The Parakeet has considered the problem of youth unemployment and come up with the ideal solution: work for free!
How bad are things in Canada’s job market? Bank of Canada Governor Stephen Poloz says bad enough for young people to consider working for free.
Adult children stuck in their parents’ basements because they can’t find adequate employment should take unpaid work to bolster résumés as they wait for the recovery to take hold, Poloz said Monday in Toronto.
The Bank of Canada estimates about 200,000 young people want to work or work more, and Poloz said they may be scarred by prolonged unemployment that prevents them from moving out on their own. He said he’s been asked for advice on how young people can find work.
“Having something unpaid on your CV is very worth it, because that’s the one thing you can do to counteract this scarring effect,” Poloz told reporters was his advice to discouraged youth.
Going back to school for something useful is not an option, apparently. As a sometime employer, I can’t say volunteer work impresses me very much. It’s very difficult to judge the quality, for one thing: no volunteer agency is ever going to fire their volunteers, or give them bad references. And my big question is … was that really the best thing you could think of? Not school, not working at Timmy’s, nothing?
I might make exceptions to this general rule for closely related and idealistic work. If I was hiring a nurse, for instance, going to Liberia for a year to treat Ebola patients or deliver babies would not be a negative. But not necessarily a lot of credit because around here, nurses don’t deliver babies; I need a nurse to treat my paper cuts, which can get pretty vicious sometimes.
Anyway, the parakeet’s getting a pretty rough ride in the G&M comments.
There’s good news about the US deficit:
Robust economic growth has helped push the U.S. budget deficit down to the lowest level since 2008, marking the sharpest turnaround in the government’s fiscal position in at least 46 years.
The shortfall of $483.4 billion in the 12 months ended Sept. 30 was 2.8 percent of the nation’s gross domestic product of $17.2 trillion over the same period, according to data compiled by Bloomberg using Commerce Department figures. The figure peaked at 10.1 percent of GDP in December 2009.
That’s quite the drop!
Whoopsy! BNS disclosed some nasty 14Q4 charges:
Scotiabank (TSX: BNS) (NYSE: BNS) today announced that it expects to record certain charges in its fiscal 2014 fourth quarter earnings, aggregating to a total of approximately $451 million pre-tax, or $341 million after tax. Diluted earnings per share are expected to be impacted by approximately $0.28. These items will also impact the Bank’s Common Equity Tier 1 capital ratio by approximately 10 basis points. The charges fall into two broad categories: (1) changes in estimates and additional credit provisions; and (2) restructuring charges.
DBRS comments:
Some of the charges are consistent with DBRS’s opinion that Scotiabank’s exposure in emerging markets and corporate lending is higher compared to its Canadian bank peers; as a result, DBRS views BNS’s credit risk as the highest among the big five banks, although it remains strong overall as the Bank is also the most geographically diverse. DBRS does not expect the restructuring efforts to negatively impact the Bank’s operations in any material way. In Canada, the efforts are expected to improve customer service and efficiency of non-customer-facing functions. In International Banking, Scotiabank indicates they are attempting to right-size the branch networks in various countries in light of the economic realities.
Brookfield’s aggressive approach to expansion has cost Brookfield Renewable Energy Partners L.P. it’s S&P ‘Positive’outlook:
- •We are revising our outlook on Brookfield Renewable Energy Partners L.P. (BREP) to stable from positive.
- •The outlook revision reflects our assessment of the amount of debt being maintained at the parent level in relation to parent-only cash flow that the partnership is generating.
- •We are also affirming our ratings on BREP and subsidiaries Brookfield Renewable Power Preferred Equity Inc. and BRP Finance ULC, including our ‘BBB’ long-term corporate credit rating on BREP.
…
At the same time Standard & Poor’s affirmed its ratings on BREP and subsidiaries Brookfield Renewable Power Preferred Equity Inc. and BRP Finance ULC, including its ‘BBB’ long-term corporate credit rating on BREP.The outlook revision reflects our view of the company’s ability to generate strong remittable cash flows from its holdings and its increased level of holding company (holdco) recourse debt. The company has articulated a policy of maintaining relatively low levels of leverage at the holdco level with leverage at the holdco used opportunistically for acquisitions with equity as market conditions allow. However, during the course of the year, the company has made a number of acquisitions that, although partially funded with new equity issuance, maintained a higher level of debt at the holdco. This has resulted in lower credit metrics.
…
The stable outlook reflects our expectation that BREP will continue to increase its parent-only cash flow while maintaining modest amounts of debt at the holding company as well as maintaining the highly contracted and well-diversified portfolio of generation assets.We could raise the ratings if we believe that parent-only cash flow to debt will continue at or above 30% assuming the current quality of cash flow score of ‘4’.
We could lower the rating if the partnership is unable to maintain parent-only cash flow to debt above 23% or if there is deterioration in the quality of cash flow score. This could result from acquisitions financed with substantially higher levels of holding-company debt or a material change in the partnership’s contractual profile.
It was another red-hot day for the Canadian preferred share market, with PerpetualDiscounts winning 57bp, FixedResets gaining 16bp and DeemedRetractibles up 21bp. Volatility was suitably elevated, with the highlights showing not a single loser, and CGI.PR.D making a monkey out of me by leading the charts with a gain of over 2%, shortly after I opined that it was near the top of its range, so maybe I should consider working for a bank as a volunteer. Volume was on the low side of 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 | 0.0569 % | 2,524.3 |
| FixedFloater | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0569 % | 3,996.4 |
| Floater | 2.99 % | 3.10 % | 64,272 | 19.46 | 4 | 0.0569 % | 2,683.5 |
| OpRet | 4.02 % | -1.75 % | 101,562 | 0.08 | 1 | 0.0000 % | 2,748.7 |
| SplitShare | 4.25 % | 3.83 % | 66,490 | 3.78 | 5 | 0.5803 % | 3,186.6 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0000 % | 2,513.4 |
| Perpetual-Premium | 5.45 % | -5.99 % | 69,486 | 0.09 | 19 | 0.1835 % | 2,477.3 |
| Perpetual-Discount | 5.13 % | 5.06 % | 105,992 | 15.28 | 16 | 0.5743 % | 2,657.6 |
| FixedReset | 4.18 % | 3.62 % | 167,821 | 4.59 | 74 | 0.1581 % | 2,581.1 |
| Deemed-Retractible | 4.97 % | 0.65 % | 101,356 | 0.16 | 41 | 0.2123 % | 2,595.6 |
| FloatingReset | 2.55 % | -1.90 % | 65,636 | 0.08 | 6 | -0.0391 % | 2,553.6 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| BAM.PR.Z | FixedReset | 1.04 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2017-12-31 Maturity Price : 25.00 Evaluated at bid price : 26.35 Bid-YTW : 3.16 % |
| GWO.PR.I | Deemed-Retractible | 1.08 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2025-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.36 Bid-YTW : 5.43 % |
| ELF.PR.G | Perpetual-Discount | 1.27 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-11-04 Maturity Price : 22.05 Evaluated at bid price : 22.40 Bid-YTW : 5.33 % |
| PWF.PR.S | Perpetual-Discount | 1.46 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-11-04 Maturity Price : 23.96 Evaluated at bid price : 24.35 Bid-YTW : 4.94 % |
| ELF.PR.F | Perpetual-Discount | 1.64 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-11-04 Maturity Price : 24.55 Evaluated at bid price : 24.80 Bid-YTW : 5.38 % |
| CGI.PR.D | SplitShare | 2.04 % | YTW SCENARIO Maturity Type : Soft Maturity Maturity Date : 2023-06-14 Maturity Price : 25.00 Evaluated at bid price : 26.02 Bid-YTW : 3.29 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| IFC.PR.C | FixedReset | 108,689 | RBC crossed two blocks of 50,000 each, both at 25.54. YTW SCENARIO Maturity Type : Call Maturity Date : 2016-09-30 Maturity Price : 25.00 Evaluated at bid price : 25.55 Bid-YTW : 3.24 % |
| ENB.PR.Y | FixedReset | 73,265 | Scotia crossed 50,000 at 24.05. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-11-04 Maturity Price : 22.79 Evaluated at bid price : 24.00 Bid-YTW : 4.08 % |
| ENB.PR.F | FixedReset | 69,913 | RBC crossed 50,000 at 24.85. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-11-04 Maturity Price : 23.24 Evaluated at bid price : 24.84 Bid-YTW : 4.02 % |
| ENB.PR.T | FixedReset | 52,520 | RBC crossed 50,000 at 24.44. YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2044-11-04 Maturity Price : 22.99 Evaluated at bid price : 24.45 Bid-YTW : 4.08 % |
| BNS.PR.Z | FixedReset | 44,386 | RBC crossed 39,900 at 24.78. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.72 Bid-YTW : 3.22 % |
| FTS.PR.M | FixedReset | 36,668 | YTW SCENARIO Maturity Type : Call Maturity Date : 2019-12-01 Maturity Price : 25.00 Evaluated at bid price : 25.51 Bid-YTW : 3.79 % |
| There were 27 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| MFC.PR.G | FixedReset | Quote: 26.10 – 26.70 Spot Rate : 0.6000 Average : 0.3775 YTW SCENARIO |
| PVS.PR.C | SplitShare | Quote: 25.95 – 26.80 Spot Rate : 0.8500 Average : 0.6613 YTW SCENARIO |
| NEW.PR.D | SplitShare | Quote: 32.65 – 33.58 Spot Rate : 0.9300 Average : 0.7640 YTW SCENARIO |
| MFC.PR.K | FixedReset | Quote: 25.20 – 25.61 Spot Rate : 0.4100 Average : 0.2467 YTW SCENARIO |
| PWF.PR.A | Floater | Quote: 19.30 – 20.00 Spot Rate : 0.7000 Average : 0.5384 YTW SCENARIO |
| PWF.PR.G | Perpetual-Premium | Quote: 25.60 – 25.95 Spot Rate : 0.3500 Average : 0.2181 YTW SCENARIO |