News and resources for Canada's top financial advisors
Est. 1998
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Economic growth falls short
(July 31, 2008) Those hoping for a rebound in the U.S. economy were disappointed today, as GDP growth for the second quarter fell short of estimates, at 1.9%. Consensus estimates had predicted growth of 2.3%.
Consumer spending, which was boosted by the federal fiscal stimulus package, was one of the key drivers of the resurgence in economic activity, rising by 1.5% in the second quartile (up from 0.9% in the first quartile of this year). On the whole, consumer spending contributed a massive 1.08 percentage point to U.S. GDP.
The other area that contributed to the GDP was exports. U.S. exports rose by a strong 9.2%, while imports dropped for the third straight quarter. As a result, the net trade added a massive 2.42 percentage point to the GDP (the biggest contribution to this component since 1980). However, residential construction still took a beating, falling for the 10th consecutive quarter (falling a grand total of 15.6%), but was better than the 25% drop in the first quarter — this suggests that the decline in residential construction may be slowing.
In Canada, economic activity retreated in May, as the country’s gross domestic product for the month saw a surprising contraction of 0.1%, Statistics Canada said today.
Economists had been looking for growth of 0.2% for the month. May’s figure was down from the strong 0.4% growth seen in April.
The economy saw contraction in four of the six months between December 2007 and May 2008.
Statistics Canada said there was a “significant” decrease in the energy sector in May, while declines were also recorded in finance, forestry, construction and wholesale trade. Activity was higher for manufacturing, retail trade and the public sector.
• • •
GMP Private Client selects Toogood Financial Systems
(July 31, 2008) GMP Private Client, a subsidiary of GMP Capital Trust, has announced that it will enlist the services of Toogood Financial Systems to provide an enterprise-wide software solution.
Toogood will provide portfolio management, performance measurement, modelling, trade order management and client reporting.
(07/31/08)
(July 31, 2008) TD Waterhouse has agreed to pay $2 million in a settlement with the Investment Industry Regulatory Organization of Canada (IIROC) over its involvement in selling units of the Olympus United hedge fund of funds.
Olympus United was managed by Norshield Asset Management, which was the focus of a fraud investigation.
TD Waterhouse Canada admitted, in an IIROC hearing, that between 2001 and early 2005, the firm facilitated purchases of Olympus funds in client accounts without ensuring that clients were in fact accredited investors pursuant to the relevant prospectus exemption rules (and contrary to IDA Regulations 1300.1(a), 1300.2 and Policy 2).
The firm also admitted that from 2001 to the fall of 2004, it failed to establish and maintain alternative investment review or approval procedures and failed to establish and maintain sufficient training and guidance to its approved persons to ensure that the purchase of hedge funds was appropriate for its clients (contrary to IDA By-law 29.27, Regulations 1300.1(q), 1300.2 and Policy 2).
As a result, IIROC imposed a $2 million fine. TD was also ordered to pay $50,000 in costs that the Investment Dealers Association of Canada (IDA) incurred while formally investigating the charges against TD.
The IIROC has not yet released the reasons for its decision.
Read: Norshield dubbed potential “fraud”
• • •
Investment managers want single regulator
(July 31, 2008) Canada’s investment managers want the feds to end the constitutional quagmire and establish an “opt-in” national securities regulator.
The Investment Counsel Association of Canada (ICAC) is urging the federal government to establish a federal regulator using an “opt-in” solution. Their rationale, as stated in their submission to the Expert Panel on Securities Regulation, is that an opt-in option could “overcome perpetual political and legal wrangling that has left investors at risk.”
In a submission to the Expert Panel, the ICAC suggested that the federal government should use its power to create a separate national regulatory system that would enable securities issuers and registrants to be registered with and subject to the jurisdiction of a federal regulator. Such a system would then exclude provincial jurisdiction over those participants who opt in.
The ICAC has long advocated the need for a national securities’ regulator and has participated actively in promoting the concept. While the organization — which represents Canadian investment management firms with over $700 billion of assets under administration — would prefer to see a national regulator created. As a result of federal/provincial collaboration, it feels the country can no longer wait for governments to solve their differences.
ICAC’s submission focused on eight key advantages to the opt-in model. These include the following:
• • •
Economic growth falls short
(July 31, 2008) Those hoping for a rebound in the U.S. economy were disappointed today, as GDP growth for the second quarter fell short of estimates, at 1.9%. Consensus estimates had predicted growth of 2.3%.
Consumer spending, which was boosted by the federal fiscal stimulus package, was one of the key drivers of the resurgence in economic activity, rising by 1.5% in the second quartile (up from 0.9% in the first quartile of this year). On the whole, consumer spending contributed a massive 1.08 percentage point to U.S. GDP.
The other area that contributed to the GDP was exports. U.S. exports rose by a strong 9.2%, while imports dropped for the third straight quarter. As a result, the net trade added a massive 2.42 percentage point to the GDP (the biggest contribution to this component since 1980). However, residential construction still took a beating, falling for the 10th consecutive quarter (falling a grand total of 15.6%), but was better than the 25% drop in the first quarter — this suggests that the decline in residential construction may be slowing.
In Canada, economic activity retreated in May, as the country’s gross domestic product for the month saw a surprising contraction of 0.1%, Statistics Canada said today.
Economists had been looking for growth of 0.2% for the month. May’s figure was down from the strong 0.4% growth seen in April.
The economy saw contraction in four of the six months between December 2007 and May 2008.
Statistics Canada said there was a “significant” decrease in the energy sector in May, while declines were also recorded in finance, forestry, construction and wholesale trade. Activity was higher for manufacturing, retail trade and the public sector.
• • •
GMP Private Client selects Toogood Financial Systems
(July 31, 2008) GMP Private Client, a subsidiary of GMP Capital Trust, has announced that it will enlist the services of Toogood Financial Systems to provide an enterprise-wide software solution.
Toogood will provide portfolio management, performance measurement, modelling, trade order management and client reporting.
(07/31/08)
(July 31, 2008) TD Waterhouse has agreed to pay $2 million in a settlement with the Investment Industry Regulatory Organization of Canada (IIROC) over its involvement in selling units of the Olympus United hedge fund of funds.
Olympus United was managed by Norshield Asset Management, which was the focus of a fraud investigation.
TD Waterhouse Canada admitted, in an IIROC hearing, that between 2001 and early 2005, the firm facilitated purchases of Olympus funds in client accounts without ensuring that clients were in fact accredited investors pursuant to the relevant prospectus exemption rules (and contrary to IDA Regulations 1300.1(a), 1300.2 and Policy 2).
The firm also admitted that from 2001 to the fall of 2004, it failed to establish and maintain alternative investment review or approval procedures and failed to establish and maintain sufficient training and guidance to its approved persons to ensure that the purchase of hedge funds was appropriate for its clients (contrary to IDA By-law 29.27, Regulations 1300.1(q), 1300.2 and Policy 2).
As a result, IIROC imposed a $2 million fine. TD was also ordered to pay $50,000 in costs that the Investment Dealers Association of Canada (IDA) incurred while formally investigating the charges against TD.
The IIROC has not yet released the reasons for its decision.
Read: Norshield dubbed potential “fraud”
• • •
Investment managers want single regulator
(July 31, 2008) Canada’s investment managers want the feds to end the constitutional quagmire and establish an “opt-in” national securities regulator.
The Investment Counsel Association of Canada (ICAC) is urging the federal government to establish a federal regulator using an “opt-in” solution. Their rationale, as stated in their submission to the Expert Panel on Securities Regulation, is that an opt-in option could “overcome perpetual political and legal wrangling that has left investors at risk.”
In a submission to the Expert Panel, the ICAC suggested that the federal government should use its power to create a separate national regulatory system that would enable securities issuers and registrants to be registered with and subject to the jurisdiction of a federal regulator. Such a system would then exclude provincial jurisdiction over those participants who opt in.
The ICAC has long advocated the need for a national securities’ regulator and has participated actively in promoting the concept. While the organization — which represents Canadian investment management firms with over $700 billion of assets under administration — would prefer to see a national regulator created. As a result of federal/provincial collaboration, it feels the country can no longer wait for governments to solve their differences.
ICAC’s submission focused on eight key advantages to the opt-in model. These include the following:
• • •
Economic growth falls short
(July 31, 2008) Those hoping for a rebound in the U.S. economy were disappointed today, as GDP growth for the second quarter fell short of estimates, at 1.9%. Consensus estimates had predicted growth of 2.3%.
Consumer spending, which was boosted by the federal fiscal stimulus package, was one of the key drivers of the resurgence in economic activity, rising by 1.5% in the second quartile (up from 0.9% in the first quartile of this year). On the whole, consumer spending contributed a massive 1.08 percentage point to U.S. GDP.
The other area that contributed to the GDP was exports. U.S. exports rose by a strong 9.2%, while imports dropped for the third straight quarter. As a result, the net trade added a massive 2.42 percentage point to the GDP (the biggest contribution to this component since 1980). However, residential construction still took a beating, falling for the 10th consecutive quarter (falling a grand total of 15.6%), but was better than the 25% drop in the first quarter — this suggests that the decline in residential construction may be slowing.
In Canada, economic activity retreated in May, as the country’s gross domestic product for the month saw a surprising contraction of 0.1%, Statistics Canada said today.
Economists had been looking for growth of 0.2% for the month. May’s figure was down from the strong 0.4% growth seen in April.
The economy saw contraction in four of the six months between December 2007 and May 2008.
Statistics Canada said there was a “significant” decrease in the energy sector in May, while declines were also recorded in finance, forestry, construction and wholesale trade. Activity was higher for manufacturing, retail trade and the public sector.
• • •
GMP Private Client selects Toogood Financial Systems
(July 31, 2008) GMP Private Client, a subsidiary of GMP Capital Trust, has announced that it will enlist the services of Toogood Financial Systems to provide an enterprise-wide software solution.
Toogood will provide portfolio management, performance measurement, modelling, trade order management and client reporting.
(07/31/08)
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