LACKIE: BoC seems intent on blowing up economy in order to fix it

Interest rates have stayed too low for too long, and as irrational exuberance fueled our real estate market, many people have defied their heads

content of the article

Last week real estate Twitter started tweeting.

advertising 2

content of the article

It seemed that a group of Vancouver homeowners, furious at the Bank of Canada rate hikes, felt compelled to protest. The accompanying petition bemoaned the affordability crisis and called for government intervention.

content of the article

At first glance I didn’t make much of it. After years of COVID restrictions and vaccination guidelines, and the ensuing protests both online and online, that anger has completely returned to normal.

And now that we’re in the midst of the sharpest and fastest rise in interest rates in decades, and the Bank of Canada’s messages are dancing around the reality that its interest rate stance has made a complete 180. For far too long they have delayed an appropriate response to what was clearly an impending inflationary crisis.

advertising 3

content of the article

And now here we are, and it feels like the BoC’s position has shifted from complete and total magical thinking about “temporary inflation” to a tacit acceptance that the only way out of this mess will be the economy essentially blowing them up and then putting them back together again.

Good times.


We apologize, but this video could not be loaded.

It’s hard not to be angry that we were led to this place. Interest rates have been too low for too long. Point. And in that time, the irrational exuberance that has fueled our real estate market — even for just the last twelve months — has gotten over the heads of many people.

Those protesting homeowners in Vancouver? It turned out to be mostly local real estate agents who were absolutely incensed that their real estate speculation was matched by objectively extreme leverage with actual risks and not the guaranteed returns one can only assume they guaranteed their clients.

Also Read :  Fed is locked into raising rates without pushing the economy into a recession

advertising 4

content of the article

Everyone is a genius on the way up. Everyone’s a victim on the way down.

What a mess.

And now that the stock market is also imploding, the inconsequential ambition is about to get home to settle down.

Many stupid people have made financial decisions that will prove absolutely disastrous.


We apologize, but this video could not be loaded.

In the months to come, prepare to hear more stories from those in need after they pulled every penny they could out of their house to invest in a stock market they didn’t really understand, but the now also being beaten.

Pre-build buyers who not only can’t unload what they bought at the price they bought it at, let alone the profit promised to them, won’t be able to qualify for any financing at all to complete the deals to complete.

advertising 5

content of the article

Private credit has declined and capital is now harder to come by and surprisingly expensive if you can find it. Do not believe me? One only has to do a little foray into Reddit to hear some of the gruesome stories. And it hasn’t even gotten particularly bad.

Also Read :  UK economy hit as people shop less than pre-Covid

I know what you’re thinking – blame the brokers. And yes, there are far too many unscrupulous real estate agents out there who absolutely deserve your contempt. But at the same time, where does personal responsibility come into play? If the old adage says “with great risk comes great reward”, the other side of this coin is certainly true.

All right, protest, boys. But if you sincerely believe that your fellow taxpayers should relieve you of the consequences of your bad decisions, you are a long way from learning the lesson the universe is sending you.

Many will have no qualms about telling you that you deserve whatever comes your way.


Display 1


Postmedia strives to maintain a vibrant but civilized forum for discussion and encourages all readers to share their views on our articles. Comments may take up to an hour to be moderated before they appear on the site. We ask that you keep your comments relevant and respectful. We’ve turned on email notifications – you’ll now receive an email when you get a reply to your comment, there’s an update on a comment thread you follow, or when a user you follow comments follows. For more information and details on how to customize your email settings, see our Community Guidelines.


Leave a Reply

Your email address will not be published.