They were ranked by affordability based on income. The worst three countries were Belgium, Canada and Australia.
Australia is specifically mentioned by the IMF's deputy managing director Min Zhu - along with Belgium, Canada, Norway and Sweden - as one of the countries where house prices are out of whack with where history suggests they should be.When countries are ranked on how they are moving in the right direction, Canada is 26th.
We all know what the housing bubble did to the United States, so we should take heed:
The IMF says boom-bust house price patterns have preceded more than two-thirds of the 50 most recent systemic banking crises. And when you have a banking crisis in a modern, debt-fuelled capitalist economy it is almost impossible to escape a recession.The ABC suggests that Australia faired better during the 2008 economic crisis because none of their banks failed, primarily because of a government bailout. In Canada our banks also survived because of a 114 billion dollar bailout; one that our government kept hidden, to make themselves look good.
The U.S. also engaged in massive bailouts, but faired poorly because of sub-prime mortgages. This brings us to another Canadian government "secret"; the fact they have also infected our once sound mortgage industry with these high risk transactions.
From a special Globe and Mail investigation, How high-risk mortgages crept north.
New mortgage borrowers signed up for an estimated $56-billion of risky 40-year mortgages, more than half of the total new mortgages approved by banks, trust companies and other lenders during that time, according to banking and insurance sources. Those sources estimated that 10 per cent of the mortgages, worth about $10-billion, were taken out with no money down.Canadians continue to lead in household debt and while house prices continue to rise, and borrowing on equity escalates, we could be heading toward a financial tsunami.
The mushrooming of a Canadian version of subprime mortgages has gone largely unnoticed. The Conservative government finally banned the practice last summer, after repeated warnings from frustrated senior officials and bankers that the country's financial system was being exposed to far too much risk as the housing market weakened.
Stephen Harper, with the help of a complacent media, and millions of dollars in tax-payer funded ads; has painted himself as a strong economic steward, but it's all smoke and mirrors.
Instead of bogus feel good ads and cautious reports, we need to have a serious conversation about the true state of our economy.
With rumours of an early election, are the Conservatives hoping to get it over with before the you know what hits the fan? Remember during the 2008 campaign, Harper claimed that there would be no economic crisis, despite knowing full well that one was imminent.
In fact, he even went so far as to suggest that there would only be a recession if the Liberals won the election.
How much longer can he mislead Canadians? I guess he's hoping at least as long as another election campaign.
If a tsunami was coming our government would have its back to it until the first wave broke over us. We learned this in 2008 when the Harper government failed to foresee the global economic meltdown. Harper's response was that no one saw it coming. Nouriel Roubini saw it coming and sounded the alarm well in advance. Two Nobel laureate economists, Krugman and Stiglitz, saw it coming and tried to warn anyone who would listen. It was the main subject in Krugman's book "The Great Unraveling."
ReplyDeleteIt's a standard rightwing lie that "no one saw it coming." The best and the brightest saw it coming and sounded the alarm well in advance and the rightwingnuts dismissed them as, gulp, 'alarmists.'
When Calgary suffered its second "once in a hundred years" flood in eight years last year the provincial and municipal leadership again parroted the line about how nobody could have seen it coming. What? It's the result of the very phenomenon, the hyper-energized Polar Jet Stream, whose Rossby waves can throw Atlanta, Georgia into a deep freeze on the same day that a village in northern Alaska clocks 62F temperatures, that we've been warned about for at least a few years.
You're absolutely right. I remember a debate between Art Laffer, of the infamous Laffer curve and it might have been Krugman. Laffer bet that there would be no crisis. He lost that bet. Mr. "Lower taxes and the economy will take care of itself" has gone into hiding I think.
DeleteAll this must be viewed in the larger context of US/Bilderberg/Davos/IMF/World Bank actions. It is no coincidence that the US is pushing active war on so many fronts, all aimed at preventing the BRICS+ from breaking free from the US-dollar system.
ReplyDeleteI read within the first couple months in the early 2000's of the first "Low/no-down payment, no principle" mortgages being released, what would happen when they opened 5-years later. And it happened, exactly as predicted.
Canada is now an economic vassal state of the US. The only way we will break that is if the BRICS+ succeed and future Canadian leaders (corporate and political) realize there is more to the world than what the US/Bilderberg types want.
And yes, Harper will want to hold the 2015 election early IF, and ONLY IF, he knows the US will force active war with Russia. An attempt to crash the Cdn economy as the US increases its belligerence will be used to scare Cdn voters into "staying the course" with a tried and true military strategy... if Harper can convince Cdns Afghanistan was not a huge debacle.
The early election candidate meeting push in Feb-March 2014 was based on Horwath sitting tight through two Wynne budgets to force both a Fed and Ont election within 3 weeks in Oct 2015.