Justin Trudeau’s Federal Deficit is Spending debt is headed for $1 trillion Canada’s Population Smaller than California – May 17, 2020,
There’s an exodus happening in the U.S State of California, California currently has about 39 million people, California also has about 3 million Undocumented immigrants which are a strain on their economy and their State has a $54 billion dollar deficit.
Now, California doesn’t have access to Printing money the way Canada’s Federal Government has, but when your country or state is spending a lot more money than it’s making, you see where the problems are created. I personally look at the fiat monetary system as a political policy dollar, sure the Canadian dollar should be viewed as a commodity dollar or a Petro-dollar but policy plays a huge role in servicing the debt.
Modern monetary theory is really going to get put to the test for Canada in the years ahead. You see during a pandemic, people aren’t going to call in the debt, no, it’s during a recession when people start calling in debts and also demanding more compensation for lending you their money.
The world is awash with fiat money, but I don’t worry about that because money can be destroyed with the rush of bankruptcies, which are inevitable at this point. We are entering into an era in which cash will either be king or cash will be trash.
I’d hope cash would be king, but it wouldn’t surprise me if cash were trashed because printing money is easier for governments to do, the problem with printing money is that diluting the money supply while people are losing their jobs will cause rapid inflation and possible economic stagnation, while at the same time Justin Trudeau adds on additional regulations to businesses.
Why California is the perfect comparison to Canada, is because just a few years ago, there was a comparison between Ontario’s debt under former Liberal Premier of Ontario Canada Kathleen Wynne and her deficit spending to California and Ontarios debt during that period was higher than California.
Ontario vs. California: Who’s Really in Debt? | fraserinstitute.org
Well, now Justin Trudeau has basically surpassed Kathlynne Wynne and then some with his deficit spending and because of his economic policies, Justin Trudeau is actually going to make it harder to pay back the debt. Because most of the revenue from Ottawa used to come from Western Canada, well, Justin Trudeau has done everything in his power to make Albertan energy uncompetitive globally and a lot of investment has been withdrawing from Western Canada because of this.
So I say this only to point out that not only is Canada headed for a trillion-dollar debt, but via Trudeau’s cabinet it’s looking more and more like it’s going to be almost impossible to service it without growing the printing money.
Typically deficit spending is financed with taxes, sure the deficit might grow but the debt on it can easily be financed, what Justin Trudeau is doing is making it almost impossible to service the debt. This should be worrying to Canadians
Ottawa’s debt headed for ‘previously inconceivable’ $1 trillion | FinancialPost.com
Interesting times ahead!