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It's different in #Canada. (Thread)
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by @hmacbe view original on Twitter
Eurozone countries don't have monetary autonomy or even absolute control over their banks. Canada does.
Japan's population is demographically very old and thus intolerant of inflation. Canada's isn't.
Japan's population is demographically very old and thus intolerant of inflation. Canada's isn't.
The US real estate bubble was localized.
Vegas, Phoenix, and South Florida went nuts while Texas slept through it. #VanRE and GTA are important enough to get a coordinated response at the national level.
Vegas, Phoenix, and South Florida went nuts while Texas slept through it. #VanRE and GTA are important enough to get a coordinated response at the national level.
The banking market is extremely concentrated which allows the TBTF policy of suspending mark-to-market on bank assets a real option.
Their oil, metal-bending, and forestry sectors would get a big boost if/when they devalue. Also the FDI that fuels this mess gets a boost because in their home currencies the homes become cheaper to buy.
The riddle is easy to solve.
They (soft) devalue the Canadian Dollar through negative interest rates. If a vacant home can be financed with a positive carry then prices won't fall by much. This process socializes losses.
They (soft) devalue the Canadian Dollar through negative interest rates. If a vacant home can be financed with a positive carry then prices won't fall by much. This process socializes losses.
I struggle to see this ending any other way.
cc @hmacbe @AlderLaneeggs @willybalters @LandlordRescue
cc @hmacbe @AlderLaneeggs @willybalters @LandlordRescue
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