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David Baskin: RESPs are your best back-to-school buy

As people think about buying things for the back-to-school season, they should be thinking about registered education savings plans, writes David Baskin.

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David Baskin: Share buybacks sparked some the business world's woes

By David Baskin, president of Baskin Financial Services in Toronto

One of the truly shocking aspects of the current recession is the collapse in the stock price of iconic American companies. General Motors, in its 101st year, is on the verge of bankruptcy, saved only by billions of government aid. Citibank, a global colossus only last year, has lost 95 per cent of its share value. Bank of America is down 90 per cent. General Electric, once the most valuable company in the world, is off by 75 per cent and had to cut its dividend. Even Microsoft has lost almost half of its value.

Many books will be written in future years to explain how this could have happened, but one major factor stands out. Investors have encouraged companies to manage for higher short term profit at the expense of long term stability.

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David Baskin: Moderation in market watching

By David Baskin, president of Baskin Financial Services in Toronto

I know that some of our clients don't open the mail we send them. For them, ignorance may not be bliss, but it is better than facing the harsh reality of the past six months. I know we also have clients who monitor their portfolios constantly through the day and who watch business television for hours on end. For these clients, there can never be too much information. I think both of these groups are getting it wrong.

It is obvious that no matter how much you watch the market, watching will not make it go up. It is equally true, though, that watching too much can make your spirits go down. Daily and even hourly fluctuations become like hits of a powerful mood altering drug. A sudden rally leads to exultation and a last minute slump causes a depression.

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David Baskin: Buying a gilt-edged insurance policy

By David Baskin, president of Baskin Financial Services in Toronto

There are few subjects in economics that arouse more passion and vitriol than the question of gold and its role in a modern economy.

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David Baskin: There's no made-in-Canada solution to this economic crisis

By David Baskin, president of Baskin Financial Services in Toronto

We are the victims of the economic equivalent of a drive by shooting, collateral damage in the great asset implosion. This economic crisis is not a made-in-Canada problem, and it is short sighted and parochial to think that there is a made-in-Canada solution.

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David Baskin: For better or worse, Obama is placing his bet with Keynes

By David Baskin, president of Baskin Financial Services in Toronto


With the inauguration of Barack Obama the final piece has been put in place for a no-holds-barred economic battle of the brains. On the right, obviously, are the surviving Reagonites, neo-cons and supply-siders. Disciples of Milton Friedman, the late Nobel Prize winning father of monetarism, they believe in hard money in hard times. On the left, cheque books in hand, are the spiritual successors of Franklin Roosevelt and his “new deal,” the 21st century Keynesians.

Where is Obama placing his bets?

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David Baskin: Four resolutions for investors in 2009

By David Baskin, president of Baskin Financial Services in Toronto

Few of us can resist the temptation of New Year’s resolutions. As we all know, keeping them can be a lot harder than making them. Here are four resolutions that investors should try hard to observe during 2009.

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David Baskin: Taxing poetic

By David Baskin, president of Baskin Financial Services in Toronto

An ode to the trying economic times and the wisdom of massive stimulus packages.

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David Baskin: Economic lessons from the past two months

By David Baskin, president of Baskin Financial Services in Toronto

Experience is a great teacher, so the saying goes, but she sends in hefty bills. Having paid for the education we took in the last two months, it would be a shame if we did not learn some things. Here are what I would take to be the most important lessons.

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David Baskin: The benefits and costs of Pigovian taxes

By David Baskin, president of Baskin Financial Services in Toronto

Arthur Pigou was one of the foremost economists of the early 20th century. Although his neoclassical school of economics has been largely supplanted, his name has recently had an astonishing renaissance because he was the first proponent of what are now called Pigovian taxes.

Pigou believed that while markets are efficient, they can give rise to bad side effects or "externalities" that are not priced into the product being sold. For example, the price of bottled water does not take into account the external cost of cleaning up and disposing of the millions of discarded plastic containers. Pigou had a solution. Governments, he said, should use taxes to modify behaviour and to address these external costs.

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