Canada Could Start Printing Money To Help Slow Economy (QE)

[Economy 52,968]

http://business.financialpost.com/news/economy/smart-money-says-bank-of-canada-needs-to-pull-out-the-big-guns-to-rescue-economy

 

Yet another economist is warning bank of Canada not to delay something that was on the table and that was to start "Quantitative Easing" which the US did for some time to help its economy, and Japan and Europe are still doing it now

 

The idea with QE is to print money and buy up assets and debt to stimulate economy and liquidity and once economy recovers the bank sells it again and removes the extra money from the system.

 

Though manufacturing and non-energy exports are finally improving, it is not making up for the slump in oil prices yet and the housing bubble is showing signs that it is about to burst as home prices are peaking and so is construction.

[Chic 20,830]

They can fax it over to me thank you

[Computer 10,980]

Well first where do they have the rate at?

[Economy 52,968]

Well first where do they have the rate at?

0.5%. They halve a full half a percent they can still cut

 

many experts think that wont do it tho

 

i worry QE now especially with the US about to raise rates could collapse the currency too much...

 

yes a weaker dollar helps exports but at the same time u dont wanna cause big inflation either, our currency already fell 10 cents against US Dollar this year alone plus the drop the year before  

 

TBH if it was up to me id leave it. They already cut rates this year and mortage rates are already at like 2%. And the currench already fell enough to help exporters. Also i doubt the oil industry will contract anymore cause i cant see oil dropping much further than the $40/barrel mark so the biggest slowdown in energy, the innitial shock is already priced in the economy

 

id leave it alone and see how it goes. Manufacturing should keep improving. Also, dont wanna make inflation high, and dont wanna make housing bubble worse by lowering rates even further  

[Computer 10,980]

0.5%. They half a full half a percent they can still cut

 

many experts think that wont do it tho

 

i worry QE now especially with the US about to raise rates could collapse the currency too much...

 

yes a weaker dollar helps exports but at the same time u dont wanna cause big inflation either, our currency already fell 10 cents against US Dollar this year alone plus the drop the year before  

I know... my brother in law is Canadian and his parents always mentione the exchange rate when they visit.  It will be bad if it it changes too much.

But you will get a lot of Americans visiting and anyway inflation makes people spend.

I love QE, I always feel bad Greece wasn't able to use it.

[Economy 52,968]

I know... my brother in law is Canadian and his parents always mentione the exchange rate when they visit.  It will be bad if it it changes too much.

But you will get a lot of Americans visiting and anyway inflation makes people spend.

I love QE, I always feel bad Greece wasn't able to use it.

i dunno that inflation will make ppl spend... Deflation makes ppl hoard money but 2% or 4% inflation makes no difference. And considering our consumer debt is crazy high, if wages dont follow inflation it will actually take bite out of consumer spending power

 

Canada needs transition now... We relied on real-estate and the consumer for too long because exports were saggy... But now consumer debt is too high and real-estate is inbalanced... Low oil prices also came at a bad time adding pressure to economy especially Western Canada

 

the weaker currency (in part caused by low oil prices) as well as improving US should definitely help manufactuing and exports and soften slowdown in domestic economic activity

 

i think cuttig rates further is too desperate, unemployment is 6.8% (5.8% using American measuring system) so i dont think things are bad enough yet to justify QE especially if exports are finally rebounding after 7 years of struggle