CIBC economist Avery Shenfeld comments on Canada’s slowing economy, BoC Cutting Interest Rates? – March 1, 2018,
Well the economic numbers are out in Canada and being that Canada is losing its manufacturing base at an alarming rate, adding to the pending doom the value of residential and commercial property to own and to lease is skyrocketing all over Canada, debt has reached its peak, wages are stagnant, Canada might as well have a Federal minimum wage as minimum wages are so high in every province, there’s a labor shortage as most Canadians have been raised to avoid to any labor-intensive type of work for a living, Government dependence is at ridiculous numbers and regulations on Canadian businesses, along with tariffs are very high, the assumption by the white collar class is to devalue the Canadian dollar, or to simply lower interest rates, lowering interest rates worked last time right? so why not do it again?
The reason Canada may want to reconsider lowering interest rates again
In case people haven’t noticed, in case Canadians haven’t realized, the market even the big banks are starting to ignore what the BoC does, the market is going to correct this scheme whether Governments like it or not, it hasn’t happened yet, because the expectation is that a deal with China will be done soon. Once the U.S, China tensions cease, the market is going to start base it’s projections on the new trade deal regarding the worlds 2 largest economies, this is very, very, very bad for Canada, I also have to point out something regarding Canada and U.S trade, the U.S signed a FREE TRADE deal with Canada’s competitor for the U.S market South Korea, this free trade deal along with Donald Trumps US Reciprocal Trade Act, which you can read about below means the in a few years the money manipulation tactics that Canada has been using since Jean Chrétiens Liberals will come to an end.
Donald Trump insists on trade reciprocity. But what kind? – The Economist
President Donald J. Trump is Securing Fair and Balanced Trade for the American PeoplePresident Donald J. Trump Launches a New Reciprocal Trade Relationship with the European Union
Canada is in brand new economic territory and because Canada’s current Prime Minister Justin Trudeau has a low economic IQ, he doesn’t understand that, well, the world is about to experience change, Canada for the first time in a very long time is on the wrong side of history and what Canadians should be talking about is mitigating the new high interest rate economy, because I can’t stress this enough, once your country loses manufacturing more and more things have to be imported, the European Union(the Euro currency) was created because of this, people forget that prior to the Euro a lot of European countries had worthless currencies.
Luckily for Canada the market hasn’t caught on to our looming disaster yet, however, if this data starts to reach more and more investors around the world, they’re going to start pricing in risk for the Canadian dollar and the Loonie might slide uncontrollably, which will force Bank of Canada governor Stephen Poloz to either to raise rates or hold rates steady and what’s worse in all of this will be the U.S market crash, which is on its way also.
Loan defaults in the United States continue to mount even as Donald Trump talks about bringing jobs back to America, what separates Canada from America however are the types of jobs Americans are getting, most of the job growth in Canada is in the service sector, mostly the public sector but primarily the service sector. This is a horrible number and that’s where a vast majority of Canada’s problems exist, there’s no easy fix to a lack of skills in an economy where the Canadian dollar is worth-less.
Interest rates in Canada will have a lot of pressure to go up, because if rates remain low in Canada the price of imports will rise dramatically, making matters worse is that Trudeau’s Liberals are running a deficit, the reason Trudeau gave his stupid followers to run a deficit was that interest rates were low, this disaster will be the one that’s going to cause Canada the most pain going forward. Now, what makes matters even worse is that I expect Justin Trudeau to win a minority government in this upcoming election, which by my estimation is really, really bad for Canada because my personal belief is that the U.S crash will happen during Donald Trump’s second term in office.
My personal opinion will be that Trump will renegotiate America’s trillion dollar debts and this is what’s going to cause Canada the most pain because Canada won’t have that same luxury, which for me means very high-interest rates in Canada. Now this story isn’t all doom and gloom, I mean it’s doom and gloom if you expect the government to take care of you from cradle to grave, it’s doom and gloom if you’re in bad debt, or did some bad debt based bets, it’s doom and gloom if you’re reliant on debt to survive, it’s doom and gloom if you have a low economic IQ, however for everyone else, this may be the best time of your life.
The bad money will be exiting the system, at least temporarily and it’s important to understand that bad money revolves around people who hope to get rich quick. Sure some will escape the wrath of the market, but I’d advise Canadians to seek out more information than the quick fix Avery Shenfeld is giving on the CBC. Because well, change is coming and the abundance of money that’s been available to Canadians might simply vanish and unlike Americans many of whom have gotten used to being rejected by banks for loans, this will be an adjustment period for a lot of Canadians that won’t understand why or how this happened.
In simple terms, the market will be calling in their debts and they’ll refuse to lend out more money without more security. This has always been the curse of central banking, sure the BoC can print money, but Canada is not the worlds central reserve currency, many Canadians learn that outside of Canada most people don’t even recognize or accept our money, all over the world people know what a Greenback/US banknote looks like and they’ll gladly accept it and trade for it.
Interesting times ahead