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Central bank surprises

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Former Societe Generale trader Jerome Kerviel has been found guilty of breach of trust and computer hacking and handed a five-year prison sentence, with two years suspended. Upon release, like all rogues in France, he has also been sentenced to wear a crimson cravat and a boutonniere regardless of the season or weather. A parole officer has been assigned to monitor Kerviel’s mandatory ennui for at least 18 months following release.

Central bankers are like Kinder chocolate eggs – full of surprises. Overnight, the Bank of Japan cut its policy rate to a range of 0 to 0.10 percent from, umm, 0.10 percent and said it would set up a fund to buy 5 trillion yen – around $60 billion US – in JGBs, CP, ABCP and corporate bonds. The Reserve Bank of Australia meanwhile, demurred from a rate hike forcing Goldman Sachs and others to retreat from bullish positions on the Aussie dollar. This means the ECB is now the only G3 central bank that has not implemented additional easing measures and that the probability of more asset purchases from the Fed are likely in November (one can safely summarize NY Fed governor Bill Dudley’s speech last Friday: We’re in the asset buyin’ bidness, and bidness is a boomin’). So where does this leave our central bank and our federal Finance Minister? Those are the questions we need to ask and answer today and in the run-up to Friday’s jobs figures. Jim Flaherty said yesterday that the good times are over. So will Mark Carney’s No. 2, Tiff Macklem, read from a similar script today when he speaks in Montreal? We’ll have the speech at 1:00 pm.

If the global economy is in such sad shape that it needs additional stimulus and monetary easing, then why are so many industrial commodities climbing? Tin surged to a record today and Goldman Sachs said copper will soar 35 percent to $11,000 a ton within 12 months. We focus on gold plenty, as we should, but there is a world of stuff out there that we can take a closer look at, including copper, tin, lead and other materials that may not be as purty but are much more useful. Market Morning is chasing the Goldman analyst but there’s plenty of opportunity for other experts on other metals. Who mines the stuff? Who’s buying the stuff? Who’s shipping it? And where do the stocks and bonds trade?

Looking at less flashy, more useful metals doesn’t obviate the need to maintain a tight focus on gold, however. Headline sits down with Rob McEwen of U.S. Gold and Tom Meredith of VG Gold at 12:30.

According to a regulatory filing today, Potash Corp. of Saskatchewan (POT-T) didn’t think much of the Conference Board’s report yesterday. The report concluded that a takeover by BHP would not be bad for jobs, management or governance and would in fact be less detrimental to provincial coffers than a bid from Sinochem or someone else. Potash says the report has it all wrong and that BHP’s bid would be the worst case scenario for the province and that the province must remain open to other bids – especially those that Potash is working on. Me, I’d like to see Potash CEO Bill Doyle’s passport… I bet it has some very interesting new stamps in it.

Air Canada (AC.B-T) says it will be flying out of Toronto’s island airport – the Billy Bishop Airport – by mid February. Robert Deluce is the CEO of Porter Airlines, the only airline taking off from the airport right now. He will tell us what he thinks about these Air Canada upstarts at 1:30.

Enbridge's (ENB-T) top executives will be in Toronto today for an investment community conference at First Canadian Place. We are actively pursuing Pat Daniel; even if there is no media access for this event it will certainly be worth our time to tune in to the webcast to hear Enbridge's strategy for minimizing long-term damage from the trio of recent pipeline problems. It all gets started at 8am, and there'll be a similar event tomorrow in NYC.

Quebecor CEO Pierre-Karl Peladeau is scheduled to share his thoughts on the future of media during a Canadian Club speech in Ottawa at 12pm. We'll track his comments about the race – and we expect tape turn from our colleagues in Ottawa.

One of Canada's most respected policy experts tables a new report on foreign direct investment in this country. Jack Mintz's research paper comes against the backdrop of Ottawa's ongoing review into foreign investment rules for the telecom sector and amid calls to chip away at other capital barriers. Could Mintz's plan make Canada more competitive? We're trying to line him up for SqueezePlay.

ISM takes us inside the services side of the U.S. economy with its non-manufacturing index at 10am. Market Morning will have it covered.

Jean Coutu (PJC.A-T) could be the highlight among today's earnings. We'll zero-in on what the company is saying about demand for generic drugs (and pricing). The Close will turn its attention to results from Yum! Brands (YUM-N) after the bell.

Every morning Managing Editor Marty Cej writes a "chase note" to BNN's editorial staff listing the stories and events that will be in the spotlight that day. Never miss an edition of The Chase...follow http://twitter.com/martycej

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