Can cryptocurrency protect you from inflation? – Globe and Mail Op-Ed

People have many happy expectations of cryptocurrencies as they look for ways to conduct their financial affairs outside the traditional financial system. They hope that, as crypto and its supporting blockchain technology mature, there will eventually be no delays in settling their transactions, cheaper cross-border transactions and no pesky fees on bank accounts, among other advantages.

Many also imagine that crypto assets can protect them from rising inflation. That, however, is one benefit crypto assets do not offer.

Crypto assets such as bitcoin and ethereum and their decentralized blockchain technology offer the promise that, at some point in the future, it may be possible to price goods and services and have one’s…

William B.P. Robson – The Federal Gas Pedal Meets Bank of Canada Brakes

Alexandre Laurin – Pension-Related Tax Rule Changes for Budget 2022

The budget should think inside the box — the IP Box – Financial Post Op-Ed

Finance Minister Chrystia Freeland tables the federal budget Thursday. She should use the occasion to implement policies that would improve Canada’s lacklustre innovation. A useful step in that direction would be to announce that income from patents and other intellectual property (IP) will be taxed at a special low rate. Generally described as an “IP Box,” such an initiative would boost Canada’s flagging R&D spending, raise our low commercialization rate, and stem an outflow of IP profits to tax havens.

As I explain in a C.D. Howe Institute paper published today, two developments make this a good time for an IP Box. The first is an OECD-inspired international agreement that income taxed at a preferential rate must be derived…

An Intellectual Property Box for Canada: Why and How

On inflation, the government and the Bank of Canada are pulling in opposite directions – Globe and Mail Op-Ed

With inflation pushing 6 per cent, and federal debt up about half-a-trillion dollars in two years, Canadian macroeconomic policy is a mess. It will get worse. The Bank of Canada is moving to get inflation down – applying the brakes. The federal government’s budget this week will show tens of billions more borrowing and spending – foot firmly on the gas. Monetary tightening and fiscal excess prefigure a wild economic ride ahead. Perhaps a recession.

Saying “recession” might seem alarmist. The economy is on a tear. Employment is well above, and unemployment well below, where they were pre-COVID. Economywide spending rose an eye-popping 12 per cent over the past year.

The problem, though, is that this surge owes so much to…

Kronick, Robson – House-Rich, Everything-Else-Poor

Only tighter money can keep the dollar from shrinking – Financial Post Op-Ed

What explains surging inflation in Canada and many other advanced economies? Most commentators — correctly — blame loose monetary policy. That contrasts with the 1970s and 1980s, when many people argued inflation was not something central banks could control and that tight money was therefore a case of pain for no gain. With the Bank of Canada and other central banks beginning to tighten, those arguments may return. If they prevail, monetary policy will stay too loose and inflation will keep raging.

Inflation is another term for a persistent decline in the value of money, which like most values is determined by supply and demand. If the Bank of Canada promotes growth in the supply of Canadian dollars that exceeds growth in the…

Canada has blown through our fiscal guardrails. When will our federal budgets reflect that? – Globe and Mail Op-Ed

The budget that federal Finance Minister Chrystia Freeland will present shortly will reveal whether the government is serious about putting the national finances on to a sustainable track.

There is room for doubt. Since 2015, the government had been running deficits larger than it promised, and larger than a strong economy justified. Then it responded to the COVID-19 pandemic with debt-financed spending on an unprecedented scale.

To assuage concerns about soaring federal debt – concerns heightened by the government’s equally unprecedented failure to present a budget at all in 2020 – the Finance Minister introduced a new concept in the government’s fall economic statement that year: fiscal…

Perrault, Haley – Picking up the Twenties: A Simple Proposal for Internal Free Trade

Policy is making us house-rich, everything-else-poor – Financial Post Op-Ed

In the fall of 2020, barely noticed amid the stresses of COVID-19, Canada’s economy passed a peculiar milestone. Residential investment surpassed all other business investment — more than for nonresidential structures, machinery and equipment, and intellectual property products combined. That was unprecedented. As recently as the early 2000s, it would have been inconceivable. As a nation, we risk ending up with nice roofs over our heads, but without the incomes we need for everything else we want. House-rich, and everything-else-poor.

Because a growing economy and inflation make recent experience hard to compare with what happened decades ago, it helps to measure investment relative to GDP. Until the…

Laurin, Dahir – Not so Fast, Please, on Automatic Tax Filing