What we're talking about when we talk about "rule of law"

As every good Canuck knows, nobody does rule of law rulier or lawier than we do. Look up "rule of law" in the encyclopedia and there's a picture of a little beaver waving the Maple Leaf.

That's us!

"Rule of law" has become a get-out-of-jail-free card for those who make our laws and rules.

Wanna slap Meng Wanzhou in the slammer for a couple years to disabuse the Yellow Peril of their fantasies about 5G dominance? Rule of law! We had no choice!

A jerk-off US hedge-fund titan loots Sears Canada for billions and leaves 16,000 Canadian pensioners in the lurch? Rule of law! We had no choice!

Another US hedge-fund titan adds billions to the value of CP Rail by killing over five thousand excellent Canadian working class jobs. We are so grateful we thank Bill Ackman for making this Canadian icon more efficient, and gift him a couple of billions as a token of our gratitude.

We had no choice... rule of law!

But nothing throws into relief our attachment to rule of law quite like the Wet'suwet'en debacle. At least we've cleared up one of the great mysteries of this rule-of-law juggernaut.

When we talk about rule of law, we talk about the rule of White Man's Law.

Yup, all of Justin's vacuous twaddle about reconciliation and mutual respect and nation-to-nation dialogue is going down the shitter even as I type these words.

Now he's asking  our FN neighbours, living with the legacy of 400 years of betrayal and broken promises, to be patient. At least he's being even-handed; that's also what he's asking of the non-natives who have been inconvenienced by the rail blockade for a couple weeks.

We are, after all, a fair and just nation, governed by the rule of law...

Oopsie! There goes another CPRail train off the rails in a ball of fire...

Seems we've seen a lot of CPRail disasters in the news recently.

A few years ago they were in the news a lot too, but not because of their horrendous safety record. No, the story then was all about how two American business geniuses turned CPRail around. Destroying the old culture at the company, their stated aim, payed off big time. Bill and Hunter waddled away with a cool two billion for their efforts.

They were able to add all that value to the company by shedding five thousand workers and ten thousand rail cars. Make the trains longer. You don't need nearly as many locomotives. Let the trains run faster too.


Do you think there could be a connection between that story and today's?

Would Justin have prevented the great CPR boondoggle?

In case you don't remember, that's where the Harper gang allowed hedge fund sharpie Bill Ackman to destroy the iconic CP Rail with a mere 14% share-holding.

It's called "activism."

Bill Ackman is an "activist investor."

Well, that can only be good.

Nothing like an "activist investor" to shake things up a bit...

By eliminating 5000 jobs.

By making the trains longer and making them go faster.

Hey, sounds like a winning formula to me!

The quiet death of a Canadian success story

Sentinelle Medical was a cutting edge manufacturer of MRI technology based in Toronto. It was spun out from the Sunnybrook Research Institute where its technology had been developed with a combination of public and private investment. It was an innovative leader in the field of MRI technology used in breast cancer screening.

In 2010 the promising upstart was bought out by American health-care tech conglomerate Hologic for $85 millions. Sentinelle remained a largely independent entity within Hologic and kept its operations in Toronto.

In November of 2013 so-called "activist investor" Carl Icahn bought 34 million shares in Hologic, which gave the hedge fund tycoon about 12% of the company. He promised to shake things up to "unlock shareholder value," which is another way of saying he was going to slash and burn whatever he could to goose the share price and make himself wealthier. Apparently the one thing billionaires never have enough of is money.

How Icahn and his ilk can pull off their rapacious plundering with relatively minor stock positions isn't that much of a mystery. The business press tends to portray "unlocking shareholder value" as an altruistic public service, regardless of how much damage is done to the company, its employees, and the communities they are a part of. As in the case of the Ackman takeover of CP Rail, accomplished with a mere 10% ownership position, the other shareholders tend to shut up and go along for the ride.

The new Icahn installed board of directors at Hologic deemed Sentinelle to be insufficiently lucrative, and by late 2014 Sentinelle found itself in the hands of Inviro, the health and wellness division of Philips, the Dutch multi-national of light-bulb fame.

The Toronto operations were promptly shuttered, throwing the Canadian employees out of work.

At least they can take comfort in the fact that Mr. Icahn did indeed unlock shareholder value; his holding in Hologic is worth about $500 millions more today than when he bought in a year and a half ago.

CP Rail kills 5,000 jobs, can't figure out how to spend ensuing cash horde

That's quite a conundrum facing the management team over there at CP Rail. Hitman Harrison takes a perverse pride in having eliminated close to 5,000 good Canadian jobs. That's 5,000 folks no longer getting a paycheck, and even a simpleton realizes that if you don't have to pay that cash out to lazy-ass Canadian workers, well, ya gotta do something with it...

For the Ackman-installed management team those savings add up to somewhere between 300 and 400 millions of dollars per year; perhaps a little more.

What to do, what to do?....

Hunter Harrison himself was ruminating during a recent speech about who was going to pay to replace those exploding DOT 111 tankers. A casual observer might be tempted to draw a line linking a railroad's surplus cash to the unsafe oil tank wagons they are pulling back and forth across the country, but that would be just a tad too obvious. They didn't pay Hunter a $50,000,000 signing bonus to invest in safety, for Gods sakes!

Thankfully, Hunter came to his senses a few days after those careless ruminations. Instead of investing in safety, or figuring out a way to get Canadian farmers' bumper grain crop to market, he's come up with a meaningful way to meet the needs of CP Rail's American shareholders - a share buy back.

Share buy-backs are perhaps the most useless and counter-productive investment strategy when it comes to investing surplus cash. Doesn't enhance the company, doesn't open doors to new business opportunities, doesn't do a damed thing except goose the share price.

Ergo, the share-holders love it!

The biggest shareholder of CP Rail is of course US hedgie Bill Ackman and his Pershing Square fund.

That's job one for CP Rail today. It's no longer about trains or jobs or getting grain to market.

It's about meeting the needs of American hedge funds.

Canadian Pacific Railway sees 26% surge in accidents

That's the headline the pros at the Globe and Mail and the Financial Post forgot to write.

When CP Rail released their Q2 results a few weeks ago the business press was full of adulatory twaddle over the phoenix-like rebirth that the genius Bill Ackman and his hired gun, Hunter "Hitman" Harrison have engineered at the railroad.

Revenues up! Net income up! Earnings per share, up up and away!...

Hallelujahs abounded and champagne corks popped as the journos outdid themselves lavishing praise on the "activist investor" and his hatchet-man.

In fact, they were so busy praising the results that they entirely forgot to mention the other item that's taken an impressive leap; The FRA train accident rate.

Right there on page 20 of the Q2 report; the year-to-date accident rate per million train-miles was 1.51 in 2012 and 1.91 this year, an increase of over 26%.

Given that this stat came out barely two weeks after the Lac Megantic disaster, one would think that the newshounds would be all over the revelation that CPR's accident rate has gone up 26% while thousands of employees were being pink slipped.

An accidental oversight, I'm sure.

Hot stock tips for Louis Proyect

Don't know how "hot" these are Louis, but I'm always keen to help out a fellow traveller.

I made a list of stinkers to avoid not too long ago.

Postmedia Networks would be a lovely short play if you can find any shares to short. The company is essentially bankrupt, but the corpse is still twitching and probably will for a while longer, but in the not too distant future the company will be but a distant and not particularly fond memory.

I'll admit I missed the boat on Facebook. They've actually regained their issue price since I wrote that. Still think they're vulnerable when the NEXT BIG THING pops up.

Now I don't know to what extent you're a big picture guy, Louis, but somewhere along the line these big gold companies are going to be a buy opportunity. Barrick is around $17 now. There is an awful lot of bullshit around all the gold miners. They've been doing write-downs like crazy because the price of gold has gone from $1,900 to $1,300.

Here's the mystery; all that stuff they are writing down was in the planning stages years ago when gold was well under $1,000. I think a lot of these write-downs are essentially fraudulent. The big boys could come out of the grave in a hurry any time. I suppose a lot depends on how comfortable you are owning shares in companies that are implicated in the most egregious abuses of the environment and human rights in their host countries.

And of course the multiple billions that will eventually have to be coughed up to cover the Lac Megantic disaster threaten Bill Ackman's magical turn-around at CP Rail, so you might want to consider that as a short.

That's not much, but I hope it helps.

In solidarity,

Calgary mayor blasts CP Rail over latest disaster

As well he should.

Naheed Nenshi is apparently bold enough to draw a line from CP Rail's layoffs of thousands of workers and the fact that their trains seem to be falling off bridges and tipping into wetlands and rivers with alarming frequency.

Hedge fund boss Bill Ackman recently announced that he plans to sell off about a billion dollars of his CP Rail holding. His miraculous "turnaround" at the railway consists of making the trains longer and firing thousands of workers.

Mayor Nenshi asks a serious question and deserves an answer; how many bridge inspectors have been fired?

"Activist investors" pee on rug at Tim Hortons

Those "activist investors" are at it again, this time hoping to shake down the venerable Canadian donut chain for a few easy millions.

I wish the media big-boys would drop the "activist investor" bullshit and call it like it is. These aren't activist investors, they're opportunistic shit-bag hedge fund managers looking for an easy score.

The reason they keep doing it is because it keeps working. Bill Ackman made his hedge crew a couple of billions with a relatively small stake in CP Rail.

Einhorn and company took a run at the Apple cash hoard with a similarly insignificant share position.

Why do the management types cave to this kind of blackmail?

I think it all has to do with where the MBA grads get hired. All your top guns from schools like Wharton go to the hedge funds. The guys from the fringe schools go into public service.

There's a vast pool of graduates from the middle tier who end up in the corporate sector. Secretly they all wish they worked at the hedge funds. That's because at Tim Hortons or Apple a middle management MBA can make a really good dollar...

But at a hedge fund they can get stinking filthy rich really fast!

That's why when the hedgies come a calling, the management guys at these target companies just smile and bend over.

Another CP train goes off the tracks, but it's just a "little" oil spill

So don't worry about it.

Hatchet-man Hunter Harrison tells us CP Rail is "investing in technology to limit derailments."

Whew! In the nick of time, I might add!

Since he's axed 4 or 5 thousand of the guys who used to maintain those tracks I guess it's a good thing derailment-limiting technology is available to take their place.

Mr. Harrison has reaped a $50 million windfall since he climbed aboard Bill Ackman's plan to goose the share value of the venerable CPR.

Bill is doing that by firing all the workers and making the trains longer. Why did no one think of that before?

I'd guess because they were interested in running a trans-national railway in a socially and environmentally responsible way, which everybody knows doesn't cut it in this day and age.

Anyway, this makes it three spills in three months for Bill and Hunter and the little railway that used to could.

But watching the Bill and Hunter show has become a lot like watching NASCAR; we know "the big one" is coming.

Bill Ackman's "vision" for CP Rail already fraying around the edges

Not that Ackman ever had a vision for CP that went beyond making a quick buck.

Business media were over-the-top today in praise of the quick turnaround Ackman has engineered at the railway.  Hunter "Hitman" Harrison, the Ackman installation as Chief Engineer, was busy bragging that  things were going so swimmingly that pink-slips might go to 6,000 from an initially projected 4,000.

Alas, late in the day the Montreal Gazette dropped this stinker into the celebratory punch bowl. Seems the outfit that runs Montreal area commuter trains has a few issues. They can't get their trains to the station in time with any consistency because of the newer leaner CPR's "...poor track-maintenance planning, switching errors, and communication problems. Strained relations between CP and its employees are another big part of the problem..."

Well whadya know... maybe you can't run a railroad without people after all?

Ackman's vision for CP Rail vindicated by record quarterly results!

Read it and snivel, Ackman haters. Bill Ackman's vision, being executed by $50 million man Hunter Harrison, has left the doubters in the dust.

Profit up by over 50%!

Most profitable quarter in the history of the 130 year old company!

This should secure Bill's place in the pantheon of top hedgies once and for all!

Ackman's "cost-cutting" at CP Rail; 50 million for the new CEO

Outgoing CPR CEO Fred Green would have had to work another ten years or more to get the kind of green Harrison Hunter scored in his first year at the venerable Canadian railway.

Hunter's first year compensation is reported to come within a whisker of 50 million.

That of course will come out of the hides of the 4,500 CPR employees scheduled for redundancy in the next couple of years.

But what the hey, everybody knows you can let track maintenance slide for a few years. And squeeze a few more years out of those rail cars that were scheduled to be replaced. And whatever lawsuits result from the horrendous accidents that will inevitably result from all this cutting will take so long to drag through the courts that Bill and Hunter will be long gone by the time the shit hits the fan.

Long gone with their pockets bulging with cash... long gone with the applause of the Canadian business media still ringing in their ears.

Hedge funds, share floats, and the megaphonies

Correct me if I'm wrong, but on the face of it David Einhorn and his hedge fund own about .1% of Apple.

For that .1% they seem to be getting an inordinate amount of press.

Google "EinhornApple" to see what I mean.

And even though they've dropped their gratuitous legal action, it's plain to see that the strategy here is to use the media as a megaphone to influence share price.

Bill Ackerman plays a similar game. Although he didn't have the decency of being in the stock for a couple of years (unlike Einhorn), he relied on the media to trumpet his concerns for greater efficiencies at CP Rail.

The media were his most accommodating co-conspirators in his coup at CP.

That "activist investor" schtick is getting kind of stale.

The folks at the Globe and the Star should be more than conduits for hedge fund press releases. 

You're fired... and have a Merry Christmas!

That's the fare-thee-well some 1,700 CP Rail employees got this week, with a further 3,500 put on notice that this would be their last Christmas with the company.

The self-proclaimed "new sheriff in town" is showing the workers what he's made of. Hunter Harrison is no bleeding heart sentimentalist. He's been brought in to turn around CPR's "spoiled, bad, horrible culture." What better way to impress upon the workers that times have changed than to announce massive lay-offs three weeks before Christmas.

The media love this stuff. The fawning over Harrison and his boss, "activist shareholder" Bill Ackman has been nothing short of revolting.

Story after story portrays the duo as heroic knights who have ridden to the rescue of a struggling CPR in the nick of time. What rubbish!

CPR was consistently profitable before the "activist investor" began accumulating his 14% position in the company. Ackman then began to agitate for a change in management, which he won in a proxy battle earlier this year.

Out with the old, in with the new, and thanks for the memories, you 1,700 we don't need on the payroll anymore.

This is yet another sad example to underline the point that any notion of a "social contract" is dead in today's corporate climate. You don't fire those 1,700 employees because the company is struggling, but simply because you can, knowing that the news is going to further goose the share price, which in the end is all that Harrison and Ackman are concerned about.

It's the same logic that allows Caterpillar to close a profitable operation in London because workers in Indiana have been sufficiently beaten down to do the same jobs for less. It's unnecessary from a business point of view.

The long term interests of the workers, their communities, and even the company can all be sacrificed to the short-term greed of these corporate rapists.

And their shills in the media do nothing but applaud.