|
see also
www.Wednesday-Night.com/newsBurma.htm Burma latest news
Wednesday night #808 at the Nicholsons' brought back many pleasant memories. Marc Nicholson was home for a visit, en route to continuing his studies in California after a year in post graduate education in London, England.
Long time devotees of David and Diana's Wednesday night salons remembered Marc as a rather precocious young man whose
words of wisdom belied his youth. When he was last in for a visit, he spoke about Cyprus and the Middle East. On this occasion it was refreshing to meet the young guests and to hear Marc speak of the English economy and the place of the United Kingdom in the
European Community.
A great number of topics was covered by the guests. On some points there was agreement, on others there was considerable debate, while on still others the guests listened in silent recognition of the expertise of the speaker.
Kudos For the Experts:
Ron Meisels and David Nicholson were congratulated for their accurate market forecasts, and Tony Deutsch on the accuracy of his prediction of the result of the recent federal election. Mr Paragon's US stock portfolo untouchrd for seven years is up 215% Div/income not included!
The Canadian Economy:
Interest rates are stable and will continue to remain so in the foreseeable future, the economy will continue to rise by 4%, there is no pressure on inflation. The Canadian trade surplus is not as great as anticipated however because of our low interest rates which cause money to be heading to the United States, keeping the Canadian dollar low.
Despite the undervalued Canadian dollar, our trade surplus is not as great as anticipated. It was suggested that one reason for this is that Canada has been unwilling to bend the rules in seeking foreign contracts by, for example, subsidizing the financing of contracts in trades with foreign purchasers such as China. Canada is
unlikey to support the Canadian dollar unless it falls below seventy-two cents U.S.
The outlook is very rosy for the Canadian Economy. The situation is
similar to the 1950's, with similar inflation and interest rates. The baby boom bulge has now passed and we are on the verge of a period of expansion similar to that of the '50s.
The Recent American Agressive Intervention in Yugoslavia:
The capture of Radovan Karadzic will not solve the problem in Bosnia. The distrust between the various ethnic groups has developed and grown to the point where it will only be solved by the passage of time. The ethnic nationalism in evidence in Bosnia is the result of the overflow of Croatian and Serbian nationalism. What is most important for
the international community to do is to ensure that Bosnia is maintained intact. A Greater Serbia and a Greater Croatia would lead to the question of a Greater Albania, which would impact on Bosnia, Croatia and more importantly, on Greece. This could lead
to a major conflagration.
A Common European Currency:
There is grave doubt that this will be achieved. The most obvious reason for this is that in losing its currency, a country loses a great deal of its decision-making ability. There is in addition however, a very serious technical problem. The European Economic Community is not a logical currency area. There is at most a group of about six or seven countries that might, and probably will go ahead with a common currency. These include the Benelux countries, Germany and possibly Italy.
As an aside, the opinion was expressed that if Québec ever became sovereign, it would find it impossible to avoid creating its own currency. Québec has projected a balanced
budget, but unlike Alberta and Ontario, it will have achieved this not by cutting the bureaucracy but by displacing the burden to municipalities and educational, health and social service institutions. This is the only government not to go through a real downsizing. It was pointed out that for instance, the insistance that public and parapublic agencies pay for the liberation of union officials to attend meetings has cost the taxpayer about fifty million dollars a year. The civil service has hardly decreased in number. In Québec, the civil service has become a sacred cow, totally entrenched, impermeable to attack by any political party.
The Impending Crash: Imminent or Distant? Two views-
A number of conditions exist in to-day's world economy, including:
- Unemployment in Europe is 12%, in U.S. 4%
- Interest rates are very low
- Banks are merging and talking about merging
- Personal credit is very high
- Corporations are flush with cash
First Scenario:
- These conditions duplicate those in 1929.
BEWARE OF OCTOBER 1997.
Second Scenario:
- These conditions duplicate those in 1895.
We can look forward to steady growth for the next thirty-four years with only minor glitches and corrections.
The reader is invited to select the appropriate scenario elaborated by two credible gentlemen, as did the Wednesday night guests, or to create their own.
The formal part of the evening ended at 11:30 p.m., but the exchanges
continued into the
early hours of Thursday morning.
by Herbert Bercovitz
|