From Canada, Al opines on the future of U.S. exports with newsletter writer David Coffin and mining executive Gary Freeman
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Hi Matt,
I would have to agree.
Big Al
Al, you are in the most beautiful part of Canada. Im jealous. But its also the least productive and maybe even one of the least creative parts of the country. I dont know what Vancouver produces apart from lefties, fish, more lefties, fish and David Suzuki, the Elvis of the Canadian left wing moonbats. In fact Suzuki means “bass” in Japanese so this closes the circle. Jokes aside, they cultivate beautiful Douglas Fir and apples and strawberries over there, but nothing that will frighten Japan or China.
Seriously, take away the govt jobs ( sales auditors, tax auditors, firemen, nurses take away the real estate jobs, teachers, customs officers,,, what is left: fishermen and lumberjacks and glass companies. Its a mystery how the economy turns in Canada.
I have been there four times in my life and can tell you that it is incredibly pictoresque, especially the view from Granville Island. You will find there a gret glass company that produces beautiful glass works, even for Donald Trump!
The people there are as fine as it gets but real esate is very expensive ( at least the roads are great. Here in Montreal, the City of Montreal should allow astronauts from NASA to practice driving here for practice for driving on the moon!).
Hi James,
Call me crazy, but I think that Vancouver is a wonderful example of capitalism at work. Of course, I mean as far as the mining industry is concerned.
I have been involved in the sector since about 1982. Long time.
I remember one of the first times I came up here I had two days of meetings with some pretty influential folks. Stockbrokers, attorneys, newsletter writers ,etc. I’ll never for on the evening of the second day I was sitting on my deck in the hotel, drinking a gin and tonic and saying to myself, “This is the most incredible example of capitalism I have ever seen.”
Now, remember I am only referring to one small sector.
As far as the beauty of the city and surrounding areas are concerned, you could not be more correct.
I am a true blue American who really loves Canada.
Big Al
Al, I know that British Columbia is popular with resources, but I never knew how popular it was with regard to the mining industry. No doubt the people are efficient and we wish them the best.
And you are right, it is unfortunately a small sector. Wish it was bigger.
But I also know that in recent years, many yhoung people have fled to other parts of the country to gain experience in factories with hopes to return with a trade and capital.
There is a hotel on Granville Island with a huge open deck to enjoy the view of the skyscrapers, the water and the bridge.
I believe they still offer buffets for breakfast.
Its a beautiful place.
Hi James B,
It’s called the Granville Island Hotel.
We enjoy the Granville Island area. Kathy and I collect Sid Dickins art and we buy a lot of it from a shop over there.
Best,
Big Al
In order to be an exporter again, we need to win the war Obama has engaged against the private sector. Until we have lower taxes and reduced regulations, Americans cannot profitably create and manufacture. Obama is not taking the necessary steps to create prosperity. He wants more government and more regulations which destroy any incentive for businesses to expand in the US.
Hi Karen,
I discussed the larger role that the government is playing in the U.S. economy yesterday at my workshop at the Cambridgehouse Conference.
I agree with you. The sad thing is, in my mind, the only alternative is for our country to take its lumps and go back to free enterprise and Austrian economics.
Will that ever happen? Probably not.
Big Sad Al
I don’t know why this is so complicated. We simply have to restore tariffis on imports to bring manufacturing jobs back to the US and restore the middle class standard of living. Am I the only one who has noticed that the decline in the US economy coincides directly with our decision to participate in free trade?
You’re not the only one who has noticed that “free trade” is not free of some cost. The way the American economy developed with tariffs allowed domestic manufacturing to make everything we needed here first for the home market. Self-sufficiency was economic strength. Add in labor unions which have had to defend their dwindling members against free trade interests that want U.S. workers to compete directly with lower levels of global wages. If less union influence in recent decades is a good thing, why have most non-union workers had little, if any, improvement in their real wages and benefits? It’s great for global investors who are only concerned with return on investment. The “average” American who bought cheap free trade imports at the long-term peril of his or her own job now feels the heat. We used to say “Buy American” for a reason. If you don’t protect what you have, you won’t have it.
Morning Joe,
Sure, that is probably part of it.
I think that there are other factors that also play a major role. Look at the auto industry and notice the quality of Detroit products from the early sixties on. Pretty sad compared to BMW’s and Mercedes. More recently look at the Asian cars.
I think that this example holds true for a lot of our products.
Sad but, in my mind, true.
Big Al
Hi Charles,
Buy American is certainly important, but so is Make American. What incentive does Nike have to manufacture over here. Eugene, Oregon would be a prosperous city with probably triple or quadruple its population it Make American were a standard.
Look at the problems Boeing is having by moving some of its production facilities out of Seattle.
I don’t think the govt is the only culprit here. Many Americans are also to blame by putting saving money ahead of national pride.
Best,
Big Al
Al:
Just curious; have you driven an American car lately?
Joe
Yep, Kathy drives a late model Expedition and we both like it.
Contrary to what people would naturally infer from what I said above, we have had a Ford of one sort or another in the family for the past twenty years.
I will grant you that our late model Expedition is very much different from the first Explorer we bought way back when,
Big Al
Ford is the only one I would even consider. To purchase a post-bailout GM or Dodge is to endorse Marxism. On top of that, these “patriots” have set-up operations elsewhere while the likes of Mercedes, Toyota, and Nissan have opened plants in the U.S.
Glad to hear it! I beleive American cars are much better than they are given credit for.
This is a little off topic but timely nonetheless. Jurisdictional risk is becoming more of a factor in pricing a company’s stock as time moves on and the mining industry becomes more significant due to precious metals pricing going higher. With the elections in Peru yesterday, mining companies that have a significant part of their mines located in Peru now have a serious overhang on their stock price. This overhang will result in a discounting of the stock price of those companies involved in Peru. An investor must be aware of a company’s management, its properties, the price forecast in the underlying commodity, the direction of real interest rates, and a whole host of other factors. The truth is you could be dead right on all these other factors and still lose if the jurisdiction where its mines are located are nationalized by the ruling party.
Venezuela, Peru, Bolivia, Russia, China, South Africa and some other countries in Africa are some of the prominent countries that seem to carry above average risk. Diversification in a portfolio containing mining companies from all over can mitigate some of this risk, but my preference is to avoid these countries entirely. A perfect example of a company getting hammered by this jurisdictional risk is Bear Creek Mining. Without this aspect of risk, the stock price would be double of what its current valuation is.
Going down fast,
What can I add to this? Nothing because you’ve said it all.
Thanks,
Big Al
Dont wish to be negative, but in my experience, from the other side of the pond, when you lose your export industry, it never comes back…never ever…you cant recreate it…shame for both our countries
Hi Nigel,
Theoretically, a country could probably turn it around. But from realistic and practical standpoint, you are absolutely correct.
Sad but true,
Big Al
From Pliny the Elder, bemoaning the enormous amount of gold and silver that the Rome’s coffers lost to imports, 1st century AD (excuse the implied misogyny): “According to our lowest estimates, India and Arabia are draining 100 million sesterces from the Empire every year — so dearly do we pay for our luxuries and our women.”
Hi Dirk,
Don’t we ever learn from history?
To me the parallels between the Roman Empire and the good old U.S. of A are too close. And, that is too bad!
Big Al
The US Exports more goods than any nation even in this current day. I would assume that means they are an exporter of some consequence.
Perhaps natural gas is a good start.