Week Ending May 13

These are some of the stories from the “inside pages” that caught my eye during the week ending May 13:

  • Corporate welfare – how much does the auto industry cost Canada?
  • Surrogacy and the Ukraine
  • Finns are Compassionate and TOUGH!
  • The fall of crypto currencies

Jobs and the Auto Industry 

Corporate welfare has its place. For instance, if Canada wants an aerospace industry it should make it a clear objective and support Canadian companies in the sector. If we want a stronger agriculture and food supply chain, governments should invest in Canadian initiatives. But should it invest in foreign car manufacturers that routinely threaten plant closures to secure more subsidies?

Greig Mordue, the chair, manufacturing policy and associate professor of engineering at McMaster University,  asserts that :

  • That since 2000, the Canadian and Ontario governments have invested US $9.1 billion into foreign automobile manufacturers
  • And, over that same period employment in Ontario’s auto industry dropped from 54,000 people to 37,000 people.
  • Currently, Ontario makes about 1.1 million cars each year – down from about 3 million in the year 2000. 

Ukrainian Surrogacy

Reproductive choices limited

Troubles in the Ukrainian surrogacy industry makes for an interesting counterpoint to the US Supreme Court’s impending decision to upend Roe v. Wade. International surrogacy is legal in the Ukraine. Conditions apply:

  • Single parents and gay couples cannot apply 
  • Surrogate mothers must have had children of their own
  • “Intended Parents” have clear parental rights. Their names go on the birth certificate from the outset. 
  • Cost: US$40 / US$ 50 thousand. This compares favourable to the US where the price is between US$100 and US$200,000 or to Israel at US$75,000

What happens to surrogate mothers in wartime. They have signed a contract to comply with the surrogacy agency to protect the foetus. But also, they have families. When the agency moves them to safe havens, families can be left behind. If Poland, say, provides that safe haven, then the new child is subject to Polish laws and a long adoption process will ensue. 

The Finns are Tough

A new NATO member?

I wrote recently that the Finns consider good shelter a human right – compassionate. Toughness – the National Post recently printed an article from The Daily Telegraph. In it we discover that:

  • Finland has enough nuclear bunkers for 4 million or 72% of its 5.5 million people
  • Helsinki alone has 5,500 bunkers
  • That by law, any building more than 13,000 square feet (1200 square metres)  must make provision for a shelter
  • It has a wartime army of 280,000 supplemented by 700,000 reservists 
  • Defence spending is effective – armed forces are equipped with modern weaponry. 

I have to shill the Shadow Lines TV series one more time. If you live next to a bear, be ready to swat it on the nose. Finland is.

The Crypto Infrastructure Cracks

  • Value of one bitcoin on March 28 – US$47,454
  • And the value on May 13 – US$30,345

Now imagine that on that March date someone in a shawarma shop tells you:

  • Central bankers are financially illiterate
  • That crypto currencies are a good inflation hedge and by extension, a good investment.
  • On the strength of that advice, you had invested your US$100,000 nest egg in Bitcoin
  • Today that investment would have a value of  US$63,940 in the most resilient of the cryptos. 

Would you ever take investment advice from that shawarma shop customer again? Probably not – but that person aspires to be Prime Minister. He continues as frontrunner for the leadership of one of Canada’s main political parties – the Conservatives.  In line with the rules for the last Conservative party debate, I have not named him. I can only hope that all of his campaign funds had been converted to Bitcoin on March 29.

Regardless, many will vote for him because there is a perception that he will be a better financial manager. In this regard, the current government is not a hard act to follow. They will pass off his crypto currency passion as a passing fancy to appeal to a certain voting block. He has, however, had a long history with crypto currency. He featured on a crypto currency podcast with so-called crypto expert / conspiracy theorist Robert Breedlove. The un-named candidate tells Breedlove he is “extremely informative.” In the Toronto Sun, Warren Kinsella wraps up a column on Breedlove and the Candidate with the more appropriate line: “It is extremely nuts”.

The hyperlinked title will take you to the Economist article on the downturn of crypto currencies. 

Love that downward red line

Quote for the week ending May 13.

“Bitcoin is ingenious but it has no unique value at all. It doesn’t produce anything. You can stare at it all day and no little bitcoins come out. It’s a delusion, basically,”

Warren Buffett in a 2019 interview with CNBC. He added “its like rat poison for investors.”

That’s it for the week ending May 13.

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