What signing CETA says about Canada

Plus, how Canada's housing bubble compares to the U.S. one before it burst, and what went wrong when Sobeys bought Safeway

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Canada now appears as the only “adult in the room” when it comes to global trade negotiations, writes Carlo Dade, director of the Canada West Foundation’s Centre for Trade and Investment Policy. The big story regarding the Comprehensive Economic and Trade Agreement (CETA) between Canada and the EU is not that the agreement was finally signed, but how well Canada has performed. Canada has proved it can negotiate with a unified and coherent position internationally, even when faced with concerns from certain provinces, sectors and advocacy groups. Plus, Canadian trade negotiators have embraced the reality that negotiations between two or more governments involve give and take. “As Canada enters tougher trade negotiations in Asia, what many thought was a weakness in Canada’s negotiating position—having the provinces participate—is turning out to be a strength.” (Huffington Post)

When it comes to our respective housing bubbles, comparing Canada’s current infatuation with real estate with the peak of property mania in the U.S. yields some disturbing insights. Compared to the U.S. bubble’s peak, Canadian house prices are more inflated than they were in the U.S., and when both housing markets are compared in U.S. dollars, Canada’s is more expensive than the U.S. market was. As for U.S. and Canadian household debt-to-GDP ratios, Canada recently exceeded the level reached by American households in the first quarter of 2008. (Maclean’s)

How Sobeys vaporized half of Safeway’s value in just three years. When Sobeys headed to Western Canada to snap up Safeway for $5.8 billion in 2013, it was hailed as a masterstroke. The purchase gave Sobeys girth in Western Canada and made it Alberta’s number one supermarket chain operator. Since then, it has booked billions in writedowns and dumped its CEO. (The Globe and Mail)