Marketing

Economic

http://www.canada.com/vancouversun/news/business/story.html?id=32ee0fc9-50e9-49ef-883b-1fdffd36ff63

1. what stage does the economic currently at? (recession? blooming?

The U.S. banking crisis, already a fearsome beast, seems to be spreading rapidly in at least two

Directions. First, it's gone global, with European governments scrambling in desperation to prop up banks before they fail. Second, it's spreading more widely into the real economy, with recessions on the horizon not only in the U.S, but also in Canada and several European countries.

All this was reflected in plunging global stock markets Monday. Stocks in emerging nations,

Europe and Canada plunged even more steeply than in the U.S. as investors in other

countries began to see the credit crisis as a threat to them, not just to U.S. investors.

The outlook for Canada is increasingly darkening along with that of our neighbor.

Economists from the Bank of Nova Scotia and UBS Securities said Monday that a U.S.

recession began last summer, and has now spread to Canada.

The Canadian slump won't be as serious as that in the U.S. and some European nations, both forecasts predict, because the Canadian banking system remains solid and the financial underpinnings of this country's economy are not weakened by growing government indebtedness. Still, Canada's economy is clearly stalling, said economist Derek Holt at Scotia Capital, the bank's investment arm. It's being hurt by falling export sales to the U.S and a squeeze on domestic spending as job growth stalls and fear spreads through the economy. Finally, as a big resource exporter, Canada is hit harder than most countries by plunging income from the petroleum and other commodities that earlier this year commanded record export prices.

However, said Holt, both the U.S. and Europe are in a "bigger pickle" because of

governments and banking systems burdened with massive debts, many of them unlikely to be

repaid. Until recently,...