CWB Bank

[Vader]

Everest,

posted Nov 27, 2004 17:19
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The options for the disposition of the Government hopper car fleet are:

a) status quo
b) commercial sale
c) give to FRCC for $1.00

Option b) gives the railroads the opportunity to acquire the cars and pass all the costs associated on to farmers through the revenue cap.

Option a) allows farmers to continue to receive the benefit of the cars at no cost

Option c) is better than option b).

Funding the FRCC has prevented option b) and has saved farmers millions of dollars. It would appear that the "loan" to the FRCC might have been money very well spent even if it is never paid back.

[TOM4CWB]

Vader;

You avoided Everest's question again!

Should the CWB be lending money to outside groups... when it has no mandate in law... to lend money in this manner?

[Vader]

I answered with my opinion which is not a legal opinion. If you want a legal opinion you are asking the wrong person. I believe it was the right thing to do and that it made money for farmers. Maximizing returns to farmers should be the overriding principal - in my opinion.

[Incognito]

Dont give the rheotical "Lorne Hehn" response:

"Maximizing returns to farmers should be the overriding principal"

If that is the case, what has been done to protect farmer's returns in the face of a CAD dollar that has risen over 25% in two years?

[Incognito]

scuse the spelling...lol

[freenorth]

Hey Vader what happened to the CWB line that goes something like
" we return all money from sales less administrative costs to farmers"
They wouldn't bend the truth and s... t....r.....e.......t.....c......h their mandate
would they.

One day the future will be brighter.

[boone]

Post:There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things.
:Machiavelli

Does anyone have all the answers? The easy decisions have all been made, let's work on the difficult ones.

[Vader]

Incognito. If you have knowledge of the CAD what is stopping you from hedging it yourself?

[Incognito]

Absolutely nothing is stopping me.

Where is the power of the single desk?

AWB praises its currency hedging program and the CWB blames a rising dollar for lower prices. Why the dichotomy?

If the CWB is not hedging currency risk, then tell farmers that currency risk is their responsibility.

[freenorth]

The CWB loves to praise itself for equally sharing returns through the pooling system with all producers yet by playing Banker with our money
it is giving special status to certain farm organizations over others.
Is this the role of the CWB to collect from the masses to redistribute
to certain political supporters? Sounds more like a tax collection arm
of the government than a marketer!!!

How long will this silliness be allowed to go on for and what will they
spend it on next now that they think they can.

[JD4ME]

Out of curiousity and some level of sense, has anyone rather than debate this heresay actually either phoned their FBR's or even their director and asked them about whether this is true or not and the rational behind it if it is. If it is true and it's an interest free and non repayable loan as stated as much as I support the FRCC I'd be raising hell with my FBR and letting him/her know about it. If it has to be rapyed by the meber groups of the FRCC if the deal doesn't fly thats a different story. Remember though when the Vice president of CN stands up and try's and weakens the claim of the FRCC on the cars it's not his own personal money he spent to get to Ottawa to lobby either.

[freenorth]

JD4ME I have verified these loan numbers from an informed respectable
source within the CWB. There will also be information regarding this in Hansard when it becomes available from the testimony to the Ag Committee of Parliament regarding this. I didn't make this up. Even Vader doesn't dispute the numbers.

The $35000 was to assist FRCC in start up and then two additional loans
of $50000 which are forgiveable if they don't get the cars. You can't send
people to Ottawa as often as they do without having some financial
assistance from somewhere.

[Vader]

If there is a dichotomy between the CWB and the AWB it is in part due to the fact that the AWB collected 800 million dollars from its farmers and put it into a capital fund. This allows them to backstop their financial activity. The only backstop the CWB has is the government guarantees on it borrowing.

Is it true that the AWB actually lost a bunch of money on its risk management strategy a few year back?

[Vader]

Freenorth,

Do the directors of the CWB "stretch" their mandate? I found in the CWB act the following.

The board of directors shall direct and manage the business and affairs of the Corporation and is for those purposes vested with all the powers of the Corporation.

Spending producers money to keep the hopper cars out of the hands of the railroads becomes an administrative expense. One that I would say produced significant net savings to producers. What is the total value of the hopper car fleet and what would it have cost us producers annually had the railroads acquired that assest in a commercial bidding process? Certainly the railroads would have passed that purchase price directly on to us through the revenue cap.

[freenorth]

Vader:

I'm sure the Directors of the CWB can find many ways to attempt to justify
doing just about whatever their social principles may be. However for those of us without the freedoms of other Canadians operating in the
ghetto area of the designated wheat board we find their constant
entray into areas of trransportation and farmer advocacy repulsive, and
beyond their mandate.

Espescially when they're using our money to achieve goals contrary
to our opinion.