It was a year most of us would like to forget - but one that we're certain to remember.
Great fortunes and reputations will be made from the meltdown. Many have already been lost. Books will be written, documentaries made. Historians and economists will be arguing about its causes and consequences for years. The only thing it wasn't was dull.
So there's no better way to mark it than the way Hollywood would - with an awards ceremony, minus the Valentino dresses and golden statuettes. And the smiles. Here's a look back at the crazy, the foolish and the brilliant of 2008.
Deal Busts
The Mary Decker Prize for the Most Spectacular Stumble at the Finish … named for the superstar U.S. track athlete who famously crashed and fell at the '84 Olympics, there was only one serious contender for the dishonour: Ontario Teachers' Pension Plan's failed $35-billion buyout of BCE. After getting past the credit crisis, the bondholders and the Supreme Court, the deal from a bygone era collapses on an accounting technicality. Seriously? Conspiracy theorists will be chewing on it for ages.
The Schadenfreude Award … goes to the large minority of Magna International shareholders who tried to, but couldn't, stop the creepy 2007 deal between founder Frank Stronach and Russian oligarch Oleg Deripaska. The arrangement granted Mr. Deripaska a share of control in the auto parts company without paying a premium for it. And it turns out he really didn't pay for it - the banks did. Guess who had to dump his shares because of a monster margin call? Goodbye, Oleg.
The Where Have You Gone, Neil Sedaka? Tribute … EnCana boss Randy Eresman tried to break up Canada's largest energy company and discovered that, like in the song, breaking up is hard to do. Some felt Mr. Eresman was setting up the two smaller entities as takeover bait. "There's very few companies in the world that would have the means to be able to take over either of these companies," he said in July.
How about today, with EnCana's stock down by half since late spring? The split is off, for now.
The Be Careful What You Wish For Award … goes to Rio Tinto CEO Tom Albanese, whose months of fending off the hostile moves of rival BHP Billiton finally paid off, in a way.
BHP abandoned the pursuit in late November, citing the $40-billion in debt Rio has (most of it taken on to buy Alcan in 2007), which now resembles a concrete anchor. One other thing: Rio's U.S. dollar stock price is down 85 per cent from its springtime peak. That's some fine takeover defence work, gentlemen.
You paid what? The John Roth Commemorative Citation for the Bubbliest Acquisition … to Shell Canada, for its $5.2-billion bid in mid-July for Duvernay Oil, a company that only a few years earlier was worth less than your brother's hockey card collection. Even at the peak of the energy boom, eyebrows popped at the 42-per-cent premium. "Shell were really interested in us," explained Michael Rose, Duvernay founder and the luckiest man in Western Canada. You don't say. In Shell's defence, somebody had to win this one. If not them, then…
The New Era Award (sponsored by AOL Time Warner) … to Teck Cominco and its chief executive, Don Lindsay. Having whiffed on Inco in 2006, Mr. Lindsay finally hooked his big deal with a $14-billion play for Fording Canadian Coal Trust, just before the bottom fell out of coal prices. Now the dividend's gone, spending has been slashed and questions linger about Teck's ability to repay the debt. Suddenly, life as an investment banker at CIBC doesn't look so terrible.
Presidency of the Bill Holland Admirers' Society … to Bank of Nova Scotia chief executive Rick Waugh who paid $2.3-billion or $22 a share to acquire a 37-per-cent chunk in Mr. Holland's CI Financial in early October. This was considered a bargain, since the seller, Sun Life Financial, was so desperate for the money that it could only have made a bad deal, right? CI fell below $12 the following month and Scotiabank moved to give Sun Life less cash and more shares. Who's desperate now? Sun Life CEO Don Stewart wins one, for a change.
The Gordon Nixon Sun Vacation Package … Port of Spain, the capital of Trinidad and Tobago, continues its inexorable rise as an, um, powerful global financial centre with Royal Bank of Canada's $2.2-billion (U.S.) purchase of RBTT Financial Group.
It's unfair to judge a deal that was negotiated nearly a year before banking's Black September - but at three times book value and $26-million per branch, we'd bet RBC wouldn't mind a mulligan on this one.
Great moves
Best Buffett Impersonation … Prem Watsa of Fairfax Financial Holdings found a gold mine on Wall Street. His bet against U.S. banks, monoline insurers and other bumbling enablers of the mortgage bubble earned a sweet $2-billion for Fairfax. In Canada, it was the trade of the year. Now he's using the profits to finance desperate companies on nearly usurious terms, just like his idol Warren would do.
The Bon Cop, Bad Cop Award for Uniting Two Solitudes … To the boards of the Montreal Exchange and the TSX Group, for putting rivalry aside long enough get a merger done. Things have been anything but peachy since: TSX CEO Richard Nesbitt left before the deal could close, MX boss Luc Bertrand got snubbed, Montreal's derivatives business stinks like five-day-old poutine, and a technical glitch left the TSX red-faced and idle for a day. But the alternative - drowning separately during the financial crisis of a lifetime - was worse.
The 'S' in Saskatchewan stands for 'Shrewd' Award … Fertilizer mania was short-lived, but in the only Canadian province that's shaped like a piece of cheese, they made the most of it. In April, Potash Corp. signed a huge new contract to supply the stuff to China - at a price three times what the Chinese had paid in 2007. But the topper was the deal to sell Saskferco, partly owned by the Saskatchewan government, to a Norwegian firm for $1.6-billion in July. Food prices and fertilizer stocks have been plunging ever since. Moral of the story: The locals always win.
The Canadian Belts & Suspenders Co. Honorary Certificate … to Gerry McCaughey of Canadian Imperial Bank of Commerce. They laughed, they cried, they mocked him mercilessly when he passed the cap to investors in January for nearly $3-billion in new equity. Canadian banks just don't do such things. But it turned out he was just at the front of a very long parade. By year's end, the other Big Five banks had all sold stock - at much lower prices than if they'd swallowed the medicine when Mr. McCaughey did.
The Cockroach Award … to WestJet Airlines. That's not a cheap shot. Cockroaches are survivors. They've withstood nuclear attacks and ice ages. They thrive by adapting. So does WestJet, which tied up with Southwest Airlines this summer in a clever alliance that unites the best-run airlines in the United States and Canada.
When the Great Depression of 2009-10 is over, these two will be charging $3,000 to get from Vancouver to Los Angeles - but you won't have a choice, because all the other airlines will be bankrupt.
New Stars
Mark Carney, Bank of Canada: The new governor surprised Bay Street early on by ignoring the economists' calls for interest rate cuts. Maybe it was a misstep, but it established his backbone on inflation. When the depth of the financial crisis became apparent, the gov moved with alacrity. For an encore, he dragged the ABCP compromise across the finish line. Now if only we could clone him and make him finance minister.
Allan Leighton, Loblaw: At 55, he's not exactly new to the retailing scene or to the Weston empire. But having shoved Mark Foote over the cliff, the Brit has a firm grasp on Loblaw for the first time. Let Galen What's-his-Name tout enviro-friendly detergent on TV; it's Mr. Leighton who's doing the dirty work, such as grabbing suppliers in the sensitive parts and squeezing.
Jurgen Schreiber, Shoppers Drug Mart: What product's sales go up in a recession? Lipstick. In what line of business is the new chief of Shoppers focusing his attention? Exactly. None of that's to say that a stock this expensive won't get crushed if he turns in a quarter or two of lousy numbers. But so far, it's all cherry-flavoured lip gloss.
Sean Durfy, WestJet: See the cockroach award above. On Oct. 10, as the financial world was crumbling all around it, WestJet set a company record for most passengers flown in a single day. The airline's ability to put bums in the leather seats no matter what, is partly a testament to the marketing skills of its Newfoundland-born CEO.