Wednesday, June 19, 2013

RBC Economics' Provincial Forecast Versus Real Life Barometers


This morning, 680 News alerted me through Twitter, that RBC Economics have put out another forecast that everything is still improving.  I had a few things to say about this banking spin in December of 2012.

So, lets just take a quick look at some everyday economic barometers, to see what those point to.

TTC Subway Advertising
When times are good, the overhead advertising in the train cars is full of big brands.  When times are bad, it's half-full (exposing a lot of white, blank space) and what advertising it does have is full of government programs to get the economy out of a rut and further education adverts or credit counselling adverts for you to get yourself out of your own ruts.

Verdict:  
Given it's about 70% sold and full of government and college adverts, it doesn't indicate things are good.


Bank of Canada Behaviour
When times are good, interest rates are up and borrowing is encouraged.  When times are bad, interest rates are low, and the message is to deleverage and pay off debts.

Verdict:  Interest rates are still at 1%, and the resounding message right now is to reduce household debts.


Mens Casual Clothing Colours
When times are good, everything is bright, brash and confident. Think of 1950s attire, or 1980s outfits.  When times are not as good, we turn to bland colours that don't stick out as very confident.  Look around you and everyone's about as colourful as they were in the late 1970s.

Verdict:
We are back to a lot of the browns and greys again.  Even in the office, the bright red and yellow ties are out and more subdued blues and maroons are in.



Product Advertising
During good times, advertising is all about how wonderful the product is.  During the bad times it's all about how crappy the competition is.  For men, it's how bad another truck is against yours if you purchase this product.  For women, it's how the competition's skin cream leaves your skin feeling sticky, but if you purchase this brand, you'll not have the issues the competition will give you.

Verdict:
Adverts are scrappy right now.  The other banks don't stay open long enough.  Other beers are too fizzy or tasteless.  


Conclusion
Looking around me, I'd say things are not indicative of a recovery any time soon.