Canada, tax haven.

Day 582

Tim Hortons soon will be officially domiciled in Canada. For tax purposes!

No, not Luxembourg, Grand Cay or Delaware. 

Tim Hortons Inc. is relocating its incorporation from the U.S. to Canada to exploit the Great White North's lower corporate tax burden.

Let me repeat that. Canada's corporate tax burden is lower than America's.

(This follows by a few years the sale of Hortons by Ohio-based Wendy's International.)

Remember that the next time the whiners of the Globe and Post op-ed pages and BNN scold policymakers about this high-tax, business-hostile regime of ours.

Breaking news

* GM gets cold feet about Magna-Opel, cozies up to initially spurned bidder RHJ International. Background on Belgian private-equity firm RHJ here.

Must reads

* Gregg Easterbrook, NYT: Yes Virginia, there is a way to reduce coal-fired power-plant CO2 emissions by two-thirds - if purist environmentalists will get out of the way. Which would be good, since coal isn't going away: the U.S. is the Saudi Arabia of coal (Alberta's not far behind), and America derives half its electric power from coal-fired plants that are a leading culprit in global warming.

* David Segal, NYT: How a luxe innkeeper copes with hard times. Detailed profile of Four Seasons Hotels. In confronting irate hotel owners who want the Toronto hotel-management firm to trim expenses during the downturn, much is revealed about how a defiant Issy Sharp's all-weather adherence to high standards made FS the world's leading luxury hotelier. (How globally renowned is FS, among well-heeled business travelers and best-practices management gurus? This story remained one of the NYT's top five most e-mailed articles two days after publication.)

For the purposes of this blog, the inception of the Great Recession in the U.S., the epicentre of the crisis, is taken as the start date for the global slump. The U.S. has been in recession since December 2007.

Oh, now you show up.

Day 582

Well, that didn't take long. The Jackson family has moved to take control of the late Michael Jackson's assets. Specifically, it took five days.

So my big question: Where were parents Katherine and Joseph, in court yesterday to assert control of their son's estate, during the past 15-plus years of their son's mental and physical decline? Where were Jermaine, Janet and Michael's many other siblings? Where were record-label executives, concert promoters, arena owners and the entire legion for whom Michael Jackson generated hundreds of millions of dollars in revenue - indeed, revived a stagnant music industry, circa 1983? 

It's that same question I ask about Richard Carpenter and his mom as Karen Carpenter spiralled downward. (She had come home to her mother's house, and died in her childhood bedroom; wasn't that some kind of cry for help?) It's the same question I ask about Britney Spears, Lindsay Lohan and Amy Winehouse. Don't these folks have loving family and friends to help them take back control of their obviously troubled lives?

Forty years after Judy Garland's death, have we not learned the need for intervention?   

For the purposes of this blog, the inception of the Great Recession in the U.S., the epicentre of the crisis, is taken as the start date for the global slump. The U.S. has been in recession since December 2007.

Oh look, someone still wants to go soft on white-collar criminals.

Day 582

Seems reasonable to me. Madoff gets 2.3 years for each billion dollars of the estimated $65 billion (U.S.) in fictitious assets his gullible clients believed he held for them. 

The Globe's Christie Blatchford ("Madoff's no murderer") begs to differ. I expect that's less because of any sympathy for Madoff, than her view that super-max sentences should be reserved for her bread and butter, which is killers, child molesters and so on.

Thing is, Madoff and the moral cripples on Wall Street who looted the global financial system of trillions of dollars are murderers, at least indirectly. If Blatchford is unaware of the spike in suicides among foreclosed-upon homeowners and blue-collar workers suddenly made jobless by employers driven to the wall in the credit drought, she hasn't been reading the papers.

Related

* Guardian/AP: Waiting for the next Madoff scandal.

For the purposes of this blog, the inception of the Great Recession in the U.S., the epicentre of the crisis, is taken as the start date for the global slump. The U.S. has been in recession since December 2007.

Have a great Pride weekend!

 

So far as we know, there will be no Canadian government events recognizing the achievements and continuing challenges of the Gay and Lesbian community. The White House, however, will host a high-profile event Monday, attended by Barack Obama, where the president is expected to speak on LGBT issues as well as mark the 40th anniversary of the landmark Stonewall uprising. According to Shin Inouye, a White House spokesman: 

Next Monday’s event is a chance for the White House to recognize the accomplishments of LGBT Americans. Invited guests include families, volunteers and activists, and community leaders. This event was long planned as a way to applaud these individuals during Pride month.

Participants at the White House gathering have been invited to accompany their partners in this first-ever WH event, recognizing the importance of partnerships. The WH remains under pressure, though, for its slow pace on achieving progress on two Obama campaign pledges: scrapping two low points of the Clinton adminstration: the Defense of Marriage Act and the Dont Ask, Dont Tell military policy - both nonsensical and cruel throwbacks to the pre-Stonewall era.

For updates on the WH event, check here.

Related

Frank Rich, New York Times: 40 Years Later, Still Second-Class Americans.

On the farm, the usual shakedown of taxpayers.

Day 580

One of our favourite commentators, Washington Post columnist Steven Pearlstein, tears a strip off the U.S. farm lobby for trying to obstruct climate-change legislation - even after finagling special treatment in the proposed legislation. (Which, BTW, passed the U.S. House Friday and awaits Senate consideration.) Bottom line: Farmers, or at least those representing them, don't want to participate in the shared sacrificce of saving the planet. More incredibly, they expect to be paid - to receive even more subsidies than they enormous haul they already extract from taxpayers - for anything they do by way of reducing CO2 emissions. (Cows are estimated to produce almsot three-quarters of global emissions of methane, one of the most destructive of greenhouse gases.)

"The next time the world's most selfish lobby comes to Washington demanding drought relief, someone ought to have the good sense to tell them to go pound sand," Pearlstein concludes. 

Read Pearlstein's quick, blunt tutorial of farm economics, and feel your blood-pressure rise.

Related

* Reuters: Canadian scientists breeding cows that burp less.

"Cows are responsible for nearly three-quarters of total methane emissions, according to Environment Canada. Most of the gas comes from bovine burps, which are 20 times more potent than carbon dioxide as a greenhouse gas.

"Stephen Moore, a professor at the University of Alberta in Edmonton, is examining the genes responsible for methane produced from a cow's four stomachs in order to breed more efficient, environmentally friendly cows."

 

For the purposes of this blog, the inception of the Great Recession in the U.S., the epicentre of the crisis, is taken as the start date for the global slump. The U.S. has been in recession since December 2007.

Tony Fell explains the entirely avoidable global financial meltdown.

Day 579

How we wish Tony Fell had been in charge of Wall Street when the financial exotica was concocted that in 2008 would tip us into the worst global financial crisis since the Depression. Fell always was a fair dealer, as we said of him in praise of Fell's record on his retirement after turning an under-capitalized Dominion Securities into today's RBC Capital Markets juggernaut (see below). The sort of operator, Warren Buffett once said, you could spend futile hours on Wall Street in search of.

In Friday's Report on Business Magazine, distributed with that day's Globe and Mail, Fell succinctly lays out how global financiers and co-conspirator clients got us into the current mess. His observations, as told to Globe business reporter Gord Pitts, should be mandatory reading at every MBA mill in the land:

"The major lesson from the current crisis is there is too much debt in the world. Over time, the chief financial officers of companies morphed into investment bankers. They tried to find ways to build more leverage into their balance sheets, and to build around the Income Tax Act to save taxes.

"Balance sheets became far more complicated. At the end of the day, a lot of companies would have been far better off if they had spent more time running their basic businesses and less time trying to engineer their balance sheets.

"And our industry has a constant desire to create ever-more complex products. It's unfortunate, because in retrospect we have done huge damage. Financial innovation has gone way to far, far past regulatory surveillance, far past common sense.

"A good example are these collateralized debt obligations (CDOs) and collateralized loan obligations. The people who developed them had no idea what they were making; the people who rated them had no idea what they were rating; the people who sold them had no idea what they were selling; and the people who bought them had no idea what they were buying. That's what the record shows."

Fact: Uncle Sam, to the dismay of most Americans, is spending about $100 billion (U.S.) to bail out GM and Chrysler, which represent a fair chunk of America's manufacturing sector. Those firms spent decades digging the hole they're in. 

Fact: Uncle Sam is spending far more, $173 billion (U.S.), to bail out New York-based American International Group Inc. (AIG), a firm most Americans have never heard of. But it was the #1 global insurer before it was brought to its knees in the space of just two years by an unsupervised rogue credit-default-swap operation in faraway London. Had the giant AIG collapsed, so would the global economy, since AIG's small get-quick-rich crew in London had committed the firm to guaranteeing most of those soon-to-sour CDOs. That's leverage.

Also see Nick Leeson, one-man destroyer of a two-century-old Barings Brothers, a cautionary tale later ignorned by the C-suite savants at AIG, Citigroup, Switzerland's UBS, Bank of America, Bear Stearns, Lehman Brothers, Merrill Lynch and so on.

Bagehot said it best: When bankers are busy, trouble is brewing. Thanks for the update, Mr. Fell. And if there's a reincarnation in your future, we hope it's as...an investment banker.

Here's the Toronto Star tribute to Fell we wrote Oct, 28, 2007 (sorry, no URL available):

With Tony Fell, the finance gods broke the mould

We were amused at Anthony (Tony) Fell's recollection that during his remarkable five-decade career on Bay Street, the dean of Canadian investment bankers regretted missing opportunities to acquire rivals Wood Gundy and Midland Walwyn. Sort of like Glen Sather in the glory days of the Edmonton Oilers, wishing he could add Doug Gilmour and Mario Lemieux to a line-up already anchored by Wayne Gretzky and Mark Messier.

We'll be lucky ever again to see the likes of Tony Fell, 68, one of North America's greatest consolidators of securities firms, who this week announced his retirement effective Dec. 31.

Dominion Securities was a relatively minor and money-losing outfit when Fell became its president at the tender age of 34 in the mid-1970s, a time when the entire industry was woefully undercapitalized compared with its U.S. counterpart.

Nonetheless, a newly robust "DS" began nabbing more than its share of lucrative underwritings against stiff foreign and domestic competition. And during Fell's stewardship, DS became Bay Street's undisputed powerhouse with its acquisitions of storied rivals Harris & Partners Ltd., A.E. Ames & Co. Ltd., Pitfield Mackay Ross Ltd., all of Toronto; leading Vancouver securities house Pemberton Securities; Montreal's McNeil Mantha Inc.; and, in 1996, Richardson Greenshields of Canada Inc., the nation's largest remaining independent securities dealer.

During Fell's leadership at DS, later RBC Dominion and currently RBC Capital Markets, the firm went from a loss of about $2 million in 1974 to a profit of $1.4 billion last year.

But this is a case where numbers don't tell the story.

Fell smoothly integrated his many prized acquisitions, no mean feat in an industry where the principal asset is human talent that can easily defect. Obviously as DS grew so did its capital base, making bigger deals possible. But that's not why DS's dealmakers loved working there.

Sure, Tony Fell knew every corporate titan worth knowing, and as a Conservative fundraiser, boasted a wide range of political contacts as well. But you worked for Tony because he deflected praise for every DS coup to subordinates. He took the blame when things went wrong. His word was his bond. Simple things that add up to one word: character.

Fell was fiercely competitive, but having lost out on leading a lucrative underwriting, he turned on a dime and zealously took on the grunt work of helping distribute the shares. A member of the dwindling generation of gentlemen dealmakers (he was a graduate of the old money St. Andrew's prep school in Aurora), Fell knew enough to leave some money on the table in negotiations with folks he'd be dealing with again.

By now you're thinking Fell doesn't much care for the current era of Bay Street and Wall Street, in which celebrity dealmakers think it's all about them. And you'd be right.

Fell's career should have been marked by culture clashes. Instead, he managed to create a team spirit at DS, and later made DS a team player within Royal Bank, adding immensely to the bank's bench strength and profitability.

Fell now plans to continue, if not ramp up, his extraordinary philanthropic activities, by which he has helped build this city. What some of us crave is a Fell memoir about his role in leaving an industry in better competitive shape than he found it, and how to become a go-to guy in raising capital without developing a swelled head or surrendering a reputation for unshakeable integrity.

If he could only overcome his aversion to drawing attention to himself, Fell could author a guidebook on managing for the ages. We're keeping our fingers crossed.

 

For the purposes of this blog, the inception of the Great Recession in the U.S., the epicentre of the crisis, is taken as the start date for the global slump. The U.S. has been in recession since December 2007.

 

 

Michael Jackson (1958-2009)

Day 578

"Beauty is truth, truth beauty," -that is all

Ye know on earth, and all ye need to know. -John Keats

As with Judy Garland and with Elvis, it did not end well for Michael Joseph Jackson, the best thing ever to come out of Gary, Ind., otherwise a U.S. Steel company town named for a hard-hearted former CEO of that former colossus. But that's a story best told in a minor key.

All we need to know is that Jackson was perhaps the crossover artist in race as well as genres, completing for post-Boomers the work begun by Louis, Ella, Miles and other giants of previous generations. That despite his improbable youth, he was the lead singer among his siblings in the Jackson 5, the most successful of the "bubblegum" rockers. That four of his solo studio albums - Off The Wall (1979), Bad (1987), Dangerous (1991) and HIStory (1995) are among the world's bestselling records; and that 27 years after its release, Thriller (1982) remains the bestselling record of all time. That while the likes of Duran Duran pioneered music videos, Jackson's huge fan base and his own gifts of choreography and storytelling made such videos a compulsory part of every promising new artist's repertoire. And that a 60-something U.S. music critic, whose ambit covers Mozart to Mel Torme, was not alone among a half-dozen critics to name "Billie Jean" as one of the previous century's five most important musical compositions in an Esquire survey earlier this decade. 

Below is a decent amateur history of the Jackson 5, its soundtrack "Got To Be There"; and a Jackson live performance of "Billie Jean" in a 1980s tribute to Motown's 25th year.

We interrupt this blog for a misleading commercial message.

Day 578

Your tax dollars at work

The following advertisement, ostensibly for the Government of Canada but in fact on behalf of Stephen Harper and the Tories, is now appearing, at your expense, in newspapers and websites across the land:

CANADA'S ECONOMIC ACTION PLAN

FINANCING FOR CREDITWORTHY BUSINESS IS IMPROVING

80% ALREADY BEING IMPLEMENTED

LEARN MORE

Well, money surely is flowing out of Ottawa to pay for the ads. It most decidedly is not flowing out to pay for infrastructure and other economic stimulus at anything like the rate the Tories are claiming or Canadians were led, and are being led, to believe.

Write your MP, to demand the Tories pay for their own ads. Or to complain about the stalled progress of the stimulus - which at this rate should kick in sometime after the recession ends. (The postage is free.)

And the Oscar for most transparent publicity gimmick goes to...the Oscars!

 

Last year's best-picture Oscar "the envelope please" moment.

The Oscars have announced a doubling of best-picture nominations, to 10. We're told this is to widen the field to a greater diversity of entries. Or, as cynics say, to kow-tow to the studios whose big-budget schlock doesn't get nominated, and to revive a ratings slide for the awards gala. Funny, we recall that last year's five best-pic nominees were regarded at the time as the weakest selection in years. Imagine doubling the size of that field.

We also recall Sam Goldwyn's dim view of the anti-TV brainwave of enlarging cinema screens: "A wide screen just makes a bad film twice as bad."

Spit and polish

 Have a close read of the Globe's gush about Sonja Bata's "gutsy plan" to revive former company town of Batawa, Ont., where the family-owned Bata Ltd.'s shoe-making factory was closed years ago and the work outsourced to cheaper-labour nations. Lots of meetings, lots of passion, lots of presentations...and that's about it. The place still looks as it did when I visited upon its closing, a desolate cluster of empty buildings.

Batawa (pictured left), near Trenton, was only briefly consequential, as Czech emigre Tom Bata's launching pad to rebuild a multi-generation footwear empire jeopardized by Soviet expropriation. Soon, Bata found his metier, employing shoemakers at rock-bottom wages in developing countries. He was never able to make much of a success of his North American retail operations, but was a big wheel in places like Cameroon and Nigeria.

With her elegant shoe museum on Bloor, for which we're grateful to Raymond Moriyama, Sonja Bata, now 82, is welcome to polish her image as she chooses. Why she'd invite Carleton University students to conceive unrealized (and unrealizable) dreams of a tech campus or other New Economy centre in remote Batawa after allowing the demolition of John Parkin's still-gorgeous Bata headquarters in Don Mills is anyone's guess. Along with why the Globe got gulled into helping with the image-makeover bid. Before Nike came along, Bata was the pioneering global sweatshop operator we began to have our doubts about in the 1970s. They were never erased. They never will be.

For the purposes of this blog, the inception of the Great Recession in the U.S., the epicentre of the crisis, is taken as the start date for the global slump. The U.S. has been in recession since December 2007.

The GOP hits bottom. Again.

Day 578

We were about to congratulate the Palmetto State for surviving handily the mysterious four-day absence of its GOP governor, until Mark Sanford finally reappeared yesterday, to confess an extramarital relationship. Just over a week before the South Carolina governor`s revelation, U.S. Senator John Ensign (R-Nev.) fessed up to cheating on his spouse. What with sex scandals touching U.S. lawmakers David Vitter, Bob Ney and Larry Craig (until recently a long-serving GOP U.S. senator from Idaho, after whom a men's-room stall at Minneapolis International has been named), it seems the GOP has to keep learning over and over that its traditional claims to a superior adherence to family values and moral rectitude are lousy selling points if members of your own party keep running afoul of what passes for decent behaviour.

 

Mark Sanford, GOP governor of South Carolina, pictured left, tells reporters yesterday of his extramarital affair with an Argentine woman. Eight days earlier, U.S. Senator John Ensign (R-Nev) acknowledges his extramarital affair with a former campaign worker. Ensign is not a national figure, and is overshadowed even at home by Harry Reid (D-Nev), the Senate majority leader. But Sanford, head of the Republican governors association until his announced retirement from that post yesterday, was a rising star with 2012 presidential ambitions. Sanford sought to deny his state its $700-million (U.S.) share of the Obama stimulus package, citing his ideological opposition to intrusive government.

But it`s hypocrisy that defines the modern GOP. Look at what the Republican Party of recent decades stands for, and then its record:

* Family values and moral probity. See above. Who is this party of Newt Gingriches (cheated on his first two wives), John McCains (cheated on his first wife), Rush Limbaughs (Oxycontin addict), Bill O'Reillys (out-of-court settlement over sexual harassment of a coworker), William (Book of Virtues) Bennetts (inveterate Vegas high-roller who has inveighed against gambling) to be claiming its moral superiority over anyone?

* Fiscal probity: Under Reagan and Bush, the U.S. federal deficit exploded to record levels. In just two terms, Bill Clinton, playing the traditional Dem role of cleaning up GOP messes, turned his inherited deficit into budgetary surpluses. Successor George W. Bush promptly reverted to the GOP`s spendthrift ways, running three-digit deficits in seven of his eight years. (In Dubya`s first year, he inherited the last of the Clinton surpluses.) On leaving office, Bush Jr. bequeathed a record $1.2-trillion (U.S.) deficit to Obama. All through the Dubya years, a freespending Congress was controlled by the GOP.

* National security. Competent FBI field offices forwarded disturbing reports from everyday Americans about peculiar behaviour of al-Qaeda operatives in the U.S., circa 2000-01. But on arrival at Washington HQ, these were shelved. Dubya`s FBI didn`t talk to his CIA, and Bush himself in August 2001 tossed aside his Presidential Daily Briefing dossier labelled "Al-Qaeda poised to strike in U.S." In the Clinton White House, PDB`s of that nature routinely triggered ``Principals Meetings`` among the president, vice president, national security advisor, defense secretary, heads of the FBI, CIA, and joint chiefs of staff.  Not this time. Bush churlishly told the sad-sack CIA officer who handed him the fateful warning on Air Force One that day, "Fine, you've covered your ass," and continued on to his vacation at his faux ranch in Crawford. Fact: The GOP controlled the presidency and Congress when America was hit with the worst terrorist attack in its history.

And then there`s Katrina. 

The Dems are scarcely better at keeping their trousers zipped, as we well know from the antics of Clinton, John Edwards and Eliot Spitzer. And the Dems` ousted Illinois governor Rod Blagojevich is proof that terrestial border security should take a backseat to building a less porous border with outer space.

The problem for Republicans, though, is that they're the ones running on the above issues - family values, careful spending of the people's money, protecting the homeland. One could argue that since Reagan came along in 1981, the GOP has done a miserable job at all three. One cannot argue that since Dubya came along in 2001, the GOP has failed manifestly at all three.

Worse for the GOP, while Dems don't hold themselves out as role models of morally straight behaviour, one of their own now occupying the White House is an overtly family man whose solid marriage and disciplined kids alone probably account for two-thirds of Obama`s high public-approval rating. Which means the GOP as never before in modern times cannot afford impropriety eruptions.

Of course, it would help if the GOP had some ideas of its own on economic recovery, the climate change spectre, energy self-reliance, educational and healthcare reform, and a foreign policy that extended beyond bullying. Today`s Republicans, with too few exceptions, present themselves as self-interested moral eunichs who would make Americans endure even harder times than these in order to maintain Dubya's tax cuts for the richest of the rich. There will be no quick fixes for the GOP image. As Obama told Republican National Committee head Michael Steele at the White House Correspondents Dinner last month, ``Unfortunately, the RNC is not eligible for the government bailout program.`` 

Investing

* WSJ: Now you can invest like Buffett, save like Scrooge. Some of the Oracles picks are trading far below what he paid.

For the purposes of this blog, the inception of the Great Recession in the U.S., the epicentre of the crisis, is taken as the start date for the global slump. The U.S. has been in recession since December 2007.

Not that the NHL has ever been confused with a class act.

Day 577

So the NHL and its Great Satan commish, Gary Bettman, have for years been shortchanging player widows, a court decision finds, some beneficiaries getting a mere 10 per cent of what they've been owed over the years. Jim Balsillie will not be sending Mr. B a note of comisseration over the scandal. Makes you wonder, though, why the players association, which brought the suit, wasn't more forceful years ago about making this a cause celebre. I mean, this sort of thing falls squarely in its balliwick, or so we assumed once Alan Eagleson got the hook. And is it just me that marvels at the seeming lifetime appointments enjoyed by incompetent pro sports commissioners (there's a redundancy in that wording, I'm sure), when cab drivers have to reapply for their licenses every few years?

Strike trifecta?

Already I can feel the surge of sympathy building nationwide as Toronto copes with a strike by its 30,000 municipal workers and threatened work stoppages by employees of its LCBO liquor monopoly (patrons of Alberta's privatized liquor stores will be especially sorrowful), and employees at the larger of Canada's two self-declared national newspapers (based in Toronto, where else, like its National Post rival). Such a flood of tears there will be, one might need a Starbucks grande cup to collect them. (Do they have Starbucks in Red Deer? Chicoutimi?) 

China syndrome

The bad news, according to the EU and the Obama administration, is that China has been hoarding all manner of raw materials, subsidizing local manufacturers while forcing the price up for the rest of us by keeping them off the market. Then again, the diplomatic deep freeze in Sino-Canadian relations appears abruptly to be melting. All part of a sinister Bejing plot to win Ottawa approval for Chinese takeover runs at our own resources, no doubt. Ottawa was sanguine about the loss of Alcan's, Inco's and Falconbridge's local autonomy. No doubt, CEOs and shareholders of EnCana, Suncor-Petrocan, Nexen, Canadian Natural Resources and the like eagerly await a yuan-denominated windfall. 

Update: China's Sinopec bids for Toronto-listed Addex Petroleum.

Bernanke's stay of execution

We're still betting the U.S. Fed chairman gets reappointed by Obama when his term expires early next year, following the tradition of Republican Ronald Reagan in reappointing Paul Volcker (a Carter appointee), and Democrat Bill Clinton in reappointing Alan Greenspan (a late-term Reagan appointee). No sooner had rumours ignited last week that Bernanke was out of favor than Obama lavished praise on him in a press conference yesterday - called, one almost wonders, just to make that one point. We're thinking wannabe Bernanke successor Larry Summers might as well start now firing off resumes to politically incorrect colleges - Pepperdine and Bob Jones University come to mind.

The Banker embarrasses itself

The house rag of global banking places a curious lot atop its annual list of the 1,000 "strongest" world banks: J.P. Morgan Chase, Bank of America, Citigroup Inc., Royal Bank of Scotland Group PLC (RBS) and HSBC PLC. 

HSBC, the London/Hong Kong giant, is the only one of the top five not to have been rescued with government bailout funds. The others are all in varying conditions of fragility. Citi and Britain's RBS have been effectively nationalized.

The Banker's rankings are based on capital strength, or the amount of Tier 1 capital held. HSBC dropped from first place last year, having apparently erred in being too sound to need a government capital top-up. Someone at the Banker neglected to note that the four other "strongest" banks boast comfortable Tier 1 capital because Uncle Sam and the British treasury have lent it to them with a spider's web of strings attached. And that all five of these "soundest" banks have a ton of looming consumer-related loan losses in their immediate future.

Hold these stocks forever - or at least until next year

Remember that Mr. and Mrs. Bridge scene in the bank vault where Paul Newman hauls a sheaf of stock certificates out of the couple's safe deposit box and sternly cautions wife Joanne Woodward, "Never sell these. They will take care of you"? We'd be impressed with Fortune's annual list of "40 Best Stocks To Retire On" except...the editors dumped more than half of last year's hold-'em-forever picks in making this year's list. Dunno about you, but my definition of a stock on which to retire is that you don't have to replace it 12 months after buying it. I think that's called portfolio "churning," the means by which most mutual fund managers rack up impressive trading fees, passed along to the investor, cutting into his or her returns; and also miss those brief windows when a solid stock, in the blink of an eye, makes its episodic big advances before plateauing for awhile. Which is why funds so chronically underperform the indexes.

Read it here first

* Ontario and Quebec cabinet shuffles.

* Seeking Alpha: The global food crisis is poised for an encore.

* Slate: Why newspapers still beat Amazon's Kindle for reader-friendliness.

For the purposes of this blog, the inception of the Great Recession in the U.S., the epicentre of the crisis, is taken as the start date for the global slump. The U.S. has been in recession since December 2007.