The Higher The Loonie Rises The Closer Canada Gets to Negative Interest Rates – May 5, 2021,

Joe Biden is bringing back Barack Obamas America and if Canadians remember the Canadian dollar reached parity with the U.S dollar under the Obama Administration. Do Canadians remember what happened next? the then Bank of Canada governor Stephen Poloz lowered interest rates, claiming it was done to help Western Canada, of course, it was a lie, interest rates were lowered because Canada can’t pay for it’s welfare State without an artificially low loonie.

All countries of the world have embraced the Euro-dollar system because it benefits the Welfare State, you rarely if ever hear about Austerity measures anymore. Shrink the size of the Governemnt? Have you gone mad even some conservatives will argue? FORMER U.S President Donald Trump cut regulations and he’s gone now, corporatists get their monopolies via regulations, government regulations raise the barrier to entry.

The minimum wage regulation equates to more jobs being sent overseas, to countries with fewer regulations, regulations are so oppressive in Western Nations, that entrepreneurs would rather put their intellectual property at risk in China rather than to deal with a liticuous Western country.

In real terms, this equates to low-interest rates until a new system is developed. Now, some are claiming that a digital dollar will be the norm, but I disagree because I know too many people even some who are a lot younger than me, who want nothing to do with computers or the internet.

If central bank digital dollars have no cash component, and people are FORCED to use it, I can see an underground economy being created almost instantly, and stopping underground economies is expensive, if digital dollars aren’t transparent and retail banks are abolished, the incentive to uphold central banks will be lost quickly because Humans are fickle and their behavior changes based on their perceived oppressor. I couldn’t even begin to think what might happen if a digital currency is forced on people.

I have friends in China who laugh at the digital yuan, sure they might use it, but they don’t save it, they don’t value the digital yuan, they save other things, they change their behavior only stupid people trust the government and you can’t save stupid. I bring all of this up because Canada’s central bank has nowhere to go unless they want a market crash? interest rates are going NEGATIVE!

They would be negative right now had it not been for debt deferrals and oh yea, by the way, the Canadian central bank going negative doesn’t equate to the retail banks having predictable behavior. I don’t know what the retail banks will do once the Bank of Canada goes negative, they might raise their rates anyway, or they might simply raise their fees or create new fees, I don’t know, I have no clue, they have to be profitable and what that profitability looks like in a negative interest rate environment is beyond my comprehension.

But raising interest rates equates to stagnation or a market crash, the Canadian economy can’t afford either in fiat Canadian dollar terms. Furthermore, in order to keep the cost of living UP, prices mustn’t fall below all the price and wage control mechanisms that already exist in the Canadian economy. If you study what prolonged the Great Depression in the United States, it was FDR’s inability to mirror the market with his price and wage control measures.

‘Luckily’ for Franklin D. Roosevelt he was blessed with a World War and I don’t know about you but if my life is at risk, my spending behavior will change, we all see China getting aggressive with Taiwan, well The United States, Japan, and other nations have a vested interest in the nation of Taiwan which the Chinese Communist Party claims is a rogue state that belongs to China.

Now if Western Nations didn’t love the Welfare State so much, this Chinese Communist Party problem wouldn’t even exist, because it wouldn’t be financed, but to pay for all of this welfare equates to the outsourcing of jobs, so if ever there was a time for China to be aggressive with Taiwan, now is that time. How this relates to Canada, is that choices will have to be made in the Western World regarding dealing with this debt problem, if Canada goes negative, it’s a sign to me that economic disaster looms and there’s a new sheriff in town that speaks Mandarin.

If the Bank of Canada does the right thing and tells our governments that if they want a welfare state they’d better raise taxes and pay for it the honest way, well then maybe there’s hope. But as it stands now, I see NEGATIVE INTEREST RATES coming to Canada! Austerity measures appear unlikely at this point

North American stock markets up in late-morning trading, loonie climbs higher |

Interesting times ahead