The Best Two Ways to Play Canada’s Economy, Currency And Natural Resources

Tony Daltorio, Investment U Research

A vast amount of natural resources. A love of hockey. A penchant for bacon. And liberal use of the word “eh.”

All are associated with Canada, of course. But America’s neighbor to the north boasts another fine trait: an efficiently run economy.

You see, although Canada borders the United States, it takes a completely different approach towards economic policy.

That showed strongly just recently when America stoked protectionist fears by slapping stiff duties on tire imports from China. Yet days later, Canada unveiled plans for a significant move in the opposite direction. Canada aims to abolish all remaining tariffs on imported machinery and equipment used by domestic manufacturers, saving Canadian manufacturers C$250-300 million a year.

And while the United States dithers over

Well not really…

But I do think this orgy of consumption around Christmas is a pointless and painful waste of time. It simply stores up even more foreign debt that will have to be serviced and eventually repaid.

We simply can’t afford to keep spending the way we have. The charts below show why. We need to reduce our consumer spending to reduce our imports and drag that current account deficit back closer to 4-5% than the 8-10% range it is in now.

I was simply stunned to see the pictures of shoppers thronging to the malls on Boxing Day, as Stuff reports. There is an illusion of a deal which means people spend just as much as they would have without the sales, but get more things they don’t really need. It’s still stuff we don’t need.

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