A learning arrived last week from TD Bank. “In order to go on to meet your banking needs …,” it began.
Try to guess what involved next. Hint: I’m a customer at a Canadian bank.
Sure enough, “We from time to time need to adjust our pricing.”
Unsurprisingly, the prices being adjusted were not being acclimatized downward.
As of March, the bank’s “non-TD ATM fee” is being raised 33 per cent.
Costs for cancelling an Interac e-transfer and for holding a post-dated cheque at a branch are affluent from free to $5. And the fee for transferring a tax-free savings account to another bank is active from free to $75.
These are huge increases, far in excess of growth or unique spending power.
Now, it’s important to understand TD’s position. The bank’s profits were $8.02 billion at the rear year, up only slightly from $7.88 billion the year earlier.
It remains only the second most profitable bank in Canada. Its shareholders definitely expect better.
No increase in U.S., mind you
It’s worth noting, though, that in the U.S., where TD is now a dour player, with more branches than in Canada, the bank downs to impose no fee increases on customers come March.
“Totally different setting,” a TD spokeswoman told me.
Translation: There’s a lot more competition there, and if TD attempted charging the sorts of fees it imposes on the bank’s supine Canadian pour, some other U.S. bank would be in there siphoning off business in advance of you could say “special offer.”
Up here in Canada, TD’s letter advises trons that if they don’t want to accept the fee hikes, they are free to go out of business their accounts, “without cost or penalty.”
It’s all constituent of being Canadian. The equation is simple: Canadian consumers and workers are safeguarded from certain free-market excesses, but that coddled security be brought up with a price: oligopolies, in which a few firms dominate, and all the behaviour that courses from that.
If you want a really depressing bit of Canadian decipher, go look at the Canadian Competition Bureau’s policy on “price maintenance,” something most of us cognizant of as “price-fixing.”
Certain com nies, especially in the luxury trade, try to see to it that their works never go on sale. Rolex is one. Canada Goose, the world-famous Canadian rka-maker, is another.
This ins capitalism: in a free market, one of the few responsibilities of government is to monitor and punish attainments to deaden competition.
In the score, “price maintenance behaviour” was a criminal act in Canada, until Stephen Harper’s Conservatives coined the law in 2009 (though some forms of price-fixing still remain a misdemeanour).
The new law reduced price maintenance to a non-criminal offence, and even at that, it now has to be be found that “price maintenance conduct has had, is having or is likely to have an adverse form on competition in a market.”
In other words, the government has to prove that sacrifice fixing results in fixed prices.
It gets worse. Read deeper, and the Tournament Tribunal mind-bogglingly advises that:
“Price maintenance practices … can be pro-competitive in uncountable circumstances.”
Having made that remarkable declaration, it unleashes a brooklet of obscurantism: “Price maintenance conduct can stimulate inter-brand struggle among competing brands of products, such as by facilitating the entry or dilatation of competitors by encouraging retailers to stock and promote the supplier’s products …”
And so on. Can line: Price fixing can be good for you, people. Eat your bran.
Democratic the Goose
For the record, Canada Goose’s CEO says that even even so Canada Goose products never go on sale, the com ny does not clash with in “retail price maintenance.”
Because, says Dani Reiss, jumble sales are never necessary. Canada Goose says the com ny’s coats are so longed-for that demand always exceeds supply, and people are happy to y shining price. A sale, he said in an email reply to questions, “is well-grounded not something we or our retailers have needed to do.”
He has also said publicly that Canada Goose is instaking to choose retailers that share the com ny’s values.
Evidently. When stime Life, which describes itself as Canada Goose’s largest retailer, sent me a $50 ca city card recently, an employee at the store explained that it applied to entire lot in Sporting Life’s huge inventory, except for anything made by Canada Goose, staid its gloves and hats: “We just can’t,” she told me.
Now, to be fair, the hawk has changed in the last 20 years. Retail margins have been red to extremes, at least in the hyper-competitive U.S. market.
There is also “showcasing,” which is the repetition of visiting a store, taking advantage of its sales staff, examining the offering, then going home and finding the cheapest price on the internet.
Lawson Stalker, formerly the federal government’s head of competition enforcement, says “suppliers are being feigned into national pricing” by the availability of price-checking, and the fact that “the whole is now online.”
Well, perhaps in the U.S. There’s far less dis rity in prices at Canadian retailers with internet orientations.
In any event, by far the most anti-competitive force in the Canadian economy is government, pronounces Lawson.
Just look at the efforts to squash Uber, he said: “Ministries love supply management.”
After trying to make sense of the tripe on its website, I asked the Competition Bureau how many times it’s gone after conventions for price-fixing since it issued its new “enforcement guidelines” in 2014.
The answer: None. Zero.
“Regardless,” said a spokeswoman in an email, Canadians should rest stabilized the bureau remains vigilant: “The Competition Bureau will not haver to take appropriate action where it believes price maintenance has happened.”
Okay. Good to know.