Economy 52,851 Posted August 27, 2015 Share Posted August 27, 2015 http://www.bnn.ca/News/2015/5/5/Bank-of-Canada-lays-out-plan-for-future-bailouts.aspx The Central Bank of Canada has come up with a plan to be used in case of an emergency financial crisis that would make a bailout for banks possible without using tax payer money. The plan involves the Central Bank loaning the money directly to ailed banks at a low rate so the Government wouldnt have to loan it using tax-payers money. The Bank of Canada assured it wouldnt print money out of nothing to loan the banks, instead it would sell assets from its balance sheet to raise real money to loan the banks. Critics argue that during a financial meltdown assets held by the Central Bank would drop in value and likely wouldnt sufficiently cover the money needed. Link to post Share on other sites More sharing options...
LeoFameMonster 1,592 Posted August 27, 2015 Share Posted August 27, 2015 highly doubtful. they will use tax payers money. Thanks Harper the 1st prime minister in Canadian history to be in power for 2 recessions. Link to post Share on other sites More sharing options...
Luc 4,776 Posted August 27, 2015 Share Posted August 27, 2015 is this a random leak? It's a very scary time for something like this to leak... Link to post Share on other sites More sharing options...
Economy 52,851 Posted August 27, 2015 Author Share Posted August 27, 2015 is this a random leak? It's a very scary time for something like this to leak... i dont know it it was a leak or not... it seems like an odd planed And tbh it seems suspiciously conviniently timed considering Canada just slipped into a technical recession (although its regional and affecting only specific provinces)... The Housing Market also remains red hot and over-prices while construction still makes up 13% of GDP and makes up 3/4 of high paying jobs created since our 2009 recession. Seriously go on google and search up "canada housing bubble" or even just "canada housing market" its 1 site after the other on the bubble... Hardly any experts disagree theres a bubble and when even the Government admits the market is "frothy" and "full" you know theres an issue. additionally ppl have refinanced inflated value and spent money on craop giving our debt to income ratio of a wooping 166% Our banks may be highly Capitalized and regulated to be resilient... But I have a feeling the Central Bank has secret doubts and worries about the worst case scenario PS: Our bond yields keep dropping and Central Bank suggests no rate hike for a long time so our banks keep dropping mortgage rates further adding fuel to credit borrowing Link to post Share on other sites More sharing options...
Economy 52,851 Posted August 28, 2015 Author Share Posted August 28, 2015 highly doubtful. they will use tax payers money. Thanks Harper the 1st prime minister in Canadian history to be in power for 2 recessions. i dont think either recession was his fault tho Link to post Share on other sites More sharing options...
LeoFameMonster 1,592 Posted August 28, 2015 Share Posted August 28, 2015 i dont think either recession was his fault tho Ya I guess the leader of the country is 100% fault free when it comes to the Country going into a recession. "Ever heard of when china sneezes Canada catches a cold" that's all harper Link to post Share on other sites More sharing options...
Economy 52,851 Posted August 28, 2015 Author Share Posted August 28, 2015 Ya I guess the leader of the country is 100% fault free when it comes to the Country going into a recession. "Ever heard of when china sneezes Canada catches a cold" that's all harper ok virtually no one escaped the 2008 crisis... Especially not a Country like Canada thats highly dependant on trade (much of our country doesnt have enough population density to make a very domestic self-reliant economy being efficient #2 hes not a dictator not everything he says goes #3 Provincial Governments have a lot of influence on the economy too. cant look only at Ottawa #4 Recessions happen even in well managed Countries. Dont think contractions will never occur in something as volatile as GDP #5 a recession now was kinda innevitable considering we didnt fail as hard as other Nations so our currency went up, killed many exporters and our economy become reliant on consumption and housing which is not sustainable to be relying on that if your not generating wealth to back-up that consumption. But its not our fault the world has been a mess I dont think its fair to be putting the blame on him for the challanges weve faced. We are still better off than most developed Nations and our middle class in case you didnt know is one of the richest in the world both by measures of net worth and median income trust me it aint that bad here. Link to post Share on other sites More sharing options...
Luc 4,776 Posted August 28, 2015 Share Posted August 28, 2015 Ya I guess the leader of the country is 100% fault free when it comes to the Country going into a recession. "Ever heard of when china sneezes Canada catches a cold" that's all harper Economy is something long-term. If you reform your economy, you will not immediately see changes - it will take years before you see changes. A bubble takes yeas and years to become bigger, and usually the leading party is powerless because of independent parties (like the Central Bank, which can create a whole bubble by itself just by keeping the interest rate low) and because it's usually something that started 1, 2 or 3 governments earlier.Just like how the current low unemployment in Germany isn't thanks to Merkel, but thanks to the chancellor in 2001 (Schröder) that liberalized the labour market. Link to post Share on other sites More sharing options...
LeoFameMonster 1,592 Posted August 28, 2015 Share Posted August 28, 2015 Economy is something long-term. If you reform your economy, you will not immediately see changes - it will take years before you see changes. A bubble takes yeas and years to become bigger, and usually the leading party is powerless because of independent parties (like the Central Bank, which can create a whole bubble by itself just by keeping the interest rate low) and because it's usually something that started 1, 2 or 3 governments earlier.Just like how the current low unemployment in Germany isn't thanks to Merkel, but thanks to the chancellor in 2001 (Schröder) that liberalized the labour market.Well America seems to be doing well now. While Canada just keeps slipping further into trouble. 70% of Canadians agree. Link to post Share on other sites More sharing options...
Luc 4,776 Posted August 28, 2015 Share Posted August 28, 2015 Well America seems to be doing well now. While Canada just keeps slipping further into trouble. 70% of Canadians agree. That's (for a part) because the US has a government deficit of 4,6% while Canada has a government deficit of 1,2%. Ofcourse, if you push a lot of money that you don't have into the economy, it will grow better in the short term. Also, Canada relies way more on fossile fuels than the US, so the current low oil prices hit Canada a lot more. Link to post Share on other sites More sharing options...
Economy 52,851 Posted August 28, 2015 Author Share Posted August 28, 2015 Well America seems to be doing well now. While Canada just keeps slipping further into trouble. 70% of Canadians agree. in Addition to what Luc said... Besides a bigger deficit, they also had a deep cyclical downturn and deleveraging in housing and consumer spending our banks didnt fail and kept lending so we did not have that correction Link to post Share on other sites More sharing options...
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