Moped ride on Ile Bizard

Yesterday afternoon I decided to go out to the pharmacy on my Moped. I took my video camera along for the ride. Below is a highlights video of the ride.

Enjoy

A New Economic Paradigm? Oh if only… – Part I

I’m going out on a limb a bit this evening as I’ve been wanting to write about the global economic crisis that swept over our planet starting back in September of 2008. Now, let me preface this by saying that I’m no economist and falling asleep in the back of economics 101 or was that home ec. doesn’t qualify me to write about economics worth diddly squat. However, for some reason this past economic meltdown caught my attention. It might be because I lost my job back in July of 2008 and decided to take a few well-deserved months to rest before hitting the pavement again looking for work. So take July 1st, add about 60 days or so of a glorious Summer and what do you get? September and the stock market meltdown and economic annihilation. I mean, I never got a chance. The unemployment numbers started rising, companies, those that survived, put the kibosh on hiring and my chances of finding new employment went down the toilet along with many individuals pension funds and retirement savings.
Now that Canada seems to be on the slippery up-slope of economic recovery it begs the question what exactly happened? Well, in the next few series of blog postings I would like to examine that very question. Remember now I’m no economist and won’t be using any big scary words to describe what I saw, read and heard over the last 18 months or so. Nope, this will be more like sitting on the porch swing with your favourite cozy blanket and listening to old uncle Jeb go on about the good ol’ days.
As I understand it everything seems to have started South of the border with the large financial institutions giving low-interest mortgages to folks who just couldn’t pay for them and banking, pun fully intended, on the fact that the housing market would continue to grow and homes would increase in value exponentially as they had been over the last 5-10 years. Well, what happened next is the value of homes didn’t rise and people were stuck with homes they could pay for and simply dropped the proverbial keys on the bank manager’s desk. Banks aren’t big on selling real-estate and so what happened next is houses started to lose value and pretty soon whole neighbourhoods were up for sale. This caused a domino effect with the banking institutions losing billions, consumers’ confidence taking a nose dive and this lack of confidence affecting the stockmarket, where confidence is really the name of the game. You see, in most cases when you listen to the evening news and they talk about the Dow Jones Industrial average or the NASDAQ or the S&P 500, these are all the average prices of shares in varied companies, usually under the same type of industry or market sector. Many times these daily fluctuations are driven by peoples’ perception of what might happen to a company, a industry or a whole sector of the market. If there is something going on in the middle-East that threatens oil shipments, then the price of the barrel of oil goes up. This may cause the price of goods to rise and so companies selling manufactured goods overseas may sell less and post lower profits which then cause their shareholders, those who own the stocks in the company, to sell their shares. If they do that the share prices drop, which may start other people selling their shares and so on and so on and so on. Before you know it, you have what is called a bear market, where the overall level of the market goes down over time. Taken to an extreme the stock market can then also drive the general population to reduce spending as their own economic optimism drops and people start losing jobs. This is what happened in the months following the low-interest mortgage problems in the US. The markets having suffered huge loses over several months started affecting other sectors and pretty soon companies were laying off people and everyone’s purses and wallets were being drawn closed.
I elude to a “New” economic paradigm in the subject and the reason I do so is that I truly believe that this last economic crisis has left an indelible mark on consumers. I’ll have more on that and the effect of the auto industry in Part II.