New IMF report warns of Canada’s high debt levels + MORE Oct 12th

DesRosiers Automotive Consultants said Wednesday that capital spending for Canada’s motor vehicle assembly industry has averaged $1.2-billion a year for 2010-17, down from $2.3-billion from 2000 to 2009

TORONTO _ A new stress test for all uninsured mortgages is unnecessary and could increase costs for homebuyers, a report by the Fraser Institute said Wednesday.
Study author Neil Mohindra wrote the proposed stress test “will do more harm than good” by limiting access to mortgages for some homebuyers.
“The mandatory standard for stress testing could result in a less competitive and more concentrated mortgage market,” he wrote in the report.
The study comes as the federal Office of the Superintendent of Financial Institutions finalizes new lending guidelines.
Among the changes being contemplated is a requirement that homebuyers who have a down payment of 20 per cent or more and do not require mortgage insurance still have to show they can make their payments if interest rates rise.
The head of OSFI has said that Canada’s banking regulator wants to reduce the risk of mortgage defaults because of high levels of household debt.
“We are not waiting to see those risks crystallize in rising arrears and defaults before we act,” OSFI head Jeremy Rudin said last week…

MONTREAL _ The head of one of the companies offering financing for taxi permits in Montreal insists there is still a market for the much-devalued commodity.
The price of a permit has decreased almost 40 per cent since Uber began operating in Quebec about four years ago, according to the province’s Transport Department.
Michel Hebert’s company, FinTaxi, is doing what it can to prop up the market by refusing to finance permits at a value below $110,000 _ regardless of how much a seller is willing to offer.
“We think the value of the taxi permit is higher than $110,000,” Hebert said in an interview. “And we are keeping that base.”
FinTaxi is wholly owned by the Fonds de solidarite FTQ, a massive investment fund with ties to the province’s largest labour federation, which counts the taxi drivers’ union among its members.
Organized labour in Quebec doesn’t only have a vested interest in the future of the government-controlled taxi system to save jobs _ there are tens of millions of dollars on the line for the Fonds FTQ if the permit market goes bust…

OTTAWA _ Shopify Inc.’s chief executive says he’ll push back against a short-seller’s report questioning the company’s business model during the release of their next financial results.
Company CEO Tobias Lutke tweeted that he looks forward to the next earnings call, expected in early November, where he’ll address the “short-selling troll” targeting Shopify.
He further tweeted that “the irony of an outfit like Citron accusing any business of being a get-rich-quick scheme should not be lost on anyone.”
Last week, short-seller Citron Research released a report claiming Ottawa-based Shopify was running what it called an overvalued get-rich-quick scheme, sending the stock down from near $150 a share to around $112 a share on Tuesday.
The stock regained a bit of ground by mid-day Wednesday, up $4 to $119.76 for a 3.5 per cent gain for the day.
Ottawa-based Shopify posted a defence of its business model to its website last Thursday, but didn’t specifically refer to allegations published by Andrew Left of Citron Research…

In the new report, the International Monetary Fund says these dynamics in Canada’s private non-financial sector leaves its economy more sensitive to tighter financial conditions.