There is more indication that, if Carney was Spend-Every-Penny’s lapdog, Poluz will be his parakeet:
The two previous Bank of Canada governors, Mr. Carney and David Dodge, were unafraid to engage on subjects that didn’t necessarily pertain to the Bank of Canada’s core mandate of keeping inflation at an annual rate of 2 per cent. This tendency brought both men attention that they might not have had otherwise, and could cause them to eclipse their political masters.
Mr. Poloz came across as inclined to mind his own business. He called the central bank a “team player” and “part of the family of the public service.” He told New Democratic finance critic Peggy Nash that he had no problem with a legislation that would give cabinet a veto over hiring decisions at Crown corporations, including the central bank. “I see quite a clean separation between, if you like, administrative independence versus monetary policy independence,” he said.
How can you run an enterprise if you don’t have total control over staff? Answer: you can’t.
There was a decent jobs number in the US:
American employers took on more workers than forecast in May as the world’s largest economy weathered the impact of higher taxes and federal spending cuts.
Payrolls rose 175,000 after a revised 149,000 increase in April that was smaller than first estimated, Labor Department figures showed today in Washington. The median forecast in a Bloomberg survey called for a gain of 163,000. The unemployment rate climbed to 7.6 percent from 7.5 percent as a surge in the number of people entering the labor force swamped the number of positions available.
The Canadian number was very good:
The Canadian economy churned out 95,000 jobs last month, the second-biggest monthly gain on record, mostly in full-time positions in the private sector.
The jump in job creation is the largest since August, 2002, and sent the country’s jobless rate down a notch to 7.1 per cent in May, Statistics Canada said Friday. The increase was eight times what economists had expected.
…
Private companies led the way. The private sector added 94,600 positions while the public sector created 6,600 jobs. Self employment fell by 6,200. The construction sector added 42,700 jobs, the biggest gain on record.Wage gains, though still modest, are running above the rate of inflation, with average hourly wages growing 2.3 per cent in May from last year.
Bloomberg has an interesting piece about high frequency trading:
For the first time since its inception, high-frequency trading, the bogey machine of the markets, is in retreat. According to estimates from Rosenblatt Securities, as much as two-thirds of all stock trades in the U.S. from 2008 to 2011 were executed by high-frequency firms; today it’s about half. In 2009, high-frequency traders moved about 3.25 billion shares a day. In 2012, it was 1.6 billion a day. Speed traders aren’t just trading fewer shares, they’re making less money on each trade. Average profits have fallen from about a tenth of a penny per share to a twentieth of a penny.
…
By the end of Aug. 2, Knight had spent $440 million unwinding its trades, or about 40 percent of the company’s value before the glitch.Knight is being acquired by Chicago-based Getco, one of the leading high-frequency market-making firms, and for years considered among the fastest. The match, however, is one of two ailing titans. On April 15, Getco revealed that its profits had plunged 90 percent last year. With 409 employees, it made just $16 million in 2012, compared with $163 million in 2011 and $430 million in 2008. Getco and Knight declined to comment for this story.
Getco’s woes say a lot about another wound to high-frequency trading: Speed doesn’t pay like it used to. Firms have spent millions to maintain millisecond advantages by constantly updating their computers and paying steep fees to have their servers placed next to those of the exchanges in big data centers. Once exchanges saw how valuable those thousandths of a second were, they raised fees to locate next to them. They’ve also hiked the prices of their data feeds. As firms spend millions trying to shave milliseconds off execution times, the market has sped up but the racers have stayed even. The result: smaller profits. “Speed has been commoditized,” says Bernie Dan, CEO of Chicago-based Sun Trading, one of the largest high-frequency market-making trading firms.
It was a grim day for the Canadian preferred share market – for half of it, anyway! – with PerpetualPremiums losing 48bp, FixedResets gaining 4bp and DeemedRetractibles down 28bp. The lengthy Performance Highlights table is comprised almost entirely of losers, largely PerpetualPremiums. Volume was average.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.1889 % | 2,549.4 |
| FixedFloater | 4.02 % | 3.35 % | 39,216 | 18.61 | 1 | 0.1271 % | 4,086.7 |
| Floater | 2.61 % | 2.96 % | 83,562 | 19.77 | 5 | -0.1889 % | 2,752.6 |
| OpRet | 4.82 % | 1.67 % | 61,720 | 0.08 | 5 | 0.0544 % | 2,616.6 |
| SplitShare | 4.65 % | 4.22 % | 99,893 | 4.04 | 6 | 0.0472 % | 2,977.2 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0544 % | 2,392.6 |
| Perpetual-Premium | 5.30 % | 4.29 % | 85,858 | 0.87 | 32 | -0.4763 % | 2,343.6 |
| Perpetual-Discount | 4.92 % | 4.99 % | 388,455 | 15.43 | 6 | -0.6614 % | 2,575.8 |
| FixedReset | 4.90 % | 2.88 % | 239,157 | 3.32 | 82 | 0.0404 % | 2,507.0 |
| Deemed-Retractible | 4.95 % | 4.24 % | 145,414 | 1.64 | 44 | -0.2753 % | 2,432.9 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| ELF.PR.F | Perpetual-Premium | -3.08 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-06-07 Maturity Price : 23.96 Evaluated at bid price : 24.24 Bid-YTW : 5.54 % |
| SLF.PR.E | Deemed-Retractible | -1.60 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.33 Bid-YTW : 5.27 % |
| FTS.PR.J | Perpetual-Premium | -1.41 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-06-07 Maturity Price : 24.07 Evaluated at bid price : 24.45 Bid-YTW : 4.87 % |
| IGM.PR.B | Perpetual-Premium | -1.34 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2016-12-31 Maturity Price : 25.50 Evaluated at bid price : 26.49 Bid-YTW : 4.80 % |
| BNS.PR.M | Deemed-Retractible | -1.32 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2015-07-27 Maturity Price : 25.25 Evaluated at bid price : 25.46 Bid-YTW : 4.30 % |
| BAM.PF.C | Perpetual-Discount | -1.17 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-06-07 Maturity Price : 23.30 Evaluated at bid price : 23.60 Bid-YTW : 5.22 % |
| CM.PR.G | Perpetual-Premium | -1.17 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-05-01 Maturity Price : 25.00 Evaluated at bid price : 25.37 Bid-YTW : 4.38 % |
| CU.PR.F | Perpetual-Discount | -1.11 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-06-07 Maturity Price : 23.69 Evaluated at bid price : 24.03 Bid-YTW : 4.69 % |
| MFC.PR.J | FixedReset | 1.17 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2018-03-19 Maturity Price : 25.00 Evaluated at bid price : 25.85 Bid-YTW : 3.21 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| CM.PR.M | FixedReset | 264,180 | TD crossed 110,000 at 26.39. Nesbitt crossed blocks of 100,000 and 50,000 at the same price. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-07-31 Maturity Price : 25.00 Evaluated at bid price : 26.40 Bid-YTW : 2.16 % |
| ENB.PR.Y | FixedReset | 182,000 | Recent new issue. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-06-07 Maturity Price : 23.14 Evaluated at bid price : 25.11 Bid-YTW : 3.66 % |
| MFC.PR.D | FixedReset | 145,447 | Scotia crossed 50,000 at 25.90; RBC did the same. TD crossed 40,000 at the same price. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-06-19 Maturity Price : 25.00 Evaluated at bid price : 25.88 Bid-YTW : 2.94 % |
| PWF.PR.K | Perpetual-Premium | 118,523 | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-06-07 Maturity Price : 24.69 Evaluated at bid price : 24.99 Bid-YTW : 5.00 % |
| CU.PR.F | Perpetual-Discount | 70,065 | Nesbitt crossed blocks of 40,000 and 20,000, both at 24.25. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2043-06-07 Maturity Price : 23.69 Evaluated at bid price : 24.03 Bid-YTW : 4.69 % |
| RY.PR.P | FixedReset | 60,295 | RBC crossed 50,000 at 25.70. YTW SCENARIO Maturity Type : Call Maturity Date : 2014-02-24 Maturity Price : 25.00 Evaluated at bid price : 25.70 Bid-YTW : 2.61 % |
| There were 30 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| ELF.PR.F | Perpetual-Premium | Quote: 24.24 – 25.24 Spot Rate : 1.0000 Average : 0.5804 YTW SCENARIO |
| IGM.PR.B | Perpetual-Premium | Quote: 26.49 – 26.85 Spot Rate : 0.3600 Average : 0.2276 YTW SCENARIO |
| GWO.PR.J | FixedReset | Quote: 25.41 – 25.74 Spot Rate : 0.3300 Average : 0.1989 YTW SCENARIO |
| CM.PR.G | Perpetual-Premium | Quote: 25.37 – 25.71 Spot Rate : 0.3400 Average : 0.2218 YTW SCENARIO |
| HSE.PR.A | FixedReset | Quote: 25.48 – 25.82 Spot Rate : 0.3400 Average : 0.2327 YTW SCENARIO |
| ABK.PR.C | SplitShare | Quote: 31.76 – 32.40 Spot Rate : 0.6400 Average : 0.5442 YTW SCENARIO |