Alberta Politics & Government Thread 3.0

[Paulie Walnuts]

https://globalnews.ca/news/10981669/...age-room-stay/

[Fuzz]

Well it's been far more than 90 days since Smith promised to fix healthcare, so I guess this is what fixed means. I know it's easy to ignore when you don't need it, which for many people may be most of their lives, but for those that do it's an ever present reminder that the cruelty is the point. Please remember than next election. It doesn't have to be this way.

[Faust]

Alberta premier unveils new entity to oversee Heritage Fund

https://financialpost.com/news/alberta-heritage-fund

[Fuzz]

Originally Posted by Faust

Alberta premier unveils new entity to oversee Heritage Fund

https://financialpost.com/news/alberta-heritage-fund

So, a second Heritage fund with the same name as the first? And this one to be managed by a private corporation? But I thought AIMco was the best-est, and could manage all money everywhere? But now not this money?

This must be a pretty amazing company with a strong track record of investments, presumably in energy? And of course, Canadian. Ok...but at least they are Canadian so understand our unique issues, particularly in Alberta? Oh, they are American? Well then. I'm sure this will work out as well as all of her other brilliant ideas. Prosperity incoming!

[Looch City]

Seems like a lot of words just to say "we've found a new way to grift even more!".

[Fuzz]

I may have been hasty in my condemnation of experience, looks like they have two solid Alberta Boys, one who used to work at Aimco.

[Julio]

I am all for pumping up the Heritage Trust Fund, and applaud the government for, at the very least, not taking any income from it and letting it grow. This is something that should have been done decades ago.
I am wondering about their projections though...Looks like they are planning on an average 9% return every year?

[Slava]

Originally Posted by Julio

I am all for pumping up the Heritage Trust Fund, and applaud the government for, at the very least, not taking any income from it and letting it grow. This is something that should have been done decades ago.
I am wondering about their projections though...Looks like they are planning on an average 9% return every year?

Well, I'm fine with building this, but they're just out to lunch financially as usual. They can't even balance the budget as it is, so where they're suddenly coming up with gobs of money to stash away is a whole other conversation.

[Cappy]

Originally Posted by Fuzz

I may have been hasty in my condemnation of experience, looks like they have two solid Alberta Boys, one who used to work at Aimco.

And Peter Lougheed's kid is there too!

In any event, having a fund operating at arms-length from the government is a good thing, so i will give them points for that; although, why not just do that to the Heritage Fund?

For years the UCP has advocated for using Heritage Fund investments on Alberta oil and gas plays/companies, which is just putting all your eggs in one basket.

[Fuzz]

They committed to I think $2 billion in the budget for savings, so it sounds like instead of going to the Alberta Heritage Savings Trust Fund(AHSTF), it'll go to Heritage Fund Opportunities Corporation (HFOC). It kinda seems like there are limitations to how the AHSTF can be used that the UCP doesn't like, so they are starting a new fund so they don't have to follow those restrictions. And any time a government has to make an end-run around rules meant to protect citizen dollars, you should probably worry about citizen dollars.


I suspect in a year or two we will hear about how all deposits will go to HFOC now, and AHSTF will be a legacy fund surviving on existing investments. And in about 10 years we will hear about how terrible an idea this turned out to be.

[RogerWilco]

Originally Posted by Julio

I am all for pumping up the Heritage Trust Fund, and applaud the government for, at the very least, not taking any income from it and letting it grow. This is something that should have been done decades ago.
I am wondering about their projections though...Looks like they are planning on an average 9% return every year?

Danielle Smith knows a guy that can outperform the markets perpetually.

[Slava]

Originally Posted by Fuzz

They committed to I think $2 billion in the budget for savings, so it sounds like instead of going to the Alberta Heritage Savings Trust Fund(AHSTF), it'll go to Heritage Fund Opportunities Corporation (HFOC). It kinda seems like there are limitations to how the AHSTF can be used that the UCP doesn't like, so they are starting a new fund so they don't have to follow those restrictions. And any time a government has to make an end-run around rules meant to protect citizen dollars, you should probably worry about citizen dollars.


I suspect in a year or two we will hear about how all deposits will go to HFOC now, and AHSTF will be a legacy fund surviving on existing investments. And in about 10 years we will hear about how terrible an idea this turned out to be.

Yeah, you know, you might as well split things up and not take full advantage of economies of scale. You might as well start a new corporation and duplicate a bunch of things rather than just adding on the platform you already have.

[Fuzz]

Originally Posted by Slava

Yeah, you know, you might as well split things up and not take full advantage of economies of scale. You might as well start a new corporation and duplicate a bunch of things rather than just adding on the platform you already have.

Everyone knows efficiency gains are had by increasing management expenses. It's in the book. That's why AHS is going from one organization to an entire constellation of them.

[Mean Mr. Mustard]

Originally Posted by puffnstuff

An expert listed as a contributor to a pandemic review commissioned by the Alberta government has demanded his name be removed from the task force’s report recommending a stop to#COVID-19#vaccines, while doctors across the country rejected the document as dangerous bunk.

I have worked with one of the doctors listed in the report, and at some point in between the cocaine and the repeated solicitation of colleagues for sex, he apparently went off the rails. Somehow, he became a voice of science to the extent as to where people absolutely despise working with him to the effect that it hampers communication and has resulted in patients having worse health outcomes. But he is apparently respected enough by the provincial government to be a coauthor on this report.

[Torture]

Her plan, laid out alongside Finance Minister Nate Horner, is that the fund will have a strong focus on maximizing growth “while supporting areas that matter to Albertans, such as technology, energy, and infrastructure.”

Horner added that some of the investments will be “beyond AIMCo’s mandate,” adding that they will be “more in a sovereign-wealth style,” which could lead to joint investments with other long-term sovereign wealth funds.

Sources say Smith’s idea to boost the returns of the Heritage Fund, which she has been speaking about publicly for months, were discussed with AIMCo before her government took the unusual step in November of ousting the entire board and the investment manager’s chief executive, Evan Siddall.

Then, in November, after the UCP government passed an order-in-council approving the incorporation of a provincial corporation for the purpose of managing and investing all or a portion of Crown assets, Smith told the Herald that “a hybrid investment strategy” was possible, with pension funds invested in a very conservative way while Heritage funds would be invested in a manner that would allow them to grow tenfold by 2050.

Not only are they duplicating all of the management and reducing economies of scale - oh and Joe Lougheed, son of Peter Lougheed is in charge. Neat story but I'm not sure how his experience as a lawyer qualifies him for this type of role? Guess all the investment bankers said no. Anyways, key difference - they want to be able to invest the money for Smith's pet projects. (Kevin O'Leary's AI nonsense comes to mind) Smith has mused about using the Heritage fund for local projects in the past. Of course, they say this is about 'maximizing growth' but this doesn't necessarily achieve that goal. It just allows us to take riskier bets, concentrate our risk in Alberta and likely increases our reliance on O&G. If these projects were such a slam dunk investment they wouldn't need this new entity to attract investment dollars.


Just like you should be worried if an investment advisor promises you outsized returns with no risk, the narrative about chasing higher returns should worry Albertans. Shades of /r/wallstreetbets - don't worry, we can get better returns than everybody else with no more risk. We're smarter than the whole investment market. Put it all in Bitcoin or Gamestop. Diamond hands to the moon!

[Slava]

Originally Posted by Torture

Not only are they duplicating all of the management and reducing economies of scale - this is the key difference. They want to be able to invest the money for Smith's pet projects. (Kevin O'Leary's AI nonsense comes to mind) Smith has mused about using the Heritage fund for local projects in the past. Of course, they say this is about 'maximizing growth' but this doesn't necessarily achieve that goal. It just allows us to take riskier bets, concentrate our risk in Alberta and likely increases our reliance on O&G. If these projects were such a slam dunk investment they wouldn't need this new entity to attract investment dollars.


All the narrative about chasing higher returns should worry Albertans. Shades of /r/wallstreetbets - don't worry, we can get better returns than everybody else with no more risk. We're smarter than the whole investment market. Put it all in Bitcoin or Gamestop. Diamond hands to the moon!

That's not true, though. They want to participate in deals with other sovereign wealth funds and that's the angle. This is another push toward independence. So, while the idea of duplication and all that is stupid, it doesn't mean that the investments will be into pet projects or things like that. A lot of the sovereign funds in the Middle East have been prudent (my opinion here) in diversifying that wealth because they recognize that the writing is on the wall and they need to find income for the future that is not just fossil fuels. Many of these mandates are much greener and sustainable.

On the sovereignty front, if this comes to fruition and Alberta has a fund with, say, $250bn sitting there, it will be very interesting to see how that is viewed in Canada.

[Roughneck]

Originally Posted by Slava

That's not true, though. They want to participate in deals with other sovereign wealth funds and that's the angle. This is another push toward independence. So, while the idea of duplication and all that is stupid, it doesn't mean that the investments will be into pet projects or things like that. A lot of the sovereign funds in the Middle East have been prudent (my opinion here) in diversifying that wealth because they recognize that the writing is on the wall and they need to find income for the future that is not just fossil fuels. Many of these mandates are much greener and sustainable.

On the sovereignty front, if this comes to fruition and Alberta has a fund with, say, $250bn sitting there, it will be very interesting to see how that is viewed in Canada.

...to save for the future, to strengthen or diversify the economy, and to improve the quality of life of Albertans.


That was the mandate of the Heritage Savings Trust Fund. Why the need for a second?

[Torture]

Originally Posted by Slava

That's not true, though. They want to participate in deals with other sovereign wealth funds and that's the angle. This is another push toward independence. So, while the idea of duplication and all that is stupid, it doesn't mean that the investments will be into pet projects or things like that. A lot of the sovereign funds in the Middle East have been prudent (my opinion here) in diversifying that wealth because they recognize that the writing is on the wall and they need to find income for the future that is not just fossil fuels. Many of these mandates are much greener and sustainable.

On the sovereignty front, if this comes to fruition and Alberta has a fund with, say, $250bn sitting there, it will be very interesting to see how that is viewed in Canada.

I don't know why AIMCO can't do this and we need a separate organization to invest in these projects, but either way, there's a lot of 'If's doing some heavy lifting here IMO.

Do you really think the UCP are not going to interfere in investment strategies (See: AIMCO can't get high enough returns and has woke DEI roles so we're going to fire the whole board and replace them with Stephen Harper - no wait, now we're going to set up a separate 'Opportunities Fund' because AIMCO can't provide the high growth we demand?)
And if that's the case they're going to let them invest in green energy projects to diversify our risk? Sounds pretty woke and leftist to me - don't think Smith'll be happy about that. She gets upset about solar panels and windmills in Alberta and now we're going to invest in those worldwide?
And if that's the case, we're successfully going to achieve outsized returns without the risk?
And if that's the case, we'll have enough funding that we are part of these conversations with sovereign wealth funds?
And if that's the case, that we're going to sit back and watch these returns pile up to $250bn without touching them? Nevermind the rest of Canada, if it were to grow to that point we'll get itchy fingers in Alberta for the money.

[GGG]

Originally Posted by Slava

That's not true, though. They want to participate in deals with other sovereign wealth funds and that's the angle. This is another push toward independence. So, while the idea of duplication and all that is stupid, it doesn't mean that the investments will be into pet projects or things like that. A lot of the sovereign funds in the Middle East have been prudent (my opinion here) in diversifying that wealth because they recognize that the writing is on the wall and they need to find income for the future that is not just fossil fuels. Many of these mandates are much greener and sustainable.

On the sovereignty front, if this comes to fruition and Alberta has a fund with, say, $250bn sitting there, it will be very interesting to see how that is viewed in Canada.

What restricts AIMco from doing these types of deals? What is a sovereign wealth fund style investment vs a regular Pension Fund investment?

[Slava]

Originally Posted by GGG

What restricts AIMco from doing these types of deals? What is a sovereign wealth fund style investment vs a regular Pension Fund investment?

Yeah, I agree with that. As I already posted, I think they could just add to Aimco instead of the new corporation. There are some significant differences between sovereign wealth and pensions, though. Pensions are managed to meet liabilities, and in the case of sovereign wealth, you're not doing that. As a result, the mandates differ from the outset, and the actual investments in each differ. Sovereign wealth has less of a liquidity constraint overall, so you see a lot of longer-term, illiquid holdings there as opposed to pensions that, for obvious reasons, need cash flows and liquidity to meet their mandates. Of course, there are similarities and some overlaps, but they are also different.