Montreal - Canada needs a government that provides massive stimulus to diminish the recessionary harm to the economy caused by enormous greed, billionaire investor Stephen Jarislowsky said Wednesday.
In a speech to the Montreal Board of Trade, the investment guru said Canada must conduct massive infrastructure spending and be prepared to provide increased social support for the unemployed.
While refusing to take sides on the political battle in Ottawa over who should form the federal government - the Conservatives or the Liberal-New Democrat coalition that's seeking to replace them - Jarislowsky said an election now would be "absolutely foolish."
"What's needed now is a general coalition of all parties to deal with this economic problem," he told reporters following his speech.
"We need to have plans for a very, very tough period ahead and the government should operate on that on a non-political basis."
He said even spending $30 billion on stimulus would be totally insufficient, but declined to put his own price tag to maintain a stable economy.
"Contrary to Mr. Harper, if you don't spend that kind of amount and if you don't print that enormous amount of money, you're going to deepen the recession. So it has to be done," Jarislowsky said.
Jarislowsky said the global financial crisis, which he dubbed a balance-sheet depression, has been fuelled by extreme greed and that politicians, bankers, corporate boards and CEOs failed to learn lessons of the past.
"I feel certain, especially today, that a disconnect with the past largely explains the disaster we are now facing," Jarislowsky said, noting that bad economic times are needed every three to four years to keep greed in check.
In addition to criticizing U.S. President George W. Bush over the Iraq war, Jarislowsky said government officials deserve some of the blame for the economic crisis.
He singled out former Federal Reserve chairman Allan Greenspan for trusting market forces that created a destructive housing bubble by making it too easy and too inexpensive to borrow.
Housing prices far exceeded the long-term sustainable increases of inflation plus the productivity of a country, Jarislowsky said.
Canada's housing mess may not be as deep as in the United States, but prices are 30 per cent overvalued, he said.
Earlier Wednesday, the Re/Max realtor organization said in its annual outlook that it expects Canadian housing prices will decline this year and next, resulting in a five per cent decline from 2007 levels by the end of 2009. Jarislowsky said Canada need not wait for the incoming U.S. administration to develop a realistic plan to combat various possible scenarios that may surface.
Bailing out auto manufacturers like General Motors doesn't make sense unless it's accompanied by union wage concessions, he said.
Supporting banks is necessary, however, to maintain public confidence in the institutions and avoid massive withdrawal of funds.
Massive stimulus needed, investor says
Prime Minister Stephen Harper responds to a question during question period in the House of Commons on Parliament Hill in Ottawa Wednesday. - Photo by The Canadian Press
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Published on
December 4, 2008
- Published on July 1, 2010
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The Canadian Press ~ The News
Economy
Canada needs a government that provides massive stimulus to diminish the recessionary harm to the economy caused by enormous greed, billionaire investor Stephen Jarislowsky said Wednesday.
In a speech to the Montreal Board of Trade, the investment guru said Canada must conduct massive infrastructure spending and be prepared to provide increased social support for the unemployed.
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Comments
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- Sherri
- - July 2, 2010 at 14:52:23
Jarislowsky says: Supporting banks is necessary, however, to maintain public confidence in the institutions and avoid massive withdrawal of funds.
I can guarantee however, that the execs at the banks have already dipped their fingers into the bailout till too, this is what bothers me (and perhaps many others) the most. -
- Sherri
- - July 1, 2010 at 21:36:39
Jarislowsky says: Supporting banks is necessary, however, to maintain public confidence in the institutions and avoid massive withdrawal of funds.
I can guarantee however, that the execs at the banks have already dipped their fingers into the bailout till too, this is what bothers me (and perhaps many others) the most.
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