Inflation (Price Gouging) and the Bank of Canada
New economic situation – Same old government economic interference policies
Is mainstream media and government trying to drum up a recession?
Canada has had solid job growth over the past year. 104,000 new jobs in December alone.
According to Scotiabank, there are 627,000 more jobs in Canada today compared to pre-pandemic times.
Surprising…based on the dreary tone of the media and our pious politicians, I was under the impression that Canada was done for and the millennials were all home playing video games…
***For the record, the MILLENNIALS I know are hard working non-conformists, who are creating cool things, building businesses and avoiding the debt trap.
During this same time, the federal government has mismanaged the economy and the pandemic response, posting budgetary deficits of $90.2 billion in 2021-22 and $327.7 billion in 2020-21.
Prior to 2020, the biggest government deficit had been $52 billion under Harper.
Bank of Canada Interest Rate Over-Shoot
Since no one is really talking about that pandemic anymore, the government, media and central bank have been harping on for the past 8-10 months about an impending recession.
The fear merchants selling fear porn to the fear addicted. Unfortunately Canadians are starting to believe the rhetoric.
Interest rates have been forced up by the Bank of Canada (BoC), the real estate markets in CERTAIN parts of Canada have been hit hard and it seems as if the BoC may increase rates again.
Based on wise insight and council? Not likely.
Sage Advice and Other Factors
The major banks are calling for the BoC to hold off on future rate hikes because any rate hike takes time to work through the economy and have the desired effect of lowering or stabilizing prices.
My guess is that inflation is actually higher than the government is telling us AND that the interest rate hikes to this point will be sufficient to reign in inflation…or is it price gouging…
Other Interest Rate Factors
Other factors that play a role in our current high cost of living are (mysterious) supply chain issues and a complicated proxy war in Ukraine.
These factors play roles in our current economic environment and need to be considered alongside the BoC’s one trick pony of seemingly never ending rate hikes.
Economics is not that complicated. Since economics was purposefully but unwisely separated from political science (political economy used to be taught as one interconnected methodology), media pundit’s economic discourse borders on the insane, confuses citizens and ignites fear while overall government, consumer and mortgage debts are not treated with the appropriate levels of concern.
Bank of Canada Deficit Financing with Borrowed Infinity Money
The BoC and government printed infinity money without adequate parliamentary debate and almost ZERO civilian pushback. The media and the pious politicians fanned the flames of fear and despair.
The citizen now pays the big bill in tough times but the corporatocracy wins whether times are good or not.
Will the Bank of Canada raise interest rates again on January 25, 2023? Who knows?
Corporatocracy Always Wins in the Canadian Oligarchy
My bet? I think they will sit down in their gilded offices, pour priceless scotch into fine crystal then flip a gold two faced coin.
Sincerely,
Michael
PS – One of my hobbies is blogging about mortgages, debt and government policy. During the day I’m a MORTGAGE BROKER in Kelowna, BC!
Check out the Huber Mortgage Home Buyers Guide HERE
