“Canadian Oil Sands warns drop of cash levels, high debts.”

Canadian Oil Sands Ltd., the largest stakeholder in Syncrude Canada Ltd. has warned investors of a drop in their cash levels for 2014. The reason behind this drop is higher debt; Syncrude has expansion projects under way at the Mildred Lake mine, and Canadian Oil Sands controls almost 37% of the consortium.

However, the company’s profit levels have risen 20 cents per share in the third quarter compared to last year. So what is stopping investors and stockholders from being a part of this increased profiting?

The answer is in the cash flow, where investors make their profit from investing. The amount of cash that flows in and out of a business is used as inputs in financial models, and thus determines the rate of return and the net present value of the business. Also, in the case of Canadian Oil Sands Ltd., the cash flow is vital to its liquidity. If they are unable to pay their debts, the shortage in cash can be a problem in financial operations in general. When investors see a shortage in cash, they are hesitant to invest because a shortage in a cash can hinder expansion and growth.

The company’s (Canadian Oil Sands Ltd.) excuses for the reduce in cash flow were the lower gas prices this year. Canadian Oil Sands brought in $92.59 per barrel in the first nine months of 2012, while they had received $100.20 per barrel in all of 2011.

What do you think, is Canadian Oil Sands Ltd. save to invest in? Can we look past this decrease in cash flow, and confide in them to pay off their debts and expand effectively?

Would you invest in them?

http://www.theglobeandmail.com/globe-investor/canadian-oil-sands-warns-of-drop-in-cash-levels-higher-debt/article4749096/#

Have you considered self-efficient funding for your charity? Are you tired of constantly trying to find a solution for funding of your charity?

Maybe you can be convinced into a social enterprise:

http://www.guardian.co.uk/voluntary-sector-network/2012/oct/15/charity-social-enterprise

Toms’ one for one slogan has been the underlying motive of their campaign, they give back one shoe to people in need for each shoe the public purchases

The Guardian states that there are almost 70000 social enterprises in the UK now, and the interest is only increasing. To be clear about what they mean “social enterprise,” the article defines it as “an organisation that trades for social purpose, meaning that any surplus is reinvested back into the business or the community.”

Why should a charity convert into a social enterprise? Adopting a self funded approach to a charity will give the charity a more sustainable and increased social impact.

However, there are things to consider before making the jump. Many charities struggle with the cultural aspect of the decision. They struggle with jumping from being gift funded, to a self-sufficient enterprise that sells services or goods to produce income. However, they forget that the profits are used to support the activities that charities usually does.

In conclusion, if your charity realizes that you’re able to provide a service and generate profit, why not become a social enterprise? You could generate income and use it to fund your social missions. But before jumping in to do so, make sure you have a strategy and a plan for providing a service or a product so you can be sure that you will generate profit. The social enterprise offers opportunities for charities to become long-standing, profitable organizations that focus on providing social services to the community.

If the global demand is weak, and exporting isn’t happening, what do ships have left to do?

http://www.theglobeandmail.com/report-on-business/economy/the-cost-of-a-strong-dollar-and-weak-demand/article4595402/

Canada is starting to feel the effects of the global trade slowdown, with its exports going way down due to the weak global demand. The Baltic Dry Index (BDI) “tracks changes in the cost of shipping bulk commodities such as metals, grains and crude oil by sea. The index falls when shippers aren’t shipping, and between May and December of 2008, the BDI crashed 94 per cent.” The Index this year has went down 55% due to the weak demand and the excess supply. Why is this happening?

Maybe it’s because of the business caution that people never took before. In the economic  collapse of 2008, the BDI went down 94%. The BDI has already went down 55%, so it’s only natural that demand weakens and caution rises. Who wants to lose money?

We can’t turn to other countries for help, because their BDI indexes are down as well, signifying overall sluggish activity in the economy.

In a nutshell, the overall demand for trade is weak, and our dollar is strong. It makes exporting a whole lot more expensive for ourselves. What can we do?

Full story here

Vancouver’s home sales have dropped more than 30% from last September to this September. In essence, the asking price for houses hasn’t really gone up, but the mortgage has. The government has “recently eliminated the availability of a 30-year amortization on government-insured mortgages,” thus decreasing demand cause some potential buyers cannot afford it now.

Is this really worth all that money? Are you willing to pay a expensive mortgage for this?

One way to tell the increasing price of housing is the percentage increase in listings from last year to this year, a 14% increase. As Sal Guatieri of BMO Nesbitt Burns says, sales will continue to drop as buyers seek revenge after the decade-long boom of the 2000s.

However, where exactly is Canada’s housing market going? With the inevitable sliding of Vancouver’s market and the increase in Calgary (climbed 14.4% from September of last year). As well, what will happen to the condo situation in Toronto, they can’t just keep producing and selling, it has to stop at one point.

I think we must appreciate Jim Flaherty’s management of the situation, his recent tightening of mortgage regulations have decreased risk of a crash and will likely result in a progressive decrease in sales. His intention was set on high-end home buyers, particularly in Toronto, to reconsider before jumping into the market in order to avoid a future crash in the market.

As for Vancouverites, we’ll just keep our dead money in our houses! Or sell them and profit.