economic crisis: US News: Why Canada Avoided a Mortgage Meltdown
- 03/19/10 02:14 AM
By ALEX J. POLLOCK Suppose we agree that we would like our society to have widespread home ownership and a property-owning citizenry. Does it take government-sponsored enterprises (GSEs) like Fannie Mae and Freddie Mac with implied taxpayer guarantees, tax advantages for the interest paid on home mortgages, and government pressure for "creative" mortgage lending to achieve this? The Canadian experience shows that it doesn't. Canada makes a useful comparison for the U.S. Both countries are rich, advanced, stable, have sophisticated financial systems and pioneer histories, and stretch from Atlantic to Pacific. But Canada has no housing GSEs. Mortgage interest is not … (3 comments)
economic crisis: National News: Loonie rises to highest level since July 2008
- 03/17/10 01:23 AM
TORONTO -- The Canadian dollar rose to its highest level since July 2008 on Tuesday after the U.S. Federal Reserve held benchmark interest rates near zero, as expected, and renewed its promise to keep them exceptionally low for an extended period. Building on momentum from firmer oil and equities prices and stronger-than-expected domestic economic data, the Canadian dollar rose as high as $1.0135 to the U.S. dollar, or 98.67 U.S. cents, after the U.S. central bank's decision. Tuesday's rise marked the resumption of the currency's upward march after pausing on Monday as investors took a break after an 11-day stretch … (1 comments)
economic crisis: Bloomberg Update on Canadian Dollar Trades
- 03/11/10 12:21 AM
Canada Dollar Trades Near Five-Month High on Growth Outlook Canada's dollar traded near its strongest level in almost five months as investors bet the nation's economy will be among the strongest during the recovery... With trade data out tomorrow ahead of Friday's employment data, a lot of players may be in ‘wait and see' mode given much of this dollar-Canada move has been on more bullish Bank of Canada rate expectations," Sacha Tihanyi, a currency strategist at Bank of Nova Scotia in Toronto, wrote in an e-mail. "A very good employment print will push these expectations and help drive dollar-Canada even … (0 comments)
economic crisis: Interest Rate Expected to Reach Record Low
- 01/15/09 05:43 PM
Many economists expect that the Bank of Canada will cut interest rates to a record low next week on January 20th to stimulate the economy. Its expected that the Bank of Canada will cut its rate by 0.50% to a record low of 1.00%. The Canadian Banks are expected to follow with a cut to their prime rates, which are currently sitting at 3.50%. European Central Bank to cut its trendsetting interest rate to two per cent on Thursday.
economic crisis: Interest Rate Cut to Lowest Since 1694
- 01/08/09 12:00 AM
The Bank of England has cut its overnight lending rate by half point to 1.5%, the lowest since the central bank was founded in 1694. Many economists believe that the Bank of England will cut rates below 1.0% by the second quarter. The central bank reduced the interest rate by 1.5 percentage points in November and by 1 percentage point in December.
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economic crisis: Bank of Canada Hints of Possible Interest Rate Cut
- 11/19/08 12:54 PM
Bank of Canada governor Mark Carney said in a speech recently that the Canadian economy has deteriorated more quickly than he had anticipated, hinting strongly he will cut interest rates at the next meeting on December 9. This is also the first time that the Bank of Canada has conceded that the Canadian economy could be headed for a recession. "Starting from flat growth in the first quarter of 2009 and the second quarter of 2009 ... recession is a possibility for Canada," commented Carney. The technical definition of a recession is two or more consecutive quarters of negative economic growth. … (2 comments)
economic crisis: Japan Slips into Recession
- 11/16/08 11:26 PM
New numbers released by the Japanese government indicate the country has entered a recession. Japan's economy, the second largest in the world, contracted by 0.1 percent in the third quarter, after shrinking 0.9 percent in the second quarter of the year. Japan has estimated that its Gross domestic product (GDP) contracted at an annualised rate of 0.4 percent. The Bank of Japan has also cut its key interest rate for the first time in more than seven years, lowering it to 0.3 per cent, joining central banks around the world in trimming borrowing costs. Japan joins Germany and Italy on the … (9 comments)
economic crisis: Canadian Gov't may increase Bank Mortgage Purchases to $75 Billion
- 11/12/08 05:07 PM
Finance Minister Jim Flaherty pledged today to triple the amount of mortgages the government can buy from banks to as much as C$75 billion. The Canadian Gov't, using its crown corporation, the Canadian Mortgage and Housing Corp. (CMHC), purchased $25 billion in mortgages last month. Allow me to explain in simply terms what the government is in fact doing... The gov't via CMHC has insured many mortgages for the banks. In other words, CMHC has sold the banks default insurance on mortgages that the banks have provided to their clients, which guarantees that CMHC will cover any shortfall realized by the … (2 comments)
economic crisis: Bank of Canada expected to Lower Interest Rates
- 11/12/08 04:31 PM
Bank of Canada has hinted that they may cut interest rates again. Early today in Toronto, Bank of Canada Senior Deputy Governor Paul Jenkins stated, "Some further monetary stimulus will likely be required to achieve our 2 percent inflation target over the medium term." The Cdn Central Bank cut its benchmark overnight lending rate to 2.25 percent on Oct. 21. Some economists expect that the Bank of Canada will cut their overnight rate a half point to 1.75 percent on Dec. 9. This would be the lowest since 1960.
By ALEX J. POLLOCK
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