The income trust flip flop in fall 2006 still haunts Prime Minister Stephen Harper. It has cost him in polls and this year, in 2010, will likely do so again as Ottawa's punitive 31.5% tax on the remaining 169 income trusts will force them to privatize or be taken out by big corporations or pensions.
His policy boondoggle caused damage: 1. A broken promise by the Prime Minister made, unequivocally, to leave trusts intact because of their importance to small investors and retirees; 2. The soiling of the country's reputation because the flip flop was retroactive and confiscated billion in value; 3. The disappearance of 51 income trusts (out of 220) bought by foreigners and others who do not pay taxes; and 4. Evidence that finance did not understand nor do the necessary homework.
The Liberals say the 31.5% income trust tax should be 10% this year to prevent huge disruption. But a more elegant solution has been put forward by a truck driver from Cornwall Ontario and his wife, David and Lorraine Marshall. Dubbed the "Marshall Plan", it has been formally submitted in response to requests by the government for ideas before the March budget.
In a nutshell, the "Marshall Plan" calls for creation of a unique tax shelter where income trust units held in RRSPs could be placed and the 31.5% tax avoided. In return, any capital gains tax would be deferred until monies were withdrawn but the distributions to unitholders would be taxable every year.
This could be an instant windfall to Ottawa. The 169 trusts that are left pay out about billion annually in distributions to their unitholders and this income, if taxed annually at an average dividend-rate of 38%, would generate billion a year in taxes to Ottawa.
If this is not done, the damage already caused will multiply. Since 2006, the policy led to the buyout of 51 income trusts by purchasers who don't pay taxes (pensions) or who will write off profits against interest payments on debts used to acquire the trusts. This phenomena is the most damning indictment of the 2006 nonsense and will be compounded this year.
Some may argue that the Marshall Plan constitutes another bailout. But that's nonsense. How can a tax shelter which yields billion a year in taxes be a bailout? How can a tax shelter which allows the feds to eventually tax capital gains when it collapses or funds withdrawn be characterized as a bailout?
The Caisse de Depot et placements du Quebec, National Bank and others were rescued after they didn't do their homework and peddled or bought asset-backed commercial paper. So what's the justification for not rescuing innocent investor-victims who did their homework and were promised protection, then double-crossed?
The income trust policy is a blunder but can, thanks to a truck driver and his wife, be somewhat corrected. Only if, Harper and Flaherty heed and adopt the Marshall Plan in the budget this March.

Ben Stiller, like Canada, surrounded by marauders in "Last Night at the Museum"

The announced rdaddphp.7 billion takeover by PetroChina of two planned Alberta oil sands projects should be approved but with very strict, new conditions.
Diplomatically, it will send the signal to Americans that Asia will buy our oil if they don?t.
However,  the Chinese and others must be told that they cannot make any gigantic takeovers, such as the buyout of Suncor-PetroCanada or put together a string of smaller acquisitions which add up to a huge buyout. Canada must combine smart energy security and concentration of ownership policies.
Last year, Investment Canada beefed up its ?national interest? section following a wave of foreign buyouts in 2006 and 2007, but the agency still lacks transparency, street smarts or teeth.
Investment Canada should fully disclose its agreement with foreigners, then it should require every foreign player ? whether owner or contractor ?to post a huge performance bond, of hundreds of millions of dollars if appropriate, to back their pledges. These bonds would be forfeited if promises were not kept or if the foreign takeover resulted in extraordinary legal, regulatory, environmental or labor expenses to taxpayers.

A tale of three countries
This is not protectionist, but pragmatic. Consider three recent examples where foreigners have not lived up to expectations or pledges.
In 2007, U.S. Steel was allowed to take over Stelco, amid fears it would shut it down to save American jobs. U.S. Steel made promises to Investment Canada addressing these fears, then months later announced a closure of Canadian operations. Ottawa protested and has taken the steel giant to a Canadian federal court for failing to maintain employment and production as promised and  required by the Investment Canada Act. It faces fines, or could be forced to divest Stelco, if the court so chooses.

Likewise, Brazilian mining champion, CVRD, bought Canada?s Inco in 2006 and is now embroiled in a labor dispute which, unions say, contravenes promises made to Investment Canada. Industry Minister Tony Clement says that is not so but Liberal leader Michael Ignatieff says Ottawa has not made public its agreement with Vale and should do so.
?Vale Inco, when they took over the company, made very specific undertakings to the people of Canada and the government of Canada, under the Investment review process,? said Ignatieff. ?Those undertakings have never been made public. The union wants to know what Vale Inco promised the people of Canada. We need transparency and disclosure in the investment review process, and we feel the government of Canada has failed to do that.?

China
The Chinese oil sands bid is interesting timing considering that recently Alberta laid a total of 53 workplace and employment inadequacy charges against three companies which includes Sinopec Shanghai Engineering Co., its Canadian affiliate SSEC Canada Ltd., plus their client, Canadian Natural Resources Ltd.
Sinopec landed a contract with CNR to build boilers at its oil sands project and in 2006 was allowed by Ottawa to bring in 132 temporary workers from China. In April 2007, an accidental occurred leaving two Chinese workers dead, three injured and the job unfinished. Charges allege the workplace was inadequately supervised.
The Chinese mishap has caused other costly problems to Alberta and Canadian taxpayers, not to mention CNR.
?There was an employment standards investigation that led to the discovery of the 132 Chinese workers not being paid for their work from the date of the OHS incident (April 2007) to July of that year. The Alberta government is in receipt of .17 million and is in the midst of tracking the workers and determining a process to get this money back in the hands of workers,? said spokesman Barrie Harrison.
The court case involving the workplace charges has had to be postponed because of the Chinese.
?Sinopec now claims that they have no representatives in Canada so we are unable to ?serve? them and the court case was delayed until we can establish who their official representatives are and serve them notice,? said Chris Chodan, spokesman for the Alberta Occupational Health and Safety Branch.

All three foreign takeovers have imposed a cost on Canadian taxpayers and shouldn?t have. Investment Canada should get its act together.

Public humiliation in China of business criminals before their sentences are executed

A tale of two countries
The juxtaposition and timing is, well, simply wierd. Where has Ottawa gotten its China advice lately?
This week, Canadian Finance Minister Jim Flaherty enthusiastically headed a delegation to China and personally petitioned Chinese leaders to invest gazillions of hard currency dollars in Canada. He even encouraged them to take over Canadian corporations.
Also this week, Australian Prime Minister Kevin Rudd, a savvy former diplomat and China expert who speaks fluent Mandarin, vigorously and toughly attacked China for its nasty attempt to take over Rio Tinto, its bully-boy behavior and its human rights violations against Australian workers.

Why the difference?
Australia, the world's other rich Queen Scout of nations, has learned some lessons about Asia that Canada has yet to learn. The Aussies have been at the China-game for years now and have enjoyed land-mine business but ended up in the trap of allowing an inordinate proportion of their economy to be dependent on Beijing. Now Beijing is exerting its dominance with veiled threats, accusations and attacks.
It all was destined to end badly, given China?s proclivity to dictatorial governance and lack of respect for the rule of law in all matters.
Meanwhile along comes Canada's investment enthusiasts, eager to do China?s bid and, by so doing, naively inviting a big bully into its economic and corporate tents. This is also destined, shall we say politely, to end badly.

Trade is glorious, with the right partners
Of course, Canada is a small nation like Australia and has also prospered while becoming inordinately dependent upon a single trading partner, in this case the United States. The difference is that while the Americans are a prickly, and sometimes protectionist lot, they are dramatically more benign trade cohorts.
Don't get me wrong, going to China to drum up business has made sense but timing is everything. Australia?s highly publicized fight concerning China's unproven accusations, jailing of executives and nasty, hostile takeover attempt of Rio Tinto should have afforded instruction, and dictated pause or postponement, to Ottawa?s tiny trade team.
So while Canada's finance minister danced across the Sino scape, yesterday Australian Prime Minister Rudd warned Beijing that the world was watching its mistreatment of four Rio Tinto executives whose trumped-up charges followed China's failed attempt to grab the company.
He's right. But if the whole world is watching why weren't Canada's federal leaders?

I?ve spent this week happily in Quebec ? the eastern townships with friends, Montreal with smart business men and four days in the booming mine area in the province?s north with other directors of a gold mine company I'm involved with.

As is often the case, I had lunch with Stephen Jarislowsky of money management giant, Jarislowsky Fraser. He is my favorite stock market and corporate ?scold?.

Stephen is an irascible billionaire money-manager who never pulls punches about anyone or anything. No enemy was left unmentioned, notably those in public companies with whom he had dust-ups. But because our visit was mostly social, I interviewed him only briefly and about the world's biggest leveraged buyout, BCE takeout by a couple of U.S. private equity outfits and the Ontario Teachers Pension Plan. The deal has been hugely controversial, and questionable. Bondholders were skinned alive, lost then won then lost in courts. Shareholders approved a deal to close in June which didn't and, even so, new owners have started to tear the place apart and stop dividends.

Ontario Teachers' ownership exceeds the 30% limit on pension ownership and the American equity participation exceeds the 25% limits on telecom ownership.

Here?s our little chat:

Q: BCE?
A: ?It?s outrageous that the board of directors took rdaddphp billion from BCE?s bondholders. It?s also just plain stupid that the Supreme Court of Canada, in a 7 to 0 opinion, briefly heard the case and overturned the Quebec Appeal Court?s unanimous 5 to 0 opinion upholding the rights of bondholders.?

Q: The Supreme Court?s overturning of the Quebec Appeal Court?s unanimous decision in any other issue would have sparked a constitutional crisis? What was this all about?
A: ?The whole field of investor law is a joke in Canada. What was allowed to happen to BCE bondholders is unbelievable. The dividends were cut for BCE shareholders to reduce the price paid. The board did not look after the bondholders as well as the shareholders. The Quebec Appeal Court?s decision was the correct one.?

Q: Wasn?t this lack of protection for bondholders in the fine print of the deal?
A: ?In Canada, the board is responsible to the company and not the shareholders or bondholders. Thomson Reuters just sold bonds and had a clause which stated that bondholders were not protected or subordinate to shareholders. We would not buy bonds like that which mean that they can go from As to junk based on board decisions in the future.?

Q: How is it that BCE is now run by the buyers even though the deal hasn?t closed?
A: ?It?s unacceptable.?

Q: Will BCE get the debt it needs to close the deal?
A: ?I don?t know. The banks have been out of control and are now having difficulties.?

Q: What legal reforms should occur in Canada?
A: ?Much work needs to be done and I am setting up a foundation with others to come up with legislative ideas. Take Conrad Black. He stole more money in Canada than he did in the U.S. and he wasn?t even pursued here. We do not have police or securities commissions who are on the ball. We do not have specialized courts who understand what to do. Suing in Canadian courts is not a remedy because it takes ten years to get anywhere and why should shareholders have to suffer when a board has done something wrong??
?Arbitration, not lawsuits, is the best way to handle disagreements and problems.?

Q: Why has BCE been so badly managed for so long?
A: ?All the company did for decades was go to Ottawa and ask for higher rates of return. They blew money on bad investments and never fixed their customer relations problem. This is a company that has been disliked as much as Air Canada with its hated, high-handed employee behaviour toward customers. That still hasn?t been fixed. I used to have lunch with Michael [Sabia, former CEO]. I like him but he never fixed it.?

Here we go again: Transalta is under siege. That will bring the takeouts of income trusts since October 2006 to 45, and .8 billion, mostly foreigners. If debt markets had not cratered virtually all of the 200 trusts would have been bought with debt by foreigners. Trusts represented 10% of the capital markets and are disappearing mostly into private equity to boot, thus shrinking investment opportunities for Canadians to boot.
The Tories and provinces continue to blunder along despite promises to lower business taxes which, by the way, still remain the highest among the OECD nations.
Nothing changes and the gigantic Tory blunder is camouflaged as a result of soaring commodity prices. This skews the numbers nationally and lulls leaders into believing their own press releases.

Third rate Tory government
As this trend continues, the damage to Canada's capital markets will be enormous, leaving only the widely-held banks to buy.
Instead of policies that fit the international realities -- such as a race to eliminate business taxes to provide a competitive advantage to local and new enterprises -- we get a so-called "competitiveness study" that declares Canada should lift ownership limits on telecoms and banking.
(Photo: Harper -- all hat and no cattle) 

 
BCE, like PGA golfer, stuck in sand trap of credit markets and unions. AFP 

BCE's leveraged buyout, the world's biggest at C billion, is not a done deal yet, thanks to the credit crisis. But there is much salivating for those who will make millions such as the management of BCE, the fat cats in the brokerage industry, BCE's board of directors, its advisors. The deal is lousy for shareholders who have been denied the opportunity of greater profits through: a) throwing out the second-rate board and management; or b) doing a clever restructuring to enhance shareholder value.
But shareholders approved the only deal offered to them -- they were not told about alternatives -- so now we'll see if it closes. Government approvals have been obtained but BCE and the Ontario Teachers Pension Fund plus its partners should be wary of what they wish for: BCE will be sandbagged with billions in debt while people like CEO Michael Sabia and his crew will become hugely wealthy.

Next victims
But there's another casualty to this corporate greed: taxpayers who won't have taxes from BCE because it will expense massive interest payments against tax owed plus unionized employees who are being asked to axe seniority and severance benefits.
Here are excerpts from a letter emailed to me from Paul MacIntyre, one of the unionized technicians and another he wrote (in Italics) to "Mike" Sabia after he "crowed" in the press and in a newsletter to employees about obtaining Industry Canada approving this deal which I have written is not in Canada's best interests:
?We are currently in the midst of difficult "negotiations", with voting on a second ultimatum underway. Bell has refused to negotiate with our bargaining committee and has tabled consecutive "final offers". they seek monetary concessions and concessions that will seriously weaken the strength of our union,? wrote MacIntyre.
?This has been occurring in a media vaccuum and their tactics have instilled a lot of fear. Some employees are choosing to accept a draconian offer rather than face a possible work stoppage. There is absolutely no value in this takeover to employees, management (other than executive), subscribers of our services, or to taxpayers. We have been trying to get support of media so that the wealthy players lust and greed would be exposed. We have also been undermined by the actions of the National office of our Union-CEP,? he wrote.
Here's what he wrote to Michael "Mike" Sabia:
Dear Mike,
I understand that you might be a little busy at the moment to take the time to respond to an email from one of your employees. However, I am hopeful that one  of your assistants might take note and bring this to your attention.
Please don?t trumpet the approval by Industry Canada of the TEACHER?S takeover of our company as a significant hurdle that has been cleared. To anyone paying attention, that is like the ring announcer making a big deal out of the fact that the challenger is still standing after the introductions. He still has to face the champ and that champion is in the capital markets and he is being managed by the credit crisis. They will decide whether this deal gets completed.  Spare us your grand announcement?s via company email. But thank you for allowing the use of company email, so that concerned employees may respond.
Could you please provide comment to the media and to Industry Minister Jim Prentice on the bargaining tactics of your President of Operations, Pat Pichette. We realize that we are an extremely profitable company. Over file=df_foreign_takeovers_news_rss.php,000,000,000.00 in profit annually indicates a very sound business. And yes, billion dollars is a grand figure. Truly a major accomplishment for yourself if you can retire knowing that you assisted in completing the greatest transfer of ownership in Canadian corporate history. But your workforce is scratching our heads over why Bell Canada is asking for major concessions from us.
I thought that I was a member of a union but Pat seems to not want to acknowledge that fact. We have an elected bargaining committee but Pat must feel he doesn?t have to negotiate with them and he has tabled consecutive final offers. Actually, he has tabled an initial FINAL AND GLOBAL OFFER which was followed by a DEFINITIVE FINAL OFFER. He obviously has a definition of FINAL that differs from most peoples. And we weren?t sure if we should be afraid of GLOBAL because we didn?t understand what it meant. But we think it might be scary.
A lot of the technicians now refer to them as an initial FINE offer and a second DEFINITELY FINER offer. Probably was a typo error.
But  we are looking at these offers and it looks like all that has been done is the pages were shuffled. The language is different but there is a lot in the second offer that was in the first. Did someone drop the second contract on the way to the fax machine? They didn?t put the pages in the right order but the offer I am looking at looks a lot like the first.
So the question I would like to ask of you Mike, and perhaps the Industry Minister could  respond as well, is why BCE and Bell Canada are not negotiating with us? A second question would be why are you asking for concessions on seniority issues? A third would be why do you want to greatly diminish our group grievance procedures ?this is a strong disincentive to corporate bullying that we will not give up.
And Industry Minister Prentice, you have held up your responsibility to keep control of BCE in Canada. This keeps the deal onside with Canadian Law.
And the approval of Industry Canada would please the shareholders of BCE, rich and not so rich, but I would suggest the rich are the happiest. What is your responsibility to the employees of this iconic, wealthy, and financially sound company? We are a part of this industry. Are unions still recognized by the federal government? I am starting to believe that BCE and Bell Canada does not want to recognize our union. And of course we understand that when a company is saddled with over $ 30 Billion dollars in debt, that costs have to be cut to make those interest payments. Parts of the company will need to be sold and the elimination of jobs on the management side has already begun. The  subscribers to our services will probably have to make a contribution through their bills. And the company will be coming to take money out of the pockets of it?s workforce and weaken it in anticipation of future savings.
Does the Federal Government look out for the interests of the working   class? All that I see that this takeover accomplishes is a transfer of ownership between wealthy entities that they all hoped to profit from. Now that market conditions have changed, some may not profit as handsomely as they hoped. I feel terribly for them. Does it sit well with the Minister that the new company will be paying substantially lower Federal and Provincial taxes, if any at all? Does he consider the  huge loss of jobs on the management side and the taxes they pay unimportant? Are we, the technicians, merely collateral damage standing in the way of a gold rush. Why do we have to consider striking and the hardships that brings when there is absolutely zero value in this deal for taxpayers, employees and the financial health of this company. Isn?t this one big  friggin?  PONZI scheme? We?re tired of handing our money to the guys above us in the pyramid.
Mike, we know you?re busy trying to save your deal. Good luck to you. Get back to us when you can.
Honorable Minister Prentice, we look forward to your response. Don?t bother running this by the guy you?re working for. He?s probably busy combing his hair.
But we would like to understand what a deal like this does for the vast majority of your constituents- the working people.

Regards, Paul MacIntyre
Cable Repair Tech., Bell
Toronto,ON

There remains trouble in Toryland over finance minister Jim Flaherty?s non-sensical tax on energy trusts and the income trust debacle cost the party a byelection in B.C. this week. Its candidate cited income trusts as the major concern in the election. It is an issue that simply will not go away because it should not. Prime Minister Stephen Harper, at Flaherty's urging, reneged on a firm promise which is good leadership.
The issue is the single biggest reason why the Tories have not, and cannot, get a majority in the polls. Their foolish and flawed flip flop against trusts devastated and alienated their base. Some billion in value disappeared overnight, affecting two million Canadian investors.
Taxing the energy trusts too, when other countries do not, has been a major policy blunder and Albertans are determined to prove how foolish it all has been with an initiative announced last week.
Energy trusts have joined the Liberals who have asked the Auditor General of Canada to investigate Flaherty?s claims that taxing the trusts was necessary to staunch tax leakage.
It was nonsense then and still is.
?0 a barrel oil prices have camouflaged what is a big mistake in policy,? said Sue Riddell Rose in a phone interview with me last week. She is CEO of Paramount Energy Trust and the Coalition for Energy Trusts spokesperson. 

Trusts used everywhere else
Trust structures are used, and recognized, around the world as a more efficient means of managing commodity companies which find planning difficult due to price fluctuations. Flaherty exempted real estate trusts but not energy trusts, a damaging inconsistency.
About 20% of the country?s 33 energy trusts (which pay considerably more taxes than all the foreign-owned oil companies combined) have been swallowed up by foreigners or other entities.
Ottawa?s attack has ruined the junior oil sector too since October 2006 despite soaring oil prices, she said.
?The junior oil sector is no longer vibrant. There is no exit strategy which was to sell oil and gas assets to trusts,? she said. Put another way, if oil prices had remained the same as when Flaherty made his tax announcement on Oct. 31, 2006, the oil patch would be in ?dire? straits.
?They did not do their homework. They did not understand the industry and they have deceived the Canadian public,? she said.

Trusts really dumb idea
Flaherty?s leakage excuse was debunked in a report by accounting giant Deloitte weeks ago in a study that showed that the reverse has happened: where there was no leakage there is now massive leakage.
The mistake, or omission, made by him and Mark Carney ? author of the scheme and rewarded by becoming Governor of the Bank of Canada -- was to exclude the massive downstream income trusts flowed to unitholders who paid top taxation rates.
It was amateur hour and the harm has been ongoing and will worsen, Riddell explained.
?In 2006, there was no leakage at all and revenues were enhanced by the trust structure,? she said. ?We?ve tried to get breakdowns from government as to the percentage of its cash surpluses that are coming from this but cannot get anywhere.?
She said a rough guess is that Flaherty?s folly has cost governments at least rdaddphp billion in tax revenues, but only the Auditor General, with her special access, can do the analysis needed for taxpayers.
?It?s a big number,? she said. ?There are two things we would like them to do:  Go through their analysis re the actual, downstream revenue and then to analyze what has been foregone as a result of the changes.?
Why isn?t she and others giving up?
?We continue to believe a proper analysis was not done and that the wrong decision was made to enable the efficient recovery of resources for Canadians,? she said. ?I personally feel deceived by them because they misrepresented information to Canadians. Something else is driving these decisions and I think Canadians should know. I don?t.?
 

Like Canada, Ben Stiller is assaulted by barbarians in "Night at the Museum"

Where does Taqa North Ltd., an foreign company come off talking about snapping up Canadian energy companies while a review about foreign owernship is underway and won?t be done until June?
Abu Dhabi?s Taqa boasted last week that it had been given the go-ahead to look for more acquisitions by Industry Minister Jim Prentice. It wants to become one of Canada?s biggest energy companies.
And I don?t want it to. Neither do most Canadians if asked.
Circumventing government is unacceptable to most Canadians and it is strange that the company cites Prentice as encouraging takeovers. He is the minister who imposed a chill on foreign buyouts in the fall, announcing that a review was going to be undertaken.
So what gives? Is this guy lying? Or is he testing our limp, wimp Tory government? read more

-- The next Canadian federal election will be fall 2009 because the Liberals will not get their act together and the Tories will remain unpopular.

-- The Canadian dollar will hover around par with the U.S. dollar, give or take a few cents either way because the Americans must keep interest rates down, putting downward pressure on their dollar, to get over the sub-prime/housing problem. The Republicans also want to win the fall 2008 presidential and congressional elections so they will "encourage" lower interest rates to keep the economy humming.

-- Stock markets will perform well throughout the year because they always have, historically, in the fourth year of a U.S. presidency.

-- Oil will stay over 0 a barrel and hit 0 if there is a serious terrorist attack in Beijing or Europe or North America.

-- Gold will test rdaddphp,000 an ounce, especially if it appears that Pakistan's nuclear arsenal may be at risk following instability and Benazir Bhutto's assassination.

-- Resource consolidations will continue in forestry, mining and energy as Canada "Scandinavianizes" and Ottawa futzes around about foreign takeover restrictions in these sectors.

-- Canada will also continue to lose head offices and gain none abroad due to a combination of stupid Tory policies (the attack against 215 income trusts and forefeiture of 15% withholding taxes on interest payments to Americans) as well as the Canadian corporate culture of wimpiness.

-- The Beijing Olympics will have a few hiccups, but no disaster. China will win most golds.

-- Pakistan will be governed under martial law

-- Iraq won't improve

-- Afghanistan will worsen as allies leave and a more militant Pakistan drives troublemakers out. 

-- Russia will be more difficult to deal with.

-- Osama Bin Laden will NOT be caught, dead or alive.

Got any forecasts? I'll print the reasonable ones.

The TSX merger is welcome and long overdue, but Canada?s new combined capital markets entry had better start making more takeovers. That is because it is an eat-or-be-eaten world out there.
So the TSX's first move should be to create a new board comprised exclusively of world-class capital markets players, including at least 25% who are foreigners.

Then the first on the hit list should be the American Stock Exchange. Apparently, a few years back TSX?s Richard Nesbitt and others proposed to take it over plus others, but the exchange?s directors wimped out. It?s a good exchange and has a listings business which is very valuable in a consolidating world.
So let?s be clear here: The merger of Toronto and Montreal is a good move but not a forward move. It is merely a correction of the balkanization mentality of Canadian public policy that is leaving us badly behind. Years ago, all the country?s four equity and derivatives markets should have been merged instead of tossing a bone to Quebec.
If the TSX does not get on to the takeover trail immediately, it will be gobbled up by the New York, NASDAQ, London or even a third-world exchange.
The TSX should look at acquiring Boston, Philadelphia, Mexico City, Australia, one in India and/or China and any other exchange that makes sense. Mexico?s systems came from Canada and there is a great deal of synergy between the two, notably in mining, and also there will be as more economic integration takes place continentally.
I?m unsure of the ownership situations of these capital markets but whatever is possible has to be bought.
This is compelling because the combination of low interest rates, the World Trade Organization, low inflation and world economic growth has shifted the paradigm to sweeping global consolidation. And those countries, and companies, which fail to understand this will be left behind.

Canada?s steel companies could have, and should have, been consolidated by Dofasco, but that great company was the first one picked off by a global consolidator. What followed, in the absence of a consolidator in Canada, was a string of buyouts that has left the country without any significant entries in that sector.
Mining was another casualty, notably Falconbridge and Inco. Both managements failed to realize the obvious synergies for their shareholders of a merger, then of consolidations. Both lived in a coddled, provincial world, oblivious to the super-cycle for commodity prices. Both were picked off by separate consolidators, one European and one Brazilian.
Even more embarrassing was the fact that Inco?s CEO and others exercised stock options at a share just weeks before the company was bought for in a hostile bid.
Then there was Alcan and Alcoa which should have become North America?s global champion.
Instead, Canadian public policy is forged in a vacuum such as high corporate taxation in an era of tax arbitrage or the stupid and unnecessary destruction of existing income trusts. This has enhanced buyouts as trusts have been purposely crippled by the federal government to drive them out of business without any understanding of how this would block Canadians from consolidation and facilitate foreign consolidators.
The point of all this is that political and business leaders in Canada must understand what is going on in the world, not just in their silly constituencies, or there will be no Canada in 20 years? time.