Canadian Businesses

June 15, 202410 Comments

Today, I am presenting some thoughts on something that has been pressing on my mind for a while. It may sound a little (ok, a lot..) ranty, but I’m trying to press a point that some of my readers who do not own a business may not be aware of. Business owner or not, I am sure that all of you are quite aware that Canadian businesses are the lifeblood of an economy.

One of the interesting things about the Portfolio Management business is that a pretty high percentage of our clients are current or retired small business owners. The reason for this concentration of client backgrounds in business is that small business people must rely on the value of their savings AND on the capital value of their business/ associated assets when they retire. They don’t have guaranteed pensions. They don’t get big-business handouts like Honda, SNC, Bombardier, etc. Not to mention the endless Liberal family & friends contract deals. Nope. They must invest their own money in financial assets and business assets to look after their retirement. As such, they come to ValueTrend to ensure their current or future investments will cover their needs.

As a small business owner myself, I am aware of the issues surrounding business ownership in Canada. Let’s face it, a boots-on-the-ground fellow entrepreneur is going to be far more aware of the realities behind running a business than someone working within a large bank.

Today’s blog is directed at business owners (or former business owners). However, it should also be of interest to any of you who invest in TSX-listed stocks. It starts off with an interesting speech given by Bruce Pardy of Queens University. Pardy is not a politician. He is a professor of business law who is extremely concerned about the current climate for Canadian businesses. I believe his comments are relevant not only the challenges of running a business in Canada vs. other developed nations, but also translate into challenges of buying shares in publicly listed Canadian businesses vs. comparative non-Canadian stocks.

A number of my very, very astute business clients have expressed some of the exact sentiments of Mr. Pardy. Further, because these boots-on-the-ground entrepreneurs are more aware of the realities of our business climate than “employed” individuals (particularly government associated workers), I am hearing more and more of them watching the 2025 Canadian election statistics to determine the future of their companies. In fact, two of my Canadian business contacts recently moved their operations to free market states in the USA within the last year.

We can stick our heads in the ground and pretend that the mass emigration out of Canada (50 year highs) by skilled workers, venture capital investors, business owners and wealthy individuals is not happening. Or we can be aware of the facts. Here’s a short video by Mr. Pardy summarizing the challenges.

How to Destroy the Competitiveness of Canadian Businesses

Every business person AND  investor in Canada buying TSX listed stocks should watch this video.  This is Bruce Pardy (Professor of Law, Queens University) addressing the House of Commons on May 30th.

Cause and Effect

Our primary business metrics are at world-comparative lows at this time–you’ve seen my prior blogs covering this. Cause and Effect:  Flooding the country with levels of limited-skills immigration that we cannot support, deliberately driving up the cost of energy via carbon taxes (translating into higher grocery, shipping, heating, and living costs), deliberately raising our taxes at all levels (income tax, beer, Netflix, on and on), deliberately printing money and spending in non-economically productive ways, driving our debt to record levels, and pushing to destroy the energy sector while pushing an entirely non viable so-called green agenda. For example, the Parliamentary Budget Officer’s (PMO) recently released data showing that the carbon tax has literally erased $20 Billion (!!!) of GDP from Canada. This, after Trudeaus team just attempted to gag the PMO from releasing that data.

And now, they are trying rob productive Canadians and small businesses (not to mention middle class cottage owners) of even more of our hard-earned money via capital gains tax increases.

BNN has recently interviewed countless entrepreneurs and venture capital investors who were planning on investing in Canada – but have now turned around and headed south. Emigration out of Canada by the most productive people into economically and socially free states like Florida and Texas, is at record highs. This is distressing. What was Trudeaus answer to this? Was it to make it more attractive for the job makers and wealth creators to stay? Nope. He increased the capital gain tax AND then introduced an “emigration tax” of $25,000 if you leave. You know you’re losing the battle when you can’t entice productive people to stay, so you use retention penalties like dictators.

Angry?

As Professor Pardy suggests: This is EXACTLY what you would do if you were trying to destroy the prosperity of a nation, including Canadian businesses. Yet, they complain about how “angry” Canadians are, and aggression towards “politicians”.

Failing to mention that the entirety of this anger is towards THEM – NOT generalized against all “politicians”. You’d think they might have expected this, after deliberately destroying our economic prosperity and our social culture through adherence to the Great Reset agenda.

We have a housing affordability crisis.

We have a surging homelessness crisis.

We have a violent crime crisis.

We have a drug overdose crisis.

We have a cost-of-living crisis

We have a healthcare crisis

More to come: We’ve recently reading about the foreign interference coverups. Another attempt at hiding uncomfortable truths. Yet, they  feel completely entitled to avoid any consequences for all of these actions and results . You know, like an angry citizens?

As I often say: You can’t fix stupid, especially when it comes to the policies affecting Canadian businesses.

10 Comments

  • One must look at municipal government as well. In my community, in my trade, property taxes reflect $10/ hour in shop rate. That is 20K a year. You can kiss new investment good- bye at that rate. They are also introducing vacancy taxes on empty properties. I had a landlady who would not rent to welfare people. Such interference in business decisions will aggravate housing problems. She took care of her properties. She could very well exit the business to a less scrupulous owner because of the hassles.

    Reply
    • Indeed, Bert. the regional mandates seem to be increasing – in Barrie businesses recently had to have a yearly water purity test done by a government approved plumber then get him/her to file the results which also cost money. My business property is literally a house. Residents right next door don’t have to do this, and we all get the same water line…and thats just one small example.
      Lets not get started on the provincial employment laws making it horrifying to actually hire someone who ends up not working out….

      I cant share names, but boy do I know alot of small business people looking at leaving the country. The tipping point will be September 2025.

      Reply
  • Excellent article Keith. I appreciate you trying to speak about the disaster of our current government. It’s unbelievable what they are doing and yet their sycophant supporters just are obtuse or ideologically possessed with nonsense. I’m born and raised 63 years and never have I seen such a disgrace as this current corrupt government. Looking to leave the country as I know we are in the early innings of epic disaster. Thx again for your great stuff.

    Reply
    • We’re pretty much the same age Dan and I too stand in shock & awe at what has happened. Which is why I wrote these rants. Before Trudeau, I had no interest in politics and never mentioned them. It was insignificant to my work. But now, politics matter on every possible level. Your job, your investing, the economy, your freedom of speech, property ownership, social decency, and your right to personal choices. The fallout is that good, smart, hardworking and successful people with decent morals like it sounds you are, will leave. We get to keep the terrorist supporters, crack heads and unskilled workers. The rest will work for the government in some capacity. Unbelievable.

      Reply
  • It was not by accident that when the current government team arrived, and flatly
    stated that spending immensely, in the hundreds of billions, would have no consequence, in the future, in inflation, cost of living, business operations, the return on investments and the possibility of agreeing to make investments in the first place, because the mental knowledge, and lack of mathematics, lack of financial basic grasp preparation is missing in the majority of the population. Low I.Q, for finance, but high sensitivity to emotional and simplistic solutions of what goes on in the smartphone media feeds (green energy, electric vehicles, etc) are what voters are all about.

    e.g. the rule of 72, that you divide the current inflation rate (or what is has or will be over 10-20 years) by your amount of current stash of money, determines how many years that it will take to have lost fifty percent of its value, is not talked about in the media, business schools, finance books, BNN, MSNBC, etc. Hard crucial facts are hidden. Brains are too small in the viewership..with eyes glued to smartphone LCD media feeds,.

    Reply
  • Example: at 6 percent inflation, take 72 and divide by 6, meaning, HALF of your current stash of money will be gone, in value, in a 12 years from inflation, if all you do is let it still idle. Government doesn’t help with term deposits rates of return that are insufficient. It appears we are back in 1981 – 1983, when bond holders and people buying the 1-3 percent return CSB were taken to the cleaners. At 5 percent, 17 years.

    Reply
    • Inflation is now more ground level (food, fuel etc)–they claim its falling but only because big ticket items (discretionary, cars, homes) have come down a bit. Also because more unemployment and less spending. Aka the average Joe/Joanne is still seeing high inflation in their lives.

      Reply
  • This is dead on but the Liebrels are a cult & it is difficult to have an intelligent conversation with their supporters. As one woman stated, He maybe destructive, but it is not because he is stupid but, rather , because it is his plan. One can only pray that not just the Emperor but the Liebrel party is smashed in the next compromised election. In the meantime, like a termite, he burrows in to defeat the opposition by buying large numbers of votes through “refugees”, immigration, visas and more. (& no, no 1 is suggesting that reasonable levels are not beneficial_ ) The uncivil service has expanded by 25% in recent times – any1 notice better service ? Any1? He has already bought out so called Cdn journalism – investigative journalism ? only against the opposition,,,,, Most grads in the coming years will have to look for civil service careers ….
    cheers

    Reply

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