Canadian economy at risk from mounting mortgage debt

Is anyone else getting tired of all the warnings?

Be careful how much debt you take on, be careful how much house you buy, make sure to save for retirement.

Well here’s another one: Stephen Harper has been told the entire countries economy is at risk due to record debt levels and the high cost of housing.

Municipalities are asking for the government to address high housing costs, but not everyone agrees.

… Finn Poschmann, vice-president of research at the think-tank C.D. Howe Institute, said Ottawa has “little jurisdiction and almost no practical capacity to deliver housing.”

“Past attempts to do so, through CMHC for example, have produced financial disasters for the people who participated and put CMHC in grave financial situation.” he said.

“We wouldn’t want to see that again, nor the federal mortgage agency deeply underwater and as similar U.S. agencies have been, through the course of much more recent financial disasters.”

Of course our current situation is that the CMHC has been pouring money into Mortgage Backed Securities to encourage buying, they recently had to cap this program because they couldn’t keep up with the growth.

It is likely that the government could reduce the cost of housing by simply pouring even less money into MBS.

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Kwok
Guest
Kwok

TedEastSide:

Maybe for you.

My mortgage payment has gone down…was high 12 years ago…our living standard is way up! Low rates and cheap goods.

Would have been way up if I had invested in a 2nd home. Oh well, you win some ….

Ted, have you considered moving to Chilliwack to get a fresh start. If you do, don’t miss the boat the second time.

g
Guest
g

It seems like alot of the down voting is from basement suite renters, who are pissed because they will never afford to buy anything decent in the Vancouver or Burnaby area.I think you should only be allowed the privilege of voting,if you are a property owner.

tedeastside
Member
tedeastside

living standards in vancouver have been on the decline for 10 years

Bo Xilai
Member
Bo Xilai

I have been hearing this since 70s. but we drive better cars, live in nicer houses, have more vacations, eat more in restaurants, buy more Christmas presents then ever before.
so when do you think this will change? Give me a date? Before you are 80?
——————-
Yes, the sum of human achievement is demonstrated by driving a series 5 BMW instead of a series 3 BMW, eating more Shark Fin soup in Chinese restaurants and buying more Christmas garbage produced in Asian sweat shops. Yes, we do live in a guilded age… Human progress is amazing, isn’t it?

Randy Randerson
Guest
Randy Randerson

Haven’t seen Softy and Bull!Bull!Bull! in quite some time. Must be too busy to disseminate misinformation to greater fools.

No Noise
Guest
No Noise

A lot of deals at 20% off too right now – I’m not quite ready yet.

2.79% 5 yr. NEVER AGAIN
Guest
2.79% 5 yr. NEVER AGAIN

This market is slipping downward. Bull! Bull! Bull! is right that there isn’t a crash but things sure aren’t going up.

No Noise
Guest
No Noise

I keep a very close eye on east Van detached – they are all on average at least 10% off peak (18 months ago).

Nguyen
Guest
Nguyen

Son of Ponzi,

No Vietnamese in Fraser Heights because you went to Stats Canada????

Hahaha. Our entire extended family is here. Hahaha. Went to statistics Canada so that must be true. We might not exist. Oh o. Lol

Son of Ponzi
Guest
Son of Ponzi

Emmi, 110,
Agree, the Jim Pattisons are raking in all the productivity gains.
And the check out clerks are brought in from the Phillipines.

Tik-Tok
Guest
Tik-Tok

crab

ok i understand that income did not follow productivity increases. so we instead of income we got debt to spent.
but do we need new car every 3 years, do we need TV in every room, do we need ipad for every kid, do we need cellphone for every kid from grade 5? No we don’t need. And without all this consumerism your life will be more comfortable then my parents or grandparents.

emmi
Guest
emmi

pomzi, it’s a wealth distribution problem. Even if Grandpa wasn’t union the customers to the business he worked for were union. A much smaller percent of the wealth circulates in the middle class now.

crabman
Guest
crabman

Son –

That reflects lagging wages, not lagging productivity. We are about 3 times more productive than we were in the 60s.

http://research.stlouisfed.org/fredgraph.png?g=ngs

Son of Ponzi
Guest
Son of Ponzi

Crab man,
The most productive (output/inputs) years were the 50’s and the 60’s.
Remember Granny didn’t have to work.
The only reason why we are still keeping afloat is because of two income families, with many holding down 2 jobs and working insane hours.

crabman
Guest
crabman

Tik-Tok –

The reason we have a higher living standard than our grandparents is because of rising productivity. It’s been increasing at about 2%/year for the last few hundred years.

The reason why debt levels are so high is because income gains became detached from productivity gains about 30 years ago. If you’ve never seen (or read) Capitalism Hits the Fan, I highly recommend it.

Son of Ponzi
Guest
Son of Ponzi

Nguyen # 66.
I checked Statistics Canada.
There are no Vietnamese in Fraser Heights in Surrey.

Best place on meth
Member
Best place on meth

@Tik-Tok

Did your grandparents live in a concentration camp?

Best place on meth
Member
Best place on meth

Some douche voted Paul down?

KILL THEM!!

good-format
Guest
good-format

Who voted down my post and Paulb’s post? Anw why?

I think this person hates facts and only want to listen to lies.

Tik-Tok
Guest
Tik-Tok

I will read that article latter. I have to take off now.

but i ask you are you living better life than your parents or grand parents? I know i live better life then they had. I can give you thousand of examples of that. My kids live way better then when i was a kid.

Makaya
Member
Makaya

@Tik-Tok
You can start by having a look at this article http://finances.msn.com/saving-money-advice/6952105

And then make your own research to figure out whether on average, people are better off today than they were 20, 30 or 40 years ago…

jesse
Member

News flash: Barbara Yaffe says something stupid. Details at 11.

Tik-Tok
Guest
Tik-Tok

“When the borrowing that is paying for all this hits its limit.”

but what is the limit? Borrowing from whom?

patriotz
Member

@96: “i have been hearing this since 70s. but we drive better cars, live in nicer houses, have more vacations, eat more in restaurants, buy more Christmas presents then ever before.”

With declining real incomes no less. How do people do it?

“so when do you think this will change?”

When the borrowing that is paying for all this hits its limit.

good-format
Guest
good-format

Average sales in last 3 weeks:

Week of Sep 23 — Sep 27: 137
Week of Sep 30 — Oct 4: 124
Week of Oct 7 — Oct 10: 114