Shipping rates soar
The cost of leasing a ship to carry dry bulk cargo — from wheat to iron ore— is at an eleven year high. There are a few reasons: one is demand for things such as iron ore. When the Baltic Dry Index — that measures demand for ships— rise some economists say it predicts a growing economy down the road because users are buying to produce things. It is called a leading indicator because it predicts what is going to happen. Things like unemployment numbers tell you what has already happened.
Another reason for rising shipping rates is a Covid scare that closed a big port in China. The South China Morning Post reports that the Chinese port of Ningbo-Zhoushan was forced to shut one terminal on Wednesday after a worker tested positive for COVID-19 despite being fully inoculated with two doses of the Sinovac vaccine.
That also hits the container business. All this is probably going to make a lot of things more expensive. Inflation anyone?
If you can’t travel or eat out, buy stuff
Which is what people did during the long Covid pandemic. And much of the stuff they bought was made in China, Vietnam, Malaysia and other places and shipped in containers to bored, homebound people in Europe and North America.
Which is why Hapag-Lloyd made more money in the first six months of 2021 that it did in the last 10 years combined.
A gruesome thought
People who died of Covid would, on average, have lived ten years longer if they had not been hit by the disease. That means that the 27,000 people in Canada, 620,000 in the United States and 131,000 in Britain will not be receiving government benefits, from Old Age Security in Canada to Social Security in the United States. A gruesome thought, but that must be saving governments untold billions. Nothing they can mention, but maybe it is why they feel free to spend so much.
Buying votes?
This past week I received a letter from the Government of Canada telling me they are sending me $500. It is part of Old Age Security (OAS), though I don’t receive OAS as I am lucky enough to make too much money to qualify. I am still getting the $500.
It will arrive in my bank account just as the campaign starts for the September 20th election, called on Sunday. How many people will say “How nice, I’ll vote for the nice man who just gave me $500.” Sleazy in the extreme.
Speaking of hypocrisy
President Biden says this week that he wants OPEC to pump more oil. That would mean prices will fall for American drivers at the height of the `Summer Driving Season’ as people get back to doing touristy things. How can you go on about climate change on the one hand and want cheaper oil on the other?
More driving equals more carbon dioxide. And…the oil will come from such great paragons of human rights as Libya and Saudi Arabia. One of the first things President Biden did when he came to office was cancel the XL pipeline from goody-two-shoes Canada.
Taxes in Canada
Taxes are the average Canadian family’s number one expense, according to the Fraser Institute, a free market think tank that doesn’t like taxes.
They added up all taxes, not just income taxes.
“ Last year, the average Canadian family earned $96,333 and paid $35,047 in taxes compared to $34,105 for the basic necessities—housing (including rent and mortgage payments), food and clothing combined.
In other words, the average Canadian family spent 36.4 per cent of its income on taxes compared to 35.4 per cent on basic necessities.
The total tax bill for Canadians includes visible and hidden taxes (paid to the federal, provincial and local governments) including income, payroll, sales, property, carbon, health, fuel and alcohol taxes.”
Why do we get so many annoying phone calls?
Flying into space is old hat. Moon landings are ancient history. But the people who run telephone companies can’t figure out how to stop telephone scams. Bell Canada boasts about 5G. But people will not answer my telephone calls with the 416 area code because the call could be the tax department threatening them with jail, a report of phone charges on your Visa card or someone pitching a duct-cleaning service.
Phone companies could stop a lot of this, according to an expert I spoke to. There are private companies in Canada and the United States that control the assignment of numbers. Without the phone companies and the government co-ordinating things we will still get those calls. By the way, I often click through and get a live voice. “You’r from the CRA (Canada’s tax department)? Yes. Ok, what is the capital of Nunavut?” They hang up.
Food costs more
Tyson Foods (the world’s second largest meat processor) has raised the price of pork 39% for its restaurant customers in the last three months.
Beef prices are up 12% and chicken is up 16%. Inflation gets real when it hits the grocery store. It was a big contributor to the July inflation rate in the United States which was reported this week at 5.4%.
Wear nothing but a mask
A Country Garden on a hot summer afternoon.
My neighbours in Knowlton, Quebec, work this 1/8 acre garden with a high fence to keep the deer out. The harvest is so huge they have to give away surplus vegetables. We are the beneficiaries of their labour. No food inflation here.
Essay of the Week
This past week Hilary and Bill Clinton were in the village of Knowlton visiting their friend Louise Penny, the best selling author who sets her stories in this area. Hilary and Louise are working together on a thriller.
Louise Penny lives in the village and until Covid she was responsible for a minor tourist influx. A large number of her American fans come here to see if they can identify any of the places used in Louise’s mysteries. The name of the fictional village is Three Pines and it is based on Knowlton and the nearby village of Sutton.
Brome Lake Books is one of the mandatory stops for literary tourists, including Bill and Hilary who dropped in and bought a number of books. So did friends accompanying the couple, mostly Louse Penny books and related items. There are many Louise Penny books on display; when one of her books comes out this bookstore alone sells a thousand copies, many of them to those tourists, but to locals as well.
“We have 600 pre-orders for the next Louise Penny book, The Madness of Crowds” says Danny McAulay, who owns the bookstore with his wife, Lucy Hoblyn. They have operated it for 16 years.
Running a small bookstore has not been one of the greatest businesses over the past few decades. The Internet and giant chains have put many small book sellers out of business. But this place is thriving. Part of the reason is the Quebec government, which is usually dedicated to promoting French culture.
English-language bookstores, such as this one, must sell English language books and local schools and libraries have to buy books from small bookstores. There is an English elementary school in town and a bi-lingual public library across the street from the book store.
“We buy all our English-language books here, so that’s $14,000 last year,” says Jan Valasek, the local librarian.
Brome Lake Books is accredited by the government of Quebec as a supplier to schools and other public institutions. Government rules say the bookstore has to maintain its English language character and only about 5% of the 9,000 titles in the store are in French. It also has to sell just about only books. Only 5% of sales can come from things such as cards and stationery if it wishes to maintain its accreditation to sell to schools and other public institutions.
“We did better than okay during the pandemic, in part due to those instutitonal sales,” says Ms. Hoblyn.
About 25% of the books sold here are for children and young adults. Fiction makes up 40% and the rest are spread across a wide range of non-fiction and reference books.
After the local trade comes the institutions that usually make up 45% of the business 60% That includes the local library, schools and until recently even the local penitentiary in Cowansville 15 kilometres away.
“The big sellers at the penitentiary were science fiction, new age and books on body building. They stopped buying because of federal budget cuts,” says Ms Hoblyn.
Brome Lake Books is a 2,000 square foot store in the middle of town, in a modern space that used to be a Ralph Lauren outlet. Ms Hoblyn says about 65% of her customers are women, who read mostly fiction. The men who shop here read mostly history and biography.
The local shoppers are often members of the dozen or so book clubs in town. Knowlton and the surrounding area is a retirement community and those are the people who join book clubs.
“The Internet isn’t a competitor for us. People like to come in and look over and touch the books they’re going to buy,” says Ms Hoblyn.
Some of her customers even muse about buying her business. There is something romantic about the idea of owning a small bookstore. But Lucy Hoblyn says it is hard work. For one thing she is open from 10am to 5pm 363 day a year, closing only on Christmas and New Year’s Day.
“Quite a few people have this dream about owning a bookstore. Mostly it’s because they like books and they like to read. There’s no time to read during the day, and we often have to work at night,” says Ms Hoblyn.
Still she does read and many of her customers have to come to rely on her for recommendations. It’s something that comes with the territory of running a small bookstore.
NOTE: I have tried to set up a system where subscribers can pay directly. I hope it works.