Will consumers flock to a huge new mall in Calgary, like they have to this mall in Toronto? (asdsoupdsa / Flickr/Creative Commons)

By Mathew Katz

When it comes to measuring consumer confidence and spending habits, we often look to reports and surveys. But in Calgary, Alberta, economists and retail specialists have a chance to see firsthand if consumer strength will grow or fall as the recession tapers out. Their 'lab' is CrossIron Mills, a massive new 1.1-million-square-foot mall, which is set to expand the city's retail space by 3.5 percent when it opens this week.

The opening is a huge gamble on the part of the developers of the $495-million shopping center, but it might be a great predictor of where the retail economy is heading. Economists and retail experts aren't just analyzing foot traffic and sales numbers at the new mall -- they're also looking at consumer behavior. Are consumers going to avoid the stigma of conspicuous consumption and stay away from expensive new luxury stores, or re-embrace Gucci and Prada with gusto?

So far, things look fairly gloomy -- a number of anchor retailers that were set to open in the new space have either delayed their opening or pulled out altogether. And a nearby mall, the Chinook Centre, just saw July sales fall two percent.

The Loonie vs. the Eagle. (mattkiazyk / Flickr)

By Mathew Katz

The Loonie (that's the nickname for the Canadian dollar) rose to 93.7 U.S. cents yesterday, the highest the currency has been in 10 months. Great! Now Canadians can go south of their border (to Buffalo, N.Y.) and buy cheap clothing with their stronger dollar. Sounds like a fantastic deal, eh?

Well, not so much. As much as we Canadians love the bragging rights associated with having a strong dollar, our economy actually does significantly better when our dollar is down. That's why we've been content to have it hover around 60-80 U.S. cents for the better part of the past few decades.

Jim Flaherty, Canada's Finance Minister, took a stand against the rising dollar yesterday, but declined to say what he'd do about it. He said a lot of the rise was false because of currency traders over-speculating about Canada's economic comeback -- but a higher dollar could slow Canada's rise out of the recession.

Confusing? Well, here's how it works:

Continue reading "Loonie's Up, But Canada's Not Happy" >

Celebrations at the Parliament Hill in Ottawa. alex_ferguson/Flickr

 

The recession is officially over. At least, that's what Canada's central bank is saying. About Canada.

In the Bank Of Canada's latest monetary policy report, it said that Canada's gross domestic product will grow at an annual rate of 1.3 percent this quarter, up from an earlier forecast of a 1 percent contraction.

According to the bank, much of the growth is attributed to higher-than-expected Canadian consumer and business confidence. Still, the bank says total recovery will be slow and fragile. The Canadian economy is still far too interlinked with the American one to completely recover until the U.S. does.

Full disclosure: this is how I decorate my desk. Mathew Katz

 

By now, you've probably already heard about the big Canadian news of the week: Tim Hortons, the venerable Canadian coffee-and-donuts-shop, expanded into New York City, opening 12 locations in Manhattan and Brooklyn on Monday. More locations are coming to the city in August.

It may seem like a risky move: gambling an entire franchise's success in the U.S. by suddenly opening up in the country's most high-profile market during a recession when Americans are hesitant to spend, but it might be smart one. We've already written about the slow Canadian takeover of the American economy. Tim Hortons' expansion represents something bigger -- a move by some businesses -- not just Canadian ones -- to take advantage of the recession in a bid against much-larger, well-established competitors.

Continue reading "The Tim Hortons Economy" >

Processing facilities at the Athabasca Oil Sands in Alberta thedarkerside.to/flickr

 

If the American Clean Energy and Security Act passes through the Senate, it could be bad news for the Alberta oil sands.

In Alberta, Canada, there's thought to be more oil buried underground than in the whole of Saudi Arabia. Alberta's oil sands can be processed to yield billions of barrels of oil, and many believe that they could be key to providing North America with energy security and independence -- the sands now are now the top provider of oil to U.S.

But the oil is dirty. Really dirty. And the House version of the climate bill calls for largely increased tariffs on environmentally-unfriendly goods and commodities, which this oil easily falls into. President Obama has warned against this sort of environmental protectionism, but it looks like the Senate may be facing a decision between environmental safety and energy security in the coming weeks.

T. Boone Pickens discusses clean energy with Al Gore in February. Center for American Progress/flickr

 

Oil billionaire and alternative-energy activist T. Boone Pickens was in Canada this week to extol the virtues of natural gas, and pushed for increased natural gas investment and cooperation between the U.S. and Canada:

It's going to be good for America, it's going to be good for Canada, it's going to be good for the producers, it's going to be good for everybody. I can only see that the only loser in this deal is foreign oil. And I don't call you foreign. You don't look foreign.

Continue reading ""You Don't Look Foreign"" >

Canadian mayors would like to see "Buy American" thrown in the trash jayKayEss/flickr

 

On Saturday, an organization of Canada's mayors issued a resolution that would block U.S. bidders from municipal contracts. The resolution will take effect after 120 days unless the U.S. exempts Canada from the "Buy American" clauses in the American economic stimulus package.

Of all the countries that have problems with the "Buy American" limits on foreign suppliers, Canada has the most to lose. About $1.5 billion in goods move across the Canadian/U.S. border a day, and the U.S. buys 76 percent of Canada's exports. Much of that trade consists of three things Canada has a lot of: oil, water and lumber. The trade restrictions left Canadians a bit perplexed.

Canadian Industry Minister Tony Clement met with American politicians last month to warn them of a "Don't Buy American" backlash, but it looks like it's on the way.

"Don't Buy American" D-Day is coming, if this dispute isn't resolved. Mark it on your calendars: Oct. 5, 2009.

The standard currency of the future? dawn m. armfield/flickr

 

With all of the grim news coming out of the American economy, its neighbor to the north isn't doing all that badly. A Canadian company is set to take over GM's European operations. And Canadian banks are swooping in to buy up failing US banks at every opportunity. Martin Hutchinson over at Breaking Views has an interesting take on Canada's role:

Canada's biggest bailout investment to date is General Motors' local arm, not an indigenous company. Its banks are relatively sound; and its recession is shallower, and its budget and payment deficits smaller, than those in the US. With an economy strong in fast-appreciating resources and a fiscally careful government, Canada looks a safer haven than its southern neighbor in times of turmoil.