Justin Trudeau’s Fiscal Spending Continues To Produce ZERO Positive Cash Flow: Bank of Canada to keep Interest rates on hold as Consumer Price Inflation Continues – January 22, 2024
Justin Trudeau declared war on fossil fuels about ten years ago, and for the most part, he has been able to govern as if he had a majority. He appointed the current central banker, so current consumer price inflation is his fault.
Trudeau has not only regulated the Canadian economy, which resulted in private-sector spending cutbacks, but he has also grown the size of the government., which requires higher taxes.
The beauty of FIAT money, as well as the modern foreign exchange markets, is that Canadians are able to use the current strength of the Canadian dollar to buy FOREIGN-produced goods for a relatively low price.
This is the main reason, IN MY OPINION, why the central bank in Canada is forced to raise interest rates. From an outsider’s perspective, the Canadian economy looks like a HORRIBLE investment place.
Justin Trudeau’s goal appears to be to attract green energy companies, but this has, for the most part, been such a failure that he’s having to PAY companies using taxpayer money to come to Canada.
Whether it’s tax breaks not available to everyone or government grants or loans, Justin’s tax and spend economy that should favor “green energy” is cash flow negative to the Canadian consumer.
Now, if you look at Stats-Canada, they’re presenting another story because, after all, their revenue has grown because taxes are up, primarily because everything in Canada is more expensive than it was a year ago, which in real-time equates to consumer spending coming down.
So, while prices per item are higher, the amount of stuff Canadians are buying is decreasing. So, if you’re the Bank of Canada, you’d have to know that the declines in spending have more to do with the current regulatory environment and less to do with making the money cheaper to acquire.
The problem with the Zero Interest rate Policy (ZIRP) is that it would equate to IRRESPONSIBLE governments purchasing non-cash-producing JUNK in order to remain in power.
In the private sector, when you borrow money and buy junk, eventually you go bankrupt; however, when the government buys JUNK, they debase the currency by borrowing more money.
Justin Trudeau has been making incremental changes to the tax code in Canada, and this is making Canada an even worse place to invest. even though he’s down in the polls, 2025 is a long way away.
So, in the meantime, Canadians will basically be in survival mode until 2025, when they HOPE Justin Trudeau leaves them alone.
Interesting times ahead!