David Raymond Amos @DavidRayAmos
Replying to @DavidRayAmos @alllibertynews and 49 others
Methinks a few ethical words from Trudeau The Younger, Boris Johnson and Trump and a lot of our economic woes would be over in a heartbeat N'esy Pas?
https://davidraymondamos3.blogspot.com/2020/04/out-of-time-how-pandemic-and-oil-crash.html
https://www.cbc.ca/news/politics/newfoundland-labrador-oil-pandemic-covid-coronavirus-dwight-ball-1.5516620
'Out of time': How a pandemic and an oil crash almost sank Newfoundland and Labrador
Province couldn't borrow in the face of a pandemic and was going to run out of cash in April
· CBC News · Posted: Apr 01, 2020 4:00 AM ET
Newfoundland and Labrador Premier Dwight Ball issued a personal plea to Prime Minister Justin Trudeau to help the province escape a perfect storm of events that threatened to leave the province unable to borrow in the face of a pandemic. (Paul Daly/The Canadian Press)
His province was reporting just four cases of COVID-19 when Newfoundland and Labrador Premier Dwight Ball wrote the prime minister to warn that his province was about to go under.
It wasn't the health crisis that had Ball so concerned — though that clearly was a major worry. It was a financial crisis that had him reaching out to Justin Trudeau for help.
In the March 20 letter, Ball warned that Newfoundland and Labrador had "run out of time," according to sources with knowledge of the events.
The province with Canada's worst balance sheet had just been told that nobody wanted to buy Newfoundland and Labrador bonds. The government's attempts to finalize both its short- and long-term borrowing programs had failed.
In other words, Newfoundland and Labrador couldn't get the money it needed in the face of a pandemic.
Sources say the provincial government was on track to run out of cash by the middle of April.
"There is a point coming soon when this province will not be able to pay its public service," a senior provincial government official said of the situation at the time.
Newfoundland and Labrador was spared that fate just days later, when the Bank of Canada stepped in with a plan to buy short-term provincial bonds to "support the liquidity and efficiency" of provincial funding markets.
Bank of Canada Announces New Program to Support Provincial Funding Markets http://ow.ly/UniN30qsnYu
"This should ease those financing constraints for the provinces, and at least give them predictability for their near-term cash flows," Bank of Canada Governor Stephen Poloz told reporters in Ottawa Friday.
It was a move to help all provinces deal with the coronavirus fallout. But the combined impact of COVID-19 and the oil price war between Russia and Saudi Arabia was hammering resource-dependent provinces like Alberta and Saskatchewan especially hard — and their borrowing costs were rising as a result.
Poloz's move was a lifeline for Newfoundland and Labrador. Before Poloz stepped in, Ball's minority Liberal government was just days away from an emergency session of the House of Assembly to get approval to borrow $2 billion it wasn't sure it could raise.
'We can make payroll'
At a press conference in St. John's Wednesday afternoon, Ball confirmed that he wrote the letter, telling reporters he thought it was appropriate to draft some correspondence to reflect conversations he's had with the prime minister.
The premier said the province's borrowing picture has brightened somewhat since March 20.
"We've had some success this week in the markets — of course, supported with the Bank of Canada by the changes that they had made to help provinces like Newfoundland and Labrador with their borrowing requirement," Ball said.
"So essentially, we can make payroll. We will continue to provide the services."
Newfoundland and Labrador was in a weakened financial position even before the crisis. Its plight was only compounded by the collapse in oil prices and COVID-19. And as the virus spread around the world, economic contagion spread throughout the provincial economy.
Bank of Canada Governor Stephen Poloz spoke with reporters on Parliament Hill on Friday 3:31
Newfoundland and Labrador's most recent budget (this year's fiscal plan has been delayed indefinitely) was betting on US$63 oil. On Monday, it fell below US$23.
That price slump means hundreds of millions in revenues expected from producing fields are likely to evaporate in the coming year. And future offshore projects — including the $6.8-billion deepwater Bay du Nord prospect — have now been put on hold.
As many as 500 jobs were lost with the mothballing of Come By Chance oil refinery, which itself accounts for five per cent of the province's gross domestic product.
It all combines to create a cash-and-jobs crisis in a province that already had double-digit unemployment and no obvious floor under its free-fall in revenue. Newfoundland and Labrador doesn't receive equalization payments. Its balance sheet is completely exposed.
The cash situation is so bad, Ball warned publicly last week that his government might not be able to participate in any cost-shared programs Ottawa may use to help spur the economic recovery.
"You cannot compare Newfoundland and Labrador to other provinces," he said. "We are unique."
In the hours after the provincial legislature swiftly passed five pieces of legislation to deal with the COVID-19 pandemic, Ball warned about a looming "economic crisis" expected to follow the public health emergency — a crisis that almost certainly would require another plea to Ottawa for help.
"I think every single industry — every single key industry that's driving this economy right now — is having difficulty," Ball told reporters in St. John's.
"The federal government will have to be there to help provinces like Newfoundland and Labrador."
Read March 20 letter from NL Premier Dwight Ball to PM Justin Trudeau
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Read March 20 letter from NL Premier Dwight Ball to PM Justin Trudeau (PDF KB)
Read March 20 letter from NL Premier Dwight Ball to PM Justin Trudeau (Text KB)
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David Amos
Surprise Surprise Surprise
Marguerite Deschamps
So-called leaders gambling and banking on the antiquated fossil fuel business oblivious to the technological breakthroughs right before their nose that will soon see this polluting source of energy go the way of the dodo bird.
David Amos
Reply to @Marguerite
Deschamps: Methinks its interesting that you are now talking about Dodo
birds too However if you truly believe that oil was created from dead
dinosaurs etc you should read more of my words N'esy Pas?
Marguerite Deschamps
And I thought all along that the poorest province was New Nouveau-Brunswick all because of bilingualism. This is all we read all the time on here.
David Amos
Reply to @Marguerite
Deschamps: Methinks everybody knows why the folks on the Rock fell upon
hard times only recently The Hard Times in New Nouveau-Brunswick has
been happening over the course of 40 years or so thanks to the
questionable actions of you SANB dudes N'esy Pas?
Steven Clerk
Canadians generally are in for a bit of an economic reckoning soon and this pandemic is likely going to speed things up by a few years. Its unfortunate that we need to go broke first before change is implemented, especially at the government and public service level.
David Amos
Reply to @Steven
Clerk: Methinks you should check my work Trust that many people know
that there is still time to stop this madness. Just a few ethical words
from Trudeau The Younger, Boris Johnson and Trump and a lot of our
economic woes would be over in a heartbeat N'esy Pas?
Jerry Brett
Phew ! That was close. But everything is fine again now, isn't it? I wonder what's on TV besides that same old boring virus stuff.
David Amos
Reply to @Jerry Brett: Try Googling "Harper and Bankers" for a little tragically true comic relief
Rick James
oil war between saudis and russians is hurting canada
David Amos
Reply to @Rick James:
Nope Methinks everybody knows the Banksters are and have been since
Trudeau the Elder and his pals in the Privy Council began ignoring the
mandate of the Bank Of Canada in 1974 N'esy Pas?
Rick James
Reply to @David Amos:
please elaborate...are you saying what happens on the commodity markets
has no bearing on the price of a commodity that canada sells?
David Amos
Reply to @Rick James:
Methinks you should Google DavidRayAmos find my Twitter account in
order to check out the document I offer in the link called
checktheevidence after the words "Go Figure" then read my lawsuit
Federal Court File No T-1557-15 before you attempt to claim that I said
something I did not N'esy Pas?
John Monroe
Reply to @David Amos:
Claims the Bank of Canada began ignoring its mandate or stopped lending
to the government in 1974 are false. It still lends to the government
the same way it did before 1974.
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