U.S dollars Decline Happening a lot Slower Than Expected, spells bad news for The Canadian Dollar – May 5, 2021,

The U.S economy by all accounts is expected to crash and luckily for Joe Biden there is gridlock in Washington, not allowing him to pass most of the regulation bills he plans on passing. When it comes to the modern Democrat Party what they’re not comprehending are the costs that will be levied on their private sector via their oppressive regulatory environment.

All that aside, and this is a topic most people do not understand, the U.S Federal Reserve is still in a lot better shape than the central Bank of Canada as an example. Almost every dumb idea created by the Liberal Party of Canada which currently controls the House of Commons with a minority government has been monetized by the Bank of Canada, the excuse for the Bank of Canada doing this is obvious during the COVID-19 era, but it’s also unfortunate because it guarantees inflation.

As an example, now on the Liberal Party, to-do list is a $15 FEDERAL minimum wage, which will force all private-sector employers to pay any person they hire at least $15 an hour, which is in addition to their new carbon taxed energy costs. Now even if you believe man-made climate change is a thing, doesn’t matter, the bottom line is that these two Liberal initiatives GUARANTEE a higher cost of living and what’s worse is that the Canadian dollar might rise in value next to other currencies, which equates to any Canadian job that can be done cheaper offshore being done offshore.

As the world knows via Franklin D. Roosevelt once you raise the Federal minimum wage, it never goes back down again, in certain parts of Europe, their Federal Governments got out of the Minimum Wage business, I suspect maybe 20+ years from now, there might be a Canadian Federal Government that abolishes the $15 FEDERAL minimum wage, but that’s not a guarantee.

I know a lot of poverty-stricken countries, who have a hard to comprehending the coalition between minimum wages and poverty unless your country is as productive as let’s say a Germany in which their education systems revolves around skilled trades, a higher FEDERAL minimum wage will have a devastating impact on your economy, because in case people don’t understand flipping burgers with a currency as highly coveted as the Canadian dollar in the modern era doesn’t warrant $15 an hour, but on the flipside, sitting at home on welfare doing absolutely nothing and getting paid by various levels of the Canadian government also doesn’t warrant the standard of living that often exceeds a $15 per hour wage at 40 hours per week.

With that established, I expected the Canadian dollar to be higher at this part of the cycle because by all accounts I expect the U.S economy to crash in 2022. Once the U.S economy crashes, there will be a rush into dollars to save the currency, because most countries of the world INCLUDING CHINA have a regressive economy or a progressively taxed economy, meaning that consumers in most countries of the world are punished for their consumption.

The United States minus the Democrat Run States are often incentivized to consume, after all per capita Americans are the most entrepreneurial, which means they bypass or understand how to bypass the INCOME TAX, which frees their capital up to consume more. In Canada, we have more of a Welfare State, Union culture in which it’s an acceptable practice that if don’t meet Union guidelines, as an entrepreneur you don’t deserve to be in business.

Bank of Canada to Introduce a Corporate Bond Purchase Program | bankofcanada.ca

That’s all well and dandy but similar to an unionized wage earner who is incentivized NOT to do overtime at their unionized job because of the potential of additional tax charges, a lot of Canadian businesses pre-pandemic intentionally do not higher more and intentionally stunt their companies growth in fears they’ll open themselves up to not only unions but also the wrath of the Canadian Federal Government.

All of this ties into paying for the Canadian Welfare State which is financed primarily by keeping the Canadian dollar low relative to the U.S dollar. Canada is not alone on this, it’s just that Canada is a unique case, because of where it sits geographically, but all metrics, Canada should be EASILY the richest nation on earth, we’re a developed nation, we share a border with the United States and we’re not landlocked which even allows us to do business directly with Asia, what causes poverty in Canada, are our various levels of government which continue to grow and passes the cost of their public sector growth onto the Private Sector.

Now, even if Canada loves its welfare state and wants to keep it, common sense would tell the government not to overly tax the private sector, but this type of ideology doesn’t exist in Canada, the current Prime Minister Justin Trudeau’s current position on COVID-19 passports is emblematic of Canada being a nation that leads from behind.

Canada will align policy on ‘vaccine passports’ with international allies: Trudeau | ctvnews.ca

In the end, the culture that this lead from behind attitude brings is that Globalists control your countries destiny from a distance. Corporatists and communists in some way shape or fashion will dictate your countries economy. This is one of the reasons why the Canadian dollar as well as many other fiat currencies, derive their values via the U.S dollar. The U.S isn’t forcing this to happen, the reason this currently happens is that the U.S federal government with all of its spending and stupid economic policies has created a Euro-dollar market in which the entire world benefits from hoarding U.S dollars.

This is not to say the Euro-dollar system can’t end tomorrow, the problem with the Euro-dollar market is that there are more U.S dollars outside the United States than there are inside the United States and because so far anyway, the U.S government hasn’t attempted to change this dynamic, Federal Reserve is still the best central bank in town.

What I’m getting at here is that when the U.S economy slows, I expect that the Canadian dollar will reach ALL-TIME LOWS I don’t think the Bank of Canada will raise interest rates, I think what’s going to happen is the Bank of Canada is going to go NEGATIVE! If you think the U.S housing market is bad, at least the U.S housing market experienced a crash within the last 20 years, Canada hasn’t experienced a market correction or a market crash since the early 1990s.

Most of Canada’s public and private sector debt is monetized via an ever-rising asset market People forgot that the Bank of Canada was buying newly-issued government bonds meaning that the Canadian government has debt nobody else wants to buy. In normal times this would spell doom, but we’re in a new era now and the way I see it, all roads lead to negative interest rates, because austerity measures are out of the question.

Bank of Canada already pushing limits of domestic bond market | bnnbloomberg.ca

But as I’ve stated in prior posts, the Canadian economy isn’t built for negative interest rates, in most of the European countries playing around with negative interest rates, they’ve as an example ABOLISHED the Federal minimum wage law and their governments are supportive of their small and medium-sized businesses. The modern Canadian economy is built as if Canada was still stuck in the 1990s, that era is over and the new normal which I suspect will hit the world around 2022, in my opinion, is going to confuse Canadian lawmakers once it arrives.

Lastly, I’d like to remind the reader that the Canadian housing market has already crashed debt deferrals equates to the Canadian housing market crashing, so all rising ASSET prices in as an example the Canadian housing market will be supported by debasing the Canadian dollar. But this debasement in my opinion will happen after the Canadian dollar begins rising to the U.S dollar and then is forced to retreat because our bloated government is killing our private sector which RELUCTANTLY will be forced to raise prices!

When I go to the grocery stores now(April 5, 2021), instead of overtly raising prices, what I see are quantities shrinking in size with the same price tag, well those smaller quantities I suspect will have a higher price tag attached to them in the very near future. I also like to remind the reader that real tax cheats are the people on GOVERNMENT WELFARE as was the case during the end of the Roman empire, it was the people of Rome who consumed more than they produced who caused the decline of the Roman empire.

Interesting times ahead