Part of the answer may lie in the correlation between the Fed and the
Canadian Central Bank. I remember a study by a former professor of mine
at Utah indicating the CCB acted like the 13th District in the U.S.
Federal Reserve System. How this may relate to wider economic
experiences between Canada and the US I cannot say.
Jeff
----------
From: Michael Perelman
To: [EMAIL PROTECTED]
Subject: Re: What went right
Date: Thursday, March 12, 1998 10:44AM
Interesting data. Why would the Canadian and U.S. banks be so much more
successful in increasing their profitability?
Mark Jones wrote:
> Here are the figures on commercial bank profitability, from the IMF
1997
> report, International Capital Markets Developments, Prospects, and Key
> Policy Issues (supplementary tables), which demonstrates the adverse
> turn in the fortunes of Germany and Japan v. the Anglo-Saxon world.
Not
> much signs of hyperaccumulation here (and the opaque German and
Japanese
> figures are probably over-optimistic). In the later period it would
> appear to be the case that the major purchaser of US govt. and
> commercial bonds was not Germany or Japan - but the United Kingdom.
>
> Major Industrial Countries: Commercial Bank Profitability
> Real Return on Equity 1(In percent of total assets)
> 1985-89 1990-94
> Canada 7.9 12.1
> France . . . -3.3
> Germany 6.5 2.7
> Italy . . . -1.2
> Japan 10.4 1.5
> United Kingdom 6.1 4.9
> United States 5.0 8.5
>
> Sources: International Monetary Fund, World Economic Outlook database;
> OECD (1996); and IMF staff estimates.
> 1. Calculated as net income after taxes divided by capital and
reserves
> at the end of the previous year, minus consumer price index for the
> year.
--
Michael Perelman
Economics Department
California State University
Chico, CA 95929
Tel. 916-898-5321
E-Mail [EMAIL PROTECTED]
