FRIENDS AND ENEMIES
Happy Easter, first of all – whether you’re a religious person or not, it feels good to see some physical and spiritual signs of life out there after another Canadian Winter – though, I must say, the Winter does go by just a little bit faster when you spend your days bundled up in your sound money blanket and sipping the tears of your haters.
Second, a bunch of fun/interesting/outright whack stories came my way this week, as I’m sure was the case for many of you. Let’s review a few of them, shall we?
CCPA Says We Should Pay Another Income Tax
Of course they do – the answer is always more taxes, never a better handle on spending. The proposal from The Canadian Centre for Policy Alternatives suggests that the answer to pressures being felt by cities is to allow access to a fine-toothed tool that pulls a small additional income tax from certain brackets of income. The CCPA mentions COVID and “greater demand for improved and accessible services” but doesn’t mention two items we know are at the core of the increased expenditures – the administrative state, and limitless immigration in major cities.
If we look, as the proposal does, at Toronto as an example of how well the tax could work, we would likely paint a different picture with the evidence provided. While it is true that Toronto spends more than seven provinces and territories, a spending problem does not a tax-receipt problem make. As we’ve noted on the show, Chow’s Toronto has been an orgy of excess: $13 million to rename Dundas Street, no “none” option during a survey for which city department needs the largest budget increase, full support to the tune of $67 million for Scarborough’s bus-lane project (replacing an LRT, you can’t make this stuff up), and the list goes on. What we don’t see anywhere – from Chow, from other major cities, or from the proposal, is a significant reduction in the administrative costs in these cities.
In Toronto alone:
- Each councillor has a staffing budget of $534,714.08
- The Mayor’s Office has an operating budget of $3,054,875.67
- The 2024 operating Budget for City Council is $25.789 million gross.
- Each councillor makes approximately $142k per year.
On the surface, none of this is particularly damning – the city is huge, and growing in all the wrong ways, but when one considers that nearly all tax-funded services in Toronto have become worse, less accessible, and more expensive over the past few years, some sirens should start to sound – but they won’t be ambulance sirens, I’ll tell you that much.
I won’t add more to this topic, but you should read the report – it’s a poor suggestion that won’t solve any of the issues we’re facing, but will make you less wealthy, angrier, and force tax dollars out of the jurisdiction more quickly.
Bank of Canada Sounds Productivity Alarm
Senior Deputy Governor of The Bank of Canada, Carolyn Rogers, wants to alert stakeholders to a problem with Canadian productivity, and did so during a recent speech in Halifax.
Rogers said the quiet part out loud a few times, even if indirectly, noting that we aren’t sufficiently integrating high-skill immigrants into our workforce, though – as evidenced by the thousands of tik-tok videos, dog-shit diplomas being pumped out by formerly reputable colleges like Conestoga, and the current state of LMIA – there is a case to be made that we simply aren’t accepting skilled labour, and are instead bringing in low wage, low skill labour to suppress wages in certain job markets (which is clearly demonstrable in GDP/capita data).
Weak productivity is really inexcusable, given our vast wealth of natural resources, incredible geographic location next to the largest economy on earth, and political/societal stability among the world’s best – at least for the moment. We deserve better, and making changes on the fringes of certain policies simply won’t do the trick. We’re due for a large, sweeping review of core Canadian policy positions – both social and economic – and we’ll likely get exactly that whether by choice or by force in the next decade or so.
Bitcoin 13F Reporting Begins Next Week
As one of my favourite Twitter accounts @Macroscope17 points out, beginning next week (this week, by the time you’re reading) institutional wealth managers with more than $100 million USD under management will begin filing their 13F disclosures with the SEC. This is significant because for the moment, thanks to sites like Coinglass and others, we can see flows going into the ETF products but don’t have a clear picture of who is buying in terms of size of AUM, public significance, or other characteristics that may move the needle on price.
13F forms can be filed as late as 45 days after the end of a fiscal quarter, so we might not get the flood of data we’re after this week, or next, but in time we’ll have a very clear picture of who holds the ETF products, how much they hold and, potentially, for which clients.
Hard for me to believe that there remain a number of Bitcoiners who think the ETF is a net negative on the space – to me this is just so wrong and demonstrably so at this point that there must be an ideological lasso keeping these folks from seeing the other side of the argument. They aren’t self-custody Bitcoin, this is true, but as I’ve mentioned before they allow us to hit marginal buyers who would never buy Bitcoin in an ETF of spot. Consider that as other ETFs add Bitcoin exposure at low levels, the price pressure we benefit from would never have come through other avenues. This can’t be understated.
Canadian MPs Get Huge April 1 Pay Increase – Become 2nd Highest Paid in the World
You can’t make this up, pals. On the same day that the crippling, net negative on Canadian families Carbon Tax (sorry, Carbon Rebate!) increases by a whopping 21% or so, while the country flounders both in terms of domestic policy and international influence/success, and while our governing our MPs will become among the highest paid public servants in the world – receiving of up to $17,000 this year. Senior officials have it even better (speaker, opposition leader, cabinet minister, etc) will snipe an exta $96,800 plus vehicle allowances this year. Consider that the Canadian government has expanded the public service at an unsustainable rate since 2016, but really turned up the expansion in 2020, and that the country is more than $1tn dollars in debt, all while the number of Tik-Tok, Reel and Snapchat videos from Canadians discussing their inability to make ends meet his all-time highs. Make of this what you will but I want to add one note – I haven’t seen Poilievre oppose this raise the same way he opposes the carbon tax. He’s about getting the bag as much as anyone else.
See you Monday night,
Joey