Month: October 2010

            The marketing team at Whistler Blackcomb are working harder than ever to bring in more tourists to the area. From all of the exposure Whistler experienced during the Olympics, why would they now have a hard time driving in customers? This is all due to “the Cypress Problem”, the phrase used by Whistlers public relations office that is trying its best to counter tourist views.

           During the Olympics, Whistler, experienced their second snowiest winter. Whistler Blackcomb was the “place to be” at that time. On the other hand, Cypress Mountain had some of the worst conditions including rainstorms and lack of snow. From a tourist point of view this could go two ways. Either remember the beautiful Whistler Blackcomb for what it was, or think back to the dreadful conditions on Cypress and base your opinion on B.C.’s mountains on that (assuming tourists don’t know how to distinguish between the two mountains). It just so happens that tourists are confusing Whistler for Cypress, and this has had a severe impact on drawing in overseas visitors. Marketers are trying there best to clear up the confusion.

                   There are many other things that have contributed to Whistlers decrease in customers. The rising Canadian dollar has driven away American tourists who use to use the strong U.S. dollar to their advantage. B.C.’s new harmonized sales tax is also another negative, making goods and services more expensive at the resort. Lastly, surrounding competition is driving potential customers away from Whistler due to their cheaper rates. The resort charges a staggering $93 for a one day pass (not including any deals) ! Whistler Blackcomb clearly needs to discover better ways in attracting mountain lovers, especially in these harder economic times.

           Recently, I came across a very interesting article with the author clearly stating that Research in Motion is not the winner when it comes to the smart phone market. In the author’s view, Apple is and will continue to dominate this market. However, what the author fails to recognize is that the companies are actually dominating two very distinct markets. 

            On one side we have Apple dominating the consumer market for various reasons. Just as the author mentions, Apple clearly has many more applications and games available, something the consumer market finds attractive. Apple also finds ways to incorporate smart innovative designs into their IPhones.  Confident in their dominance in the consumer market, I believe that Apple is trying to expand into the business market. Personally, I have yet to hear of an employer paying for an employees IPhone.  

           On the other hand, Blackberry still has no competition in the business market. Their phones are designed by engineers and are more functional, and less fragile. Blackberry messenger has been a breakthrough for RIM, attracting even the younger population (Generation Z). The only problem for RIM, that is not very clearly stated in the article, is that the business market is more mature than the consumer market; in other words, Apple is growing faster due to the fickle consumer market, but that does not mean to say that RIM can not take advantage of the situation either.

                      Overall, I believe the author is mistaken that Apple will be the dominant force. The smaller core franchise that Blackberry happens to control will turn out to be more valuable than Apple`s.

              Analysts are predicting that in the next 12 months the Canadian dollar will rally to an all time high of $1.15 against the U.S. greenback. To most Canadians this is good news, however others will suffer. Exporters in Canada will face hard times ahead if this prediction proves to be true.

              Many governments and organizations around the world have been hinting on additional quantitative easing for there economies;  recently, Japan has taken drastic measures as a means to lower the value of the Yen, some of which included slashing interest rates to zero and putting an additional $60 billion aside for purchasing financial assets. If the expansion of  balance sheets for central banks around the world should go any further, from additional stimuli, the value of their currencies will depreciate.

             Should the Canadian dollar reach an all time high, the nation will most likely suffer. Canada’s economy relies heavily on exports, with the United States as its largest trading partner, exporters will be losing money; naturally, this will have a negative impact on Canada’s GDP in the year to come. At that point the Canadian government will most likely have to intervene and try its  best to control the value of the rising Canadian dollar. On a plus side, Canadian consumers can expect more purchasing power in the United States!

Here is a link to the article:

http://www.theglobeandmail.com/report-on-business/economy/economy-lab/the-economists/get-ready-for-a-115-loonie/article1745200/

             In this economy, investors are resorting to risky activities hoping that the returns will be more than satisfactory. The risky “moneymakers” are none other than high-yield bonds. Even the more conservative investors are buying into this “new big thing in bond investing”. The returns generated from these bonds are definitely attractive running into 6 or 7 per cent; however, high-yield bonds have a much higher risk of default in comparison to bonds issued by blue-chip companies or governments. Most of these high-yield bonds are being issued by companies with lower-tier credit ratings. This sudden increase in high-yield bond activity is not all a surprise. In fact these bonds are rebounding from the lows they experienced in 2008, with some big players losing as much as 40 per cent in their funds.

                       In the end, the stock market is all about risks. However, some of the risks (as they appear to be to the inexperienced investor) involved in financial markets can only be barriers to further rewards. Depending on the investor and his/her knowledge of markets, these barriers can be exposed and therefore the risks can also be dismissed. As long as the largest econmy in the world, the United States of America, does not experience a double-dip recession, markets all around the world will begin to see steady growth in all areas including their high-yeild bonds.

High-Yield Corporations