Tuesday, November 25, 2008

Recession is the word from Canada

The word from Canada is recession. The Organization for Economic Co-operation and Development, a 30-nation group founded in 1961, recommended Tuesday that Ottawa cut interest rates to help its contracting economy recover, according to the Reuters international news service. The OECD report said Canada's economy will continue to shrink at least until the middle of next year because of the global economic crisis. Stephen Harper, Canada's prime minister, blamed the global crisis on the United States on Saturday at the Asia-Pacific Economic Cooperation summit in Peru. "Our closest neighbor and largest trading partner is the epicenter of the financial earthquake and global slowdown," Harper said in a speech to business leaders in Lima. The OECD predicted deficit spending for Canada's federal and provincial governments, a situation unheard of in many countries but standard operating procedure in the United States. OECD's reports said the deficits were "cyclical" and "not alarming," but cautioned against any increased spending, even as unemployment is expected to rise. Sounds familiar.

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