One of the interesting trends I have noticed in my household is that during the summer months spending tends to drop, due to:
- No school fees needed for trips and such
- School lunches are now part of the regular groceries
- Organized sports are mostly complete so very little spending there
- Less running around, so a little less gas money spent.
This gives us a chance to try to catch up before the September onslaught of spending. September to December is the worst spending time for my family, due to start of school, sports and Christmas all piling in together and causing a glut of spending.
Did I mention it’s 6 months and 8 days until Christmas? Have you started planning yet?
Lazy Good For Nothing Canadian Workers
I mean that in a facetious fashion of course, but productivity dropped for another quarter again, according to Stats Canada.
In the first quarter of 2008, the labour productivity of Canadian businesses declined for a second consecutive quarter, in a context of inclement weather, reduced working hours, and a widespread drop in manufacturing output, especially in the motor vehicle industry.
Productivity of Canadian businesses edged down 0.3% in the first quarter of 2008, slowing from the upward revised 0.7% decline in the fourth quarter of 2007. The back-to-back declines followed four quarters of growth.
I think higher gas prices is going to be hitting us and a much stronger Canadian Dollar is going to really hurt manufacturing for a good long while.
BCE Takeover to the Supreme Court
BCE takeover bid takes another step towards wherever it may end up with a Supreme Court hearing being set. This expedited hearing means that BCE’s battle with it’s bondholders might be over soon and the final fate of BCE may be known before my kids go back to school? Maybe a little premature on that, but who knows?
More importantly the BCE board has defferred on whether to declare a second quarter dividend until the end of June, and speculation has it that that money might be used as part of a deal with the bondholders.
The Canadian Press reported Friday that one scenario would see the $294 million that otherwise would be paid as the second-quarter dividend instead used to compensate bondholders.
Hey, that’s my money! I am a shareholder and I hold BCE as a dividend paying asset, and you guys are keeping my money? Hey!
Great posts today.
I like the summer spending solstice phrase. Seems to fit nicely with Tax Freedom Day this week. Interesting that you see the lull in spending, and it makes sense. Makes me think of the larger cycle too, where spending increases after marriage, house purchase and children, and again as the kids go to university (unless they get decent summer jobs, part time jobs, or student loans), then the lull again after the house is paid off and the kids leave home. At least until they move back in by their mid-20s.
The section about BCE considering the dividend cut makes me think of how management often acts in their own best interest rather than the owners’. I’m not entirely sure in this case, but that is broadly true. I think the structure of a publicly traded company, with the board of directors supposedly looking out for owners is flawed, and the ownership base is too diluted. It’s laughable to think that a company manager with a sole owner would act as audaciously as some CEOs. For example, how could directors willingly back-date options if they were REALLY looking out for the owners? Why would owners willingly pay a CEO millions or even hundreds of millions of dollars when a similar candidate for CEO would be willing to work for perhaps 20% as much?
Anyway, I’ll step down from the soapbox. Again, great post today, BCM.