested.

Electric auto pioneer Tesla is aiming to launch a rival “Cybercab” service by 2026, although its CEO Elon Musk said he hopes the company can get the required regulatory clearances to operate in Texas and California by next year.

Tesla’s projected timeline for competing against Waymo has been met with skepticism because Musk has made unfulfilled promises about the company’s self-driving car technology for nearly a decade.

Meanwhile, Waymo’s robotaxis have driven more than 20 million fully autonomous miles and provided more than 2 million rides to passengers without encountering a serious accident that resulted in its operations being sidelined.

That safety record is a stark contrast to one of its early rivals, Cruise, a robotaxi service owned by General Motors. Cruise’s California license was suspended last year after one of its driverless cars in San Francisco dragged a jaywalking pedestrian who had been struck by a different car driven by a human.

Cruise is now trying to rebound by joining forces with Uber to make some of its services available next year in U.S. cities that still haven’t been announced. But Waymo also has forged a similar alliance with Uber to dispatch its robotaxi in Atlanta and Austin, Texas next year.

Another robotaxi service, Amazon’s Zoox, is hoping to begin offering driverless rides to the general public in Las Vegas at some point next year before also launching in San Francisco.

The Canadian Press. All rights reserved.

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