Justin Trudeau and his minions got their wish: Canadian oil companies start revealing their profit numbers and they won’t be pretty – April 28, 2020,
I’m a believer in God, and because of this belief, my theories often revolve around biblical principals. I can never get behind devaluing money, currency, or bartering. When you devalue yourself in any trade negotiation, you’re asking for trouble. If as a heterosexual man I walk up to a woman who I’m interested in and do my absolute best to put her on a pedestal while devaluing myself, why should she pursue me? She would in fact be doing me a favor by pursuing me because clearly I would be lacking the confidence to LEAD her anywhere.
If any person were to take a step back and look at the Canadian economy, they’d assume based on demographics, based on our geographic location to the United States, based on the fact that we don’t have to spend as much as other countries to defend our borders, that we as Canadians should be the richest country on earth.
We don’t only have the people, we also have the natural resources and oddly enough we even have a pretty good banking system. What’s happened to Canada that is going to get exposed if the global economy starts to deflate is our bad economic policies.
Socialism revolves around everyone benefiting during the good times, the problem with socialism is deflation, because, under a socialist heavily regulated economic environment, the barrier to entry is extremely high. As an example, if a person starts a business in Canada, the government is not only propping up the prices of commercial property values, it’s also propping up energy prices via things like carbon taxes.
Now if as a company you have to be competitive with dictator run OPEC countries while at the same time trying to appease your democratic authoritarian masters, eventually there comes a breaking point. Now, during the good times, the Governments of the world tend to forget how their bread is buttered because during the economic times, government can borrow and spend because the expectation is that the government can SERVICE its debts with it’s productive taxed citizens.
But you see the moment people become less productive, there are fewer dollars to tax and although money printing doesn’t seem like a big deal when people are productive, reality starts to settle in when they aren’t productive.
Because remember, even though your printing money, fewer things are being created, so eventually there comes a time where scarcity is no longer a myth it’s a reality and only the people with bartering skills to make the numbers work can solve these problems, however in the meantime in order to save face more than likely this is the period where governments and central banks will assume that printing more money will fix lower productivity levels, however, it won’t because the government had already set a precedence to reward people for doing nothing!
So as resources become more scarce, this is when reality starts to settle in that if the government doesn’t enact price controls, the entire system will fail, but at the same time there’s a scarcity in the market and you see dear reader, this is usually when interest rates start to rise! Because the people doing all the work to revive the economy will demand in some way shape or form to be compensated for the risk they’re taking!
In case you’re wondering this is why old theories were to bail out the too big too fail companies instead of bailing out Mainstreet. Because in the end, if you’re not part of ‘industry’ in this type of economy, you’re a liability to the government.
When people are starving Venezuela happens, that’s how this works, I get it that when you go o the grocery store you expect things will be there, but eventually there comes a time when things aren’t there! Everything is linked together, little things that you take for granted are far more important than you can comprehend.
The lifeblood of the economy oil is deflating and this is actually a very good thing for OPEC because the longer this lasts the more likely they won’t have to worry about competition. If you someone were to tell me all of this was orchestrated, it’s not to say I would believe them, but I’d hear them out.
Anyway, the, in short, the main problem with deflation historically is Austerity measures, Alberta’s oil is not profitable primarily because of government regulations, Albertan is and has been historically very efficient with oil, which is why only politics could destroy their economy, a reminder, that COVID-19 didn’t destroy Alberta’s economy, years of attacks and Justin Trudeau did, of course, COVID-19 will get the blame, but the nail in the coffin came from our current Prime Minister.
A lot of people don’t know that Kuwait has a high valued currency, what a high valued currency does is it’s a buffer for times like this in which the value of your petrodollar might decline!
You want a high valued, in-demand currency when resources are scarce, you also want a favorable environment for industry during a deflationary period, Canada has none of this under Justin Trudeau and based on what I’m reading a large portion of Canada’s mainstream media is clueless as to what’s going to happen to the world. Even in Germany, they said ‘NO’ to the rest of EURO when Italy and Spain wanted to be able to print money on demand, why did Germany say no, because Germany is well aware of what hyperinflation looks like.
Don’t let current market fundamentals fool you, don’t let the forex markets fool you! Once the numbers stop making sense from an industry perspective, that’s when things really start to get interesting.
So in a deflationary oil environment, Canada would have been a lot better off, had we not built our economy on a lower valued Loonie! If what I’m saying doesn’t make any sense now, it’s okay, you’ll figure it out eventually! Pandora’s box has been opened and I highly recommend that Canadians prepare themselves accordingly!
Canadian oil companies start revealing their profit numbers — and they won’t be pretty | CBC
Interesting times ahead!