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Outlook OUTLOOK is published each Saturday by the HILLS HERALD Home Newspaper of A Division Canadian Newspapers Company Limited at Guelph Street Georgetown OnUrio L7G 8772201 PUBLISHER K Robert Malcolmson EDITOR Brian MacLeod AD MANAGER Dan Taylor Second Class Mail Registered Number 8778822 STAFF WRITERS BenDummett SPORTS EDITOR Colin Gibson ACCOUNTING Jennie Inga Shier CLASSIFIED ADVERTISING Joan Mannall ADVERTISING SALES Jeannine Valois Roberts PRODUCTION DEPARTMENT Dave Hasting Gilson Susanne Wilson CIRCULATION Marie Shadbolt 15 prime rate could happen SNAFU Bruce Dianne Matey YourButinus A per cent prime lending rate Analysts say it could happen Shortterm interest rates are the highest they have been since 1962 Back then the prime was on its way down from a high of more than per cent The message should be clear The countrys money authorities want us to stop borrowing At Thursdays setting the Bank of Canada rate climbed more than a tenth of a percentage point to per cent The bank rate is set a quarter of a percentage point above the yield on threemonth Government of Canada treasury bills Over the past week banks and trust companies have raised their shortterm mortgage rates again Oneyear mortgage loans cost per cent at most lenders Short- term deposit rates have risen as well The prime is the chartered banks benchmark lending rate It serves as a base for business and consumer loan rates The bank rate is what the central bank charges for infrequent loans to troubled commercial banks Historically bankers have kept the prime threequarters to percentage points higher than the Bank of Canada rate on average SPREAD NARROWS With the prime at 1425 per cent the spread has narrowed to the point where another surge in market rates will push up ad ministered rates That is not to say market rates necessarily will rise further Their direction depends on trends in the global marketplace Of key con cern are currency fluctuations Central bankers often raise their interest rates to support the value of their countrys exchange rate John Crow governor of the Bank of Canada and Michael Wilson finance minister say they are keeping interest rates high to curb inflation Price rises are fuelled by borrowed money Indeed the money supply has been growing mightily over the past year This explains why Mr Crow and Mr Wilson are so ner vous Demand for loans is strong thereby adding to the money supp ly- HOME LOANS STRONG The great growth in the money supply is being fuelled by demand for mortgage money This money is being used to buy houses at in flated prices At the same time a cash shor tage is forcing more consumers and businesses to go to their banker hat in hand Business and consumer loan growth is strong although it has slowed lately As long as this continue Mr Crow will be right In keeping interest rates high But must they be a full percen tage points higher than they are in the United States After all the Americans are reckless spenders too Perhaps more so than most Canadians The historic spread between Canadian and US interest rates points in one direction only the Canadian dollar In the past spreads have widened this much only in times of dollar crisis Could Canadas high interest rates be masking an underlying weakness in the Canadian dollar Next we will look at a looking dollar crisis and why Canadians should hold some of their in vestments in US dollars Poets Corner Submissions to the Hills Herald Poets Corner should be ad dressed to Colin Gibson Poetry Editor A name and address must ac company the poem for verification purposes Pen names are allowed if requested FROM IN THE NIGHT From in the shadows came a lonesome moan Taunting haunting and dominating over all other senses A tightly woven forest melts Into the night Holding molding and embracing all that dare enter its domain A sudden rush of mystical wind carries with it aromas of a wood ed crypt A chattering of branches echoes of fear and insipid depths Its essence being stripped From in the darkness came a mournful cry Softly summoning the warm soothing rain like tears A riling mist pretends to hide for tune and faction Of a brutal valballa only a fool would contend Mystery ends with the rain and the forest welcomes tales Of long forgotten light Final submission the nocturnal fabrication admittedly Ends with the apostolic night Smith Hills SUMMER SNOW I walk along my pebbled street my shadow shimmering in the heat Kids ride teetering bicycles by Im moggy Sticky and wonder ing why that half a year later I fondly remember breathing the freshest cold air of December When winter approaches Ill look on to June and thirsty summer afternoons I lie In my garages shade sipping the Iciest lemonade I only wish I could forget theres several months of sum mer yet I enjoy summer whenever it snows and think of the winter long after It goes the strange fact Is as you can see I like both seasons equally By CH Raymond Hills Your great great great great grandsons going to be a corporate raider whatever that is Publicity hounds like Bushs wrath Kevin Bell Washington Bureau that she and first dog Millie loved the stuff Broccoli growers were delighted Washington can be a strange ci ty Its a city where earning the presidents wrath can do wonders for you Consider Richard Gephardt and broccoli for instance Both are do ing well because the president doesnt like them A recent speech by Gephardt the Democratic majority leader in the ouse earned frontpage coverage in some newspapers because of his virulent attack against President George Bush Normally Gephardts speech would have been forgotten in a few days but Bush took exception to being called a wimp He unleashed his Republican at tack dogs namely party chairman Lee Atwater and Senator Alan Simpson and Gephardt was viciously denounced by just about every Republican who had an opi nion to offer Instead of defusing the Issue the attacks put the spotlight back on Gephardt who was invited to repeat his charges on several weekend talk shows What could have been a oneshot speech turned into a gold mine of publicity for Gephardt who didnt mind the attention at all It was a lot like the recent broc coli flap When Bush said he didnt want broccoli served on Air Force One some sharp broccoli growers in California saw their golden op portunity In a lavish publicity stunt tons of the vegetable were shipped here for Washingtons homeless First Lady Barbara Bush accepted a bunch from the growers and ad- Washington is also a city where an insignificant stunt over a harmless vegetable can grab headlines For day the broccoli story was a big item on the local news Newspapers devoted stories to the presidents eating habits and even ran a few broccoli recipes to try to tempt Bush One prominent commentator went so far as to devote an entire column congratulating the presi dent for finally being decisive on something even if it was just broc coli Washington is a city in the throes of mourning its growing global ir relevance while dramatic events are taking place around the world Journalists are fleeing in search of important news as Capitol Hills in ternal squabbles seem increasing ly unimportant Some have even looked to Canada Our constitu tional turmoil was beginning to be noticed by some large American newspapers But then came the medias love affair with the broccoli story It was a story that reporters could finally sink their teeth into but the media obsession with a presidents dietary dysfunction may have pro vided more proof that the city is in deed becoming irrelevant Washington is also a city where bureaucrats and politicians try to fuzz the meanings of the English language State Department spokesperson Margaret recently responded this way when asked if Secretary of State James Baker was becoming impatient with Israels delay In responding to his peace proposals Secretary Baker in his testimony before Congress said that the time to act is now He did not define Bouchard is slow on the environment When Bouchards en vironmental bugle sounded this week it played the Retreat The longdelayed strategy paper released by the federal environ ment minister offered more ques tions notably about public will ingness to pay for pollution cleanup than solutions Con fronted by obstinate bureaucrats and powerful lobby groups Ot tawas progreen forces backed off Thecontent of Bouchards discussion paper which will now go out for public comment was a blow to those who seek swift action to clean up the environment But it doesnt mean the bugle should now start playing The Last Post By all accounts Bouchard is per sonally committed to tough action to reverse the degradation of the environment Unfortunately for him the political timing may not now be in his favor Last year polls suggested tax payers were willing to pay addi tional taxes to protect the environ ment Buoyed by that response one draft of Bouchards strategy leaked in November called for an environmental levy on oil and gas to be used to repair damages aris ing from the burning of fossil fuels This was a measure suggested by an assortment of environmental groups It was frowned upon however by Energy Minister Jake Epp and attacked by opponents in side the federal public service TAX AN OPTION But Bouchard seemed open to the Idea of taxation to fight pollu tion About weeks ago he acknowledged public support for a socalled dedicated tax one specifically for environmental pro tection rather than general federal spending He referred to it as a green tax which could be more generally applied as opposed to a carbon tax that wouJd be restricted to users of oil gas and coal While evidently preferring a green tax he did not rule out the possibility of a carbon tax Recent soundings however sug gest a shift in the publics support for such taxes In early March a poll commis sioned by Bouchards department found thai taxpayer rage over the proposed goods and services tax GST had eroded previous back ing for a dedicated environment tax Rather than pay more even for the environment the respondents said theyd rather see Ottawa rear range its spending priorities The poll reflected some suspicion that the federal government was not truly committed to cleaner air and water Its possible that by next fall when public industry and provin cial government consultations are concluded and the final version of Bouchards plan is written the mood will have changed again But thats likely a dream What else do you expect in a city where city planners named streets after the alphabet but somehow forgot to include a J Street