Comment 81276

By A Smith (anonymous) | Posted September 26, 2012 at 14:52:20 in reply to Comment 81250

>> Those who wish to push austerity on Canada need to be reminded of these facts, before they send us spiralling down this path too.

In 1981, Canada's GDP (as measured in ounces of gold) was approximately 600M. In 2005, it was 2,746M. Today, after cutting corporate taxes, social programs and interest rates, it has fallen to 1,022M ounces.

If we assume that investors don't want to lose money, the market is telling us that our economy and the policies we have embraced, are not working to create real wealth.

A major part of the free market is price setting. Prices for goods/services and also the price of money. If capital is artificially priced to low, people use too much of it, which can cause shortages in parts of the economy that actually need it.

I would argue that too much money is currently being funneled into housing and not enough into productive investments. This would explain why household incomes are not keeping up with household debt and also why commodities are so expensive.

Raise real interest rates, stop worrying about federal deficits (we print debt on paper) and take care of the poor. If we do these things, Canada will continue to be a great and prosperous country.

Permalink | Context

Events Calendar

Recent Articles

Article Archives

Blog Archives

Site Tools