So your friend has no idea how to manage his finances is what you're saying. A resource based economy, with low government debt, and relatively low employment. What more do you want? Name one country in the entire world who's economics are as sound as Canada's are right now (and politcally stable, of course). Manufacturers are getting clubbed by the high dollar, but even that is starting to depreciate. Did you read the news recently regarding the new trade deal with the EU? Expected to bring tens of billions of dollars to the Canadian economy. I'm not saying we are not without concerns: Ageing population Infastructure deficit But compartively speaking, where else do you want to put your money?
There's more to be said about the value of oil than the CAD dollar, it's simply tagging along for the ride. P.S Going bankrupt with a 60k take home, the guy must be trying to be American
Canadians are worse off than Americans when it comes to debt. http://www.ctv.ca/servlet/ArticleNe...usehold-cebt-100511/20100511?hub=TopStoriesV2 Canadians' debt-to-income ratio now ranks first among 20-advanced countries in the OECD and a new study suggests the recession did little to dampen the country's enthusiasm for taking on household debt.
At least there are jobs. Just look at the unemployment rate in some of the European countries. Debt to income ratio is high because credit is CHEAP, and many are taking advantage of the cheap credit. Luckily the government has finally stricken the mortgage rules. This will help slow down the folks who SHOULD NOT be buying in the first place. I used to work in a bank, and I don't agree with first-time home owners buying a property with less than 10% down. Realistically, if you don't have at least 10% of the purchase price, you should be renting. You are bound to lose more money in the long-run by dishing out mortgage interests, maintenance cost and property taxes. Two of which are bound to GO UP and UP and UP every year.
Kids aren't staying in school till their late 20s/early 30s by choice. There just aren't jobs in Canada for university-educated people outside of healthcare or government. Canada is just a giant welfare state that leeches off of an increasingly small resource sector, with little else. The situation with mortgages is nothing short of frightening.
Investment in the resource sector is increasing. It is increasingly growing, not shrinking. Case in point - the Chinese investment in oil sands earlier in the week. What is the situation with mortgages? Are you taking the stance that people won't be able to afford their mortgages when rates rise?
Kazz, you've been "sponsoring" the rally on here we had since last March and now you are trying to suggest that my anecdotal evidence through my example - a "joe blow" if you will is merely characteristic of 100s of thousands of Canadian families- overleveraged, like the US, but in terms of real debt instead of real assets. Pitz is totally right, its a technical welfare state, and highly jobless aside from the creation of government anointed Pseudo-Jobs. I saw what was happening here and globally and positioned myself accordingly being long risk averse assets untied to the CAD, commodities and equities. As for buying anything in Canada, you'll be in for a real surprise. Eric Sprott was on BNN last night at 5:30pm, you might want to cherish some of his advice.
Sponsoring the rally? What does that even mean? Prices were going up so I got bullish. When prices downtrend, I get bearish. I am a strict believer in the trend is your friend. Your example of someone taking home $60,000/year and going bankrupt is an example of someone who doesn't know how to manage money or risk. I blame the individual, not the economy. If you have a job, making that much money per year, what else are you looking for? If you haven't been exposed to the CAD, commodities, or equities over the past year, you've fucked yourself out of a lot of money. Congrats.
Ummm, no its not. Natural gas investment has collapsed in Canada. And as a percentage of the economy, the resource sector has almost never been smaller, in the entire history of Canada. Forget rates rising, most can't even afford their mortgages right now, and negative equity is rapidly rising.
Have you seen the price of natural gas? Why do you think companies aren't investing in natural gas right now? As for your mortgage claims, do you have any numbers to backup any of your statements? Because I base my opinions on facts. Here is some Canadian mortgage information for you and others to educate yourself with: http://www.canadianmortgagetrends.c...trends/caamp-2010-spring-mortgage-survey.html "93% of mortgagors have never missed a payment " "4% of mortgagors missed a payment in the last year" "6.8% of mortgagors indicate that they presently have difficulties making payments" "0.45% of Canadian mortgage holders are 90+ days overdue on their mortgage payments (as of February)" Need I continue?