{"id":14498,"date":"2015-11-17T07:36:05","date_gmt":"2015-11-17T12:36:05","guid":{"rendered":"http:\/\/olduvai.ca\/?p=14498"},"modified":"2015-11-17T07:38:29","modified_gmt":"2015-11-17T12:38:29","slug":"foreign-investors-bail-out-of-canadas-money-machine","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=14498","title":{"rendered":"Foreign Investors Bail out of Canada\u2019s Money Machine"},"content":{"rendered":"<header>\n<h3 class=\"entry-title\"><a href=\"http:\/\/wolfstreet.com\/2015\/11\/16\/foreign-investors-dump-canadian-money-machine\/\" target=\"_blank\">Foreign Investors Bail out of Canada\u2019s Money Machine<\/a><\/h3>\n<p class=\"entry-meta\"><strong>First net outflow from Canadian\u00a0securities since 2008.<\/strong><\/p>\n<\/header>\n<div class=\"entry-content\">\n<p>On first sight, it wasn\u2019t that bad.\u00a0<a href=\"http:\/\/www.statcan.gc.ca\/daily-quotidien\/151116\/dq151116b-eng.htm?HPA\" target=\"_blank\"><u>Statistics Canada<\/u><\/a>\u00a0reported today that in September, foreign (non-resident) investors purchased C$3.3 billion of Canadian securities \u2013 adding C$3.2 billion in equities and C$0.9 billion in bonds to their holdings while getting rid of C$0.8 billion in money market instruments.<\/p>\n<p>But in July and August, foreign investors had dumped large quantities of equities. While they bought Canadian bonds during those two months, it wasn\u2019t enough.<\/p>\n<p>So for the third quarter overall, foreigners dumped C$9.2 billion of Canadian equities; \u201cthe highest such decline since the first quarter of 2013,\u201d Statistics Canada pointed out. They also dumped C$4.5 billion of money market instruments (private corporate paper and federal government business enterprise paper). And they picked up C$12.8 billion of bonds.<\/p>\n<p>This makes for a total outflow of C$0.9 billion in the third quarter, the first such outflow of foreign investment from Canadian securities since 2008.<\/p>\n<p>The data is very volatile, as the chart by\u00a0<a href=\"https:\/\/www.nbc.ca\/en\/rates-and-analysis\/economic-analysis.html\" target=\"_blank\"><u>NBF Economics and Strategy<\/u><\/a>, a division of the National Bank of Canada, shows. But it had been volatile only with positive numbers, with\u00a0<em>increases<\/em>\u00a0of foreign investment, ever since that ignominious year 2008. So when this net quarterly outflow\u00a0<em>does<\/em>\u00a0occur, as it did in 2008 and in Q3 2015, it\u2019s a sign of something larger:<\/p>\n<p><a class=\"image-anchor\" href=\"http:\/\/wolfstreet.com\/wp-content\/uploads\/2015\/11\/Canada-net-foreign-inflows-into-canadian-securities.png\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-19477\" src=\"http:\/\/wolfstreet.com\/wp-content\/uploads\/2015\/11\/Canada-net-foreign-inflows-into-canadian-securities.png\" alt=\"Canada-net-foreign-inflows-into-canadian-securities\" width=\"514\" height=\"631\" \/><\/a><\/p>\n<p>\u201cCanada seems to be less alluring to foreign investors these days,\u201d NBF explains.<\/p>\n<p>It doesn\u2019t help that Canadian stocks, as measured by the TSX, are dominated by the energy and mining sector and by former hedge-fund and mutual-fund darling and now deposed Canadian superstar Valeant. So the TSX has gotten clobbered, down 14% since April.<\/p>\n<p>And the Bank of Canada has been in interest-rate-cutting mode this year. Its intention has been to beat down the Canadian dollar even more, which it accomplished. In late October, it hit $0.748, its lowest level against the USD since July 2004.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Foreign Investors Bail out of Canada\u2019s Money Machine First net outflow from Canadian\u00a0securities since 2008. On first sight, it wasn\u2019t that bad.\u00a0Statistics Canada\u00a0reported today that in September, foreign (non-resident) investors purchased C$3.3 billion of Canadian securities \u2013 adding C$3.2 billion in equities and C$0.9 billion in bonds to their holdings while getting rid of C$0.8 [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[103,10636,3631,4940,1936,4254,4255],"class_list":["post-14498","post","type-post","status-publish","format-standard","hentry","category-economics","tag-canada","tag-canadian-bonds","tag-canadian-securities","tag-capital-outflow","tag-statistics-canada","tag-wolf-richter","tag-wolfstreet"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14498","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14498"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14498\/revisions"}],"predecessor-version":[{"id":14500,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/14498\/revisions\/14500"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14498"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14498"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14498"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}