Need investment advice? Ask Harper

The Prime Minister isn’t shy about telling Canadians what to do with their money

by Tamsin McMahon

If you’re in the market for a financial advisor, why not try Stephen Harper?

The Prime Minister offered up a bit of investment advice in an interview with group of local community newspapers in Vancouver last week.

Canada’s high level of household debts, Harper said in 45-minute interview, which was posted to SoundCloud, are largely because so many Canadian have taken advantage of historically low interest rates to buy homes and cars. Given that mortgage rates have in recent times fallen as low as 2.99 per cent and car loans are often interest-free, he says, Canadians are making what “I, as an economist, would argue is a rational decision to borrow more.”

How rational? Well Harper himself admits he and wife Laureen also took advantage of low interest rates to borrow money, although he didn’t elaborate on how much or for what purpose. (According to disclosure documents filed with the Parliamentary Conflict of Interest and Ethics Commissioner, the couple has a joint loan from the Bank of Nova Scotia.) But he warned that Canadians should start taking stock of their debts to make sure they can pay them off when interest rates inevitably rise, sometime in the next “two to three years.”

That’s what Harper says he’s doing anyway:

I know that my wife and I have never been big borrowers, but we have borrowed some money in the last few years because of the low rates. But we also know if the rates went up considerably we could still afford to carry that debt. But Canadians should ask themselves that question.

Harper has never been shy about doling out investment advice, telling CBC’s The National in June 2012 it was a good time to buy and hold:

As Prime Minister I am not allowed to invest speculatively and so I don’t. But to the extent I advise people, as we do with the government, think about what you need to do in the long-term to grow your portfolio. Be in markets and places where the business is good, where the long-term prospects are solid, and focus on that. Things will go up and down in short term, they always do. It’s been more spectacular over the last five years than in 80 years, but nevertheless those things come and go, there will always be solid businesses and solid markets will always experience growth over time. Have a mid- to long-term game plan and stick with it…Don’t cut and run. And that’s what our financial institutions do. That’s why we have the most solid financial institutions in the world. They don’t think that way. They don’t cut and run and they don’t get involved in a lot of short term speculation.

An interview he did with Peter Mansbridge during the 2008 financial crisis ruffled some feathers when he suggested the stock market meltdown had opened up “great buying opportunities.”

He’s not the only federal politician to hand out investment advice recently. Finance Minister Jim Flaherty has also been warning Canadians that the days of cheap debt are probably coming to an end. His comments earlier this month that  Canada was under “pressure” to raise interest rates provoked accusations he was encroaching on the Bank of Canada’s exclusive control over monetary policy.

Much of Harper and Flaherty’s advice should be seen through the light of politics: Put a positive spin on a financial crisis in the midst of an election; try to preemptively deflate a potential speculative bubble; encourage Canadians to put the brakes on household debt lest it cause problems for the economy between now and the 2015 federal election.

But beyond politics, Harper’s investment advice seems to have been prescient. The TSX has indeed rebounded since the lows of late 2008 and early 2009, meaning many investors who jumped into the market at the time have seen their portfolios appreciate. Interest rates will most likely have to go up eventually, though when exactly that might happen is the source of much debate. His financial advice may be on the money — but whether the country’s Prime Minister has any business telling Canadians what to do with their cash is another matter.

 




Browse

Need investment advice? Ask Harper

  1. “during the 2008 financial crisis ruffled some feathers when he suggested
    the stock market meltdown had opened up “great buying opportunities.”

    … which is totally true. As an example I bought Las Vegas Sands @ $4.85 in 2009, it is up to $80 today.

    • Golly….and it only took 5 years. LOL

      • Easier than working or begging for welfare. Hazards of saving and investing is it is easier. No bosses or peers to tick you off. No traffic jams or smelly buses.

        EWWilson is like me, an experienced investor. Multiplied is investment in 5 years by $80/4.85 = 16.5 times and got dividends while he waited.

        But he saved and invested in himself to learn. I had similar experiences. Having seen Sep 2008 coming I was very high in cash for the crash and bought stock like crazy in Jan-Mar at heavy discounts. Made off like a bandit.

        • You’d be better off going to Vegas itself for the most part….at least Vegas has rules.

          • The Stock Market has rules as well.
            Don’t complain about the fact you don’t understand them.

        • Yes but the “casualties” of that “meltdown” still far outweighed any profits, even within the last +5 years.
          Many, many haven’t been near as well off, and will likely not again. job losses, and outsourcing have skyrocketed.

          • Dave doesn’t care. He just wants you to know how awesome he is.

          • The “meltdown” was the result of US Government policy which basically ordered the banks to provide mortgages to people who had no business trying to get one.
            Can’t blame the banks for “selling” the risk to someone else…..they were simply adjusting to Govenment policy that would have seen them all go bankrupt, if something happened…..and it did.
            That being said, many of these bankers went about it in a rather sleazy and dishonest manner……….and it is regretful that those who were guilty of causing this didn’t spend any time in jail.

      • This comment was deleted.

        • Please note: Dave and James have taken it upon themselves to play ‘gramps’ on here and patronize people with their unwanted ‘advice’.

          I neither support nor encourage their economic [or other] crackpottery.

    • Hey, and how about those Blackberry shares? Whoa.

    • Please tell us this was part of a large and diversified portfolio.

  2. Need expense claim advise? Ask Justin Trudeau.

    • You must dream about him nightly.

      • I have nightmares. Trudeau Sr. screwed me with a lot of taxes for interest.

        Trudeau Jr gets elected, I cash out of Canada unless of course he lowers tax taxes and hidden taxes as inflation. Bit that isn’t likely

        Isn’t that I like Harper, just that the alternatives are probably worse.

        • On the contrary, It’s thanks, in part, to “Trudeau Sr” that I got my educatinal breaks, was able to get good career jobs, …
          each to their own I guess.

          • So Dave paid for your education, and you needed the Prime Minister to get you a job? Doesn’t sound like you’ve been very successful in life.

          • in another recent post, I already mentioned that, way back, when , I had worked at INCO Mines in Thonpson, Manitoba, …, not that any of that even matters, but NO, no PM has ever gotten me a job, and I have never worked in the gov’t, nor ever needed to.

            But, YES, it is thanks to “Trudeau Sr”, our PM at that time, and the govt’s educational policies which offered MUCH better “grants” and subsidies, (in comparison to today) for many canadian youth wanting to go back to and FINISH their College, or Univesities.
            Especially in the fields of (computer) science, and technology,… -which is what I did, and I took full advantage of it.
            In other words, Trudeau Sr’s “advice” was much more sound, back then, than anything that comes out of Harpo’s mouth, even today.

            I have since worked for many years, and with more than one graduation, the first 3 years of working, I completely paid back all my “CSL’s,… and other loans”

            So um, how’s that for being very successful, AND still paying all my taxes, just like you, and Dave, and any other canadian still has to do ???

            Unfortunately with almost zero “Grants” today, and fat-cat tuition prices, the canadian youth today will take decades to pay all their “Loans” back !
            Why? -because Harpo runs and/or allows our Educational system to be run like a “for-profit” business only, instead of investing money, and good minds, back into Education for ALL canadians. <- that which "Trudeau Sr." had achieved.

            oh and btw, it's not me that ever needed any PM, it's the PM who needed me to pay my taxes so that he can collect a Gov't-Salary, and "his" kids' can get a "free" education, although theirs will be much more "spoon-fed", and much easier to achieve, than the hard work I had to do to get mine.
            Needless to say, it's even much harder for many (average, non-rich) canadian youth today, than in my day, or even Dave's day. Yours? -I dunno.

            We are ALL paying for each others education, via taxes, at all points in our life.

            "…Thus endeth the lesson…" !

    • Harper giving ECONomic advise to Canadians is like, Harper giving Neil young piano lessons, an oxymoron.

      • I don’t think you know what an oxymoron is.

  3. Harper is possibly the last man in Canada anyone would ask for financial advice.

    • Nope. Flaherty then Harper by 1/100th of a cent. In fact, if you took all MPs, all Senators, all senior governemtn staff, your haverage retired investor knows more about economics thant 1000x the whole lot combined.

    • …well, except maybe for “dave…” here. :)

      • LOL true

    • Harper makes announcements that will impact markets – he’d be a great person to ask for advice.

      • Oh? Which one?

        ‘There is no recession’

        ‘Austerity is the solution’ or

        ‘Buy low and sell high?’

        Harper has yet to have any impact on the markets.

  4. yeah I’d tale advice from Steverino like I’d take hemlock in my coffee – not a chance – this guy only has the interests of his big oil buddies and Israel in mind.
    He doesn’t give a crap about ordinary average people in this country.
    Remember this is the government that taxed income trusts costing many canadians to lose a comfortable retirement.

    • Azaeleaprawn….
      If you took Harper’s advice and invested…..you would be better off. In case you aren’t aware, a great many people have investments in the resource sector…and extracting those resources and realizing a profit will benefit those people…and the majority of them are NOT rich. Mutual funds, RRSP’s, RESP,’s Pension funds, TFSA’s..etc……..all held for the most part by the average Canadian’s you seem so concerned with.
      I suspect your opposition to Harper has more to do with his views on the state of Israel, than on the markets.

      • If I’m not mistaken, the majority of Canadians are carrying record levels of debt. It would seem to me that an informed economist would be very aware of that fact and that urging people to buy stock is somewhat mischievous, if not downright nocuous.

        • Pickngrin…..it is not the job of the Prime Minister, nor anyone else for that matter, to tell people what debt level they should maintain. That is an individual responsiblity. If people live beyond their means, they have no one to blame but themselves.
          If however, buying stock will help earn money to pay off the aforementioned debt..then the advice stands.

        • Harper never told people to invest. He simply pointed out that if you were planning on investing, it was a good time to do so. And he was correct.

      • I’ve done really well without Steverino’s advice (Google, ya know, bought at the IPO ) and besides my conscience is clear knowing I haven’t listened to that Israel loving NeoCon…and no , I’m not a muslim or in fact of any religious persuasion

  5. The PM is as much an economist as he is a jazz pianist.

  6. The stock market indexes of every one of our our G8 partners increased between 15% (UK) and 29% (Germany) in 2013.

    Canada’s increased by only 1%.

    Since manufacturing in Canada has been hollowed out, the biggest beneficiaries of a lower Canadian $ will be big oil. With the US set to become a net exporter of energy by 2015, they really don’t need our dillbit product, or the Keystone pipeline for that matter.

    And the discount on Canadian dillbit will become permanent because it’s dirty. And Canada won’t be able to do anything about that.

    Economic prosperity through currency devaluation? Yeah, right. Big Oil still makes money as the rest of the world gets more expensive.

    What’s your next big idea Harper? Surrounding our tailing ponds with banana plantations?

    • Actually, when you consider currency devaluation, Canada again was a negative value economy of fiat fraud debt.

      Most people may have made more money but it doesn’t buy the same amount of goods.

      But if you ignore Ottawa BS, and went offshore….. you might have made off huge….

      Forget political deceivers for your money. Now you know why Ottawa is crowing about offshore accounts, savvy already have money out of Canada.

      • I’m using figures from the Jan 11 edition of The Economist. The index for each G8 member has been normalized to $US and the % increase calc’d from that. Here is a table of those numbers…

        http://www2.macleans.ca/2014/01/13/econowatch-its-bad-news-for-crocs-stock-and-a-sliver-of-good-for-the-euro/#comment-1199763126

        In case you did not notice, the $CDN has been falling against the $US. And just about every other currency in the world.

        • So you tweaked the numbers in order to make your “point”. Good for you.

          Oh, and by the way the “economy” is not the stock market. I can only imagine the fit of rage you’d be in if the government were enacting policies in order to boost the stock market.

          • I never tweaked anything and I never claimed stock markets and national economies were the same.

            BTW, nice troll line ya got there.

    • “What’s your next big idea Harper? Surrounding our tailing ponds with banana plantations?”

      Hey maybe that’s why he’s gone to Israel with 200 people – to get some ideas on what to plant around the Tar Sands tailings ponds

      • Eco Disaster tourism. He also plans it for the coast of B.C.

  7. Take advice from Harper? I will not.

    There is no risk in a mortgage free home if you have enough money for food, taxes and utilities.

    I could take out $300k loan on my $500k home but why? So I pay the bank $15k in interest each year? I would have to allocate $25k of pretax income, $10k for taxes!!!! The real cost of income pre tax is $25k. 5% if gross earnings and a cash flow headache.

    Sort of reminds me of when I has a $10k CD/GIC of 6.25% and a 6% mortgage. and the banker asked me if I was nuts to cash in a higher yield CD to pay down my mortgage. Was he red faced when I said a 6.25 return, 2.25% goes to taxes so the net yield is really 4%. So I save 2% cashing in the CD to reduce the mortgage.

    ALWAYS factor in taxes and inflation.

    If I don’t take an extra $25k out of the RRSP, I can lower my tax bracket some too. So the REAL cost is $15k + $10k in extra taxes for and equivalent 5% rate.

    And if interest rates go up or income goes down a bit, do I care? Stress free, very low risk with no loan. And when I need a retirement home, have cash and can use the expenses as tax deductible and step up RRSP withdrawals without the tax pillaging to offset my lower taxes owed.

    Yep, I manage and average the taxes I pay to lower my tax load.

  8. Actually maybe a little money advice from our pol. leaders might not be such a bad thing.
    Harper`s sensible advice about buying when the market is low and making sure you can handle higher rates could be added to with good sage about allowing one family member to help out the other in time of need.
    Trudeau could give advice on the expense claim file, that FV has been telling us about for months now, as well as the uniquely Liberal strategy of allowing family members to take money from the national treasury for job security purposes.
    Mulcair can certainly teach us all how a wealthy country can become even wealthier by shutting down the oilsands and then building a pipeline to ship oil to Quebec to be refined by government workers in NDP ridings,

    As a side note to the bosses here:
    If you want more traffic here I would suggest that you inject some hair angle into each story. Some of the self-professed feminists aboard here seem to enjoy discussing hair, especially woman hair. Like, in this story you could have mentioned Mulcair`s facial hair and then went on to discuss the number of NDPers with facial hair—-maybe some before and after pictures would work too. I hope this helps.

    • Mulcair’s beard was a topic for months, Trudeau’s hair is always a topic along with his appearance over all…..but mention a deliberate image effort by Con women….and all of a sudden it’s a silly topic not worth discussing.

      • ?????????????

        • Another Sat nite drunk I see.

          • i don’t drink it just seems some of your posts are a bit disjointed.

          • It’s about a comment someone else made regarding Con women all looking like Fox network presenters. More image than brains.

    • “Actually maybe a little money advice from our pol. leaders might not be such a bad thing”
      you’re joking right?

      They’re just politicians/failed Lawyers mostly, puppets for the really big brothers who do the really big investitures. Sure, Harpo might advise us to manage our debts better,…, but that doesn’t count as really anything.

      Most men who have no hair, bald, think of it as “…rolling stone gathers no moss”, but your leanings, sound more like the exception to that- “mold” problems.

    • ????????????????????

  9. Trudeau and Mulcair would never dream of ‘doling out investment advice’. Their policy is much, much more efficient. They’ll take your money and ‘invest’ it for you.
    See? Problem solved.

    • Yes,
      Every time you hear someone from the NDP (Or from Wynne’s Libs) say they want to make “investments” it’s time to cash out and move it offshore.
      To those folks, the word “investment” is just their way of softening up the fact they plan to hike taxes.

      • It is true that the word “spending” was magically eliminated from Canadian politicians’ lexicon sometime in the last 2-3 decades. I first noticed it with Jack Layton and the NDP — they never proposed spending money on anything. Just “investing.” Pardon me, I’m going to go invest in a coffee.

  10. Bad judgment then and now!

    What the “Esso Paperboy” had to say during the worst of the recession!

    Stephen Harper, “economist” in 2008: “If Canada were going to see a recession we would have had it already”.

  11. Safety Wiener: Agriculture Canada handed $826,000 to Brampton, Ont.’s Cardinal Meat Specialists Ltd. to help the meat-processing company research a sausage that doesn’t burst open when cooked. In a news release, Pierre Lemieux, the parliamentary secretary for agriculture, said a grant to develop a less-explosive sausage was critical to the government’s focus on “jobs, growth, and long-term prosperity.”

    • This proves that Harper is Evil Incarnate.

    • ??????

  12. Our Prime Minister doling out financial advice to upper middle class and rich Canadians. He believes non-existent recessions afford good buying opportunities. Sage advice.

    Do you think, Mr. Harper, that it’s time to have another austerity summit, in Alberta this time, to celebrate the oilsands and Gazebo Tony can misappropriate another $50 million, better make that $55 million factoring in inflation, to build some fancy gazebos in Fort McMurray to spruce up the town?

Your email address will not be published. Required fields are marked *