Monday, March 30, 2009

Great View of the Skyline



Check out this bookshelf appropriately named Skyline created by Vincenzo de Cotiis. Formed out of varying types of wood including maple and some veneers as well, this piece of furniture makes a statement and is finished in natural wax. It has height so please take note of the exact dimensions so that you don't spend the chunk of change only to find out it doesn't fit in your home. I do enjoy when furniture is artwork.


Bankers to get keys to kingdom
Critics fear for central banks' independence
Paul Vieira, Financial Post

Published: Monday, March 30, 2009

Chris Kleponis/Bloomberg NewsCentral bankers from the G7. From left: Mark Carney, governor of the Bank of Canada, Christian Noyer, governor of the Bank of France, Axel Weber, president of the German Bundesbank, Ben S. Bernanke, ...
Nationalization, stimulation, subsidization, appropriation, bond buybacks and bailouts. In the space of a year, global policymakers have thrown away 30 years of free-market orthodoxy in an unprecedented intervention in the global economy. In the second instalment of a two-part series, the Financial Post takes a look at the repercussions for growth, banking and monetary policy.
OTTAWA -- Senior policymakers from the Group of 20 nations, led by those in Washington, are likely to agree this week to give their central bankers more power to ensure there's no return of the type of credit crisis that has rocked the global financial system.
That is no surprise, experts say, because central banks are endowed with the skill and know-how to detect asset bubbles, and act accordingly. And for the most part, their role in stabilizing the current global recession has been applauded.
But that doesn't mean everyone is happy with the behaviour to date of the guardians of monetary policy. There is concern about their inability to undo the stimulus they have injected, and the double-digit inflation that could ensue. Further, will central bankers be able to return to their independent ways, and their traditional single-minded focus on inflation, given how closely they have worked with their respective finance ministers in tackling the economic crisis? Or are they bound to become yet another agency whose role is to implement the wishes of the government of the day?
"The situation is changing so fast, and the unthinkable is becoming thinkable so rapidly, that you cannot make predictions about the relationship between central banks and governments anymore," said Andrew Hilton, director of the Centre for the Study of Financial Innovation, a London-based think-tank. "It is a bit difficult to see where it all goes because in the end, is there much difference between monetary and fiscal policy?"
Among those raising the red flag most forcibly about what the future holds for central banks is John Taylor, an economics professor at Stanford University. In recent testimony to the U. S. Congress, he described the recent moves of the U. S. Federal Reserve as "mondustrial" policy -- a combination of monetary and industrial -- in reference to how Ben Bernanke, the Fed chairman, opted to purchase securities and make loans to certain sectors and financial institutions through the creation of money, or quantitative easing, in central-bank lexicon.
"What justification is there for an independent government agency to engage in such a selective credit policy?" Mr. Taylor added. "For the Federal Reserve to be taking on these responsibilities raises questions about its independence,"
The Fed has taken among the most aggressive steps, moving in to save Bear Stearns and then American International Group, with the White House's blessing. And through recent initiatives such as the term asset-backed securities loan facility (TALF) and the purchase of U. S. treasuries, the Fed's balance sheet has ballooned an astounding 144% to US$4.45-trillion in just three weeks. In comparison, the Bank of Canada's balance sheet has grown roughly 47% since the onset of the financial crisis, from $54.8-billion to $80.6-billion, as of February. That may increase further if the Canadian central bank engages in quantitative easing, as suggested in this month's interest-rate announcement.
In the United Kingdom, the Bank of England has embarked on a bid to flood financial markets with cash through a US$200-billion-plus effort to acquire bonds, corporate debt and other securities. Until now the European Central Bank, which sets rates for the 16-nation Euro bloc, had laid low. But late last week, the ECB's vice-president indicated the central bank may offer banks long-term loans and acquire commercial paper to boost the continental economy.
The Fed's extraordinary action has been justified by a mission statement that clearly states it has a duty to supervise and regulate banking institutions, maintain the stability of the financial system and contain systemic risk that may arise in financial markets.
Nevertheless, Mr. Taylor says, these actions "have the potential to change the role of the central bank in the future in ways that could be harmful. The success of monetary policy during the great moderation period of long expansions and mild recessions was not due to a lot of discretion but to following predictable policies and guidelines that worked."
Geoffrey Wood, an economics professor at London's Cass Business School and special advisor to the Bank of England, also has concerns regarding where the Fed is headed.
"I do think there's a danger of the Fed becoming more of an active agent," he said. "More will be asked of it, it has taken more on itself, and it has taken big risks with its balance sheets. Given all this, it is more likely to make mistakes -- and if it makes more mistakes, it is likely to come under greater government influence."
Other analysts maintain central banks, including the Fed, can revert back to their traditional, independent role -- even with any additional regulatory responsibility that falls on their laps.
"Clearly central banks have conducted some of the out-of-the-box kind of policies, but I think these times called for that," said Nariman Behravesh, chief economist at IHS Global Insight, a Lexington, Mass.-based economic consultancy and forecasting firm. "Once the economy starts to recover, you will start to see the central banks reassert their independence--because I don't think anyone wants to go back to a situation in which the central banks are at the beck-and-call, if you will, of finance ministers or governments."
Eric Lascelles, chief economist and rates strategist at Toronto-based TD Securities, says central bankers are able to act nimbly in times of crisis compared to legislators -- in particular in Canada, which finds itself with a minority government and was in the middle of an election campaign when the crisis broke out in earnest.
In the United States, it is believed the Fed would take on the bulk of new oversight responsibilities as outlined last week by Timothy Geithner, the U. S. Treasury Secretary. As he envisages it, one entity would be responsible for ensuring systemic stability over major institutions, and critical payments and settlement systems.
Among the key regulator tasks, experts say, will be to identify, and then slowly burst, growing asset bubbles such as the dot-com boom of the late 1990s and the housing craze of this decade.
"What they can do about it is another question, however," Mr. Wood said. "They will need new instruments. They have rates to conduct monetary policy and help target inflation, but it would only be accidental if they could control asset bubbles at the same time. What those new instruments would be, nobody has any idea at the moment."
A key test as to whether central banks can go back to their accustomed knitting is when it comes time to unwind their balance sheets and take out the cash from the system. What if legislators object, arguing the economic recovery has yet to kick in?
"If the central bank feels it doesn't have the authority to stick its finger up at the state, then you do have the danger of moving toward Zimbabwe," warned Mr. Hilton, of the British think-tank.
That south African country has been subjected to hyperinflation, the result of its central bank forced to finance the public spending through directly acquiring Zimbabwean bonds from the government.
Most analysts, however, say central banks have exit strategies ready to pull excess cash out of the system. Mr. Hilton, a former World Bank economist, is not among those brimming with confidence.
"Western economies are like forests in autumn these days, with all the leaves lying on the ground and the wind still," he says. "What happens if the wind starts to blow? We will have to suck a lot of that cash out very, very quickly indeed."

Tuesday, March 17, 2009

First Time Plunge

Drop in house prices driving first-time buyers to take the plunge
by Brenda Bouw,
Tuesday, March 10, 2009

First-time homebuyers are being lured into the real-estate market by falling prices, lower interest rates, more selection and new government incentives, a new report shows.
The ReMax real estate company said preliminary figures show sales were up in February, after a terrible January, driven by more first-time buyers entering the market.
The report comes alongside new Statistics Canada figures showing the first year-over-year decrease in new-home prices in more than a decade.
ReMax said lower prices and record low lending rates are prompting many first time buyers to "get off the fence, out of the rental, and into the market."
"While a sense of caution still prevails, more and more first-timers are finding it hard to pass up the chance to become homeowners in today's buyer-centric real-estate climate," ReMax said in its report released Wednesday.
"Buyers are clearly in control in most Canadian markets."
Wendell Collier said he and his girlfriend have finally waded into the market in Toronto after waiting it out for years.
"There is less pressure now," said Collier. "There are no bidding wars, you see houses sitting on the market a lot longer. It's a buyer's market again."
Collier also said low interest rates have been an incentive.
"You start saying 'Okay, now it's looking very possible.' Before we would have handled it, but we would have been stretched thin for a couple of years. Now we can have our cake and eat it too."
After years of renting, Tyler Backus recently bought his first house in the Haldimand-Norfolk region of Ontario, inspired by falling prices and the new federal renovation tax credit.
"It seemed that everything was going down in price and it was the right time to buy," said Backus.
Ottawa recently announced new tax credits of up to $1,350 for homebuyers to renovate their house or cottage. It also increased the amount first-time homebuyers can withdraw from their RRSPs from $20,000 to $25,000, and implemented a tax credit for first-timers of up to $750 to help cover closing costs.
ReMax said 22 of the 32 markets in the survey, or 69 per cent, "remain firmly in buyer's market territory."
Some of these spots include Vancouver and Victoria, Edmonton and Calgary, Saskatoon and Regina, Ottawa and Toronto, and Halifax.
Cities such as Winnipeg, Kitchener-Waterloo, Ont., Sudbury, Ont. St. John's, N.L., and Charlottetown had what ReMax called "more balanced conditions" between buyers and sellers.
It said 40 per cent of the 32 markets had single-detached homes priced under $200,000.
The most affordable markets for detached homes, based on starting prices were Moncton, N.B. in Eastern Canada at $115,000, Windsor at $75,000 in Ontario and Winnipeg at $185,000 in Western Canada.
In its report released Wednesday, StatsCan said new home prices fell 0.8 per cent in January compared with the same month a year earlier.
It was the first year-over-year decrease across the country since January 1997, led by a steep drop in Western Canada.
New home prices in Edmonton fell the most by 10.4 per cent, followed by a 6.5 per cent drop in Calgary, 4.2 per cent drop in Victoria and 3.2 per cent dip in Vancouver.
Regina was the rare Western Canadian city that saw a large increase in new home prices, a lift of 21.7 per cent. Only St. John's, N.L. saw new home prices rise more, by 24.1 per cent in January compared to the same month in 2008.
Earlier this week, Canada Mortgage and Housing Corp. said housing starts fell for the sixth straight month in February, down 12.3 per cent to a seasonally adjusted annual rate of 134,600 units. That's after falling 10.9 per cent in January.
February's figures are a 30 per cent drop from the same period last year, and were lower than most economists expected
Scotiabank economist Adrienne Warren said new home sales respond to what happens in the larger resale market, which has seen a reversal in recent months after nearly a decade of constant growth.
Resale home activity fell 37.3 per cent across Canada in January compared to the same time last year, while average prices fell 11.3 per cent. National figures for February are due in the coming days.
Warren said early indications are that February sales activity has picked up compared to a dismal January, but she predicts a turnaround will not be quick.
Housing sales will continue to be weak this year and there will be "a sluggish recovery" starting in 2010, she said. That's because a lot of buyers are still concerned about losing their jobs in the current recession.
As for first-time home buyers, Warren said they can be an indicator of a market recovery.
"In any recovery you need to have first-time buyers because other buyers are just shuffling around housing. For a buyer that wants to move up, you need that first-time buyer to come in and buy from them," Warren said.
Vancouver real-estate agent Shelly Smee said she has a handful of clients who are preparing to move up in the market now that house prices have fallen in Canada's most expensive city. She said some couples are looking at moving out of their condominiums and into a house.
"Some people are thinking now is a good time to move up and they can finally afford it," Smee said.
Smee also said some clients have also built up equity in their homes in recent years and are now considering upgrading thanks to record-low borrowing rates.
Interest rates have fallen dramatically in recent months as the central banks and federal government seek to ease the credit conditions in order to jump-start the flagging economy.
Last week, the Bank of Canada did its part by dropping the overnight rate down to an unheard of half per cent. Canada's chartered banks then lowered their prime rate to 2.5 per cent and having been lowering other lending rates including mortgages.

Wednesday, March 11, 2009


Taste in furniture varies from person to person but I have discovered a company that creates furniture that you have to appreciate for its design and beauty even if you would never put it in your house and for the record, I definitely would.

Taken from their website:

Hudson Furniture Inc. respects the natural forms of trees and inherent grain of wood with well defined organic lines and geometric forms using traditional joinery techniques and hand rubbed oil finishes. All Hudson furniture is available in custom dimensions, custom finishes and a variety of wood species such as Claro Walnut, Black Walnut, Myrtle, Jasmine, Acacia, Satinwood and Ebonized Pine.None of the woods we use are harvested from old growth forests. Our wood slabs are domestically sourced from either salvaged trees or wind/storm damaged trees. The trees have an average life span of 250-300 years. When these trees die, they gradually do so from the crest to the roots. The farmers or the tree owners thus have to remove these trees as they might cause damage to houses, other trees or outlying areas. We integrate various wood species into our designs to produce unique works of art.
" We put high regard and value on these trees by turning them into pieces of enduring art instead of leaving them out to decay ", Barlas Baylar, Hudson Furniture Inc. founder and designer.
Hudson Furniture Inc. is also New York's only repository for legally harvested petrified wood. For Hudson Furniture Inc. it was second nature to explore petrified wood as an extension of its already existing collection of organic contemporary designs. Petrified wood, having the visual characteristics of wood but the feel of stone, represents a contemporary fusion of the two original materials into a new compelling organic interior accessory. Hudson Furniture Inc.'s owner Barlas Baylar takes extra precaution with embassies and consulates to seek approvals and legalities of petrified wood exportation from all regions of the world. Hudson Furniture Inc. has also recently added a line of solid walnut furniture designs by startchitects Renzo Piano, Mario Botta and Terry Dwan.

Tuesday, March 10, 2009


North Alberta the best place to weather the economic storm
Canwest News Service
Published: Tuesday, March 10, 2009

Northern Alberta is the best place in North America to weather an economic storm that's becoming worse than originally forecast, said Michael Percy, dean of business at University of Alberta.
"When I look down the road, it's going to be grimmer than I thought it would be for the next year, year-and-a-half. This is going to be an intense downturn," he told city council Tuesday.
However, Mr. Percy said "there's no better jurisdiction to be located in than Alberta," particularly north of Red Deer, because he still expects companies to pump money into oil sands projects as prices improve.
"At the end of the day, so many fundamentals are positive in the case of Alberta, the best strategy is to treat this as short-term."
Mr. Percy was one of five local experts brought in to give councillors their thoughts on where the economy is heading and what the city should do about it.
The speakers also included ATB Financial senior economist Todd Hirsch, National Bank Financial investment adviser Angus Watt, Melcor Developments Ltd. president Ralph Young and Clark Builders founder Andy Clark.
They suggested falling costs make this a good time for the city to move ahead with infrastructure construction needed as Edmonton continues to grow, especially with interest rates low.
Mr. Clark said his company has 30 projects going on right now, but by the end of the year they only have 10 scheduled.
"I think you're going to see some pretty hungry builders out there in six months, 12 months more."