Letters and tweets — May 2015

CPA Magazine readers respond to the February and March 2015 issues via mail and Twitter.

How about a postal banking system?

Re “He’s Got Mail” (March), the elimination of home delivery and the transformation of Canada Post into a glorified courier service may save Canada Post as a profit centre and justify high management bonuses, but how does this serve Canadians?

CEO Deepak Chopra should emulate the UK, France, Italy, Switzerland and New Zealand, all of which have successful postal banks that receive a substantial percentage of their sales and profits from financial services while other revenue sources declined. Not only are many Canadians unhappy with the fees and charges of commercial banks, but postal outlets already have a presence in rural communities and inner-city neighbourhoods where banking services are not reasonably available.

How about some true entrepreneurial spirit that innovates and expands instead of downsizes and destroys?

Larry Kazdan, Vancouver

“He’s Got Mail” provokes criticisms of the future for home deliveries. The most egregious concept of the new system is that two residents on the same street would create a bizarre difference: the apartment dweller would have mail delivered whereas the homeowner would have to travel to the post box. It would be better, particularly in big cities, to leave postal service as is and reduce deliveries to twice weekly and let attrition take care of staff reductions. This would save millions of dollars.

John Watson, Toronto

The lowdown on rates

When I opened the March issue and saw “Our Interest in Rising Rates,” I was looking forward to an in-depth analysis of interest rates. The article was OK, but it didn’t dive deeper into the theory of rates (why they move up and down) and why there is a difference between variable and fixed rates in the Canadian market.

It should have discussed why the Bank of Canada reduces the prime lending rate, but banks don’t follow its lead; why there is a difference between the central bank rate of 0.75% and the prime lending rate of 3%; and why Canadian banks immediately reduced the rates they pay for savings and GICs by 0.25%.

Everyone is talking about rising interest rates, but what if they never go up? Once you let the genie out, can you put it back in? Looking at Japan as a comparison would have been interesting.

Adam Zacharjasz, Toronto