In every calamity there is opportunity.... And is it not mostly after the fact....that all the expert opinions about coulda shoulda woulda ....come out ......? Whether Canadian, American, Japanese, Chinese....what matters now is a viable solution which will provide for sustainable progress from this point on.... Any country that adopts a 10/5 C tax only will immediately gain not only financial freedom that they have never had before....but the the first one in the door will grab the best companies, talent, along with the jobs....and the policos will see revenues that they thought was never possible.....This is exactly what the US should be doing.....and is doing quite the opposite.....less financial freedom....less freedom in general....and a poor economic outlook....with a incredible financial burden on all.....for the next several generations....This does not have to happen.... Secondly everyone is in this together.....like it or not.... A new direct access securities highway needs to be put in place whereby all transactions are tax free in the name of efficient capital....and to rather quickly replace the capital that was quickly ejected from the economy.... This big govt. crap has got to end.....needs to be reversed....rapido.... Firstly the two party lobbyist system has got to go....It does not work.....and will never work well by its flawed design.... The US is in a race to the bottom by design.... This has to be changed....or to the bottom it WILL go....IS going....but fast.... The point is just why is it that the politcos get to destroy everything in sight before change can happen.... The next screw up is.... cap and trade....which will cost lots of jobs....and also pay lots of ex oil workers for not working.... http://globaleconomicanalysis.blogspot.com/2009/07/obamas-cap-and-trade-energy-plan-will.html The current system has got to go....
If you like Canada then you should really move to Sweden or Finland, it's socialism at it's finest. Wait till you try opening a business and making it successful. You will be F'ed over by the government bureaucracy, taxes etc, etc... left right and center.
Hmm, I wonder why a bigger system would crash more greatly than a smaller system. It's seems totally logical to me. Canadian Banks are nowhere near the size of American ones. Blame it on your ideological counterpart, or the regulators or the boogie, I don't care, but use your common sense, FFS.
Where I'm from, Denmark, we have a much more extensive regulatory environment when it comes to banks. None of them are nationalized, as they were in the old days, but the amount of oversight is greater than that of Canada. Yet, our government, too, has enacted several bailout packages because a number of banks were in immediate danger of bankruptcy. In fact, several banks went under despite of the bailout package. A lot of factors goes into why something fails. I think it's naive to think that oversight is what apparently "saved" Canada from having the troubles the US is in - and when I say "saved" remember that Canada, too, is in a recession. I think that the unfortunate events in the banking system recently are due to much more than risk taking on the banks' own part. This didn't only happen in the trading part of the banks. I think what happened was part due to an economy growing stronger by the day - or by the hour, even. Massive economic growth eventually leaves to a situation of stabilization or correction, as we all know it from watching any financial instrument's chart. It might be unfortunate, but we are still a few that believes that corrections in the economy is one of the greatest strengths of a capitalistic system. Systems that try to prevent economic fluctuations not only attempts to limit downside; they take away the upside, too. Bottom line is, that I think it's naive to blame it on certain aspects of the system and then expect that major changes are going to make anything better or "fix" anything. As long as you have a free market economy, you'd have to do with booms and busts. If you simply cannot grasp the outlook of such a future, I suggest you to look at other ways of running a society; socialism or communism. If you prefer pure downside, I'm sure you'll absolutely love these systems.
On the issue of the danish mortgage system, I agree. The system managed to survive, even after the extensive liberalization of the danish banking and mortgage system that has taken place over the last 20 years and especially with the current liberal (European sense) government. It's one of the few things "we've" managed to get right. I do also think, however, that the original idea behind Fannie May and its role in the American mortgage system was great - and still is, even in the light of recent events. Important to notice to this is that the Fannie Mae model to a great extent resembles the system as it is in Denmark, with, of course, distinct differences - differences that has to be there considering the huge economic differences between the two countries. I don't think the "danish system" could ever be imposed centrally in a country like the US - it would have to be locally managed; and many local communities have "already" found solutions that fits their community best. BTW. I think this might be the only issue on which I agree with Soros...
Canada doesn't have Goldman Sachs sucking the life out of it. Every country that GS has a major presence in is fucked upside down with shitty US mortgage tranches aka AAA garbage. It's only a matter of time China gets bent. GS is building up a presence there.
Where's the evidence that it was combined commercial and investment banking that caused this? Northern Rock was the first UK bank run in over a century, and it didn't have an investment banking division. Corus Bancshares didn't get brought to its knees by investment banking. Swedbank isn't facing ruin because of investment banking. All of them got screwed in the same way that commercial & retail banks get screwed throughout the ages - seppuku via lax and massive lending at the peak of a real estate and credit bubble.
The banks also lent heavily to funds to finance all those subprime carry trades. And did plently themselves
As I was saying earlier, it was much more than just the banks actions that caused this whole problem - in the US is was partly due to a political goal of a higher home ownership rate causing the sub-prime loans that the banks otherwise wouldn't have participated in. These sub-prime mortgage bonds were compiled into CDOs and sold to companies all over the world thus impacting not only US banks but banks in other countries too, when people started defaulting on them. (I'm sure you knew this anyway, but just to have a discussion going or give you a chance to prove me wrong ) Now I'm not that much into the Northern Rock situation, but I'm pretty sure that was part of the reason why it went under.