Mr. Majendie: Majendie Wealth Management is part of Scotia McLeod's Wealth Management operation. Scotia McLeod is the brokerage arm or investment dealer part of the Bank of Nova Scotia. Our money management has a value-oriented style, exclusively geared to Canadian securities, but we think of them in global context and relative to the US.
TWST: What was the impact on Canada of the events that occurred over the last 12 to 18 months in the United States?
Mr. Majendie: The impact equity market wise was equally as severe as in the US. We are an interconnected economy and the global perception is that as goes the US so goes Canada. In the short-term, that can be true. There are some differences, however. The market reacted in very similar fashion to the US and actually globally, of course, because all equities were down substantially in varying degrees. But as we have come out of that recession and markets have recovered, it's clear that Canada's economic performance has been somewhat different and particularly the banking system performance has been different. If I could highlight the banking side, we have an oligopoly here, which comprises six major banks. None of our banks had to be bailed out and there were only very minimal government programs to help the banks. Really the safety of the Canadian banking system stood out not just against the US, but also on a global basis coming out of this. Also, economically speaking, what we found out as we came out of the recession is that the consumer is in relatively better shape in Canada since our savings rates have been better. There has been a modestly better recovery in the consumer sector of the economy, which has now even got some of the authorities concerned because the housing market, which was never nearly as weak in the first place as south of the border, is starting to firm up really quite strongly, and we've had significant year-over-year gains in real estate prices depending on the region. In sum, the stock market impact was similar, but I think Canada has come out of this situation stronger both in terms of its banking system and its overall debt-to-GDP ratio, which is obviously a considerable concern in the States.
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