Miguel Siu, BEcon, RFRA - Financial Planner

Market close at 16 :00 today.



High volatility.

Japan’s benchmark stock index, the Nikkei 225, suffered its biggest decline for nearly four decades. It was down by 12%, the biggest single-day fall since the Black Monday crash of 1987. Other stock indices around the world were lower as investors dumped riskier assets. South Korea’s Kospi fell by 9%, Germany’s Dax was down 2%, and share indices in Australia, Hong Kong and China also fell heavily.

London’s FTSE 100 ended the day 166.5 points down at 8,008, its lowest close since April, and down more than 2% across the day.

Investors are concerned that the Federal Reserve may have left it too late to try to support the world’s biggest economy, with fears of the ripple effect from a US recession shaking economies around the world.

A much-anticipated report on Friday showed the US economy added just 114,000 jobs last month, well down from June and far fewer than expected, while the jobless rate rose to the highest level since October 2021. Weak factory data last week also added to concern about a recession less than 100 days from the US presidential election.

Bitcoin (BTC) plunged to multi-month lows on Monday, falling over 14% in 24 hours amid US recession fears and disappointing economic data. This drop reduced Bitcoin’s market value by around $220 billion and led to a 15.9% decline in the global crypto market cap, now at $1.81 trillion.

⛽ Precios de la gasolina en Latinoamérica (Precios por galón) 💵

1. 🇻🇪 Venezuela: $0.10 x galón (subvencionado*)
2. 🇨🇺 Cuba: $2.80 (subvencionado*)
3. 🇵🇪 Perú: $3.50
4. 🇵🇦 Panamá: $3.60
5. 🇨🇴 Colombia: $3.70
6. 🇪🇨 Ecuador: $3.80
7. 🇲🇽 México: $4.00
8. 🇧🇷 Brasil: $4.20
9. 🇵🇾 Paraguay: $4.30
10. 🇨🇱 Chile: $4.50
11. 🇦🇷 Argentina: $5.00

*Subvencionado: Precio artificialmente bajo, financiado por el gobierno.

El argumento económico habitual contra el uso de subvenciones es que generan un desajuste entre los precios y los costos de producción. En consecuencia, pueden distorsionar los mercados, impedir el logro de resultados eficientes y desviar recursos hacia usos menos productivos.

Share of population with bank account:

🇦🇫 Afghanistan: 9%
🇵🇰 Pakistan: 16%
🇱🇧 Lebanon: 20%
🇪🇬 Egypt: 26%
🇵🇸 Palestine: 33%
🇧🇩 Bangladesh: 37%
🇬🇭 Ghana: 39%
🇲🇦 Morocco: 42%
🇳🇬 Nigeria: 45%
🇮🇩 Indonesia: 50%
🇰🇪 Kenya: 50%
🇳🇵 Nepal: 52%
🇨🇴 Colombia: 55%
🇦🇷 Argentina: 66%
🇹🇷 Turkey: 73%
🇮🇳 India: 77%
🇰🇿 Kazakhstan: 81%
🇷🇺 Russia: 88%
🇨🇳 China: 88%
🇮🇷 Iran: 89%
🇮🇱 Israel: 92%
🇺🇲 USA: 94%
🇸🇬Singapore: 97%
🇮🇹 Italy: 97%
🇪🇸 Spain: 98%
🇳🇿 New Zealand: 98%
🇬🇧 UK: 99%
🇩🇪 Germany: 99%
🇩🇰 Denmark: 100%

According to Global Economy

Bank of Canada, reduces policy rate by 25 basis points to 4.50%. July 24th, 2024.



The Bank of Canada today reduced its target for the overnight rate to 4½%, with the Bank Rate at 4¾% and the deposit rate at 4½%. The Bank is continuing its policy of balance sheet normalization.

The global economy is expected to continue expanding at an annual rate of about 3% through 2026. While inflation is still above central bank targets in most advanced economies, it is forecast to ease gradually. In the United States, the anticipated economic slowdown is materializing, with consumption growth moderating. US inflation looks to have resumed its downward path. In the euro area, growth is picking up following a weak 2023. China’s economy is growing modestly, with weak domestic demand partially offset by strong exports. Global financial conditions have eased, with lower bond yields, buoyant equity prices, and robust corporate debt issuance. The Canadian dollar has been relatively stable and oil prices are around the levels assumed in April’s Monetary Policy Report (MPR).

In Canada, economic growth likely picked up to about 1½% through the first half of this year. However, with robust population growth of about 3%, the economy’s potential output is still growing faster than GDP, which means excess supply has increased. Household spending, including both consumer purchases and housing, has been weak. There are signs of slack in the labour market. The unemployment rate has risen to 6.4%, with employment continuing to grow more slowly than the labour force and job seekers taking longer to find work. Wage growth is showing some signs of moderating, but remains elevated.

GDP growth is forecast to increase in the second half of 2024 and through 2025. This reflects stronger exports and a recovery in household spending and business investment as borrowing costs ease. Residential investment is expected to grow robustly. With new government limits on admissions of non-permanent residents, population growth should slow in 2025.

Overall, the Bank forecasts GDP growth of 1.2% in 2024, 2.1% in 2025, and 2.4% in 2026. The strengthening economy will gradually absorb excess supply through 2025 and into 2026.

CPI inflation moderated to 2.7% in June after increasing in May. Broad inflationary pressures are easing. The Bank’s preferred measures of core inflation have been below 3% for several months and the breadth of price increases across components of the CPI is now near its historical norm. Shelter price inflation remains high, driven by rent and mortgage interest costs, and is still the biggest contributor to total inflation. Inflation is also elevated in services that are closely affected by wages, such as restaurants and personal care.

The Bank’s preferred measures of core inflation are expected to slow to about 2½% in the second half of 2024 and ease gradually through 2025. The Bank expects CPI inflation to come down below core inflation in the second half of this year, largely because of base year effects on gasoline prices. As those effects wear off, CPI inflation may edge up again before settling around the 2% target next year.

With broad price pressures continuing to ease and inflation expected to move closer to 2%, Governing Council decided to reduce the policy interest rate by a further 25 basis points. Ongoing excess supply is lowering inflationary pressures. At the same time, price pressures in some important parts of the economy—notably shelter and some other services—are holding inflation up. Governing Council is carefully assessing these opposing forces on inflation. Monetary policy decisions will be guided by incoming information and our assessment of their implications for the inflation outlook. The Bank remains resolute in its commitment to restoring price stability for Canadians.

Bank of Canada cuts key interest rate to 4.75%

First time in four years.

The global economy grew by about 3 per cent in the first quarter of 2024, broadly in line with the Bank’s April Monetary Policy Report (MPR) projection. In the United States, the economy expanded more slowly than was expected, as weakness in exports and inventories weighed on activity. Growth in private domestic demand remained strong but eased. In the euro area, activity picked up in the first quarter of 2024. China’s economy was also stronger in the first quarter, buoyed by exports and industrial production, although domestic demand remained weak. Inflation in most advanced economies continues to ease, although progress towards price stability is bumpy and is proceeding at different speeds across regions. Oil prices have averaged close to the MPR assumptions, and financial conditions are little changed since April.

CCC. Canadian Commercial Corporation.

We are Canada’s government to government contracting agency.

Hatch to help Peru deliver largest drip irrigation project in the world. 🇵🇪👏🇨🇦



OTTAWA, April 30, 2024 (GLOBE NEWSWIRE) —

Today, CCC signed a government to government (G2G) contract with the Ministry of Agricultural Development and Irrigation of Peru to help deliver the third stage of the $750 million CHAVIMOCHIC infrastructure project with Canadian expertise from Hatch. Canada was selected to offer project management services in December 2023 following a G2G procurement process.

The CHAVIMOCHIC project is a key pillar in the economic development of northern Peru and completes the Palo Redondo Dam, which will capture water from the Santa River to irrigate the Chao, Virú, Moche, and Chicama Valleys, as well as to generate hydroelectric power. Once completed, the project will be the largest drip irrigation project in the world – enabling Peru to cultivate an additional 63,000ha of land, as well as improve existing farming operations in the region of La Libertad, which represent another 48,000ha of land. It will also supply reliable and sustainable potable water to 40,000 families and create more than 150,000 new local jobs. The project is expected to boost the agricultural and agribusiness sectors in northern Peru, enabling the region to triple its exports from 400 million to 1.2 billion USD per year.

Based in Mississauga, Ontario, Hatch is a global engineering, project delivery, and professional services firm. The company delivers multi-billion-dollar projects for clients across the globe in the energy, infrastructure, and metals sectors, including the Fargo-Moorhead flood control project in the United States, the El Leon flood control project in Peru, the 3 February hydroelectric facility (formerly El Chaparral) in El Salvador, and the Jansen potash project and On-Corridor Works project in Canada. Through CCC’s G2G contract, Hatch will provide project management services to Peru’s Ministry of Agricultural Development and Irrigation – the lead government body responsible for the development of the CHAVIMOCHIC project. The ministry is tasked with growing, diversifying, and fostering the country’s agribusiness.

Deuda pública como porcentaje del PIB, en 2023:

🇨🇳 China 287%
🇬🇷 Grecia: 168%
🇮🇹 Italia: 143%
🇺🇸 USA 124%
🇫🇷 Francia: 110%
🇪🇸 España: 107%
🇧🇪 Bélgica: 106%
🇬🇧 Reino Unido: 104%
🇮🇳 India 89%
🇦🇷 Argentina 88%
🇦🇹 Austria: 74%
🇩🇪 Alemania: 65%
🇪🇨 Ecuador 62%
🇻🇪 Venezuela 61%
🇮🇱 Israel 60%
🇲🇽 México 59%
🇨🇴 COLOMBIA 54%
🇵🇱 Polonia: 49%
🇳🇱 Países Bajos: 49%
🇮🇪 Irlanda: 42%
🇨🇭 Suiza: 39%
🇳🇴 Noruega: 37%
🇨🇱 Chile 37%
🇹🇷 Turquía: 34%
🇸🇦 Arabia Saudita 26%
🇷🇺 Rusia: 21%

Financial Planning.

Scotiabank Top Performer Breakfast Q1 2024.

10 habits of the ultra successful:

1. Read
2. Write
3. Reflect
4. Connect
5. Exercise
6. Set goals
7. Give back
8. Track progress
9. Practice gratitude
10. Learn something new

Success starts with positive habits.

Citi to cut 20,000 jobs through 2026, swings to $1.8 billion loss.

Jan 12 - Citigroup (C.N) will cut 20,000 jobs over the next two years, the bank said on Friday, after reporting a $1.8 billion quarterly loss driven by a string of one-off charges.

Shares of the bank - which has rolled out a multi-year effort to cut bureaucracy, increase profits and boost a stock that has lagged peers - fell more than 1%.

"The fourth quarter was very clearly disappointing," CEO Jane Fraser told analysts. "We know that 2024 is critical."

Analysts said results from the third-largest U.S. lender by assets were strong when the one-off charges were excluded.

"Citigroup's earnings looked awful with a big loss of $1.8 billion, but the bank's underlying business showed resilience," said Octavio Marenzi, CEO at management consultancy firm Opimas.

The loss was driven by $3.8 billion in charges disclosed in a filing on Wednesday that included reorganization expenses, a reserve related to currency devaluations and instability in Argentina and Russia and a $1.7 billion payment to replenish a government deposit insurance fund.
The bank expects to report between $700 million and $1 billion in charges this year related to severance costs and the reorganization.

"Whenever an industry or company goes through these types of reductions, it’s tough on morale," Mason told reporters. The staffing cuts will not affect revenue growth, he said.

Rivals JPMorgan Chase (JPM.N) and Bank of America (BAC.N) on Friday reported lower quarterly profits, while Wells Fargo outperformed on cost cuts.

TFSA - Tax Free Saving Account



Canadians will soon be able to contribute another $7,000 to their tax-free savings accounts for 2024. For someone who has never contributed to a TFSA, and has been a resident of Canada and at least 18 years of age since 2009, the cumulative TFSA limit will hit $95,000.

Feliz Navidad!

Cuando llega el día de Navidad nos viene el mismo calor cuando eramos niños, el mismo calor qué envuelve nuestro corazón y nuestro hogar.

"Se hace hombre entre los hombres, para que en Él y por medio de Él todo ser humano pueda renovarse profundamente. Con su nacimiento, nos introduce a todos en la dimensión de la divinidad, concediendo a quien acoge su don con fe la posibilidad de participar de su misma vida divina".

San Juan Pablo II (Navidad de 1998).

Evergrande Group. Riesgo de colapso amenaza a la economía China y el resto del mundo.



Fundada en 1996, Evergrande impulsó su crecimiento a través de un gran endeudamiento. No en vano a Hui lo llamaban el “rey de las deudas”.

Cuando la empresa incumplió sus compromisos comerciales en 2021, provocó gran conmoción en los mercados financieros mundiales, ya que el sector inmobiliario representa casi una cuarta parte de la economía de China.

Rápidamente se transformó en un ícono de la profunda crisis crisis inmobiliaria que amenaza a la economía china.

Con una gigantesca deuda sobre su espalda, la empresa ha estado tratando de recaudar efectivo a través de la venta de activos y acciones para pagar a proveedores y acreedores.

Aunque les debe dinero a prestamistas fuera del país, la mayor parte de la deuda de Evergrande está en manos de ciudadanos comunes chinos, muchos de los cuales han invertido en casas que no han sido terminadas.

La empresa está siendo administrada por un "comité de gestión de riesgos" dominado por funcionarios estatales que intentan evitar un colapso total a través de un plan de reestructuración.

Si este fracasa y Evergrande es incapaz de llegar a un nuevo acuerdo con sus acreedores, podría enfrentarse al fin de todas sus operaciones.

Por ahora, el control policial bajo el que se encuentra Hui, quien sigue siendo presidente de Evergrande, no ha hecho sino alimentar los temores de que la reestructuración de la firma no funcione y su desaparición termine siendo inevitable.

September 30th. 🍁

Each year, September 30 marks the National Day for Truth and Reconciliation.

The day honours the children who never returned home and Survivors of residential schools, as well as their families and communities. Public commemoration of the tragic and painful history and ongoing impacts of residential schools is a vital component of the reconciliation process.

“By raising the DSB to 3.5 per cent, we are taking action to enhance the resilience of Canada’s largest banks against vulnerabilities,” he said in a statement. “This change will help Canada maintain a resilient financial system. The DSB is a safety buffer for the banking system that can be lowered when appropriate, such as during economic downturns.”

OSFI hikes domestic stability buffer for Canada's big banks OSFI cites high household and corporate debt levels and the rising cost of debt among vulnerabilities of nation's biggest banks. Read on

El GLP vehicular (78%), aceite envasado (63%) y el balón de gas (51%) figuran entre los productos con mayores aumentos el 2021.

Inflación cerró el 2021 con un alza acumulada de 6.4%, la tasa más alta en 13 años El GLP vehicular (78%), aceite envasado (63%) y balón de gas (51%) registraron los mayores aumentos.

While the bank makes it clear it's not ready to raise its benchmark rate yet, it gave a clear signal that it is headed in that direction by winding down its so-called quantitative easing program, one that saw the bank buy up as much as $5 billion worth of government bonds every week to keep lending cheap.

Miguel E. Siu Guillen on LinkedIn: Higher rates are coming sooner than you think, Bank of Canada signals While the bank makes it clear it's not ready to raise its benchmark rate yet, it gave a clear signal that it is headed in that direction by winding down...

Miguel Siu, BEcon, RFRA - Financial Planner is now on WhatsApp.

The objective of the OAS program is “to ensure a minimum income for seniors and help reduce the incidence of low income among Canada’s seniors.” The OAS benefits include: the OAS pension, which is paid to all individuals aged 65 and older who meet residence requirements, the Guaranteed Income Supplement for low-income seniors, and the Allowances for low-income Canadians aged 60 to 64 who are spouses or common-law partners of GIS recipients, or who are widowed or widowers.

Older seniors to get extra Old Age Security in the coming months One-time $500 payment, plus extra 10% annually for those over age of 75 in 2022 comes on top of indexation adjustment

New stress test. Harder to qualify.

As of today, it's harder to qualify for a mortgage in Canada | CBC News The federal government has raised the minimum financial bar that anyone applying for a mortgage must meet, which will reduce the pool of qualified borrowers and likely cool the real estate market.

En febrero las autoridades del mercado financiero canadiense dieron luz verde a la creación de un ETF (exchanged-traded fund o fondo de inversión cotizado) que invierte exclusivamente en Bitcoin. Con ello, se abre la puerta a invertir en criptomonedas alrededor del mundo. Y sí, también incluye a la Bolsa de Valores de Lima (BVL).

Ventajas:

La primera es la seguridad, ya que las criptodivisas no negocian en los mercados de valores como las bolsas, sino que se operan en plataformas de negociación no supervisadas, dando por tanto un nivel de seguridad a sus usuarios inferior al que proporcionan los mercados organizados como la plaza bursátil limeña.

Adicionalmente, realizar estas inversiones a través de la BVL reduce el riesgo de lavado de activos, por lo que es probable que un banco o una casa de bolsa peruana no aceptan abonos cuyo origen estén vinculados a plataformas de negociación no supervisadas.

La segunda ventaja es la eficiencia tributaria, puesto que la rentabilidad generada por la inversión en valores listados en Lima conllevan un impuesto a la renta del 5% para personas naturales, frente al 30% sobre las utilidades obtenidas en mercados internacionales.

Peruanos podrán invertir en Bitcoin a través de la Bolsa de Valores de Lima Invertir en valores extranjeros a través de la BVL presenta varias ventajas frente a hacerlo a través de un mercado o broker extanjero, como la seguridad o eficiencia tributaria.

There is no safer place in the world to have your pension than in Canada. The Canadian pension plan model has shown that with exemplary corporate governance and principled independence, pension plans can help ensure that a country’s citizens have a retirement egg to fall back on, even during these trying times.

Mark Wiseman: The world could learn from Canada's pension model - BNN Bloomberg Chief among the many challenges brought on by COVID-19 is the acceleration of the global pension crisis. Low interest rates and decreased economic activity are ballooning pension liabilities and challenging return assumptions, ultimately stressing pension plans all over the world.