Imagine if the TSX were down 17.8% and it WAS the government's fault?

Perhaps with the TSX down 10% during the last four trading days, people can get a better appreciation of what it was like and continues to be like for income trust investors who believed Stephen Harper when he solemnly pledged he would never raid their nest eggs by taxing income trusts. These folks experienced a 17.8% drop in the value of their savings. A loss of retirement savings that is perpetuated to this day.

That precipitous move by Harper and Flaherty is the largest loss willfully inflicted on citizens by any government, ever. It has cost 2.5 million Canadians over $35 billion of their life savings and every tax paying Canadian the loss of $1.4 billion in ANNUAL taxes to date .

I think Stephen Harper has a penchant for nuclear meltdowns. He is not fit to lead our country. Difficult times calls for competent and steady leadership. Not shoot from the hip dogmatic nonsense, which in the case of income trusts, Stephen Harper was spoon fed by lobbyists , Gwyn Morgan, Paul Desmarais Jr and Dominic D’Alessandro

Calculation of $35 billion loss:

The income trust market closed on October 31, 2006 at 164.86 as measured by the S&P/TSX Income Trust Index. On the evening of that same day, Finance Minister Jim Flaherty announced that he would introduce a 31.5% tax on income trusts. Two days later the index was at 138.21, This represents a loss of 16.2% which on a $200 billion market represents a loss of $32.5 billion. Two weeks later the index was at 135.51 representing a loss of 17.8% or $35.6 billion.

Harper treats us like unequals

Treats us like unequals? That’s the title of an article in today’s Leader-Post.

Let’s examine that claim as it relates to Stephen Harper’s decision to tax income trusts after he promised he would never raid senior’s nest eggs by making such a move.

As a starting point, Harper has allowed pension funds to own income trusts in their private equity portfolios free of the 31.5% tax and the 75% of Canadians without pensions can not? That sounds decidedly unequal to me.

Meanwhile as "compensation" for his draconian income trust tax, Harper has granted those 25% with pensions the right to split their pension income with their spouses or common law partners, whereas the 75% of Canadians without pensions can not. That sounds decidedly unequal to me.

Interest on corporate debt can be serviced with pretax cash flows, but distributions on income trusts can not. That sounds decidedly unequal to me.

Interest on corporate debt can flow to foreign investors free of any taxation, but distributions on income trusts can not. That sounds decidedly unequal to me.

Harper’s mini budget called for corporate tax rates to be reduced by 34% by the year 2012, and yet no such corresponding reduction on the income trust tax . That sounds decidedly unequal to me

John Manley and his 700 fellow lawyers at law firm McCarthy Tétrault LLP can participate and own a tax flow through partnership, but average Canadians seeking retirement income can not. That sounds decidedly unequal to me.

The pension plan of newly minted Bank of Canada Governor and architect of the Income Trust tax, Mark Carney’s own pension plan, the Public Sector Pension Plan can own Thunder Energy Trust, free of any 31.5% tax and growth restrictions, but average Canadians can not. That sounds decidedly unequal to me.

The resultant undervaluation in the trust sector, allowed the Public Sector Pension Plan to act in a predatory manner, working hand in hand with the civil servants who provided this legislative “carve out” and who are its beneficiaries. That sounds decidedly unequal to me.

And yet before being caught with their hands in the cookie jar, the Public Sector Pension Plan felt compelled to make this statement of self admission:

“Our exceptional level of liquidity provides us with a competitive advantage vis-à-vis others (Read: the average Canadian) in capturing the return premiums offered on less liquid (Read: private equity) investments.

Of course, as investors we are not called upon to formulate government policy...but we do have to make assessments of the potential impact of these various forces and factor those assessments into our investment decisions.”

Sure, we believe you. Just like we believe that our illustrious leader treats us like equals, or not, as the case may be:

Harper treats us like unequals
Murray Mandryk, Special to The Leader-Post
Published: Friday, January 18, 2008

Three bad days, and 2007’s gains are gone

That’s the title of today’s headline article in the Globe’s Report on Business. That’s also the way that Canada’s Finance Minister would like Canadians to save for retirement, when he condemns income trusts on the basis that we cannot become a “nation of coupon clippers”.

Implicit in that statement is that Jim Flaherty, an ambulance chasing insurance litigator who favours jailing the homeless, would prefer that Canadians saving for retirement become a nation of stock speculators or a nation of day traders.

The problem with the stock market at large is that it is premised largely on the greater fool theory, in which you attempt to buy low and sell high, provided you can find someone willing to provide you with your investment gain. Unfortunately the broad market is captive to investor sentiment at any point in time, which can turn on a dime, as it has these past three days, wiping out in three days all the returns that investors experienced during the entirety of 2007.

This is what makes income trusts unique, in that their returns are largely derived from the distributions that are paid on a monthly basis. Never will you read a headline in the Globe that says “Three bad days and 2007’s distributions are gone”. Once paid, these distributions are irrevocable.

Doesn’t that sound like the more prudent way to provide retirement income and peace of mind? With the traditional common share investment in a corporation, the investor looks to the market for his/her return, whereas with the income trust investment, the investor is looking to the company for his/her return. Income trusts are a buy and hold strategy as opposed to a buy and sell strategy.

Income trusts had grown over the past 10 years to a $235 billion market, as a result of the dramatic decline in interest rates and the fact that Canada has an aging population, of whom 75% do not have employer pensions. Stephen Harper solemnly promised he would never tax income trusts, but as with most of his promises, he promptly broke it. The reasons he cited are all fabricated nonsense, as income trusts do not cause tax leakage or weaken our economic growth or prosperity .

Income trusts however do cause headaches. Headaches for the likes of Dominic D’Alessandro of Manulife and Paul Desmarais Jr of Power Corporation/Great West Life, who were having a difficult time selling their investment wares like annuities and Income Plus in the face of the broad and growing popularity of income trusts.

In addition, corporations like CI Financial who had adopted the income trust model were provided with a higher valuation by the marketplace. This higher valuation was accorded by the market to income trusts. because investors place a premium on companies who were more disciplined in the payout of their earnings and who would only do acquisitions that would be accretive to earnings. Meaning acqusitions that increase the monthly distributions, rather than decrease the monthly distributions.

This caused a problem for companies like Manulife and Power Corporation, since they certainly liked the idea of enhancing their valuations by converting to income trusts but the idea of embracing these new ground rules of financial discipline was anathema to them. For example, Power’s acquisition of Putnam Investments which was not accretive to earnings, would not have been permissible by investors, had Power been an income trust.

As such, the Harper government has become the instrument of big business and the big Lifecos and made himself the arbiter of which investments will be available for the 75% of Canadians who must fend for their own retirement and which ones will not, meanwhile hypocritically and most unjustly allowing the Pension Funds who manage the retirement income for the 25% of Canadians to own income trusts in their private equity portfolios free of the new 31.5% tax. How can this be considered a Tax Fairness Plan? Harper then took this inequity even further by allowing the privileged 25% to split their pension income, but not the 75%, resulting in tax savings of up to $12,000 a year.

Would it surprise you to learn that every person, namely every politician and every bureaucrat who was involved in this policy’s design was a member of that exclusive 25% club?

And to think that this whole policy flip flop that was designed to serve the bespoke policy objectives of Manulife and Power Corporation and the like was perpetrated on the complete falsehood of tax leakage. All in order that you too can be the proud owner of retirement investments where all it takes is three bad days and all of last years’ gains are gone. Poof.

Perhaps Stephen Harper’s next occupation could be working in a boiler room operation, swindling unsuspecting investors from their life savings. He would come well recommended for that job, having swindled $35 billion form Canadians during his first nine months as the Right Honourable Prime Swindler of Canada

Open Letter to Jim Abbott and the Voters of Columbia/Kootenay

Jim Abbott, as it now stands you are untrustworthy, not credible, deceitful and
corrupt. You do not represent the people of Columbia/Kootenay, you represent
yourself.

Explain to the Union Workers, the Rotary Club, Seniors, and young savers and investors how some Trusts that could be owned by all and taxes paid, are now in your pension fund where no taxes are paid and we can no longer own these companies?

We, the voters were promised the CONS would not interfere with the Trust structure to get our vote, tamper with the Trust structure causing $35 Billion of voters' savings to evaporate, and then your pension fund snaps them up at discount prices where they pay no taxes and are no longer available publicly. Stripped out of our union pension funds and mutual funds.

There is no tax leakage or was there ever any. You can't prove it. When asked to prove it you produce a document with 18 pages blacked out.

In fact Jim Abbott your lies and deceit and manipulation have cost every taxpayer in Canada @ $344.00 so far, and a $7 Billion tax loss so far.

You Jim Abbott are beneath contempt.

If you were not protected by political immunity you would be on trial. You may be on trial yet. We, along with millions of other Canadians will not vote CON in the next election or ever again.

It is obvious you have 3 choices.

1) Run as a CON, be defeated, walk the streets of Cranbrook knowing you've screwed everyone you meet. You will be remembered forever. "The Greatest Betrayal by a Government on the Citizens in Canadian History"

2) Don't run. Walk the streets of Cranbrook knowing you've screwed everyone you meet. You will be remembered forever. "The Greatest Betrayal by a Government on the Citizens in Canadian History"

3) Run as an Independent. Distance yourself from the CONS manipulation, lies, deceit and betrayal. Prove to the People of Columbia/Kootenay and Canada you are a man of honesty, integrity, ethics and dignity.

Life is a series of choices Jim Abbott, choose wisely.

Silence and avoidance are no longer choices you have.

As you do not reply to letters, phone calls or emails we ask you to announce a press release when you plan a Town hall meeting and tell Canada what you plan to do. The National Media will attend.

Names withheld-we fear reprisal.

Yes Jim Abbott, we fear you.

From: http://www1.investorvillage.com/groups.asp?mb=6966&mn=3188&pt=msg&mid=3900797

Isodope Man: Able to leap tall buildings in a single bound.

Able to create tax leakage where none previously existed.

Able to hollow out the Canadian economy and hand over prime Canadian oil and gas reserves to middle-eastern state-owned enterprises with a single tax policy:

January 16, 2008
TAQA completes $4.6 billion acquisition of PrimeWest Energy Trust
CBC News

January 17, 2008
TAQA cites letter from Jim Prentice urging further takeovers
Globe and Mail

New Bank of Canada Governor Rodney Dangerfield gets no respect: Big banks consider defying rate cut

Looks like Mark Carney is getting the respect he deserves. After all, he only got the job by being an instrument for larger forces.....why would they kow tow to him now?

Looks like the Big Banks are now setting Canada’s monetary policy. Just imagine if these 600 pound gorillas were allowed to merge?


Big banks consider defying rate cut
Would risk destabilizing country's monetary policy
HEATHER SCOFFIELD AND TARA PERKINS
From Wednesday's Globe and Mail
January 16, 2008 at 2:50 AM EST

Some of Canada's big banks are contemplating holding their prime rates steady in the face of a rate cut by the Bank of Canada, a move that could destabilize the country's monetary policy.........

Stephen Harper practices bulldozer democracy: "Conservatives fire president of nuclear safety agency"

Stephen Harper is going to have to learn to “play nice” in the sand box, lest he have no sand box at all to play in. That said, there is nothing child’s play whatsoever about the issue of nuclear safety.

One thing is for certain: if Bulldozer Steve doesn’t get his way, he will fire you. As occurred when he fired the head of Elections Canada following his spat with Jean-Pierre Kingsley over the brewing “in and out” campaign financing abuses of the Conservatives in the 2006 election.

Who is well served by this form of bulldozer democracy? Canadians? Our important institutions like Elections Canada and the Nuclear Safety Association? It reminds me of his draconian treatment of once pandered to income trust investors, whose nest eggs he promised he would never raid and once elected, condemned them as “coupon clippers”. Better perhaps that Canadians become day traders and stock speculators in retirement?

Yesterday income trust tax apologist Terry Corcoran of the National Post had an article entitled Who's cashing in on the ABCP market? that ended with the following lofty statement:“ it looks too much like an insiders' game, in which some people are protected, others aren't, and the market is being starved of information”.

Too bad people like Terry Corcoran aren’t able to apply their lofty principles more uniformly, since that comment applies equally to income trusts and its handling by the press. Perhaps its time for someone to write the piece entitled: Who's cashing in on the income trust policy?

Starved of information? Bulldozer Democracy? Where is the proof of alleged tax leakage? When it comes to policy making, it’s always best to start and the beginning and work forward.


Conservatives fire president of nuclear safety agency
Ian MacLeod, Vancouver Sun
Published: Wednesday, January 16, 2008
OTTAWA - The federal government late Tuesday night fired Linda Keen as president of the embattled Canadian Nuclear Safety Commission......