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Ring of Fire miners want Ontario to start making decisions

Written By Unknown on Jumat, 28 Februari 2014 | 22.40

Two of the biggest players in the Ring of Fire say the province has to start making decisions to move the mining development forward.

Noront Resources CEO Paul Parisotto said, while he'd like to have his mine in the far north open by now, he's not in a rush.

"You'll hear [Northern Development and Mines] Minister Gravelle say all the time: 'We have to get it right.' To me, that's been code for, let's move slowly and make sure things get done properly."

That answer didn't sit well with a frustrated Dick Destefano from the Sudbury Mining Supply and Service Association.

"That's the standard line we've been listening to for the past three years. You have fundamental differences."

Those differences are largely about the road to be built into the Ring of Fire area. Noront would like it running East-West, while Cliffs Natural Resources wants it north-south.

Cliffs' director of Furnace Technology, Matthew Cramer, said the companies aren't fighting. But until the government decides, they can't convince investors to put "real money" into these mines.

Northern Ontario's Ring of Fire

(The Canadian Press)

"Until that decision is made or that infrastructure is built, it's almost impossible to fully evaluate the project and commit to the funding," he aid.

Cramer urged the Sudbury crowd to start putting pressure on politicians if they want to see Cliffs' chromite smelter actually built in the city.

The Ontario Chamber of Commerce vice-president of policy and government relations said he compares the Ring of Fire to the Alberta oil sands — a project that, at one time, only made headlines out west.

"We want to shift in the public's imagination the Ring of Fire from a northern Ontario play to a whole of Ontario play" said  Josh Hjartarson.

Cramer agreed there is some work to do educating the south about mining.

"I talk to guys in southern Ontario about a smelter and you get a glossed-over look," he said.

"In Sudbury, you get an understanding. Sometimes good, sometimes not so good, but you get an understanding of what it looks like and what it means for a community, [and] what it means for the environment."

Cramer told the crowd that Cliffs remains committed to its Ring of Fire deposit and plans for a smelter in Sudbury.

Beneath the Surface Web (PDF)
Beneath the Surface Web (Text)


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Bitcoin exchange, Mt. Gox, files for bankruptcy

The Mt. Gox bitcoin exchange in Tokyo filed for bankruptcy protection Friday and its chief executive said 850,000 bitcoins, worth several hundred million dollars, are unaccounted for.

The exchange's CEO Mark Karpeles appeared before Japanese TV news cameras, bowing deeply.

He said a weakness in the exchange's systems was behind a massive loss of the virtual currency involving 750,000 bitcoins from users and 100,000 of the company's own bitcoins. That would amount to about $473 million Cdn at recent prices.

Japan Bitcoin

Mt. Gox CEO Mark Karpeles bows in apology at a press conference at the Justice Ministry in Tokyo on Feb. 28, 2014. (Kyodo News/Associated Press)

The online exchange's unplugging earlier this week and accusations it had suffered a catastrophic theft have drawn renewed regulatory attention to a currency created in 2009 as a way to make transactions across borders without third parties such as banks.

It remains unclear if the missing bitcoins were stolen, voided by technological flaws or both.

"I am sorry for the troubles I have caused all the people," Karpeles, a Frenchman, said in Japanese at a Tokyo court.

Karpeles had not made a public appearance since rumours of the exchange's insolvency surfaced last month. He said in a web post Wednesday that he was working to resolve Mt. Gox's problems.

Collapse inevitable, finance minister says

The loss is a giant setback to the currency's image because its boosters have promoted bitcoin's cryptography as protecting it from counterfeiting and theft.

Bitcoin proponents have insisted that Mt. Gox is an isolated case, caused by the company's technological failures, and the potential of virtual currencies remains great.

Debts at Mt. Gox totaled more than 6.5 billion yen (about $70.9 million Cdn), surpassing its assets, according to Teikoku Databank, which monitors bankruptcies.

Just hours before the bankruptcy filing, Japanese Finance Minister Taro Aso had scoffed that a collapse was only inevitable.

"No one recognizes them as a real currency," he told reporters. "I expected such a thing to collapse."

Japan's financial regulators have been reluctant to intervene in the Mt. Gox situation, saying they don't have jurisdiction over something that's not a real currency.

They pointed to the Consumer Affairs Agency, which deals with product safety, as one possible place where disgruntled users may go for help.

The agency's minister Masako Mori urged extreme caution about using or investing in bitcoins. The agency has been deluged with calls about bitcoins since earlier this year.

"We're at a loss for how to help them," said Yuko Otsuki, who works in the agency's counselling department.

Bitcoin unwelcome in some countries

It's hard to know how many people around the world own bitcoins, but the currency has attracted outsize media attention and the fascination of millions as an increasing number of large retailers such as Overstock.com begin to accept it.

Speculative investors have jumped into the bitcoin fray, too, sending the currency's value fluctuating wildly in recent months. In December, the value of a single bitcoin hit an all-time high of $1,200. One bitcoin has cost about $500 lately.

'One must separate the Mt. Gox problem from the overall concept.'- Yang Weizhou, analyst at Mizuho Securities Co. in Tokyo

Roger Ver, a Tokyo resident who has provided seed capital for bitcoin ventures such as Blockchain.info, a registry of bitcoin transactions, said he believes bitcoin will survive, possibly emerging with better technology that's safer for users.

He said Mt. Gox people were likely sincere but had failed to run their business properly.

"Mt. Gox is a horrible tragedy. A lot of people lost a lot of money there, myself included," he said ahead of the bankruptcy filing. "I hope we can use this as a learning experience."

Some countries have reacted sternly to bitcoin's emergence, but many people remain fans of its potential.

Vietnam's communist government said Thursday that trading in bitcoin and other electronic currencies is illegal, and warned its citizens not to use or invest in them.

Late last year, China banned its banks and payment systems from handling bitcoin, although people still use them online. Thailand earlier put a blanket prohibition on using bitcoins and Russia has effectively banned them.

There was still considerable appetite for bitcoin in China, where it has become attractive as an investment since tightly-regulated state banks offer very low interest rates on deposits.

Virtual currencies regulation needed

Even some with money tied up in Mt. Gox were undaunted.

Huang Zhaobin, a 21-year-old student in Chengdu, said he had lost 50,000 to 60,000 yuan (about $9,090 to $10,900 Cdn) from the Mt. Gox closure.

"Actually this money itself is the benefit from bitcoin investment," said Huang, who plowed 10,000 yuan (about 1,818 Cdn) into bitcoins about three months ago.

"If it is legal, I will continue to invest for sure as it is the trend in the world."

In Singapore, Tembusu Terminals, a joint venture specializing in crypto-currencies, announced Friday its first bitcoin ATM in the city-state and plans for many more. In Hong Kong, a group opened what it said was the world's first bitcoin retail store.

Yang Weizhou, analyst at Mizuho Securities Co. in Tokyo, said laws to regulate virtual currencies may have to be created by countries including Japan.

She said lawsuits from those who lost money were likely, and any court rulings would chart unexplored territory and help define the reach of virtual money.

The trend toward such technology for peer-to-peer payments wouldn't replace traditional money but was here to stay because of its convenience, she said.

"It is undeniable," she said. "One must separate the Mt. Gox problem from the overall concept."


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Canada's economy expands at 2.9% pace, beating forecasts

Canada's economy expanded an an annualized pace of 2.9 per cent in the last three months of 2013, Statistics Canada reported Friday.

That was better than the downward-revised pace of 2.4 per cent seen in the U.S. over the same period. It was also better than the 2.5 per cent growth rate that analysts had been expecting.

The gains were broad-based, as most industrial sectors showed expansion. Mining, oil and gas, manufacturing and the public sector all grew.

For 2013 as a whole, the Canadian economy grew by two per cent.

That's about three-tenths of a percentage point higher than predicted by the Bank of Canada and the latest federal budget. It also makes 2013 the best year for the Canadian economy since 2011.

"Overall, the fourth quarter economic performance was a healthy showing for Canada," TD Bank said in a note following the data's release. "The headline growth rate also confirms something we've long recognized: the second half of 2013 was much stronger than the first half."

The strong figures were good news for the hard-hit Canadian dollar, which gained about a quarter of a cent after the data's release to trade at 90.15 cents US.

The year ended on a down note, however. Bitterly cold weather all month and a massive ice storm toward the end of December dragged the economy down, as factories, retailers and some government activities temporarily closed or operated at less-than-peak productivity. 

On a monthly basis, the Canadian economy shrank by 0.5 per cent in December. That's the worst monthly figure seen since the recession.

"Broadly speaking, the general message of a decent quarter ending on a soft note remains intact as weather … hit December figures negatively," Scotiabank economist Derek Holt said. "We expect December softness to result in deferred activity into … spring."

In revisions that helped the annual growth number, Statistics Canada said the economy had advanced by 2.9 per cent and 2.2 per cent respectively in the first and second quarters of 2013. It had previously recorded those growth rates as 2.3 and 1.6 per cent. The 2.7 per cent rate in the third quarter was left unchanged.


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U.S. economy slows to 2.4% growth

New

The Associated Press Posted: Feb 28, 2014 8:44 AM ET Last Updated: Feb 28, 2014 9:03 AM ET

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TSX COMPOSITE

Feb 28, 2014 10:15 AM ET Feb 28, 2014 10:14 AM ET Feb 28, 2014 10:15 AM ET Feb 28, 2014 10:20 AM ET Feb 28, 2014 10:15 AM ET

Index Last Trade Change
TSX COMPOSITE 14275.46 60.72
DOW 16364.94 92.29
NASDAQ 4338.72 19.79
SP 500 1864.27 9.98
TSX-VENTURE 1021.50 2.07

The data on this site is informational only and may be delayed; it is not intended as trading or investment advice and you should not rely on it as such.

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Citigroup finds fraud at Mexico unit

U.S. bank cuts profit forecast on loan losses related to oil services company Oceanografia

The Associated Press Posted: Feb 28, 2014 10:19 AM ET Last Updated: Feb 28, 2014 10:19 AM ET

Citigroup is lowering its fourth-quarter and full-year financial results after discovering fraud at a Mexican subsidiary.

The U.S.-based bank said Friday that it had extended $535 million in credit to Mexican oil services company Oceanografia SA de CV through its Banco Nacional de Mexico unit, also known as Banamex. Oceanografia has been a key supplier to Mexican state-owned oil company Petroleos Mexicanos.

Citigroup Inc. said it found out earlier this month that Oceanografia had been suspended from receiving new Mexican government contracts. Citi and Petroleos Mexicanos then reviewed their exposure to Oceanografia.

Petroleos said that it found fraud in the accounts receivables recorded by Banamex. Citigroup first detected irregularities in Banamex loans in the third quarter and had booked reserves for potential losses.

Citigroup says its 2013 net income will be reduced by $235 million to $13.7 billion from $13.9 billion. It believes the fraud is an isolated incident.

 Citigroup shares have fallen in recent weeks on concerns that slowing growth in emerging markets may reveal bad loans, as well as increase the risk of trading losses.

Citigroup's stock fell slightly in premarket trading.

With files from Reuters

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Latest Business Headlines

TSX COMPOSITE

Feb 28, 2014 10:15 AM ET Feb 28, 2014 10:14 AM ET Feb 28, 2014 10:15 AM ET Feb 28, 2014 10:20 AM ET Feb 28, 2014 10:15 AM ET

Index Last Trade Change
TSX COMPOSITE 14275.46 60.72
DOW 16364.94 92.29
NASDAQ 4338.72 19.79
SP 500 1864.27 9.98
TSX-VENTURE 1021.50 2.07

The data on this site is informational only and may be delayed; it is not intended as trading or investment advice and you should not rely on it as such.

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TD hikes dividend 9% on profit jump to $2B

Written By Unknown on Kamis, 27 Februari 2014 | 22.39

CBC News Posted: Feb 27, 2014 9:55 AM ET Last Updated: Feb 27, 2014 10:01 AM ET

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Latest Business Headlines

TSX COMPOSITE

Feb 27, 2014 10:19 AM ET Feb 27, 2014 10:19 AM ET Feb 27, 2014 10:19 AM ET Feb 27, 2014 10:20 AM ET Feb 27, 2014 10:19 AM ET

Index Last Trade Change
TSX COMPOSITE 14214.06 25.48
DOW 16168.93 -29.48
NASDAQ 4289.06 -3.00
SP 500 1843.36 -1.80
TSX-VENTURE 1011.20 3.04

The data on this site is informational only and may be delayed; it is not intended as trading or investment advice and you should not rely on it as such.

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Heinz signs deal with company to keep jobs in Leamington

H.J. Heinz Co. has signed a letter of intent with Highbury Canco Corp. to acquire the Heinz Leamington facility and become a contract packer for the food giant.

"We will continue to manufacture certain identified Heinz products and as well provide certain distribution and logistics services to Heinz in Canada," Highbury's Pradeed Sood said in a media release. "The Leamington plant has an excellent workforce, and Ontario farmers are amongst the best in the world."

Highbury Canco Corporation is an Ontario-based consortium of investors.

Highbury intends to employ approximately 250 employees, plus additional seasonal employees. 

Sam Diab is a member of that consortium, and the current factory manager at the Heinz Leamington facility.

"As a member of this community, I am honoured to be a part of this team who is focused on saving important jobs at the Heinz plant in Leamington," Diab said in a release. "We have a knowledgeable workforce, a vibrant local community, and this is a solid plan for a bright future.

"We are at a critical stage in this process and are relying on the assistance of our strategic partners to move forward.  In the next few weeks, we will be working closely with Heinz, local farmers, United Food and Commercial Workers Local 459, and all three levels of government."

Heinz slated the 105-year-old plant closure in June of this year.

CBC News was first to report an announcement was coming this week.

Leamington Mayor John Paterson has been in contact with an official at Heinz. Paterson said the official told him "it will be a good day in Leamington."

'There will be a lot of happy ... people.'- Leamington Mayor John Paterson

"There will be a press release from their company and the one they are working with, to let everyone know what's planned on happening," Paterson said before the announcement. "I'm not sure the agreement is totally finished yet, but he said it will be a good day in Leamington. There will be a lot of happy - happier - people."

Heinz announced last fall the plant would cease operations and nearly 800 people would be out of work in June.

CBC News sources say the company set to move into the plant will produce tomato juice for Heinz, in a deal that could save up to 40 per cent of the 800 jobs at the plant.

Sandra Pupatello, the CEO of the Windsor Essex Economic Development Corporation said everyone has been working together to help save jobs in Leamington.

"All levels of government have been very helpful. It is a matter of finding when and where they can be helpful. It's still very early days to be doing that, so at this point, our roles have been getting information," Pupatello said. "So we use all of those contacts to talk to people, get people into the funnel."

Pupatello said Thursday's announcement is just a start, but it could lead to better news in the future.

Sources close to the negotiations tell CBC News a Canadian food processor will continue to make tomato juice for Heinz.

The company will then sell the juice in the Canadian market.

Locally grown tomatoes will be used to make the juice.

The Leamington plant was the last in the Heinz chain to process whole tomatoes. Tomato paste made in the U.S. is used at all its other U.S. plants. If Heinz wants to maintain a share of the Canadian tomato juice market, it cannot simply add a packaging line and make tomato juice from concentrate (paste) in the U.S. and ship it to the Canadian market.

According to the Canadian Agricultural Products Act, tomato juice sold in Canada must be made from whole tomatoes.
Patterson said that whoever takes over the processing needs to get up and running quickly.

"If it's going to be a success this year, I think it needs to happen pretty soon. Tomato farmers have to get underway right away. So I think if anybody is going to be successful … it has to be announced soon," Paterson said.

Chatham-Kent-Essex PC MPP Rick Nichols said Thursday's announcement "will be good news for the town of Leamington."

Nichols also told CBC News two other companies are interested in opening in Leamington and "offer jobs to workers displaced by Heinz."

"This is just the beginning. There is more good news down the road but I don't want to build up expectations," Nichols said.

Heinz Canco Press Statement Feb 27 2014 (PDF)
Heinz Canco Press Statement Feb 27 2014 (Text)

Hoskins Heinz Statement (PDF)
Hoskins Heinz Statement (Text)


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SNC-Lavalin paid Gadhafi son's wife as Libya fell: Ex-VP

Canadian engineering giant SNC-Lavalin is facing fresh allegations about the company's close ties to Libya's former Moammar Gadhafi regime, including the claim in court documents that SNC put the wife of a Gadhafi son on its payroll during Libya's 2011 civil war, despite UN economic sanctions and Western military intervention.

The allegation comes from Riadh Ben Aissa, a former executive vice-president of SNC-Lavalin's international construction arm who has been jailed in Switzerland since April 2012. He is accused of corruption and money laundering after years as a company top-earner who won billions in megaproject contracts in Libya and across North Africa.

Que Corruption Probe 20130314

The allegation comes from Riadh Ben Aissa, a former executive vice-president of SNC-Lavalin's international construction arm who has been jailed in Switzerland since April 2012. (Ryan Remiorz/Canadian Press)

In Canada, Ben Aissa is also locked in a fierce battle with SNC-Lavalin, which has characterized him as a rogue executive who secretly supported the Gadhafi regime. He was forced to resign in February 2012, and SNC is trying to seize his assets.  

But in court documents recently filed in Montreal, Ben Aissa is fighting back and has made a string of allegations against the company, including claims that other senior executives had a long history of lobbying the Gadhafi regime, doing favours for family members and funding junkets and lavish entertainment.

Ben Aissa's most contentious allegation is that during the Libyan conflict, SNC-Lavalin temporarily placed Saadi Gadhafi's wife on its payroll in Morocco, "despite the fact she was not one of [SNC's] employees, to help her and Saadi Gadhafi's children financially. [Then CEO] Pierre Duhaime was aware of this," the court filing states.

SNC-Lavalin has refused to say whether any money went to Saadi Gadhafi's wife, or whether the company is doing any internal investigation.

Duhaime, who was forced to resign in 2012 and faces criminal charges involving alleged bribes paid on a Montreal hospital megaproject, did not respond to questions submitted through his lawyer.

However in court documents the company does acknowledge it was aware of UN economic sanctions imposed in March 2011 as Libya's civil war began to shake the Gadhafi regime. Throughout the 2000s, SNC-Lavalin won billions of dollars worth of construction megaprojects in Libya including the building of an airport, large irrigation systems and even a prison.

History of Gadhafi support

Ben Aissa, who has spent almost two years jailed in Switzerland, argues that for years (predating 2009 when he became head of construction) SNC lobbied the Gadhafi regime. He made the following claims in his court filing:

  • Former CEO Jacques Lamarre met several times with Moammar Gadhafi to foster a lucrative relationship.
  • Lamarre and another senior executive, tried to assist Saadi Gadhafi in getting a visa from the Canadian Embassy in Tunis.
  • SNC considered appointing Saadi Gadhafi to a post of vice-president.
  • SNC in 2008 paid $2 million for a visit by Saadi Gadhafi to Canada, picking up the tab for restaurants, hotels and limousines — expenses that were disclosed to the company board of directors.
  • In 2009, Ben Aissa claims, SNC paid for Saadi Gadhafi to visit the Toronto International Film Festival, paying $550,000 for an exclusive night for Gadhafi and some SNC employees featuring a performance by rapper 50 Cent.  
  • SNC knowingly paid for a luxury condo in Toronto for Saadi Gadhafi, including $200,000 for remodelling.

None of these claims have been proven in court.

Former SNC-Lavalin CEO Lamarre told CBC News in a 2013 interview that he travelled to Libya twice in the early 2000s to meet Moammar Gadhafi, but never discussed specific contracts or agreements.

"No. Never," Lamarre told CBC News. "He was talking about the overall picture. If anything specific that he was discussing, he was complaining about the visa for the Libyan students coming in Canada. It was those kind of discussion and saying that he would like to have a better relationship with Canada and all that. Nothing more specific than that."

SNC claims Ben Aissa directed secret plots

Lawyers for SNC-Lavalin have filed their own response in court, arguing that in 2011 as Libya's Gadhafi regime was falling, Ben Aissa conspired to help Saadi Gadhafi.

The company alleges that without its knowledge, Ben Aissa directed the financial controller of the construction arm, Stéphane Roy, to continue paying the fees on the Gadhafi condo in Toronto.

SNC also argues Ben Aissa oversaw a secret plot to illegally smuggle Saadi Gadhafi and his family out of Libya, contrary to UN sanctions.  

The company cites payments and emails involving Roy, Canadian consultant Cynthia Vanier and former Gadhafi bodyguard Gary Peters, including one in which Roy allegedly sent a copy of Saadi Gadhafi's passport to Vanier to arrange fake identification.  

Vanier was arrested in Mexico in 2011 and spent 17 months in jail being tried on accusations she masterminded the plot. Before any verdict, Vanier was released by Mexico's Supreme Court that had ruled her legal rights had been violated. She returned to Canada in April 2013. 

The RCMP won't talk about their investigation into SNC-Lavalin, not just in Libya but also regarding allegations of bribery and kickbacks here in Canada.

In January 2014 the Mounties charged Roy with violating UN sanctions tied to the condo payments. He has not had a chance to answer the charge but he is suing SNC-Lavalin, claiming wrongful dismissal. 

In January, the RCMP also charged Ben Aissa's predecessor at SNC-Lavalin Sami Bebawi with fraud, bribery of foreign officials and possession of proceeds of crime. He was in charge of SNC's international construction division from 1998 until 2006 with major projects in Algeria and Libya. However, the RCMP say they don't know Bebawi's whereabouts.

Please send tips on this story or other stories to Dave Seglins.
 


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CIBC profit jumps 42% to $1.2B

CIBC is reporting $1.177 billion of net income in the first quarter, up nearly 50 per cent from last year, as it books a gain from the sale of half its Aeroplan credit card business and other items.

CIBC's adjusted net income, which excludes unusual times such as the Aeroplan deal, also grew — a less dramatic but still substantial increase to $951 million, up 6.3 per cent from $882 million a year earlier.

Excluding certain items, CIBC's adjusted diluted earnings were $2.31 per share, up from $2.12 per share in the first quarter of 2013 — 15 cents above the Thomson Reuters estimate of $2.16 per share.

"Our record results this quarter reflect the progress we continue to make in executing our client-focused strategy," CIBC chief executive Gerald McCaughey said in a statement.

"Each of our core businesses delivered strong results. The strength of our underlying fundamentals allows us to generate high returns for our shareholders."

The bank says its dividend will rise by two cents or two per cent to 98 cents per common share, payable April 28.

Under standard accounting, CIBC's net income was $2.88 per share. The bank said the Aeroplan deal accounted for 48 cents per share of the net income.

CIBC's net earnings also included several other unusual items including a gain of 14 cents per share from the sale of its stake in a European finance portfolio, mostly offset by several negative items.

'Each of our core businesses delivered strong results'- CIBC president Gerald McCaughey

During the quarter, TD became the primary issuer of new Aeroplan Visa cards for the next 10 years — replacing CIBC, which had filled that role for more than two decades.

However, the banks and Aeroplan's operator — Montreal-based Aimia Inc. (TSX:AIM) — reached a compromise that allowed CIBC to keep half its Aerogold Visa customers and sell the other half to TD.

In addition, CIBC will continue to process the accounts until new TD cards are issued and both banks will have the right to sign up new customers under their respective Aeroplan loyalty programs.

CIBC is also offering other credit cards that offer loyalty points that can be exchanged for travel on other airlines besides Air Canada, which began Aeroplan as a frequent flyer reward system.


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Boeing smartphone targets aerospace, government

Boeing Black phone smartphone

Boeing unveiled a smartphone targeted at the defence and aerospace sectors late Wednesday. ((Boeing))

Boeing Co. on Wednesday unveiled a smartphone that appears to come straight from a James Bond spy movie.

In addition to encrypting calls, any attempt to open the casing of the Boeing Black Smartphone deletes all data and renders the device inoperable.

The secure phone marks an extension of the communications arm of the Chicago-based aerospace and defense contractor, which is best known for jetliners and fighter planes.

Such a phone might have prevented damage to Washington's diplomacy in Ukraine from a leaked telephone call. A senior U.S. State Department officer and the ambassador to Ukraine apparently used unencrypted cellphones for a call about political developments in Ukraine that became public.

Boeing's tamper-proof phone is aimed at government agencies and contractors who need to keep communication and data secure, according to Boeing and filings with the U.S. Federal Communications Commission.

Made in the United States, the phone runs on Google Inc's Android operating system. The 5.2-by-2.7-inch (13.2-by-6.9 cm) handset, slightly larger than an iPhone, uses dual SIM cards to enable it to access multiple cell networks instead of a single network like a normal cellphone.

Due to the phone's security features, Boeing is releasing few details about the wireless network operators or manufacturer it is working with, and has not provided a price or date by which the phone might be widely available, but said it has begun offering the phone to potential customers.

Boeing's website says the phone can be configured to connect with biometric sensors or satellites. Other attachments can extend battery life or use solar power.

The phone can operate on the WCDMA, GSM and LTE frequency bands and offers WiFi and Bluetooth connectivity.

The company has been developing the phone for 36 months, said Boeing spokeswoman Rebecca Yeamans.

"We saw a need for our customers in a certain market space" that Boeing could meet with its technology expertise, she said.

A sample purchase contract submitted to the FCC says the phone would be sold directly by Boeing or its agents.

Yeamans said Boeing combined its own engineers with the talent of people who joined Boeing recently through acquisitions that included Argon ST Inc, Digital Receiver Technology Inc, Kestrel Enterprises Inc, Ravenwing Inc, and Solutions Made Simple Inc.


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Mt. Gox shutdown a major blow for bitcoin

Written By Unknown on Rabu, 26 Februari 2014 | 22.40

In yet another blow to virtual currency bitcoin, a major bitcoin exchange has gone bust after secretly racking up catastrophic losses, other virtual currency companies said Tuesday.

Tokyo-based Mt. Gox posted an update on its website on Tuesday, saying a "decision was taken to close all transactions for the time being."

Mt. Gox had imposed a withdrawal ban earlier this month after detecting what it called "unusual activity" and then on Tuesday, its website went dark. The new message posted later in the day said: "We will be closely monitoring the situation and will react accordingly."  

On Sunday, Mt. Gox CEO Mark Karpeles resigned from the board of the Bitcoin Foundation, a group seeking legitimacy for the currency, which has been tainted by extreme volatility, dodgy exchanges and its association with criminal activities.

Prominent members of the bitcoin community — including San Francisco-based wallet service Coinbase and Chinese exchange BTC China — sought to distance themselves from the Mt. Gox collapse. They called it an isolated case of mismanagement and said other exchanges have better security and management systems.

Bitcoin

Major bitcoin exchange Mt. Gox, which is based in Tokyo, froze withdrawals earlier this month and its website has now gone dark. (Alexander Kirch/Shutterstock)

"As with any new industry, there are certain bad actors that need to be weeded out, and that is what we are seeing today," the statement said.

740,000 bitcoins missing

Documents purportedly leaked from the company lay out the scale of the problem. An 11-page "Crisis Strategy Draft" published on the blog of entrepreneur and bitcoin enthusiast Ryan Selkis says that 740,000 bitcoins are missing from Mt. Gox, which roughly translates to hundreds of millions of dollars' worth of losses, although figures are fuzzy given bitcoin's extreme volatility.

Mt. Gox previously suffered a crippling security theft in 2011, and several experts have warned the exchange about a software glitch which could enable hackers to silently drain the business of its bitcoins.

If the draft strategy document is correct, Mt. Gox has lost some $370 million worth of bitcoins and has liabilities of $55 million against only $33 million in assets, meaning it is unlikely to recover

"At the risk of appearing hyperbolic, this could be the end of bitcoin, at least for most of the public," the draft said.

In a post to his blog, Selkis said that the document was provided to him by a "reliable source" and that several people close to the company had confirmed the figures. Reached by phone, he declined further comment.

The scandal may cost bitcoin enthusiasts dear.

At the Tokyo office tower housing Mt. Gox, bitcoin trader Kolin Burgess said he had picketed the building since Feb. 14 after flying in from London, hoping to get back $320,000 he has tied up in bitcoins with Mt. Gox.

"I may have lost all of my money," said Burgess, next to placards asking if Mt. Gox is bankrupt. "It hasn't shaken my trust in bitcoin, but it has shaken my trust in bitcoin exchanges."

Bitcoin exchange value falls

Mt. Gox CEO Karpeles did not immediately return several messages seeking comment. A security officer at the office tower said no one from Mt. Gox was in the building. Tibbane, an internet company that Karpeles is CEO of, still has its name listed on the building's directory.

"I have no idea" where they are, said Burgess, the trader. "I'm both annoyed and worried."

On bitcoin exchanges, the currency's value has fallen to about $470 from $550 in the past few hours, a figure already down more than 50 per cent on the price of $1,200 per bitcoin reached on Mt. Gox three months ago. However, in the $500 range, it is still trades at 17 times what it traded for last year.

The disappearance of Mt. Gox could hurt bitcoin, which was started in 2009 as a currency free from government controls. Bitcoin's boosters say the currency's design make it impossible to counterfeit and difficult to manipulate, and the virtual money has won an eclectic mix of die-hard fans, including libertarians, tech enthusiasts and adventurous investors.

But the currency has struggled to shake off its associations with criminality, particularly its role in powering the now-defunct online drug marketplace Silk Road. Only last month another member of the Bitcoin Foundation, vice-chairman Charlie Shrem, was arrested at New York's Kennedy Airport on charges of money laundering.

Bitcoin defender

Not everyone believes the Mt. Gox shutdown will seriously hurt bitcoin.

Anthony Di Iorio, who runs Bitcoin Decentral Toronto, a group for those interested in bitcoin, said people will be concerned in the short-term, but will return to the virtual currency.

"The fundamentals of bitcoin are very strong. I believe that other exchanges are coming up that are much more robust and more secure than what Mt. Gox has been," he told CBC News.

Di Iorio said Mt. Gox appeared to have a security breach on its site, which went undetected. He advised bitcoin enthusiasts to exchange only small amounts of the currency at one time, as bitcoin is most secure when it is in your own digital wallet. 

"The great thing about Bitcoin is that you can be your own bank and nobody has access to your funds," he said. "But if you are putting them in an exchange, and you're buying and selling, you have to have them stored there at least for a small amount of time."

The risk with leaving your money languishing with a third-party is that if the site shuts down, your investment is gone with it.

Authorities have been taking an increasingly hard look at bitcoin and related virtual currencies including Litecoin, Namecoin, Ripple, and countless others. Some countries, including Russia, have effectively banned the currency. In other jurisdictions, authorities are weighing whether to try to tame the marketplace through licences or other mechanisms.

Alabama's securities regulator Joseph Borg said he planned to caution consumers and investors against trading on bitcoin exchanges after receiving dozens of complaints from around the United States over bitcoin exchanges.​

He expressed concern that "Main Street" investors were taking chances on the digital currency.

Even if Mt. Gox doesn't drag bitcoin down with it, there's fear that the exchange's demise will push officials to take an even more skeptical stance.

"I think this is disastrous from a [regulatory] standpoint," Selkis, the enthusiast, said in a message posted to Twitter. "The hammer will now come down hard."


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Heinz Leamington announcement coming this week

Good news appears to be in store for Leamington, which was to be hard hit by the scheduled closure of the Heinz processing plant there.

Leamington Mayor John Paterson tells CBC News he is cutting short his attendance at the Good Roads Association conference in Toronto so he can be in town "in case" there is some good news about the Heinz plant.

Sources close to the negotiations to keep work at the Leamington Heinz plant tell CBC News an announcement will be made this week.

CBC News has been told a Canadian food processor will continue to make tomato juice for Heinz. The province will be on hand to make the announcement.

The move will save up to 40 per cent of the nearly 800 jobs that were to be lost in June when Heinz ceases operations there.

Locally grown tomatoes will be used to make the juice.

According to the Canadian Agricultural Products Act, tomato juice sold in Canada "shall be the canned, unconcentrated, pasteurized liquid containing a substantial portion of fine tomato pulp extracted from sound, ripe whole tomatoes from which all stems and objectionable portions have been removed, with or without the application of heat, by any method that does not add water to such liquid."

The Leamington plant was the last in the Heinz chain to process whole tomatoes. Tomato paste made in the U.S. is used at all its other U.S. plants. If Heinz wants to maintain a share of the Canadian tomato juice market, it cannot simply add a packaging line and make tomato juice from concentrate (paste) in the U.S. and ship it to the Canadian market. 

Warren Buffett's Berkshire Hathaway and partner, 3G Capital, bought H.J. Heinz Co. for $23.3 billion US in February 2013.

In November of last year, Heinz announced it would close its Leamington processing plant in June 2014.

At the time, Buffet called the facility "unprofitable."

The 105-year-old Heinz plant in Leamington made ketchup, beans, baby food and juice.

An email to Heinz spokesperson Michael Mullen wasn't immediately returned.


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Ottawa's responsible mining review awaited by NGOs

The federal government's five-year review of Canada's corporate social responsibility strategy for the mining, oil and gas industry is expected to be released as early as next week.

But documents obtained by CBC News suggest the long-anticipated report is unlikely to recommend the creation of a legislated ombudsman who would investigate complaints and oversee the activities of the extractive sector.

It's something non-governmental organizations have been calling for since 2007, without success.

The international trade minister's office would not provide any details as to what the review, which began last September, would entail, saying only that it is "ongoing."

The government has made it clear, however, it prefers voluntary initiatives over mandatory mechanisms.

In a letter contained in documents obtained through an Access to Information request, International Trade Minister Ed Fast responds to a call for an industry ombudsman by emphasizing "the government's support for voluntary mechanisms for dispute resolution."

"The use of voluntary initiatives, based on internationally recognized standards, can be effective in resolving issues of mutual concern, and can advance public policy objectives in a more flexible, expeditious and less costly way than regulatory or legislative regimes," he wrote.

The government's corporate social responsibility​ (CSR) strategy, dubbed Building the Canadian Advantage, was launched in March 2009 to help Canadian mining, oil and gas companies improve their competitive advantage abroad "by enhancing their ability to manage social and environmental risks."

As part of the mandated five-year review, the government is carrying out consultations with various stakeholders across the country.

'I believe the time is right for fresh perspectives and sufficient flexibility to explore policy options.'—Marketa Evans, Canada's former CSR counsellor

On Dec. 12, 2013, Fast held a meeting with 13 non-governmental organizations to solicit feedback for the review.

The consultation was run by parliamentary secretary Erin O'Toole, and, according to NGO representatives who attended, lasted about an hour. Each organization was given about three minutes to present their comments, which addressed the four pillars of the CSR strategy.

In 2009 the government had adopted the following strategies:

  • Support governance-building in host countries to reduce poverty through development assistance.

  • Endorse and promote international CSR guidelines.

  • Support development of a centre for excellence in CSR.

  • Create the office of the extractive sector CSR counsellor.

But some in attendance weren't satisfied with the consultation, noting its brevity.

"I'd say others were happy to be invited to give comments and they felt their comments were heard," said Jeff Geipel, venture leader at Engineers Without Borders.

But he added, "They might have wanted more time for input."

World Vision Canada's Harry Kits agreed and said there was "not a lot of chance for interaction."

The government did accept written submissions beyond the in-person consultation. Contained within some of those submissions is criticism of the government's strategy.

While much has been accomplished in advancing the social responsibility of mining companies, significant gaps need to be addressed, particularly with respect to the centre of excellence and the office of a CSR counsellor, according to some of the organizations that attended the Dec. 12 consultation.

More powers for CSR counsellor

The office of the CSR counsellor is still vacant after Marketa Evans quietly resigned from her position in October 2013 — four years after the position was created and a year before her contract was up. She didn't publicly provide a reason for her resignation.

A memo sent to Fast from his deputy minister quotes Evans as saying, "I believe the time is right for fresh perspectives and sufficient flexibility to explore policy options." 

Cases brought before CSR counsellor

April 7, 2011 — Excellon Workers, National Mining Union vs. Excellon Resources Inc. in Mexico

Aug. 14, 2011 — Maître Ahmed Mohamed Lemine, et al vs. First Quantum Minerals limited in Mauritania

July 9, 2012 — Center for Human Rights and Environment (CEDHA), Argentina and Fundación Ciudadanos Independientes vs. McEwen Mining Inc. in Argentina

Feb. 11, 2013 — Inhabitants of Cerro de San Pedro and the Mexico Canada Responsible Mining Network vs. New Gold Inc in Mexico

April 4, 2013 — Confidential requester vs. Silver Standard Resources Inc. in Argentina

July 9, 2013 — Confidential requester vs. Golden Arrow Resources Corporation in Argentina

The mandate of the CSR counsellor is to give individuals or groups that may have been harmed by activities of mining, oil and gas companies a place to bring complaints for a voluntary mediation process.

However, many NGOs have criticized the efficacy of the office, especially as the position had no judicial power or the ability to compel parties to remain in negotiations. All six cases brought before the office are closed. Of those six, at least three ended with mining companies walking out of the process.

It's because of these documented shortcomings that NGOs renewed their push for an ombudsman. 

"Reforming the office into an ombudsperson role, with powers of investigation and sanction, would help lower the potential for conflicts in resource-rich countries where Canadian countries operate. This in turn would help developing countries feel more confident in allowing Canadian-led natural resource projects to go forward," according to Engineers Without Borders' written submission to the federal government.

However, others are wary of a watchdog with such powers. 

Kernaghan Webb, founder of Ryerson University's CSR Institute, said the government's hesitance "is out of respect for the sovereignty of other nations to resolve disputes about matters taking place within their borders."

"Do we know better than the Latin American country [about] what should happen within that country? Isn't that colonialism?" he said in an emailed response to CBC News.

The mining industry suggests combining the role of the extractive sector's CSR counsellor with the CSR office of the OECD, which promotes good business practices and addresses social concerns for the activities of multinational corporations.

The president of the Mining Association of Canada said his organization favours a two-step process that would start with mandatory verification of complaints by the CSR counsellor's office followed by voluntary mediation through the OECD if necessary.

"That sort of fact-finding role is critically important," Pierre Gratton said. "Let's make sure that's done properly."

'Major disappointment'

The centre for excellence was touted as a credible CSR information hub, operating independently from government, for experts from industry, the public sector, academia and NGOs. It was initially funded equally by industry and government, but an end to government funding has limited its activities.

MiningWatch Canada said in submission to the government that the centre "has been a major disappointment."

"We have serious concern that the centre, in line with government policy objectives, will become yet another vehicle for the advancement of government policy and/or corporate interests, rather than an institute that reflects and advances the interests of all stakeholders and rights holders," the submission read.

'Official Development Assistance should not be supporting mining-related CSR projects and partnerships'-—MiningWatch Canada, in a written report to the federal government

MiningWatch helped establish the centre and was part of its executive committee for four years, but left with a number of other founding NGOs after funding ran out. 

Ryerson's Webb, who is interim co-chair of the centre, said critics are "entitled to their opinion, but that doesn't mean that their opinion is the correct one."

"The ones who leave have lost their ability to participate in its decision making, which is an unfortunate decision on their part given the important work that carries on after they leave," he said.

But World Vision, which recently joined the centre, nevertheless agreed with MiningWatch.

"Right now, it's effectively not functioning much at all," said senior adviser Harry Kits in an interview with CBC News.

Many, including Engineers Without Borders and World Vision, are calling on a renewed long-term government funding commitment.


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Royal Bank raises dividend 6%, 1st-quarter profit up 2%

Adjusted earnings per share increase to $1.47, beating analyst estimates

The Canadian Press Posted: Feb 26, 2014 7:06 AM ET Last Updated: Feb 26, 2014 7:16 AM ET

Royal Bank of Canada says its first-quarter net income was $2.09 billion, up $45 million or two per cent from a year earlier.

The bank also announced its quarterly dividend will increase by six per cent to 71 cents per common share.

Royal is the third of Canada's big banks to report improved net income for the three months ended Jan. 31.

In RBC's case, it earned $1.38 per common share under standard accounting, up four cents from $1.34 per share a year earlier.

Excluding some items, RBC's adjusted diluted earnings per share was $1.47, which was above the general analyst estimate.

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Feb 26, 2014 10:19 AM ET Feb 26, 2014 10:19 AM ET Feb 26, 2014 10:19 AM ET Feb 26, 2014 10:20 AM ET Feb 26, 2014 10:19 AM ET

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Tesla stock surges after Morgan Stanley report

Shares of Tesla Motors Inc. surged 16 per cent Tuesday after a Wall Street analyst told investors that Tesla could shake up the electric utility sector as well as the auto industry on the same day Consumer Reports named the Model S its top pick of this year's cars.

Analyst Adam Jonas of Morgan Stanley wrote in a note to investors that Tesla could nearly double its share of the global car market by 2028. And it also could create another lucrative business by building battery packs for energy storage. He doubled his target price for Tesla stock to $320 per share from $153.

Tesla shares rose $34.65 to close at $252.30 Tuesday, and continued their rise in premarket trading early Wednesday, touching $258.60. That's just pennies off the stock's all-time high.

Tesla is expected this week to formally announce the building of a "Gigafactory" to produce batteries with Panasonic and other partners. It would be the largest lithium-ion battery pack factory in the U.S.

Such batteries could be used at homes and businesses to store energy for times of peak electricity use. Electric companies nationwide are switching to a system that charges people more for energy during peak hours, such as early evening, and batteries could cut those costs.

"If Tesla can become the world's low-cost producer in energy storage, we see significant optionality for Tesla to disrupt adjacent industries," Jonas wrote, adding that the electric energy storage business is worth $2 trillion globally.

The factory would also cut the company's own battery costs, he wrote.

Tesla, led by billionaire Elon Musk, said last week it expects to deliver more than 35,000 of its Model S sedans this year, up 55 per cent from last year as it expands in Europe and China. Musk said on an earnings conference call that Tesla plans to boost production to more than 1,000 cars per week from the current pace of 600 a week.

The Model S starts around $70,000.

Tesla must also ramp up for the Model X, a new electric SUV that it will start producing later this year. The company also plans a less-costly car for the masses that could go on sale as early as 2016.

Stifel analyst Jamie Albertine, in an investor note Tuesday, said that Tesla has said the new battery factory is being set up to handle demand for the new "Model E" lower-priced car for the masses. But Albertine, who hasn't placed a price target on the stock, wrote that the energy storage market could be far more significant to Tesla than vehicle sales.

"While we remain negative on TSLA shares above $200 as an automotive OEM (original equipment manufacturer), the energy storage opportunity requires a broader perspective and could very well justify current, if not higher valuation levels," Albertine wrote.

Tesla shares are up about 70 per cent so far this year and are worth more than seven times what they were at the end of 2012.

The Tesla Model S electric sedan is Consumer Reports' top pick in this year's automotive rankings.

The magazine cited the Model S's sporty performance and technological innovations, including its 360-kilometre range. But it acknowledged that the car is expensive. Consumer Reports paid $89,650 for the Model S it tested.

For less than a third of that price, the Toyota Prius hybrid got the nod as Consumer Reports' top green car.

The rankings, now in their 18th year, pick Consumer Reports' favorites among the 260 vehicles its team has recently tested. The rankings are closely watched in the auto industry, since shoppers consistently cite Consumer Reports as a main source of car-buying advice.

Consumer Reports buys vehicles anonymously and performs more than 50 tests on them, including evaluations of braking, handling and comfort. The magazine's testing team drives each vehicle for roughly 9,600 kilometres.

The Model S, which went on sale in 2012, got the highest score ever recorded in Consumer Reports' automotive testing last spring. But at the time, the magazine didn't have enough data from subscribers to rank its reliability.

 The magazine's annual automotive issue goes on sale next month.


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Jim Flaherty undecided on 2015 election run

Written By Unknown on Selasa, 25 Februari 2014 | 22.40

Canada's Finance Minister Jim Flaherty has not yet decided whether to run for office again in the 2015 general election, he told Reuters on Tuesday, amid speculation he may step down before then to attend to health issues.

"We'll see. I haven't decided," Flaherty said in an interview when asked to confirm his intentions.

He answered "yes" at a Nov. 13 news conference when asked whether he would run for re-election in October 2015 in the southern Ontario district he represents.

Flaherty suffers from a rare but non-fatal skin disease that causes blisters and is usually managed with powerful steroid medication.

Activities, travel scaled back

He had long been one of the most vocal cabinet ministers in Prime Minister Stephen Harper's Conservative government and gave frequent speeches to promote the government's agenda.

Since going public with his condition over a year ago, he has sharply scaled back his activities and travel.

He made an exception to attend the meeting in Sydney last week of the Group of 20 finance ministers and central bank governors and was in Melbourne on Tuesday for a business forum.

Flaherty, 64, has vowed to stay on the job until he eliminates the country's budget deficit, and he repeated on Tuesday that he expects to achieve that without difficulty next year well before Canadians go to the polls.

In remarks to a business audience on Tuesday, Flaherty, a veteran of G20 meetings, urged his colleagues to focus on balanced budgets.

Hailed as 'fantastic spine stiffener' by Australian counterpart

Australia's Treasurer Joe Hockey, an ideological ally, described him as a voice of fiscal conservatism and a "a fantastic spine stiffener" within the group for questioning any talk of more taxes or regulation.

Flaherty repeated his criticism of the U.S. Federal Reserve for its bond-purchasing program designed to stimulate the economy and which it is now in the process of tapering.

"I was never a fan of the approach the Fed took," Flaherty said of the so-called quantitative easing, which the Canadian central bank also considered during the crisis but never used.

"I think there's a risk and now we're seeing the consequences of having to get out of it ... and it's very difficult on the emerging economies."

Flaherty raised eyebrows last October when he said the Fed should end its bond purchases as quickly as it could.

Tight-lipped on Canadian dollar

He would not be drawn into reacting to earlier remarks made by Nouriel Roubini, chairman of Roubini Global Economics and an economics professor at New York University's Stern School of Business, that the value of the Canadian dollar was too strong and the Bank of Canada should commit to keep interest rates low for longer or adopt an easing bias in order to weaken the currency.

Asked whether he agreed the Canadian dollar was overvalued despite depreciating sharply in recent months, Flaherty said,

"I wouldn't characterize it in any way other than that it's a market currency. The market decides where the dollar sits."

The Canadian dollar has depreciated about 10 percent in the past year to the relief of exporters, but Roubini said it needed to fall another 10 percent to really help struggling manufacturers.

Ottawa open to further assistance to Chrysler 

On another issue grabbing attention in Canada, Flaherty signaled that Ottawa is willing to provide financial assistance to Chrysler Group LLC, which has said a decision on whether to go ahead with an investment in a Windsor, Ontario, minivan plant hinged on incentives from the federal and provincial governments.

"The auto industry has been a special case in Canada because of its importance in the manufacturing sector and in Ontario," Flaherty said, adding that he had not yet seen a proposal from Chrysler.

"We have an investment fund that I referred to in the budget last week and it's available for investments in plants and equipment," he said.

Industry Minister James Moore, not Flaherty, is in charge of industrial policy but Flaherty would likely be informed of the government's intentions.

His budget this month increased the amount of subsidies available for the sector by C$500 million ($451.69 million) in a bid to arrest the decline in the country's share of the North American car manufacturing.

Keeping close eye on housing

In the interview, Flaherty indicated he is not overly concerned about the state of the housing market and said, as expected, there are no imminent plans to intervene in the mortgage market to curb lending after having done so four times already since 2008.

But he said it would be "unwise" to rule it out as a tool in the future.

Canada's housing market caught fire following the 2008-09 recession as ultra-low borrowing costs prompted consumers to take on record-high debt and led to exorbitant prices and overbuilding.

While many economists still worry about an eventual collapse, the latest data on prices and sales underscore the view that the real estate market should be softer but relatively stable this year as borrowing costs rise.

For now, the minister is focused on increasing scrutiny of the mortgage insurance business of the federal housing agency, the Canada Mortgage and Housing Corporation (CMHC), and encouraging the growth of private mortgage insurers.

'Close eye' on mortgage security

"We keep a close eye on it. We have a new chair and we have a new CEO. There's much more financial expertise now at CMHC than there was before," he said.

In Canada, high-risk mortgages - where the borrower has paid less than a 20-percent down payment on a home - are required to have insurance that is provided by CMHC.

Flaherty has expressed concern about CMHC's role in selling insurance to banks to cover portfolios of mortgages that do not otherwise require insurance, because of the risks to taxpayers. 


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Mt. Gox, Bitcoin exchange website, offline

The website of major Bitcoin exchange Mt. Gox is offline amid reports it suffered a debilitating theft, a new setback for efforts to gain legitimacy for the virtual currency.

The URL of the Tokyo-based Mt. Gox was returning a blank page. The disappearance of the site follows the resignation Sunday of Mt. Gox from the board of the Bitcoin Foundation, a group seeking legitimacy for the currency.

Separately, several Bitcoin exchanges released a joint statement saying that funds under their control are held securely.

The Bitcoin operators said they are working to "re-establish the trust squandered" by the failings of Mt. Gox, which should not be considered a reflection of the value of Bitcoin or the digital currency industry.

A "crisis strategy" report shared widely online that purports to be an internal Mt. Gox document says more than 740,000 Bitcoins are missing from the exchange, which froze withdrawals earlier this month.

Mt. Gox CEO Mark Karpeles said the company would soon issue a statement.

"We should have an official announcement ready soon-ish. We are currently at a turning point for the business. I can't tell much more for now as this also involves other parties," he wrote in an email to Reuters.

The cloud hanging over Mt. Gox is a possibly fatal blow to Bitcoin. Supporters of the virtual currency have said its cryptography makes it immune to theft or counterfeiting.

On Bitcoin exchanges, the currency's value has fallen below $500 from about $550 in the past few hours.

Bitcoin was started in 2009 as a currency free from government controls. It had been inching toward broader acceptance despite wild swings in value in the past year. For most of the currency's history, each digital coin had been worth less than $10


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Housing to get less affordable as mortgage rates rise, RBC warns

The Royal Bank of Canada says the ability of Canadians to keep up with housing costs has been improving of late, but warns that's about to change.

RBC's latest housing affordability measure shows home servicing costs relative to incomes dipped slightly in the last three months of 2013 after having risen the previous two quarters.

But the relief will be temporary, the bank says in a new report, because mortgage rates are due to start rising this year.

"RBC anticipates that as longer-term interest rates begin to moderately rise, the costs of owning a home at market value will gradually outpace (growth) household incomes by late-2014, leading to strained affordability in several markets across Canada, much like the trend in Toronto," RBC chief economist Craig Wright said in the report.

The finding bucks the recent trend, which has seen mortgage rates remain stable or even moving lower, with some brokers offering five-year fixed rates below three per cent.

Mortgage rates expected to rise

Still, the report predicts that with bond yields expected to drift upward on the strength of an improving economy, mortgage rates will be pushed north as well.

The RBC notes that bond yields influence long-term mortgage rates more directly than the Bank of Canada's rate setting, which impacts short-term rates and is not expected to change until sometime in 2015.

In the fourth quarter, the bank estimates maintaining a detached bungalow at current market prices would have taken up 43.1 per cent of average household income, while the cost of a two-storey home would have taken 48.7 per cent.

Both measures are 0.2 points lower than was the case in the third quarter.

The improvement was mostly attributed to growth in average household incomes outstripping moderately increased home ownership costs in the last three months of the year.

But the change is in the margins, the report adds, noting that home affordability in Canada has remained largely stable in the past few years.

Vancouver market the least affordable

Given the nature of the Canadian market, the measure varies widely by location. For instance, the affordability measure on a detached bungalow in Vancouver dropped 2.3 points in the fourth quarter but still stood at 81.6 per cent, by far the highest in the country.

Toronto was the second least affordable market tipping in at 55.6 per cent on the RBC index, followed by Montreal at 38.8, Ottawa at 36.7, Calgary at 33.8 and Edmonton at 33.3 per cent.

As well, there is a major difference in affordability based on the nature of the home ownership, with owning a detached home at market value "more of a stretch" for homebuyers than owning a condominium, the report states.

The RBC index represents the percentage of pre-tax household income that is needed to service the cost of owning a home at current market prices, including payments for a mortgage, utilities and property taxes.

The affordability measure has more relevance to newer home buyers since the vast majority of Canadians will have bought their homes in the past, when prices were lower.


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BMO profit up 2% to $1.06B

Bank of Montreal reports it had $1.06 billion of net income in the first quarter, up two per cent from a year earlier, as the bank cut its provisions for credit losses by nearly half.

BMO's net income amounted to $1.58 per share, before adjustments, up five per cent from a year earlier and five cents higher than analyst estimates.

Its provisions for credit losses dropped to $99 million, from $178 million a year earlier, largely as a result from improved recoveries from its impaired loan portfolio.

BMO's adjusted net income was $1.08 billion, up $54 million or five per cent from a year ago. Adjusted earnings per share rose seven per cent to $1.61, which was also ahead of analyst estimates.

The bank says that it had improved results from most of its major divisions.

Its main Canadian banking arm for consumers and businesses contributed $484 million of net income, up $37 million or eight per cent from a year earlier.

hi-bmo-bill-downe

BMO's profit increased last quarter to just over $1 billion.

"We gained market share in domestic personal lending complemented by double-digit growth in both commercial loans and deposits," said Bank of Montreal chief executive Bill Downe.

Bank of Montreal's wealth management arm increased net income by eight per cent from a year earlier to $175 million.

Meanwhile, its U.S. personal and commercial banking arm saw net income fall by 15 per cent to US$153 million, although the bank says the division's adjusted net income showed an improvement.

"Margins were stable on both sides of the border, and Wealth Management and Capital Markets posted robust revenue growth."

But BMO Capital Markets saw lower net income, which fell seven per cent from a year earlier to $277 million, as the company was affected by higher expenses, lower loan recoveries and a higher tax rate.

BMO Capital's expenses increased $85 million or 16 per cent due to higher employee-related costs, including severance, and higher support costs to adapt to the business and regulatory environment.


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Tim Hortons plans 800 more restaurants

Tim Hortons has laid out an ambitious plan to add 800 more franchise outlets by 2018, the latest shot in an escalating war to stay on top of the quick breakfast and coffee market.

The TSX-listed company said Tuesday it will add as many as 300 new locations in the U.S. in the next four years, a market where it has had difficulty gaining a foothold.

It also plans 500 more locations in Canada, including 160 in Canada as early as this year, a market where the brand enjoys extreme brand loyalty but is perceived to be near saturation.

"We believe that our enviable guest loyalty … will present significant opportunities to grow our Canadian business over the next five years," the company said in a press release.

The company singled out a number of American markets where it already has almost 100 would-be franchises lined up, including 40 in St. Louis, 25 in Youngstown, Ohio, 15 in Fort Wayne, Ind. and 15 in Minot, N.D.

Last year, Tim Hortons was the target of activist shareholders who didn't like the direction of the company and pushed it to abandon international expansion plans and focus on its strength — cranking out cash from Canadian locations, enough to boost the dividend.

Tuesday's roadmap shows the chain is doubling down on growth plans, under the leadership of new CEO Marc Caira, who took the reins last July after executive positions at Nestle and Parmalat.

The chain has growth plans as well in the Persian Gulf, a region of the world where it's eked out a surprising foothold, with 38 locations.

The road map laid out Tuesday includes adding about 220 locations in that area over the same period.

At the end of last year, Tim Hortons had 3,588 restaurants in its Canadian system, 859 in the United States and 38 in the Gulf region.

Tim Hortons shares were up slightly, trading at $58.22  on the TSX.


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Canadian dollar lifts, but stocks fall

Written By Unknown on Sabtu, 01 Februari 2014 | 22.40

The Canadian dollar turned higher late morning Friday amid data showing the economy continued to register respectable growth during November.

The loonie was ahead 0.22 of a cent to 89.78 cents US as Statistics Canada reported that gross domestic product grew by 0.2 per cent, which was in line with expectations. That was down slightly from a 0.3 per cent gain in October.

But stocks dropped, with concern over emerging currency turmoil and Europe's low inflation returning to haunt investors. The TSX/S&P index was off earlier lows by the end of the day but still down 40.34 points to 13,694.94.

ew York's Dow industrial index dropped  149.76 points to 15,698.85, the Nasdaq slipped 19.25 points to 4,103.88 and the S&P 500 index lost 11.6 points to 1,782.59.

"The slowing in November GDP was not unexpected after very strong increases in October and September of 0.3 per cent," observed RBC Economics Assistant Chief Economist Paul Ferley.

"There is the risk of a more pronounced slowing in December for which inclement weather in the final two weekends before Christmas may even result in activity declining marginally in the month."

The U.S. dollar had been higher earlier in the morning with traders in a risk-averse mood after data raised worries about the eurozone slipping into deflation.

Eurostat, the EU's statistics office, reported that inflation in the eurozone fell to 0.7 per cent in the year to January from 0.8 per cent the previous month.

There are concerns that the eurozone could slip into a situation where prices are actually falling. Such a development can hurt an economy as consumers delay purchases and businesses postpone investment.

The deflation concerns added to emerging market worries that have buffetted markets this past week.

Countries including Turkey, South Africa, India and Russia have seen their currencies slide sharply over the past week. Traders worry that growth will slow and money will flow out of their economies as the U.S. Federal Reserve tightens its monetary policy.

Other economic data released Friday showed that U.S. consumer spending rose 0.4 per cent in December, compared with November when spending had increased an even stronger 0.6 per cent. That was the best gain in five months.

For all of 2013, income growth was 2.8 per cent, the weakest performance since 2009.


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Keystone XL gets environmental OK from U.S. State Dept.

The U.S. State Department gave a vote of confidence to the Keystone XL pipeline on Friday, saying in a report that it has no major environmental objections to the construction of the megaproject.

The report says development of the massive pipeline to move oil from Alberta to refineries on the U.S. Gulf Coast won't significantly increase the rate of oil extraction and release an unacceptable level of greenhouse gases.

That had been a key hurdle standing in the way of the project's approval. Calgary-based TransCanada has been seeking approval for the 1,800-kilometre, $7-billion project for several years.

Canadian Natural Resources Minister Joe Oliver welcomed the report's findings and said he hoped for a speedy approval of the project.

hi-transcanada-keystone852-

A final decision may not come for several months, but this study is seen as a critical step in determining whether the project will go ahead.

"This is the fifth federal study on the environmental impact of the Keystone XL pipeline. Each previous one has stated that building Keystone XL would not adversely affect the environment," Oliver said.

He noted that the report says that not building the project would actually lead to the release of as much as 28 to 42 per cent more greenhouse gases, because of energy consumed moving the same volume of oil via other means, such as by rail, trucks or barges.

"The benefits to the U.S. and Canada are clear. We await a timely decision on this project," Oliver said.

Long project

Friday's report is a step closer toward final approval, but far from the final one.

The State Department has yet to rule on whether the project is in America's best interest for non-environmental reasons and there is no date set for that ruling. Beyond that, ultimately the approval for the project will rest with the White House, which has yet to OK the deal. Obama sent the plan back to the State Department for further study before the last presidential election in 2011.

"Approval or denial of any one crude oil transport project … is unlikely to significantly impact the rate of extraction in the oilsands or the continued demand for heavy crude oil at refineries in the United States," the report says.

The report calls for a 90-day comment period, where stakeholders and interested parties are asked to comment on the report's environmental assessment of the project.

The Canadian government and other backers of the project welcome the report's conclusions. Alberta Premier Alison Redford called the report "an important step toward approval of a pipeline that will build our economic partnership with our friends in the U.S. and help foster North American energy security and independence."

The American Petroleum Institute CEO Jack Gerard declared the report had put environmental concerns to rest.

"Five years, five federal reviews, dozens of public meetings, over a million comments and one conclusion ─ the Keystone XL pipeline is safe for the environment," said Gerard.

"This long-awaited project should now be swiftly approved. It's time to put thousands of Americans to work," he added. 

But the pipeline's many opponents are already vowing to redouble their efforts to see that it's ultimately halted.

Tim Gray of Canadian group Environmental Defence said the U.S. should be dealing with carbon pollution rather than building pipelines.

"The bottom line is that it will never be easy to build a pipeline anywhere in North America. The opposition to the pipeline is strong in Canada too," Gray said. 

Opposition mounting

There's already a lawsuit in Nebraska to prevent the governor from forcing landowners to allow the pipeline on their property. And there's a State Department internal investigation into conflict-of-interest allegations against contractors who worked on the report, but had also done past work for pipeline builder TransCanada Corp.

Project opponents made it abundantly clear that they wouldn't be deterred.

"In addition to the fact that [the report authors] ignored the science, interagency criticism, basic economics of the industry and TransCanada's own recent admission that the pipeline is the key to opening up the tarsands, the fact that a foreign oil company and foreign government were given critical intelligence ahead of everyone else tells you all you need to know about how useless this [report] is," an adviser to billionaire Keystone opponent Tom Steyer told The Canadian Press on Friday.

Shares of TransCanada rose slightly on the news, just over one per cent in the minutes after the release of the report.

TransCanada CEO Russ Girling welcomed the decision, saying the pipeline capacity the company can sell in advance is all spoken for. TransCanada emphasized the enhanced security of the pipeline compared to shipping oil by rail, which many of its customers are doing.

"From a safety perspective, this will be the safest pipeline built to date in the U.S. From that perspective, this pipeline is in the national interest of the U.S," Girling said in a teleconference.

"Keystone XL has been shown time and time again to be the safest way to transport North American oil, to get oil to refineries in the Midwest and the Gulf Coast. It will have a minimal impact on the environment and it will not exacerbate environmental emissions," he said.


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Bombardier, Quebec to invest $1B in Gaspé cement plant

Bombardier's founding family is partnering with Quebec's government and two provincial agencies to invest $1 billion
in a new cement plant in the Gaspé region.

The project is expected to support about 2,300 jobs during the construction phase. Once it's built, it will support about 200 jobs and another 200 indirect jobs.

The project is being led by McInnis Cement, a company formed by members of the family that founded Bombardier Inc. and its spinoff, BRP Inc.

The Quebec government will provide a guaranteed loan worth about $250 million. The province's investment arm will invest $100 million and the Caisse de dépôt, Quebec's pension manager, will invest an additional $100 million.

Project boon to depressed region

The location in the community of Port-Daniel-Gascons was selected because of its rich limestone formations and proximity to maritime shipping that will carry 95 per cent of annual production.

The plant is welcome news for an area of Quebec that suffers from high unemployment.
   

However, rivals in the cement industry say government funding will threaten other jobs in the province.

The Canadian Cement Association criticized the government, however, for supporting the project that will add unneeded supply.

Association president Michael McSweeney said the new plant would compete directly with Quebec producers at a time when 60 per cent of their capacity sits idled.

"The government's financial participation in the project jeopardizes jobs and existing plants," he said before the
announcement after reports surfaced late last week.

Rival Lafarge could cut jobs
 

French-based Lafarge, which is partially owned by Montreal-based Power Corp., has said it would be forced to cut jobs at its plant in St-Constant, Que., if it can't maintain its activities because of a further surplus of production capacity.

The idea of a cement plant in the region dates back more than 20 years. Planning for the project began in 1998 but was postponed for a few years due to the lack of financial support.

It got back on track with a more than doubling of output after the Beaudoin family's investment arm, which also partially owns Ski-Doo maker BRP.

The cement plant promises to be among the industry's most fuel-efficient and lowest emitters of greenhouse gases on the continent.

It will initially burn petroleum coke, a refinery product and may add biomass from logging and sawmills.

"Ultimately, the production of the project's cement plant will replace that of older plants," said a November report by engineering firm Genivar, now WSP.

Beaudoin vs. Desmarais?
   

That puts it in direct conflict with Quebec's Desmarais family, whose Power Corp. owns a 21 per cent stake in Lafarge.

Quebec media have labelled the competition a battle between two of Quebec's wealthiest families.

But Power spokesman denies any friction.

"There is no disagreement between the Desmarais and the Beaudoin families. They are in fact very good friends," Stephane Lemay said in an email.

Bombardier CEO Pierre Beaudoin sits on Power's board of directors.


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Head of CPP fund investing 'where the puck is going to be'

The man in charge of the $200 billion fund that underpins the Canada Pension Plan invests with a very long horizon.

Mark Wiseman, president and CEO of the Canada Pension Plan Investment Board, uses the analogy of Wayne Gretzky, saying  "we're going to go to where the puck is going to be, not where the puck is today."

That means a highly diversified portfolio, with only one third of its assets in Canada, said Wiseman, who joined the investment board in 2005 and has been its head since July 2012. He previously worked with the Ontario Teachers' Pension Plan.

The board manages the portion of CPP's capital that is not immediately needed for benefits, and Wiseman has a firm grasp of the potential impact of the baby boom retirees. He points out that most of them are still contributing to CPP.

"We expect to have net inflows of capital into the plan for about the next decade," he said in an interview with CBC's The Lang & O'Leary Exchange.

'The policy decisions are tough ones and we leave that up to politicians to make those decisions. What is clear is that Canadians by and large need to save more for their retirement'- CPPIB CEO Mark Wiseman

"So, as a result of that, because we don't have any money to pay out in the near term we can afford a bit of volatility in the way that we invest and therefore take a riskier position and get, hopefully, a larger return in the long run for taking a little bit more risk."

The chief actuary's report in December showed the CPP is sustainable for the next 75 years.

The $200 billion fund is only "middling" in size by global standards, Wiseman said, but its scale means it can take on investments in assets such as real estate and infrastructure that smaller investors cannot.

Diversified by assets, geographically

"So the best way to think about it is we're diversified in terms of risk," he said.

"We have government bonds, we have real estate and infrastructure which are reasonably low-risk, then we move up the scale and we invest in things like private equity and private debt that might be a bit more risky and overall what we're trying to do is get a highly balanced portfolio that's diversified by asset class and by geography."

The CPPIB has stepped up the pace of investment outside Canada, including investments in emerging markets such as Peru, China, Brazil and India.

That's what Wiseman means by having his eye on where the puck will be. He agrees there is turmoil now in emerging markets as money moves toward the U.S. dollar, but points out CPPIB has the kind of investment horizon that can last out market cycles.

Investment in India

"We recently announced our first investment in India, exactly at a time when other people are leaving", he said, "but taking the long-term view by having the luxury of being able to leave our capital in the country for a long period of time, we believe will pay off a substantial dividend in the long-run."

Similarly, he believes China will eventually be the world's largest economy and its growth, though slowing, will be faster than any developed country.

"We still have a third of the portfolio invested in Canada, but if you think about it, Canada represents less than three per cent of global capital markets today so even at 33 per cent we're effectively grossly overweight Canada," Wiseman added.

Wiseman assures Canadians that CPP benefits will be there for them at retirement, though he warns most will need to do some additional saving.

"People can count on the CPP being there in terms of what they had contributed," he said.

He said he doesn't get involved in decisions such as whether CPP should be expanded as Ontario would like or how private pensions should be reformed.

"The policy decisions are tough ones and we leave that up to politicians to make those decisions. What is clear is that Canadians by and large need to save more for their retirement," Wiseman said.


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Keystone XL supporters, detractors clash over U.S. pipeline report

The Conservative government received some much-needed good news this week in the form of the U.S. State Department's massive and benign final assessment of the proposed Keystone XL pipeline.

Ever since Stephen Harper called American approval of the $5.4-billion pipeline from Alberta to the U.S. Gulf Coast a "no-brainer" back in September 2011, a lot has been riding on the eventual vindication of the prime minister's thinking.

By January 2012, Natural Resources Minister Joe Oliver had elevated pipeline politics — and the diversification of the country's foreign energy markets — to "an urgent matter of Canada's national interest."

Throw in the steady stream of Canadian supplicants to Washington on the Keystone file, a multi-million-dollar government ad campaign aimed at U.S. decision makers and consumers and, most recently, Foreign Affairs Minister John Baird's impolitic push for U.S. President Barack Obama to make up his mind, and the whole saga is taking on the aura of a slow-motion policy sink hole.

Keystone Report

Natural Resources Minister Joe Oliver says Keystone's 'benefits to the U.S. and Canada are clear.' (Frank Gunn/Associated Press)

With 2014 shaping up as the year the Conservatives need to find some pre-election traction on their bedrock — dare we say, keystone — energy policies, the State Department assessment buttresses many of the government's long-standing arguments.

"The benefits to the U.S. and Canada are clear," Oliver said Friday after the pipeline study was released.

"We await a timely decision on this project."

He'd best not hold his breath.

Eight other U.S. federal agencies have 90 days to comment on the State Department report and the president can then ruminate for as long as his political calculus deems necessary.

"The file has been caught up in a political dynamic that goes beyond a rational exchange of numbers," said David McLaughlin, a former president of the National Round Table on the Environment and the Economy and chief of staff to Finance Minister Jim Flaherty.

Environmentalists ignore U.S. findings

Certainly the environmental movement is talking past the State report as though it was just another partisan news release.

"If President Barrack Obama truly wants to be able to tell his kids he did everything he could to combat climate change, then he must reject this pipeline because it is a fuse to one of the largest carbon bombs on the planet," Mike Hudema of Greenpeace Canada said in a release late Friday.

Keystone Pipeline Texas

The U.S. State Department report on the Keystone XL pipeline is "good news" for the project, says David McLaughlin. (Tony Gutierrez/Associated Press)

The report says nothing of the sort.

Against that incendiary rhetoric, the Conservative Party of Canada responded with its own jeering web advertisement Friday within minutes of the State report's release.

"Now American billionaires are using their wealth to attack our oil industry," says the minute-long Conservative ad. "The distortion of facts and hysterical fear-mongering has to stop."

The ad was apparently in response to U.S. billionaire Tom Steyer, who has been a vocal opponent of Keystone XL.

And so while the State report should give the Harper government critical credibility on a key file, the benefits may be diluted in a political swamp.

Liberal Leader Justin Trudeau, a supporter of the Keystone project, said the State report shows opposition to the pipeline "is not scientific, it's political."

"It is a failing of our prime minister to actually make a proper case for the Keystone XL pipeline by demonstrating that you cannot separate the economy and the environment."

New Democrats, who oppose Keystone, made much the same allegation.

"The Conservative government's bumbling approach to oil sands development has given Canada a black eye and hurt our relationship with our closest ally," said NDP energy critic Peter Julian.

Harper's approach

What is emerging is a consensus among pipeline supporters and detractors alike that the Harper government's take-no-prisoners approach to promoting energy extraction has built a cage of its own.

McLaughlin is among those who note that Canada hasn't provided Obama much of an incentive, let alone political cover, to act.

If the president has "punted," the Keystone decision — to use Harper's recent description — the prime minister has repeatedly punted regulations on oil and gas sector emissions his government first promised in 2007.

Conservatives have also torched some environmentalists as being akin to terrorists, reduced environmental assessments and loudly derided an NDP cap-and-trade proposal as a job-killing tax grab.

Against that stands a U.S. State Department report that, in McLaughlin's assessment, is "good news for the (Keystone XL) project."

"There's now a clear environmental impact assessment on emissions and climate that shows it's not as negative as many environmental groups have pointed out," he said.

"But until and unless we can turn the Obama administration to Canada's corner in terms of making a positive argument that will cause the president some (domestic) political difficulty ... we have to look back over the years and say, have we invested enough political capital in return?"

McLaughlin sees it as a rhetorical question, given the current impasse — a question the State Department report can't answer.

"In that sense, I don't think anything politically has changed from yesterday to today." 


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