In 2016 if the Bank of Canada continues with this scheme Canada will be headed for Greece territory. In actuality if Canada was using the €uro, the world would be talking about us in a similar way they talk about Greece. Canada has no wiggle room right now. Banks in Europe can use negative interest rates primarily because of Greece, Canada can try this if it wants too but expect the unexpected. Interest rates should be around 2% as of 2016. However so called experts say we should keep them low.

Bay Street won’t fix Canada’s economic problems and the reason they won’t is because we’re in a global economy and major corporations will find ways to save money at every turn, which is why it’s important to give the money to main street. If manufacturing in Canada leaves; you’ll need to replace it with innovation and history has proven over and over again that the best innovations come out of main street not Bay street.

When the average Canadian gets more savings income which can also be taxed chances are they’ll spend it or invest it. When major corporations get large sums of cash they HOARD it! mainly because they have shareholders to answer too. Banks can continue to play into corporate hands or give the money back to the right people!

The right people to give money too are not debtors who spend money on things like houses or cars which won’t put money back into their pockets. You want money going into the hands of inventors; who now more than ever in history have more ways to reach out to people with capital. The world has changed and the longer Canada waits to get on board the worse the Canadian economy will get.

Building condos and commercial properties with no one to fill them won’t fix this problem. It’s time to raise interest rates. If it was up to me I’d raise rates to 10% and keep them there for 5 – 10 years before bring them down again, I would warn home buyers to lock in, I would also extend amortizations. This would deflate bay street for a few years but Bay street would also benefit after markets get adjusted.

If anyone is saying anything other than raise rates, they’re trying to push scheme forward. A crash, or reset is exactly what we need now, the reality is not that many people are in debt, the main problem is the people not in debt are paying for those who are which is causing stagnant growth. The good quality money is being sidelined for the bad cheap money, what’s worse is the cheap money is going to Bay street and Wall Street and the insiders there are anticipating a crash so they’re keeping their money sidelined.

Canada made it through 2007 as I’ve been saying for years there was no need for Canada to lower interest rates. It was an unnecessary move. Foreign capital was destined to Canadian shores anyway, because Canada weathered the storm that crashed the rest of the world; and it’s important to understand the reason Canada weathered the storm was because the fundamentals of our housing market at that time were strong.

What weakened our economy was the BoC, trying to stimulate our economy when we should have waited, they didn’t need to to anything, instead what they did is they softened the Canadian market for subprime lenders, and they’re everywhere now. Personal loans, business loans, auto loans, these cheap money lenders are inflating prices everywhere and with the oil shock real inflation is going to push inflation a lot higher than the media will report. This will make the Liberal government look good on the balance sheets but it won’t be good for main street.

Being that you can’t change the past what’s needed right now is a reset, because I guarantee anyone reading this that if the government or BoC doesn’t take action a crash is going to happen anyway. When it happens every public servant is going to play the blame game, oh China did this, Trudeau did that, it was America’s or Europe’s fault because of 2007 , I want to remind people again that Canada made it through 2007 because the fundamentals were strong, which is why the BoC felt the need to drop rates to spur more growth, not just in the housing market but in the corporate and banking world.