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Trevor Tombe Profile picture
Trevor Tombe
@trevortombe
Professor @EconCalgary | Fiscal/Econ Policy Director @policy_school | Alum @econuoft @SFUBeedie | Contributor @TheHubCanada | 💻 📊 📝 🍻
3 subscribers
May 21 • 4 tweets • 2 min read
Today's data: inflation rate falls to 2.7% in April. Would have fallen more, but gasoline pushed the rate up. Shelter remains largest contributor, but pace of increase is falling.

#cdnecon #cdnpoli www150.statcan.gc.ca/n1/daily-quoti…
Image The key Bank of Canada core measures of inflation have also remained within the target range -- lower than 2% -- over the past 3 months. This is what the bank is looking forward before lowering rates. Image
Feb 20 • 7 tweets • 3 min read
Today's data: inflation! 🥳 Prices were 2.9%, on average, higher in January than a year earlier. Inflation down from 3.4% in Dec. Biggest contributors to the drop were energy, food, travel. Cell phones offsetting some.



#cdnecon #cdnpoli www150.statcan.gc.ca/n1/daily-quoti…
Image Looking at the headline rate, shelter is larger contributor. Rent accounts for ~0.5 points of the 2.9, mortgage interest costs ~1.0 points.

Important: note the strong decline in the pace of grocery price growth. Now in line with historical norm. Image
Jan 16 • 9 tweets • 4 min read
Today's data: inflation!! 📈 Consumer prices were 3.4% higher in December than one year earlier. That's up from 3.1% in November.

I'll explore some of what's going on. #cdnecon #cdnpoli 🧵 www150.statcan.gc.ca/n1/daily-quoti…
Image This is higher than last month, true, but it doesn't mean the inflation situation is worsening. I noted this yesterday, saying 3.4% was the number to watch.
Nov 21, 2023 • 11 tweets • 5 min read
As expected, inflation fell in October. A lot. From 3.8% in September to 3.1% in October. And monthly, adjusted for seasonality, prices were lower in October than Sept.

I'll unpack some more patterns here 🧵 #cdnecon #cdnpoli www150.statcan.gc.ca/n1/daily-quoti…
Image A big part of the reason is from lower gasoline prices. That's anticipated because oil prices were down. There's a tight connection between energy's contribution to CPI and oil prices (obviously). This has been a consistent story over the past two years. Image
Nov 11, 2023 • 14 tweets • 4 min read
Some Alberta Pension Plan proponents are concerned about Albertans paying more in contributions than they receive in benefits. Is this "overcontribution" legitimate? If so, does it imply the CPP is unfair? Would an APP solve it?

Allow me to explain. 🧵🤓 #cdnpoli #ableg #cdnecon The Government of Alberta regularly cites $60 billion in excess contributions over what has been received in benefits. The report commissioned by the government includes this figure. Red is Alberta. Positive means contributions > benefits. 👇 Image
Nov 4, 2023 • 10 tweets • 3 min read
To better understand this claim, consider an equally true but misleading statement: eliminating the GST would "reduce inflation by 61%"! 😲

Does that mean the GST is inflationary? What about the carbon tax?

I'll try to clarify things 🧵 🤓 #cdnecon #cdnpoli The GST adds 5% to the cost of purchasing a good or service subject to this tax. Not all items are subject to it, though. I (roughly) estimate that, overall, the GST adds an average of 2.3% for consumer expenditures as a whole. (From here: )www150.statcan.gc.ca/t1/tbl1/en/tv.…
Oct 20, 2023 • 10 tweets • 4 min read
Thrilled that my paper on an Alberta Pension Plan was accepted for publication in Canadian Public Policy! 🥳

While it will take time to appear in the journal (March issue), the final version is here: #ableg #cdnecon 🧵 🤓papers.ssrn.com/sol3/papers.cf… In the paper, I develop a detailed model of an APP using the latest data and clear methods. It's also the foundation of the @FONCanada APP simulator: financesofthenation.ca/2023/10/03/a-n…
Oct 17, 2023 • 11 tweets • 5 min read
Today's data: inflation 📈 ! The Daily — Consumer Price Index, September 2023 ()

Despite an acceleration in gasoline (as expected) the overall pace of price growth slowed to 3.8% in Sept (down from 4% in Aug). #cdnecon #cdnpoli statcan.gc.ca
www150.statcan.gc.ca/n1/daily-quoti…
Image On a monthly basis, the seasonally adjusted change in core inflation in Sept was good (0.1%) -- a welcome improvement over July and August. I'll unpack some other developments in the thread below. Image
Sep 21, 2023 • 16 tweets • 5 min read
Should Alberta withdraw from the Canada Pension Plan? It's a major policy question with complex pros and cons. I'll help unpack the issues, based on a new paper I'm happy to share today! 🧵 🤓 #cdnecon #cdnpoli #ableg

Link to SSRN Working Paper: ssrn.com/abstract=45769… It's not a new idea. The Western Canada Concept Party (separatists) pushed for it in '82. And even earlier some in Alberta weren't a fan of the CPP in the '60s. The @edmontonjournal editorial page at the time was 🔥 !

Recent interest started in late 1990s.
Mar 1, 2023 • 4 tweets • 2 min read
Alberta's budget featured a large increase in spending, funded by royalties. The level of resource revenues required to balance is 16b (!) this year. Image Also interesting is the reversal not only in the government's spending restraint but also in its debt reduction plans. Basically holding the line now. Image
Dec 16, 2022 • 4 tweets • 1 min read
Still figuring out the details (lots of variables) but ON receiving payments appears largely due to developments in other provinces (esp. high mining revenues in QC).

'adjustment payments' are interesting again!! 🤓 I can finally update my EQ assignment for the @policy_school public finance students! They've been stuck in 2018/19 for years now... 2023/24 makes the calculation interesting again!!

Fun for me for sure. I don't know about the students.
Dec 9, 2022 • 26 tweets • 9 min read
Why is the Bank of Canada owned by the government? Because Alberta Premier William Aberhart invaded Saskatchewan.

A nerdy thread about the Bank and Bible Bill for #cdnecon, #ableg, and #cdnpoli. 🤓🧵 First, some background. The Bank of Canada was established in 1934 and began operations in early 1935. (Brief history here: bankofcanada.ca/about/our-hist…)

But it was a fully private entity, with roughly 12k shareholders across the country. Government owned no shares.
Nov 29, 2022 • 16 tweets • 6 min read
A widely anticipated, and interesting, development. What is going on? Should taxpayers be concerned? I'll explain. 🧵 #cdnecon #cdnpoli

First, here's the full picture of the Bank of Canada's finances for 2021 before all the fun started.

The Bank earns revenue from interest earnings on bonds that it holds. Expenses are (1) normal stuff, staff, etc., and (2) interest expenses, which I'll explain next. Image
Nov 3, 2022 • 4 tweets • 2 min read
The federal deficit this year is projected to fall to $36b from Budget 2022's projection of $53b. Here's the breakdown of what caused the change. #cdnecon #cdnpoli Hard to be precise, but it looks like the overwhelming majority of the increase in income taxes is due to high oil prices.

Corp income taxes up nearly $23b. That's almost two-thirds of the change. Oil & gas, mining, petroleum products dominate the increase in corp profits.
Oct 26, 2022 • 9 tweets • 3 min read
The Bank of Canada's communication challenges will grow in the coming months. In the rate announcement, for example, they say 'no meaningful evidence of price pressures easing'. Yet, in the MPR, they provide clear and unambiguous evidence that price pressures are easing. ImageImage This isn't just nitpicking, it's an important head scratcher. They say clearly that rates will need to rise further *because* inflation is persistently high (sorta). But their own projections are for it to fall back below 3 percent by Q4 2023. Image
Sep 13, 2022 • 15 tweets • 6 min read
Inflation has many concerned, and it's a complex issue. So I'm happy to share some results of work with my colleague, Prof. Sonja Chen: papers.ssrn.com/sol3/papers.cf… Not yet peer-reviewed, but there's some interesting results I'll preview here. 🧵 #cdnecon #cdnpoli First, it's important to appreciate that rising inflation is accounted for by a few specific items. Had energy and shelter prices, for example, not increased then overall inflation would have been 4.1% in July rather than 7.8%.
Sep 1, 2022 • 10 tweets • 2 min read
Some in AB's Govt are saying the surplus is due to "fiscal discipline".

All govts will spin, of course. That's what politicians do. But this claim is way off. 🧵 Quick note to start: I'm interpreting the claim of "fiscal discipline" as deliberately, and in some case explicitly, setting up a contrast w/ former govt.

Obviously if we spent 500b digging holes and filling them in again we'd have a deficit; so "discipline" has a role.
Jun 23, 2022 • 13 tweets • 4 min read
Today's high inflation is regressive. This point has been made by many, but I thought some numbers might help. 🧵 #cdnecon I estimate the effect of price increases on household disposable incomes here 👇. The high rates for May (reported today) are like a nearly 10 percent reduction in the disposable incomes of the lowest income families. Let that sink in a moment.
Jun 22, 2022 • 4 tweets • 1 min read
Inflation pressures are broad-based, to be absolutely clear, but this is worth noting: if shelter and energy prices remained flat since last year, I estimate headline inflation would have been 3.2% in May instead of 7.7%. #cdnecon This is not to deny the financial pressures that price increases create. But it shows that the biggest pressures are narrowly concentrated. This may matter for policy makers trying to figure out where to direct efforts and to understand what is going on.
Mar 16, 2022 • 7 tweets • 3 min read
Today's data: inflation! 📈 CIP increased by 5.7 percent in February compared to one-year earlier; 4.4 percent if energy excluded. www150.statcan.gc.ca/n1/daily-quoti… #cdnecon Price increases are also broad based across many product categories. Approximately two in three items within the CPI saw price increases above 3%.
Feb 24, 2022 • 9 tweets • 3 min read
This time last year, Alberta was anticipating an $11b deficit for 2022/23. Now, the government expects a surplus of $511 million ($2.3b excluding contingency).

Massive turnaround. Here's a decomposition of the relevant changes. #ableg There will be two competing stories out there. Both have elements of truth.

1) The government had little to do with the improvement. It's all oil prices.

2) The government's fiscal/economic policies made today's surplus possible.