Weak Dollar and CMHC have made Canada a magnet for money laundering – May 7, 2019,

Let me make something clear, when you talk about money laundering in Canada, you’re talking about Real Estate. One of the reasons I’ve been against easy lending and low down payments for mortgages is that it attracts the wrong type of investment. CMHC is mortgage insurance protection, it exists to allow Canadians to purchase properties they’d otherwise not qualify for. This obviously equates to a larger pool of available mortgage purchasers, which of course creates demand that otherwise wouldn’t exist. To better understand my point, interest rates have been near zero in America, why hasn’t the same type of laundering occurred in the United States real estate market?

In America, it’s a known fact that their real estate market can crash and there’s a good chance that the U.S government will do nothing to stop real estate devaluation. In Canada, CMHC, as well as the Real Estate Lobby’s, basically have the Canadian government at all levels catering to their demands. This, of course, fuels money laundering, because now, certain segments of the Canadian economy are protected from deflation or at least protected from hyper-deflation.

So, as an example, two friends, one from China and the other living in Canada might have an arrangement to purchase a property, possibly at an inflated price so they can dump their illegally made dollars into a safe haven which has proven to be rather liquid, because not only can they buy at an inflated price they can sell at an inflated price, gladly paying taxes or fees, because they’ve more than quadrupled their investments in certain instances and washed their money clean. Remember most people and entities who laundered money have already calculated loses.

So what makes Canada so attractive to them is that our system of governance revolves around protecting big corporations. I’ve often argued that Canada is the most Corporatist country on the planet, obviously, I have no evidence to back up my claims, but it’s my belief. Until you’ve traveled the world and seen other developed nations, you’re not going to understand how corporatist Canada is, we have a lot of big and major corporations that make Canada their home, part of Canadian culture revolves around consumer assumption that buying from a big box retailer is the best option, therefore a lot of Canadians aren’t used to bartering very much.

Our national lack of understanding regarding bartering, by most Canadians, has facilitated in Politicians being able to pass ridiculous tax and business laws and legislation that raise the barrier to entry, while at the same time protecting investors from risk. CMHC being insurance for mortgages is private sector protection and welfare from risk, because most Canadians don’t understand the barter agreement between CMHC and the Canadian taxpayers, the assumption is that CMHC is simply helping the poor and there really are no side effects to their existence.

Interest rates globally are low, but not every country with a low central bank rate has a housing or credit bubble, Canada has a huge credit bubble and the larger it gets, the more likely it is that Canada will welcome in laundered money. The CBC article below basically outlines what I’m writing in more traditional terms people understand. Basically, we’re closing in on a crisis point where the MARKET numbers, simply won’t make any sense. I forgot to add that Canada is losing its manufacturing base.

Now, large manufacturers in Canada in some instances are thriving, but the smaller manufacturers, you know the manufacturing companies that you’re not familiar with that in many instances even help the larger corporations, yeah, well a lot of those companies are leaving Canada in droves, most have already left and because those smaller companies don’t have recognizable names, when their gone and replaced by imports, it puts a strain on the Canadian dollar. Because sure we can tariff foreigner goods as options are lessened for Canadian consumers, but one day similar to Venezuela a day arrives when Canadians might be reliant on imports for items people take for granted, items like I dunno toilet paper or tampons, and if Canada has to have these things imported this causes prices to rise and making matters worse is that our cost of living is already high because Canadians have a lot of public servants to pay.

Now, I always like to point out that Crown Corporations(like CMHC) should be counted as Public services, but they’re not, therefore the numbers are skewed in the Canadian economy, so in the event Canada ever has a currency crisis there is going to be a lot of economic chaos that I know a lot of people won’t understand. Crown Corporations in many ways create price controls and incorrect price valuations of things. Because Crown Corporations don’t have any competition, in most instances all market prices derived from Crown Corporations aren’t measured by any free market fundamentals, which basically makes them responsible for all types of price inflations in the Canadian economy.

Furthermore being that the Canadian Loonie is artificially low for the Big Corporate interest’s sake, in the event the Bank of Canada is ever in a position that it has to raise interest rates to protect the Loonie Canada will be in a world of CREDIT trouble. Which will further facilitate its need to keep laundered money flowing through our economy! This is basically what happened to many European countries prior to the creation of the Euro. In many parts of Europe, there’s still a belief that the Government should micro-manage the economy.

Obviously, this is a recipe for disaster if you read economic history, which most people don’t do. But it usually takes a crisis for people to feel the disastrous policies and then again even a crisis doesn’t solve the problem as most people tend to blame economic matters on particular groups of people. Being that Canada has really embraced Keynesian economics and we have the privilege of having the United States as our number 1 trading partner, the real truth is that things may have to get really bad before they get better. The article below is a good read.

Weak rules have made Canada a magnet for money laundering: Don Pittis – CBC

Interesting times ahead