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- Sep 25, 2007
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- 201
Hi all,
An article from the current issue of Canadian Business magazine. Excerpts:
Canada`s economic stability had been noticed even before Harper began his publicity tour. The World Economic Forum in late 2008 rated the country`s banking system as the soundest on the planet. In March, the Financial Times ranked Bank of Canada governor Mark Carney as one of the 50 people who will shape the future of capitalism. And no less than President Barack Obama said Canada had proven itself to be "a pretty good manager of the financial system and the economy in ways that we haven`t always been here in the United States."
It is Canada`s well-managed banking sector that is most often cited for its resilience in the face of global tumult. Once ridiculed as overcautious and overly regulated, Canada`s banking sector is now being used as a model in the United States, Ireland and beyond. Britain is spending $28.6 billion to bail out Lloyds Banking Group, and the U.S. has lost more than 122 banks between January and the middle of November alone. But not a single Canadian bank closed during the recession, none needed bailouts and Canadian government`s lone intervention in the industry - an offer to purchase $125 billion in insured mortgages - went half unused.
A bit of caution proved a boon to Canada in other areas as well. During the boom years between 2002 and 2007, the residential construction levels did not exceed demographic requirements, according to Pedro Antunes, an economist with the Conference Board of Canada. "We didn`t see an overbuild in any way," he says.
Even when you consider personal finances, Canadians proved far more moderate than their American counterparts. Total household debt in Canada sits at roughly 102% of income. In the United States, the ratio is 114%. While many Americans were forced to start paying down their debts, Canadians were able to take advantage of low borrowing rates, buoying consumer spending.
If high commodity prices and Canadians` open wallets pulled the country through the start of the recession, the government`s stimulus package will be the "bridge" that gets the country back on the road to growth, says Antunes. However, it was a bridge the Conservative government initially seemed reluctant to build, despite what Harper told U.S. cable channels.
Regardless of the government`s budgetary excesses, the past year has cast Canada as a symbol of fiscal prudence and sound management to the rest of the world.
http://www.canadianbusiness.com/after_hour...118_10012_10012
Keith
An article from the current issue of Canadian Business magazine. Excerpts:
Canada`s economic stability had been noticed even before Harper began his publicity tour. The World Economic Forum in late 2008 rated the country`s banking system as the soundest on the planet. In March, the Financial Times ranked Bank of Canada governor Mark Carney as one of the 50 people who will shape the future of capitalism. And no less than President Barack Obama said Canada had proven itself to be "a pretty good manager of the financial system and the economy in ways that we haven`t always been here in the United States."
It is Canada`s well-managed banking sector that is most often cited for its resilience in the face of global tumult. Once ridiculed as overcautious and overly regulated, Canada`s banking sector is now being used as a model in the United States, Ireland and beyond. Britain is spending $28.6 billion to bail out Lloyds Banking Group, and the U.S. has lost more than 122 banks between January and the middle of November alone. But not a single Canadian bank closed during the recession, none needed bailouts and Canadian government`s lone intervention in the industry - an offer to purchase $125 billion in insured mortgages - went half unused.
A bit of caution proved a boon to Canada in other areas as well. During the boom years between 2002 and 2007, the residential construction levels did not exceed demographic requirements, according to Pedro Antunes, an economist with the Conference Board of Canada. "We didn`t see an overbuild in any way," he says.
Even when you consider personal finances, Canadians proved far more moderate than their American counterparts. Total household debt in Canada sits at roughly 102% of income. In the United States, the ratio is 114%. While many Americans were forced to start paying down their debts, Canadians were able to take advantage of low borrowing rates, buoying consumer spending.
If high commodity prices and Canadians` open wallets pulled the country through the start of the recession, the government`s stimulus package will be the "bridge" that gets the country back on the road to growth, says Antunes. However, it was a bridge the Conservative government initially seemed reluctant to build, despite what Harper told U.S. cable channels.
Regardless of the government`s budgetary excesses, the past year has cast Canada as a symbol of fiscal prudence and sound management to the rest of the world.
http://www.canadianbusiness.com/after_hour...118_10012_10012
Keith