Category: Events

Dear Friends,

Tangents:

As Carolann is out of the office this afternoon, I will be writing the newsletter on her behalf.

A Victoria man has stumbled across a rare finding on the Gorge mud flats.  Retiring last year, Bruce Campbell took up metal detecting as a hobby and had no idea he would come across this uncommon find; an English Shilling dating back to 1551-1553 when Edward VI’s had his brief reign. Before coming across this rare find, Bruce also found a 1891 Canadian nickel and a silver dime from the 1960’s.  Not realizing what he found, he went home and posted pictures on the Official Canadian Metal Detecting Website.  Not too long after, people started posting comments stating “That’s not just any old coin.”  For Bruce, this was just his hobby and now a new coin for his collection.  He also hopes the Royal BC Museum might take interest in his find.  To read the complete article, visit: http://www.timescolonist.com/16th-century-english-shilling-found-in-gorge-1.783197.

“Money won’t create success, the freedom to make it will.”
Nelson Mandela

Photos of the Day:

An Orbital Sciences Corp. Antares rocket launches from NASA’s Wallops Flight Facility in Wallops Island, Va., Jan. 9th. The spacecraft is carrying the company’s first official re-supply mission to the International Space Station. Chris Perry/NASA/AP

The giant inflatable Rubber Duck installation by Dutch artist Florentijn Hofman floats on the Parramatta River, as part of the 2014 Sydney Festival, in Western Sydney, Australia. The creation is five stories tall and five stories wide and has been seen floating in various cities around the world since 2007.Jason Reed/Reuters

Market Closes for January 10^th, 2014

Market  Index	Close	Change
Dow  Jones	16437.05	-7.71     -0.05%
S&P 500	1842.37	+4.24     +0.23%
NASDAQ	4174.664	+18.470     +0.44%
TSX	13747.52	+118.11
		+0.87%

International Markets

Market  Index	Close	Change
NIKKEI	15912.06	+31.73
		+0.20%
HANG  SENG	22846.25	+58.92
		+0.26%
SENSEX	20758.49	+45.12
		+0.22%
FTSE 100	6739.94	+48.60
		+0.73%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	2.557	2.684
CND.   30 Year Bond	3.110	3.191
U.S.   10 Year Bond	2.8561	2.9578
U.S.   30 Year Bond	3.7991	3.8678

Currencies

BOC Close	Today	Previous
Canadian $	0.91784	0.92211
US   $	1.08952	1.08448
Euro Rate  1 Euro=		Inverse
Canadian   $	1.48891	0.67163
US  $	1.36681	0.73163

Commodities

Gold	Close	Previous
London Gold   Fix	1246.33	1228.43
Oil	Close	Previous
WTI Crude Future	92.72	91.66
BRENT	109.360	109.360

Market Commentary:

Canada

By Eric Lam

Jan. 10 (Bloomberg) — Canadian stocks rose a fourth day, to an almost three-year high, as gold rallied on speculation that weaker-than-estimated U.S. jobs growth will lead the Federal Reserve to slow the pace of stimulus withdrawal.

Barrick Gold Corp. and Goldcorp Inc. rallied at least 3 percent as gold gained the most in a week. BlackBerry Ltd. climbed 1 percent for a fifth day of increases after an analyst with RBC Capital Markets raised his rating on the stock. Air Canada, the best-performing stock in the benchmark equity gauge in 2013, added 5.2 percent.

The Standard & Poor’s/TSX Composite Index rose 118.11 points, or 0.9 percent, to 13,747.52 at 4 p.m. in Toronto. The index rallied 1.5 percent this week and closed at the highest level since May 2011.

“The commodities are having a good day and gold is feeding off the weak dollar and weak jobs numbers,” said Michael O’Brien, fund manager with TD Asset Management Inc. in Toronto.

The firm manages C$218.3 billion ($200.2 billion). “Clearly the jobs data caught everybody off guard.”

Gold for February delivery jumped 1.4 percent to settle at $1,246.90 an ounce in New York, reversing an earlier drop after the jobs data.

Canada’s unemployment rate rose to 7.2 percent in December, from a five-year low of 6.9 percent in the previous month while employment fell by 45,900. Economists surveyed by Bloomberg News projected a 14,100 job increase and an unchanged jobless rate. U.S. payrolls in December increased at the slowest pace since January 2011.

Raw-materials stocks surged 2.4 percent as a group, the most since October and the biggest gain in the S&P/TSX. Nine of 10 industries advanced on trading volume 27 percent higher compared with the 30-day average at this time of the day.

Barrick Gold gained 3 percent to C$19.82 and Goldcorp increased 4 percent to C$25.29 as all 23 members of the S&P/TSX Gold Index advanced. Novagold Resources Inc. rallied 7.8 percent to C$3.05 and Osisko Mining Corp. added 5.9 percent to C$5.17.

First Majestic Silver Corp. added 5.3 percent to C$11.51 and Silver Standard Resources Inc. climbed 7.7 percent to C$8.26 as the price of silver rose 2.7 percent, the most since Jan. 2.

Bankers Petroleum Ltd. rose 4.3 percent to C$4.58 and Canadian Natural Resources Ltd. advanced 3.1 percent to C$36.19 as the price of crude rose for the first time in three days.

West Texas Intermediate rallied 1.2 percent to settle at $92.72 a barrel in New York.

BlackBerry increased 1 percent to C$9.56. The stock rallied every day this week, adding 18 percent to the highest level since September.

Mark Sue, analyst with RBC Capital Markets, said recently installed Chief Executive Officer John Chen has been able to improve BlackBerry’s liquidity and strengthen its balance sheet.

Sue upgraded the stock to sector perform, the equivalent of a hold, from underperform, the equivalent of a sell.

Air Canada soared 5.2 percent to C$8.36, the highest level since June 2008. The stock has surged 14 percent in the past two days after three days of losses. The carrier jumped 323 percent in 2013, for the best performance in the S&P/TSX.

ShawCor Ltd. fell 3.9 percent to C$39.13 after reporting its fourth-quarter earnings would be “significantly lower” than the third quarter. Income from operations is projected to fall 50 percent to 60 percent from third-quarter levels, due primarily to a 50 percent reduction in revenue in the Asia Pacific region as well as a delayed startup of several large projects, the company said in a statement.

CGI Group Inc. declined 2.5 percent to C$34.37, the lowest close since September. The software services company that built the main Obamacare website will be replaced next month when its contract with the U.S. federal government expires, a person familiar with the decision said, Bloomberg News reported.

US

By Nick Taborek

Jan. 10 (Bloomberg) — U.S. stocks rose, sending the Standard & Poor’s 500 Index higher for the week, as a weaker- than-estimated jobs report eased concern that the Federal Reserve may accelerate the pace of stimulus cuts.

Companies that pay the highest dividends such as utility and phone stocks advanced as bond yields slipped, boosting the allure of equity income. Alcoa Inc. dropped 5.4 percent after profit missed estimates. Sears Holdings Corp. plunged 14 percent as it forecast a fourth-quarter loss and said sales during the holiday period dropped. Chevron Corp. slid 1.9 percent after saying earnings suffered as energy output declined.

The S&P 500 rose 0.2 percent to 1,842.37 at 4 p.m. in New York, after falling as much as 0.3 percent earlier in the day.

The benchmark index added 0.6 this week, paring its drop in 2014 to 0.3 percent. The gauge climbed 30 percent last year, the most since 1997. The Dow Jones Industrial Average dropped 7.71 points, or 0.1 percent, to 16,437.05. About 6.6 billion shares changed hands on U.S. exchanges, 8.8 percent above the three- month average.

“This could actually be good news for the market,” Quincy Krosby, a market strategist for Newark, New Jersey-based Prudential Financial Inc., which oversees more than $1 trillion, said by phone. “If these numbers don’t get revised upward, it will keep the Fed careful about wanting to taper too quickly.”

The 74,000 gain in payrolls, less than the most pessimistic projection in a Bloomberg survey, followed a revised 241,000 advance the prior month, Labor Department figures showed today in Washington. The median forecast of 90 economists called for an increase of 197,000. The unemployment rate dropped to 6.7 percent, the lowest since October 2008, as more people left the labor force.

The Fed, which next meets Jan. 28-29, in December announced a reduction of $10 billion in its monthly bond-buying program to $75 billion, citing a recovery in the labor market. Three rounds of stimulus from the central bank have helped push the S&P 500 higher by 172 percent from a 12-year low in 2009.

At the central bank’s December meeting, some members of the Federal Open Market Committee “expressed the view that the criterion of substantial improvement in the outlook for the labor market was likely to be met in the coming year if the economy evolved as expected,” meeting minutes showed Jan. 8.

“The markets have been priced for everything to go perfect,” Ron Florance, the Scottsdale, Arizona-based deputy chief investment officer for Wells Fargo Private Bank, which oversees $170 billion, said by phone. “This number shows us that it’s not going to be perfect. We’re still on the trajectory of recovery, but I would expect heightened volatility.”

The S&P 500 trades at 15.6 times estimated earnings of its members, more than the average multiple of 14.1 over the last five years, data compiled by Bloomberg show. Earnings for companies in the S&P 500 will climb 9.5 percent on average this year, almost twice the rate of 2013, while sales will probably increase 3.9 percent, according to analyst estimates compiled by Bloomberg.

“Earnings expectations are quite ambitious this year so we have to see if these come through,” said Virginie Robert, co- founder and partner at Constance Associes in Paris. Her firm, founded in August 2013, oversees three mutual funds including one that tracks the S&P 500 Total Return Index. “The fourth quarter will probably be quite disparate. You can see that retailers who have done well with online sales are reporting better holiday results, but others probably had a terrible quarter.”

JPMorgan Chase & Co., Bank of America Corp. and Goldman Sachs Group Inc. will all report quarterly results next week.

The Chicago Board Options Exchange Volatility Index, the gauge of S&P 500 options known as the VIX, lost 5.8 percent to 12.14 today. The index has fallen 12 percent this month and closed at the lowest level since August.

Nine out of 10 main industries in the S&P 500 advanced.

Utility and phone companies, which have the highest dividend payouts among 10 S&P 500 groups, were among the best performers.

Homebuilders increased 1.3 percent amid optimism a drop in borrowing costs will buoy demand in the housing market. D.R. Horton Inc. advanced 1.8 percent to $22.15 and Lennar Corp. climbed 2 percent to $39.19.

Abercrombie & Fitch Co. jumped 12 percent to $37.19. The teen-clothing retailer increased its full-year earnings prediction. Gap Inc., which rallied 26 percent in 2013, added 1.1 percent to $39.84 after the retailer said annual profit may reach the upper end of its forecast.

Newmont Mining Corp. climbed 2.6 percent to $23.80 as gold futures jumped on speculation the Fed will slow the pace of stimulus reductions.

Intuitive Surgical Inc. advanced 8.6 percent to $420.15 for the biggest increase in the S&P 500. The company’s new robotic surgery system has an 80 percent chance of being approved by the end of the year, a SunTrust Robinson analyst said in a note.

Intercept Pharmaceuticals Inc. rallied 62 percent to $445.83 as a Bank of America analyst raised the biotech firm’s price target to $872 from $81. Intercept soared 281 percent yesterday after a trial of its liver disease drug worked well enough for the testing to be stopped.

Alcoa dropped 5.4 percent, the most in the S&P 500, to$10.11 as the aluminum producer reported fourth-quarter profit that missed analysts’ estimates because of a glut of rolled metal used in the aerospace industry.

Sears Holdings tumbled 14 percent to $36.71. Chief Executive Officer Edward Lampert, the company’s largest shareholder, has been shedding assets, selling locations and spinning off the smaller-format stores and part of the Canadian business amid a continuing sales decline.

Chevron slid 1.9 percent to $121.01 for the biggest drop in the Dow. The world’s second-largest energy company by market value will report a drop in fourth-quarter profit after oil and natural gas production declined amid slumping prices. Net income during the period was “comparable” to the $5 billion earned during the third quarter, the company said in a statement yesterday. That compares with a $7.25 billion profit for the final three months of 2012.

Five Below Inc. sank 7.2 percent to $40.46. The chain that sells teens discounted items said fourth-quarter earnings will probably not exceed 46 cents a share, down from an earlier range of 49 cents to 51 cents forecast in December, after holiday sales fell.

 

Have a wonderful weekend everyone!!!

 

Be magnificent!

 

“Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma – which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition.”
Steve Jobs

As ever,

 

Amanda Bourke

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

 

Dear Friends,

Tangents:

Carolann is out of the office this afternoon at an appointment.

Just a fun fact! Today in history the first world’s largest omelette was made in Japan! Last year, on August 11^th the world record was broken! The omelette made, weighed in at 6.466 tonnes (14,225 lb 6 oz). It took a team of 55 people 6 hours to make this omelette, all led by a head chef, Pedro Mendes. A 4,290-kg pan was used, with a 10.3-metre diameter. The omelette used 145,000 eggs, 880 lbs of oil and 220 lbs of butter. All eggs used were free range. This omelette was made at a festival held in the region for Portuguese people who live and work elsewhere during the year.

Today In History

1831 – The first bank robbery in America was reported. The City Bank of New York City lost $245,000 in the robbery.

1915 – Pluto was photographed for the first time. However, it was not known at the time.

1918 – The U.S. Congress approved Daylight-Saving Time.

1949 – The Soviet People’s Council signed the constitution of the German Democratic Republic, and declared that the North Atlantic Treaty was merely a war weapon.

1953 – The Academy Awards aired on television for the first time.

1963 – In Costa Rica, U.S. President John F. Kennedy and six Latin American presidents pledged to fight Communism.

1977 – The last episode of “The Mary Tyler Moore Show” aired.

1990 – The first world ice hockey tournament for women was held in Ottawa.
a season.

Photos of the Day – March 19^th, 2013

Lightning steaks across the sky behind the Young Meadows Presbyterian Church in Montgomery, Alabama. Strong storms moved across the state bringing hail, high winds, and heavy rainfall as a cold front passed through. Dave Martin/AP

Campaigners dressed as Britain’s Chancellor of the Exchequer George Osborne congregate in Parliament Square in central London. They were protesting on behalf of ‘Enough Food for Everyone IF’, a campaign to end global hunger. Stefan Wermuth/Reuters

“Challenges are what make life interesting and overcoming them is what makes life meaningful.” – Joshua J. Marine

Market Closes for March 19^th, 2013

Market  Index	Close	Change
Dow  Jones	14455.82	+3.76    +0.03%
S&P 500	1548.34	-3.76    -0.24%
NASDAQ	3229.095	-8.495    -0.26%
TSX	12773.87	-7.89
		-0.06%

International Markets

Market  Index	Close	Change
NIKKEI	12468.23	+247.60
		+2.03%
HANG  SENG	22041.86	-41.50
		-0.19
SENSEX	19008.10	-285.10
		-1.48%
FTSE 100	6441.32	-16.60
		-0.26%

Bonds

Bonds	% Yield	Previous % Yield
CND.  10 Year Bond	1.820	1.862
CND.   30 Year Bond	2.519	2.559
U.S.   10 Year Bond	1.9017	1.9546
U.S.   30 Year Bond	3.1281	3.1843

Currencies

BOC Close	Today	Previous
Canadian $	0.97349	0.97820
US   $	1.02723	1.02228
Euro Rate  1 Euro=		Inverse
Canadian   $	1.32156	0.75668
US  $	1.28653	0.77729

Commodities

Gold	Close	Previous
London Gold   Fix	1613.00	1605.31
Oil	Close	Previous
WTI Crude Future	92.16	93.74
BRENT	108.50	110.45

Market Commentary:

Canada

By Eric Lam

March 19 (Bloomberg) — Canadian stocks fell for a second day as commodities producers declined after Cypriot lawmakers rejected an unprecedented bank levy, sparking concerns Europe’s debt crisis will worsen.

Pengrowth Energy Corp. lost 1.2 percent as oil retreated after the euro fell to a three-month low versus the dollar.

Legacy Oil + Gas Inc. slid 5.6 percent after an analyst raised concerns about its debt. Taseko Mines Ltd. and Teck Resources Ltd. fell at least 4 percent as copper touched the lowest level in almost seven months. Lululemon Athletica Inc. slumped 2.6 percent after it said a shortage of women’s pants will cause quarterly revenue to miss company forecasts.

The Standard & Poor’s/TSX Composite Index fell 7.89 points, or 0.1 percent, to 12,773.87 in Toronto, after gaining as much as 0.4 percent earlier in the day. The S&P/TSX has risen 2.7 percent this year. Trading volume was 5.5 percent below the 30- day average.

“It’s a knee-jerk reaction, given how small Cyprus is,” said Anil Tahiliani, a fund manager with McLean & Partners in Calgary. The firm manages about C$1 billion ($973 million). The European Union “won’t let Cyprus implode. I think people are using this as an excuse to take money off the table.”

The island nation’s parliament voted against imposing losses on depositors, a key demand of European officials in return for bailout funds. Equities briefly pared losses after the vote when the European Central Bank said it will provide liquidity to Cyprus within existing rules.

While the country accounts for less than half a percent of the euro economy, the fight over the bank tax risks triggering new turmoil in the financial crisis that began in 2009 in Greece.

Canadian stocks rose earlier as data showed U.S. home construction increased by a more-than-estimated 0.8 percent in February, and building permits climbed to the highest level in almost five years.

Pengrowth fell 1.2 percent to C$5.60, as oil slid 1.7 percent to settle at $92.16 in New York. The euro declined as much as 0.9 percent to $1.2844, the lowest since Nov. 22, reducing the appeal of crude as an investment. Trican Well Service Ltd. dropped 1.4 percent to C$14.62.

Legacy Oil + Gas tumbled 5.6 percent to C$5.71. Allan Stepa, analyst with Desjardins Securities Inc., said Legacy’s C$486 million in net debt at the end of 2012 remains a concern.

“The key catalyst for Legacy will be additional measures to strengthen its balance sheet,” he said in a note to clients today.

Raw-materials producers contributed most to declines in the S&P/TSX index, falling 0.3 percent as a group. Taseko Mines dropped 4 percent to C$2.85 and Teck Resources declined 4.7 percent to C$28.45. Copper futures slid for a third straight day, losing 0.7 percent to settle at $3.4055 a pound.

Lululemon erased 2.6 percent to C$65.74, the lowest close since January. The yoga-wear retailer fell as much as 8.2 percent after saying a shortage of a women’s pants line will have a “significant” effect on financial results and will lead to lower-than-forecast first-quarter revenue.

Certain shipments of its black Luon pants are too sheer and don’t meet the company’s standards, impacting about 17 percent of all women’s pants in its stores, the company said.

Rona Inc., the nation’s largest home-improvement retailer, advanced 4 percent to C$10.98 after it announced supermarket executive Robert Sawyer will take over in April as CEO. Sawyer had been chief operating officer at Metro Inc.

Dundee Industrial Real Estate Investment Trust slipped 1.7 percent to C$10.76 after agreeing to buy C2C Industrial Properties Inc. in a transaction valued at about C$226 million.

The deal adds a portfolio of more than 2.5 million square feet of gross leasable area, Dundee said in a statement. C2C soared 26 percent to C$4.68.

US

By Lu Wang and Sarah Pringle

March 19 (Bloomberg) — U.S. stocks fell, sending the Standard & Poor’s 500 Index to its longest slump of the year, as Cypriot lawmakers’ rejection of a bank levy overshadowed data showing growth in new-home construction.

Cliffs Natural Resources Inc. tumbled 6.6 percent as Goldman Sachs Group Inc. cut its forecast for iron-ore prices.

Electronic Arts Inc. slumped 8.3 percent after the video-game maker ousted its chief executive officer. Cardinal Health Inc. fell 8.2 percent after saying its contract with Walgreen Co. won’t be renewed. Walgreen rose 5.4 percent and AmerisourceBergen Corp. surged 3.6 percent after agreeing to a partnership.

The S&P 500 fell 0.2 percent to 1,548.34 at 4 p.m. in New York, after dropping as much as 0.9 percent earlier. The gauge lost 1 percent over three days, the longest streak since Dec. 28. The Dow Jones Industrial Average added 3.76 points, or less than 0.1 percent, to 14,455.82. About 6.8 billion shares traded hands on U.S. exchanges today, or 7.4 percent above the three- month average.

“Obviously the situation in Europe is not what we want it to be,” John Manley, who helps oversee about $223.6 billion as chief equity strategist for Wells Fargo Advantage Funds in New York, said in a phone interview. “The next couple weeks will be more periods of chopping around. I don’t think it’s more than 2 to 4 percent in terms of risk on the market,” he said. “The housing market does seem to be on a bit more steady ground and that helps U.S. consumers.”

Stocks fell as Cyprus’s parliament rejected an unprecedented levy on bank deposits, dealing a blow to European plans to force savers to shoulder part of the country’s bailout in a standoff that risks renewed tumult in the euro area.

Hammered out by euro-area finance chiefs at the weekend, the deal had sought to raise 5.8 billion euros ($7.5 billion) by drawing funds from Cyprus bank accounts in return for 10 billion euros in international aid.

Equities trimmed losses late in the trading day after the European Central Bank reaffirmed its commitment to provide liquidity “as needed within the existing rules.”

The S&P 500 rose earlier as a Commerce Department report showed builders broke ground on 917,000 homes at an annual rate, up 0.8 percent from a revised 910,000 pace in January that was higher than initially estimated. Building permits, a proxy for future construction, advanced 4.6 percent to 946,000, the strongest since June 2008.

The bull market in U.S. equities entered its fifth year this month. The S&P 500 has more than doubled from its bottom in 2009, driven by better-than-estimated corporate earnings and three rounds of bond purchases by the Fed. The S&P 500 rose to within two points of its 2007 record last week while the Dow reached an all-time high.

The Federal Open Market Committee began a two-day meeting today. The policy makers agreed in December to link record-low interest rates to thresholds for unemployment and inflation so that investors and households know what conditions will prompt the Federal Reserve to consider raising rates.

The push by Fed Chairman Ben S. Bernanke to continue record stimulus faltered with the Jan. 3 release of minutes from the FOMC’s December meeting, which said several officials favored slowing or stopping bond buying well before the end of 2013.

“I don’t think there is any mystery at all,” Christopher Beck, senior vice president at Delaware Investments, said in a phone interview. His firm had more than $179 billion under management as of as of Dec. 31. “The Fed is not going to change the tone. They’re going to confirm the easing bias.”

The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against declines in the S&P 500, jumped 7.7 percent to 14.39 today, after surging 18 percent yesterday. The gauge, known as the VIX, is down 20 percent this year.

Six out of 10 S&P 500 groups retreated as energy, consumer- discretionary and financial companies fell the most, sinking at least 0.5 percent.

Cliffs Natural Resources Inc., the biggest U.S. iron ore producer, tumbled 6.6 percent to $20.33. Goldman Sachs trimmed its price forecast on the commodity, citing seaborne expansion projects and increasing production in China.

Chesapeake Energy Corp. slumped 5.1 percent to $21.04.

Freeport-McMoRan Copper & Gold Inc., the world’s second largest copper miner, slid 1.6 percent to $32.98.

Electronic Arts dropped 8.3 percent to $17.15. The second- largest U.S. maker of video games said John Riccitiello is stepping down as chief executive officer and warned quarterly results may fall short of forecasts.

Juniper Networks Inc. fell 5.3 percent to $19.14. Goldman Sachs downgraded the No. 2 maker of networking gear to sell from neutral, citing competition from Cisco Systems Inc. and Alcatel- Lucent.

Cardinal dropped 8.2 percent to $42.35 after saying its pharmaceutical distribution contract with Walgreen won’t be renewed after it expires in August. Walgreen accounted for about 21 percent of Cardinal’s revenue in 2012.

Walgreen, the largest U.S. drugstore chain, and Alliance Boots GmbH agreed to a long-term partnership with AmerisourceBergen, gaining the right to acquire a minority stake in the pharmaceutical services provider. Walgreen also reported second-quarter earnings that topped analysts’ estimates.

AmerisourceBergen surged 3.6 percent to $50.06 and Walgreen rallied 5.4 percent to $44.74.

EBay Inc. climbed 2 percent to $51.10. The operator of the world’s largest online marketplace is overhauling fees for sellers for the first time since 2010, seeking to reduce costs and make pricing less complicated as it competes with bigger rival Amazon.com Inc. for online merchants.

Have a wonderful evening everyone.

 

Be magnificent!

 

As ever,

 

“I don’t regret the things I’ve done, I regret the things I didn’t do when I had the chance.” – Unknown

Karen Parnham

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

 

St. Andrew’s Square

Suite 340A, 730 View St.,

Victoria, B.C. V8X 3Y7

Tel: 778-430-5808

Fax: 778-430-5838

 

Dear Friends,

As you know, Finance Minister Jim Flaherty delivered his federal budget on March 22 in Ottawa.

In case you haven’t had a chance to review the media coverage, I thought you would appreciate a quick overview of the federal budget.

RRSPs and estate planning: Several changes to RRSP rules aim to clamp down on use of RRSPs in certain tax planning schemes, including RRSP “strips.” The new rules are similar to anti-avoidance rules applied to TFSAs.

Individual Pension Plans: The latest budget proposes annual minimum amounts be withdrawn from IPPs once a plan member reaches age 72. This mirrors the current minimum withdrawals from RRIFs.

Guaranteed Income Supplement: The budget tops up the GIS, providing an additional $600 per year for single seniors, and up to $840 per year for senior couples.

RESPs: Transfers can now be made between individual RESPs for siblings without triggering tax penalties or repayments of Canada Education Savings Grants. The change only applies to asset transfers made after 2010.

Other Student Assistance: Eligibility for federal student loans and grants has been expanded for both full- and part-time post-secondary students. The in-study income exemption will be doubled to $100 per week and part-time students with high family incomes will now be eligible for a Canada Student Loan. There are also extensions of Education and Textbook tax credits for students working abroad.

Children’s Art Tax Credit: Expanding on a popular program for parents who enroll kids in fitness activities, Ottawa proposed a credit of up to $500 of eligible expenses for children’s programs associated with artistic, cultural recreational and developmental activities.

Family Caregiver Tax Credit: The budget introduces a 15% non-refundable credit on an amount of $2,000 to provide tax relief to caregivers of all types of infirm dependent relatives, including spouses, common-law partners and minor children.

RDSPs: Registered Disability Savings Plan beneficiaries with shortened life expectancies will have more flexibility to withdraw assets without requiring repayment of other programs, such as Canada Disability Savings Grants.

Home Renovation: Renewed funding for the Clean Air Agenda provides $400 million in 2011–12 for the ecoENERGY Retrofit to help homeowners pay for energy efficient upgrades.

Business Owners: Small businesses will receive a one-year break in EI payouts under a new Hiring Credit for Small Business. The government also gave a two-year extension of the popular 50% straight-line accelerated Capital Cost Allowance for manufacturing or processing machinery and equipment.

I hope you find these highlights useful. If you’d like to discuss these and other federal budget initiatives, please don’t hesitate to contact me.