Global Oil Bust Claims a Neocon Scalp: Canadian PM Stephen Harper Resigns as Conservatives Lose, Son of Late PM Pierre Trudeau to Become Canadian Prime Minister

The global oil bust that has hit Alberta's oil sands industry and all petrocurrencies hard -- including the Canadian dollar or looney -- has cost Stephen Harper and his Conservative Party the Prime Minister-ship in Ottawa. While a Canadian once told me that Americans probably could just as easily name coffee and donuts chain founding hockey player Tim Horton as to correctly identify Harper as her country's PM, the fact is Harper's downfall is a clear sign of the times. As is the family name of his likely successor, Liberal Party leader Justin Trudeau, son of the (in)famous socialist-leaning and Moscow-friendly French-Catholic 1970s and early 80s PM Pierre Trudeau (who liked to use the Russified nickname for Justin's brother Alexandre "Sasha"). [embed]https://twitter.com/RLause/status/656306225005506560[/embed]

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Of course, there is little reason to think Prime Minister Harper's foreign policy, with its macho posturing about taking on the Russians in the Arctic or dispatching Canadian troops to train Ukrainian National Guardsmen how to kill Donbass native rebels played much of a role in his downfall. It's far more logical to assume as in most modern Western elections economics was the main issue.

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The decline in the price  of oil, driven in part by Saudi refusal to cut OPEC production and the real global economy being in recession if not depression in most importing nations, took the wind out of Mr. Harper's sails in his electoral stronghold, the western part of Canada -- particularly in the petro-region of Alberta.

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Over the past generation, a growing wave of South and East Asian immigration has changed the demographics of Ontario, Canada's most populous province, and made it more socially if not economically liberal since the 1990s. British Columbia, with most of the population clustered in Vancouver and on nearby Vancouver Island north of Washington State's Seattle-Bellingham I-5 corridor, has also seen an influx of Chinese property buyers living up to its nickname 'Hongcouver', despite the economic slowdown in China. Unfortunately for the Chinese and other foreign investors pouring money into a bloated Canadian real estate market, it looks like the property bubble is about to burst and it's already popped in the Albertan oil industry hubs of Calgary and Edmonton.

As we mentioned at the start of this piece, just as the ruble has suffered from the oil price drop, so too has the Canadian dollar or looney has depreciated from 87 cents to a measly 77 cents versus the greenback in the last twelve months. That might not seem like a big deal. It might even appear to be a boon for American tourists who want to go skiing in Whistler or visit other parts of Canada this winter. But the fact is Canadians import a massive amount of stuff from their huge neighbor and top trade partner, and 75 percent of Canadians live within 100 miles of the U.S. border. Which means consumer inflation in Canada is acutely sensitive to CDN depreciation to the USD, and as in the U.S. cheaper gasoline hardly makes up for the quality job losses in the depressed oil and gas industry or inflation.

Nonetheless, some currency traders seem to think the looney can rally if oil prices creep back up, especially if there's more turmoil in or around Saudi Arabia in the Middle East. As always when trying to day trade currencies especially squeezing bips out of the most traded pairs like CDN-USD or USD-JPY USD-EUR, consult the experts before wading in (especially check out hour two of the October 13, 2015 Guerrilla Radio show on Forex).

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The Canucks are coming, the Russians are really scared! Canadian wartime newsreel style propaganda, April 2015

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Canadian PM Stephen Harper in Kiev, Ukraine getting pestered by Petro Poroshenko for weapons in June 2015

[embed]https://twitter.com/CanadaNATO/status/646563478149402624[/embed] While Harper did his best to antagonize Russia, if one searches for any foreign origins of his political defeat, it would be found in Canada's fastest growing trade partner, China.

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The @CanadaNATO twitter feed has been a particularly obnoxious shill for the 'democratic' US-backed Kiev regime

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Speaking late Monday night to a dual passport holding Canadian-American acquaintance who has followed Ottawa politics and the oil sands boom/bust for many years, we inquired about whether the Chinese (setting aside the so-called 'White Dragons', simply looking at the overt economic influence) may have played a role in knocking down Harper, who pursued a policy of confrontation toward Beijing's leading Eurasian ally Russia.

Our source, who has in-laws in Lebanon, was mainly buzzing about the stunning geopolitical repercussions for the U.S. and the Greater Middle East from Russian President Vladimir Putin's intervention in Syria. However, he did state that many Chinese and South Asian immigrants, particularly the highly educated and entrepreneurial whose incomes often exceed those of native Canadians, were angered by PM Harper's restrictions on family reunification. That is, a common immigration practice that one would think famously immigrant-friendly Canada would have no problem with, particularly when the U.S. doesn't place very many restrictions on the ability of permanent residents and naturalized citizens to sponsor their relatives.

Why Harper would antagonize such an affluent and influential Asian voting demographic while constantly pandering to the greater Galicia nationalists (like Prof. Taras Kuzio) among the Ukrainian diaspora in Canada, we do not know. Our knowledge of Canadian politics is very limited. Suffice to say though, PM Harper's political demise is yet another casualty of the oil price collapse accompanying the power struggle for market dominance in Eurasia and the global economic meltdown. And we don't expect the incoming Trudeau government to prioritize a new generation of Canadian icebreakers to compete with Moscow's nuclear powered fleet above the Arctic Circle.

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All the same, we don't expect any sudden or dramatic thaw between Ottawa and Moscow, just because a Trudeau will be moving in to 24 Sussex Drive (the Canadian equivalent to Number 10 Downing in London or 1600 Pennsylvania in Washington D.C.)

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