Datametrex AI Ltd V.DM

RE:RE:RE:Crazy this stock killed me..

[peppesilver57]

THE BIG IMPORTANT STORY

Q&A

How Strong, or Not So Strong, Is the Canadian Economy?

Lately, there’s been an argument about Canada’s economy. On one hand, some less-than-rosy articles in the newspapers have sounded the alarm about Canada’s lagging productivity and its falling per capita GDP — which together might mean the country is growing less prosperous. Then, on the other hand, you have people like Bloomberg Opinion columnist/economist Tyler Cowen who argue that Canada is doing just fine and the op-ed doom-and-gloomers are overreacting. In a recent essay (that’s paywalled, sorry), Cowen pointed out that, sure, the Canadian economy isn’t as productive as the U.S.’s, but most developed economies aren’t; plus, in Canada workers’ incomes have been steadily growing for two decades and the economy has expanded at a reliable clip. “In the simplest possible terms,” concludes Cowen, “Canada is not only a great place to live, it is also getting better.”

So who’s right, the hand-wringers or Tyler Cowen and the like? We asked someone who knows a thing or two about the economy: Stephen Poloz, who ran the Bank of Canada from 2013 to 2020.

What do you think about Cowen’s argument that Canadians should be more optimistic about the economy?

Poloz: That article illustrates that contrarian views get headlines, not much else. We’re in uncertain times. There are some positive things, as Cowen points out, but there’s lots to worry about. Businesses should be paying attention to the Bank of Canada’s recent announcement that our productivity levels are so low it’s an emergency.* Low productivity results from low business investment and leads to low economic growth. [Canada currently produces 71% of the value generated by the U.S. economy per hour, down from 88% in 1984.]

Should we be entirely pessimistic? No, because the opportunities to fix productivity are right in front of us, namely through greater investment in technology.

*[Note: low productivity basically means that Canadian goods and services aren’t as sought after as those offered by other countries, not that Canadians aren’t hard-working. Tech companies tend to juice productivity since they create a lot of value with a relatively small number of employees.]