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Does Canada really need a digital loonie?

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The Bank of Canada is wading into the fraught and controversial world of digital currencies, launching public consultations this week into how Canadians might use a digital dollar.

“We’ve been researching a digital dollar for quite a while now,” said Carolyn Rogers, the senior deputy governor of the central bank. “And we’re at a point where we need help from Canadians, we need to understand what Canadians want.”

And yet, the bank maintains there is neither a need nor plan to launch a digital loonie.

So, why bother with the public consultations at all?

Rogers says more transactions are being done digitally. Only about 20 per cent of retail transactions are done in cash. And, she says, there’s been a surge in interest in various digital currencies.

When most people think of a digital dollar, they first think of cryptocurrencies like bitcoin or Ethereum. What the bank is looking at is not quite crypto, but it’s not quite what we generally think of as cash either.

“The bottom line is a digital dollar [that’s] backed by the Bank of Canada,” Rogers told CBC News.

 

Does Canada really need a digital loonie?

 

The Bank of Canada launched public consultations this week asking Canadians what they think of a central bank digital currency. The central bank’s senior deputy governor Carolyn Rogers sat down with the CBC’s Peter Armstrong to talk about what a digital dollar would actually look like.

Such so-called central bank digital currencies have gained traction around the world. Dozens of central banks are researching or launching public consultations.

In a statement when its public consultations began, the Bank of Canada reiterated that any decision to create a digital currency would be made by politicians not central bankers.

“At this time, a digital Canadian dollar is not needed. And any decision to issue one rests with Parliament and the Government of Canada,” wrote the bank in a statement.

But if Parliament decided it wants a digital currency, the bank would be responsible for issuing one. Rogers says, in that case, policy makers should make sure a safe and reliable currency is made available.

A Canadian flag hangs from a building.
The Bank of Canada says any decision to create a digital currency would be made by politicians, not central bankers. (Sean Kilpatrick/The Canadian Press)

“If Canadians wanted a digital form of currency, and they didn’t have one available from the Bank of Canada, they might start to use some of those private currencies,” like bitcoin. Those currencies sometimes face wild fluctuations, among other complications. 

“So we want to make sure that they have an alternative that is as secure as the cash in their wallet. But digital,” Rogers told CBC News.

But the announcement is being met with a certain level of skepticism.

Some critics say central bank digital currencies are a way for big government to have yet more control over the financial lives of citizens. Others say they simply don’t see a need for a digital currency.

“It seems like this is a solution looking in vain for a problem to solve,” said Karl Schamotta, chief market strategist at the financial payments company Corpay.

His company’s entire business model revolves around finding ways for businesses to pay for purchases in as quick and efficient a manner as possible. And yet, Schamotta doesn’t see a role for a digital loonie.

A man in a suit gestures while speaking, flanked on both sides by Canadian flags.
Conservative Leader Pierre Poilievre has railed against the idea of a central bank-backed digital currency. (Sean Kilpatrick/The Canadian Press)

“In Canada we already have near-instant payments between people within the country. We have a very, very small unbanked population. What benefits would central bank digital currencies offer in terms of reducing payment system frictions?” he asks.

The entire idea has become something of a touchstone for conservative politicians who say they’re worried about government overreach.

Opposition leader Pierre Poilievre has spoken in favour of cryptocurrencies as a way to “opt-out of inflation.”

But he got a roaring ovation when he railed against the very idea of a central bank-backed digital currency at a recent rally in Woodstock, Ont.

“As long as I am prime minister, there will be no digital ID forced on people, no central bank digital currency,” said Poilievre to huge cheers.

In Florida this week, Republican Gov. Ron DeSantis announced legislation that would ban the use of any central bank digital currency as money, saying efforts in that direction by the White House are “about surveillance and control.”

“Today’s announcement will protect Florida consumers and businesses from the reckless adoption of a ‘centralized digital dollar’ which will stifle innovation and promote government-sanctioned surveillance,” DeSantis said in a statement.

The Bank of Canada says it’s simply trying to make sure the financial system works in a way that helps Canadians. Rogers says if some future government eventually decided to push ahead with the idea, it’s not like cash would suddenly disappear.

“It’s an alternative to the cash in my wallet,” said Rogers. “I can still have the cash in my wallet, we have no plan to get rid of cash. So this isn’t an exercise in replacing anything.”

But in terms of making financial transactions easier or less costly, Schamotta says the central bank is looking in the wrong direction. He says domestic payments, for the most part, work fine.

If there is a problem, he says, it lies with international payments.

He gives the example of someone in Canada trying to send money home to, say, the Philippines.

Each transaction “goes through a whole lot of hoops and steps and intermediaries, as it moves,” he said.

He says those costs add up and make a material dent in global GDP.

“The share of money being subtracted through the banking system as it moves across borders is horrible and the poorest people in the world pay a huge burden for doing this.”

Schamotta says he wishes more policy makers were looking at ways of reducing friction in those kinds of payments instead of seeking out a role for a digital loonie at home.

The Bank of Canada’s public consultation on a digital currency opened this week. It runs until June 19.

 

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On and off the soccer pitch, Eustaquio brothers deal with emotional roller-coaster

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A lot has happened to Mauro Eustaquio in recent months, bringing both grief and joy.

The York United FC assistant coach took temporary charge of the CPL club in late May before reverting to his regular role when Mexican Benjamin Mora was handed the reins. And this month he is serving as a guest coach with Jesse Marsch’s Canada during the current international window, reuniting him with younger brother and star midfielder Stephen Eustaquio.

But it is what has happened off the soccer pitch that has rocked the Eustaquio brothers’ world.

Their mother Esmeralda died of brain cancer in April 2023. Father Armando died unexpectedly of a heart attack in May this year, just days before Mauro was named interim York coach.

But the birth of Stephen’s daughter, Benedita, in early April has given the brothers something to celebrate amid the pain of family loss.

“We count our blessings,” said Mauro.

“Me and my brother, we had our days but we had two options — either we bounce back or we continue to kind of be miserable and hating our life,” he added. “We actually sat down about it and said ‘Look, we’ve had two or three days. It hurts. It’s going to continue to hurt. But now we have to make a decision to crack on.’

“So we’ve cracked on. We have great support in our partners. And obviously now with the little one around, there’s a lot to be thankful for, there’s a lot to be happy for. And that’s kind of how we live our life.”

Mauro, 31, is thankful for everything his folks did for them.

“Our parents … they gave us wings. So now it’s up to us to fly.”

“They’re together. They’re in a good place,” he added. “And now it’s up to us to continue their kind of legacy and what they taught us, how to be a good human being and fight for our dreams. We’re thankful for both of us to be doing something that we absolutely love.”

Born in Portugal, Mauro was two when his parents moved to Canada in search of a better life. Stephen was born two years later.

Leamington, Ont., had a sizable Portuguese community with the dads gathering on weekends to watch their teams from back home while the kids played soccer nearby.

“That’s where it all started,” said Mauro.

“It was always in our blood,” he added. “We were a very Portuguese family living in Canada and my dad was very big on maintaining our roots.”

Their mother, whose parents had spent time living in both the U.S. and Canada, made sure the boys also had a Canadian side, learning English and adapting to their new surroundings.

Their father was a fisherman, working on nearby Lake Erie, while their mother worked at a fish factory. In Portugal, the family had called the coastal town of Nazare home.

Family was king in the Eustaquio household, especially in a new country. The brothers were — and still are — very close.

“There was no Mauro going to the park without Stephen,” said Mauro, who attended both the 2022 World Cup in Qatar and Copa America this summer (briefly) to support his brother.

They remain close, talking every day. They often watch games together virtually, despite being an ocean apart.

After some 10 years in Canada, the family returned to Portugal to be back with friends and family. The boys played for their local club with Mauro being called up by a regional team at age 14.

At 16, he was invited to join União de Leiria, a bigger club once coached by Jose Mourinho. His parents said no for two years because of the lengthy commute.

The family eventually relented, as long as the team took both brothers.

Mauro, a defensive midfielder, spent three years there and drew the attention of both the Portugal under-20 team and Canada Soccer (Leiria coach José Dominguez, a former Portugal international, had ties to the Canadian coaching staff).

Nick Dasovic and Phillip Dos Santos subsequently called him up to a Canada under-20 camp in Mexico.

“At the end of the day, the way I looked at it was my first kicks with a soccer ball were in Canada,” Mauro said. “I grew up in Leamington, Ontario, so I felt like I owed something to Canada.”

After a stint with Portugal’s Sporting Pombal, Mauro joined the Ottawa Fury in 2014 under coach Marc Dos Santos, Phillip’s brother. He spent three years there, learning his craft on and off the field.

Mauro went on to play for FC Edmonton in the NASL and Penn FC, a USL team based inHarrisburg, Pa., where he tore his anterior cruciate ligament playing. After rehabbing in Portugal, he had a short stint in Ireland in Derry City only to be sidelined by a calf injury.

Derry City lost interest but Calgary’s Cavalry FC invited him to be part of the CPL’s inaugural 2019 season. Two weeks before the playoffs, he tore the ACL in his other knee on the last play of a training session.

He returned to Portugal for his rehab, electing to join third-division Caldas SC.

He started taking his coaching badges and, transitioning to coaching, came back to Canada to oversee the boys program for the Calgary Foothills.

Martin Nash, whom he worked with in Ottawa and Calgary, brought him to York in early 2022 as an assistant coach. Ironically it was Nash’s firing that led to Mauro’s promotion to interim head coach.

The two remain close.

Mauro and his fiancée Lana are scheduled to get married next spring. It was to have been later this year but the date was pushed back after the death of his father.

Follow @NeilMDavidson on X platform, formerly known as Twitter

This report by The Canadian Press was first published Sept. 4, 2024



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Alexis Galarneau replaces injured Milos Raonic on Canada’s Davis Cup roster

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TORONTO – Alexis Galarneau will replace Milos Raonic on the Canadian team at next week’s Davis Cup group stage in Manchester, England.

Tennis Canada says Raonic is unable to play due to a broken toe.

Galarneau, the world No. 220 from Laval, Que., joins a lineup that includes Montreal’s Felix Auger-Aliassime, Denis Shapovalov of Richmond Hill, Ont., Montreal’s Gabriel Diallo and Vasek Pospisil of Vernon, B.C.

Galarneau made his Davis Cup debut in 2022 and won two singles and two doubles rubbers last year as Canada secured a spot in the Final 8.

Canada will open Group D play in Manchester against Argentina on Tuesday. Canada will play Finland on Sept. 12 and host Great Britain on Sept. 15.

Canada won its lone Davis Cup title in 2022.

This report by The Canadian Press was first published Sept. 4, 2024.

The Canadian Press. All rights reserved.



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Salesman charged in luxury vehicle and identity theft fraud: Hamilton police

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Hamilton police have arrested a car salesman as part of an investigation into an alleged fraud where luxury vehicles were bought under stolen identities and then re-registered or exported overseas.

A 44-year-old man from London, Ont., faces several charges, including 14 counts each of fraud over $5,000 and obtaining credit by fraud.

Police allege the sales representative used his position at a local dealership to fraudulently acquire 14 high-end vehicles between November 2023 and March 2024.

They say the purchases were allegedly financed by loans taken out under stolen identifies without the victims’ knowledge, in a scheme that left the dealership and financial institutions with $1.5 million in losses.

Police say only one vehicle has been recovered so far and most of them have been exported out of the country or re-registered.

Police say the investigation is still active and more arrests are expected.

This report by The Canadian Press was first published Sept. 4, 2024.

The Canadian Press. All rights reserved.



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