Crawl Across the Ocean

Tuesday, February 17, 2009

No Hobgoblins Here

A week after affirming the bank's policy of paying people to borrow and taking money from those who (try to) save, Bank of Canada chief Mark Carney worries about household's high and rising debt levels.

I like how he says he's not worried about a U.S. style banking crisis here because in Canada the risky mortgages are *already* all guaranteed by the government, whereas in the U.S. they're only getting around to that now.

So we might see the same price drops and foreclosures as the U.S., and greater costs to the taxpayer than in the U.S., but the situation will be better because we won't see the same losses incurred by banks as in the U.S. Gives you some sense of how warped our priorities have become.

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