One of the Reasons Why I don’t believe in CMHC Mortgage Insurance: Number of people sleeping outside growing in Halifax due to lack of affordable housing – September 12, 2020,
I want to make it clear, that I do not write these posts to give out any financial advice. This blog post should be read for entertainment purposes only! If you have any financial problems seek out your trusted Government approved financial advisor!
So, in the real world, the private sector determines the growth of the economy, the Government’s role in society is to merely make sure everyone’s freedoms and liberties are enforced. Now, the bad part of a market economy is that there will be winners, but as in everything the winners in any economy this year aren’t guaranteed to be the winners in the economy next year.
Deflation has always been the driving force of Capitalism, but even most Capitalists don’t want you to know that, because deflation means as my standard of living rises so does yours, eventually, any widget or idea I create will be replaced by a better widget from someone else.
Now, to stop progress, and to prevent competition big business and government often work together to ward off competition using things like regulations. A crown corporation is a regulation, that prevents competition in the marketplace.
It wouldn’t be any couriers’ best interests to try and compete with Canada Post. If a courier tries to compete with Canada Post, they’d be faced with the same problem Teksavy is facing with Bell Canada and Rogers
Teksavvy refuses to pay Bell or Rogers until it’s paid millions it says it is owed | cbc.ca
You see in Canada, the unintended consequences of big government are that business who’d otherwise create deflation which is good for the Canadian retail consumer can’t because the government via regulations protects the companies which pay off governments.
Often what goes over people’s heads is this question, who pays income taxes the employer or the employee? If you answered the employee, I’d ask you e question if the private sector employer leaves Canada can employees pay income taxes? Now, being that the Public Sector makes its money from the Private Sector when a public sector employee pays income taxes, that public sector worker is actually giving the government back a portion of the income the government took from the private sector.
This is just one of the ways big government causes RETAIL price inflation. When you start talking about housing for the poor, the reason why Canada has a housing problem is that the Canada Mortgage and Housing Corporation(CMHC) helps middle-class Canadians to get housing, CMHC also helps developers and real estate investors, it also puts in place a barrier to entry, which keeps housing prices in Canada from crashing.
I bring this up because when the real economy is deflating, prices for any industry the government is involved with can not deflate. Try and remember something about the world outside of the government, the private sector in Canada via the political machine is bombarded with price controls, most of the price controls in Canada’s private sector are self-induced not because of competition but because of Canadian politics.
It’s only when the private sector company can legitimately show that they can’t make a profit is when you’ll see prices in Canada start to rise. A huge contributor to inflation in the Canadian economy is housing. The main reason housing in Canda is so expensive is that developers are incentivized to build condos instead of building rent-controlled rental housing.
No business person wants to be in the crosshairs of the government, being that even Canada’s Conservative Party is centrist, any business person with the money to do the research would look at the Canadian economy and avoid getting involved in particular segments of it.
If I had the money, I would avoid Canada’s rental sector like the plague. Alberta is probably Canada’s most Conservative province and I often read that many of them want CMHC to do more intervention into their economy. From my vantage point, this shows me a lack of financial education in the HEAVILY REGULATED Canadian financial markets.
When you shelter children from the real world, those children will grow up with skewed perception of the powers of government. The government can’t manipulate the financial markets for an extended period of time. Every business person knows that the problem with any country has to do with how the government is run.
One of the reasons that Chinese and Jewish people do so well in almost any economic system is because the figure out what the government is doing and they position themselves to be the benefices. But this is purely cultural on the part of the Jewish and Chinese, it’s in their DNA not to trust anyone and to instead analyze situations for what they are.
If you’re inadvertently a cultural Marxist or even a Nationalist, the cutthroat world of economics is going to boggle your mind. One of the reasons a lot of people hate the Chinese and the Jews are because making excuses isn’t part of their cultures.
Capitalism isn’t about excuses it’s about education via the school of Hard Knox. The government can for a period of time soften the blow of an individual’s stupid economic mistakes, but after a while, the stupid mistakes multiply and eventually can’t be contained, so a crash occurs, but similar to the COVID-19 economic crash that happened, the government via the central bank was able to print money, but instead of the people who received the money being thankful and looking to do better for themselves, the people are now calling for The Canada Emergency Response Benefit (CERB) to be a Universal Basic Income (UBI).
This is why the free market was set up the way it was because when you give an inch people take a mile. Now n the real economy, people who mentally operate under a Gold Standard are doing okay, but they’re outnumbered by the financial morons who want free crap from the government.
Being that a lot of retirements are dependent on the current system, what I see in the future is forced austerity measures. The CMHC is already shrinking in size and I assume that it will continue to shrink, although I’m not entirely sure. The problem is that even with the CMHC’s current size it’s created a new bottom for housing prices, the mortgage insurance component of CMHC in order to remain solvent can’t allow the housing market to fall below a certain level.
This is why I see debasement of the Canadian dollar as inevitable and what a lot of people don’t understand about dollar debasement is that it comes after your PRINCIPLE which ultimately hurts your cash flow! The Canadian government in my opinion is going to have a serious cash-flow problem and this growing homelessness problem in Halifax Nova Scotia, in my opinion, is only the beginning!
I want to make it clear, that I do not write these posts to give out any financial advice. This blog post should be read for entertainment purposes only! If you have any financial problems seek out your trusted Government approved financial advisor!
Interesting times ahead!