Friday, 6 February 2009

Disjointed thoughts on the economy

Or alternatively: Still recovering from watching American Idol.


Last weekend I was at a party seeing some old friends. Given that the last time we were together was over 2 years ago, we had a lot of catching up to do. I've been a bit of a "Bubble Boy" during this current economic downturn. My job is safe (as safe as a job can be), so the effects of this recession have mostly been positive ones (more on that in a minute).

The gang is a good mixture of blue-collar and white-collar workers. The careers represented were from the auto industry, engineering, construction, and trades. Now while all of them were employed, all of their companies were experiencing cutbacks and layoffs. All of them were nervous about the security of their own jobs. I mention this because some people have been accusing the media of fostering hysteria. I don't see it. People are worried because they SEE jobs being cut close to home.

Back when this all began, someone mentioned how they were sorry for the people losing their jobs. Because I'm a sarcastic unfeeling prick, I mentioned I was looking forward to the cutbacks. If enough people lose their jobs, traffic will decrease and I would be able to resume using the 401 for my commute. (For those that are new here, I drive daily from Cambridge to Brampton each morning. A distance of about 75 kms.)

Well its happened. For a few years now, I have had to exit the 401 at Guelph line, which is well west of the GTA. From there I take back roads in. For the first time in years, (assuming the weather is good) I can now make it all the way to Winston Churchill Blvd. When I started this commute 11(!!!) years ago, that was my commute. 401 from Cambridge to Winston Churchill, Steeles Ave. the rest of the way. Nice, easy, 45 minute drive.

I am not actually that happy about this. (But I am a sarcastic prick.) While it is nice to have an easy commute again, the cause isn't something to be happy about. What I am not sure of, is traffic down to fewer cars, or fewer trucks delivering goods? My sense is its more the lack of trucks. I'm not seeing near as many as I used to. I'd be very interested in any traffic studies being released in the next few months.

And this is why I do not buy the optimistic forecasts that Canada will start bouncing back later this year. There are daily announcements of layoffs and closings. The pace of job losses is not slowing down. Wouldn't that be required as an indicator that we've hit bottom? The more people that are laid off, the fewer consumers of goods there are, feeding the next cycle of lost profits and cutbacks. Until the US economy bottoms out (and there is no sign that is happening anytime soon) there is no way the Canadian economy is going to start bouncing back.

If anybody can contradict that assertion knowingly, I'd love to see the logic. Until then, I think people have a right to be nervous.

1 comment:

Ken Breadner said...

I mentioned your point to my stepdad (who CAMI in Ingersoll) tonight and he said "well, pretty much every auto plant in Ontario is either shut down completely or at least running on vastly reduced production. That alone would take hundreds, if not thousands of trucks off the road."
Many of the plants are not scheduled to cycle back up until (best case) late spring. Some may not start up again at all...