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The 'best prepared' award goes to.... CANADA (pg. 3)
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| slingshot |
| Saying we were "most prepared" is a bit of a misconception. Saying we got "lucky" is probably closer to the truth. |
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| Yohan |
| quote: | Originally posted by slingshot
Saying we were "most prepared" is a bit of a misconception. Saying we got "lucky" is probably closer to the truth. |
stop ruining it for people who just want to get a 1up on the yanks :o |
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| ChemEnhanced |
| quote: | Originally posted by slingshot
Saying we were "most prepared" is a bit of a misconception. Saying we got "lucky" is probably closer to the truth. |
I wouldn't say we got lucky....I think the fact that we just came off the highest canadian dollar in decades and the highest oil prices we've seen had something to do with us being prepared for this. |
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| Spam |
| quote: | Originally posted by ChemEnhanced
I wouldn't say we got lucky....I think the fact that we just came off the highest canadian dollar in decades and the highest oil prices we've seen had something to do with us being prepared for this. |
The highest Canadian dollar in decades hurt our exports, no?
It may also have helped that our system wasn't entrenched with bad debt like the other nations were. Did our banking regulations stop that debt from entering the Canadian banking system? |
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| DigiNut |
| quote: | Originally posted by slingshot
Saying we were "most prepared" is a bit of a misconception. Saying we got "lucky" is probably closer to the truth. |
I think it's a little from column A, a little from column B. We're so heavily tied to the U.S. economy that we can't merely get lucky.
A lot of people seem to think that Canadians have just been sitting around waiting for the global recession to go away, but that's not the case. To name just a few things:
- 4 years of fiscal conservatism, including tax reductions
- Relatively loose regulations on the financial sector (or maybe just clearer/better regulations)
- SMB incentives like IT infrastructure tax rebates (huge)
- Low interest rates
In essence, Canada has been clearing up red tape and giving money back while economic powerhouses like the U.S. think they can solve the problem by borrowing pantloads of money and tightening regulations, and before anyone starts up, I know that Bush was every bit as much to blame for this as Obama is now.
We're still heavily taxed and heavily regulated, and I'm sure that there is an element of luck, and oil, but don't be too cynical; things happen for a reason. |
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| Dr. Z |
I think that canadian hedge funds make a smaller percentage of the canadian stock market than the american hedge funds of the american stock market. When american hedge funds pulled out (first) that cut the levels in half, while the american public just panic sold to drive it down even further. Since we had a delayed reaction, due to individual investors having a delayed panic, we didn't see such low levels for canadian companies. This generated hope that miraculously stifled the crash, for us.
Thats my guess... |
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| Moral Hazard |
| quote: | Originally posted by DigiNut
I think it's a little from column A, a little from column B. We're so heavily tied to the U.S. economy that we can't merely get lucky.
A lot of people seem to think that Canadians have just been sitting around waiting for the global recession to go away, but that's not the case. To name just a few things:
- 4 years of fiscal conservatism, including tax reductions
- Relatively loose regulations on the financial sector (or maybe just clearer/better regulations)
- SMB incentives like IT infrastructure tax rebates (huge)
- Low interest rates
In essence, Canada has been clearing up red tape and giving money back while economic powerhouses like the U.S. think they can solve the problem by borrowing pantloads of money and tightening regulations, and before anyone starts up, I know that Bush was every bit as much to blame for this as Obama is now.
We're still heavily taxed and heavily regulated, and I'm sure that there is an element of luck, and oil, but don't be too cynical; things happen for a reason. |
While I largely agree with you I do have to take issue with two points....
1) we have not had 4 years of fiscal conservatism, in fact, government spending has increased at a rate higher then inflation every year since the CPC took power. I'm not saying that the increase was unwarranted or passing any sort of value judgment on the spending increase here; however, to call the present government fiscally conservative simply ignores the facts in favour of the rhetoric.
2) you cite relatively loose regulations as one of our strengths; however, it is exactly the regulations on the banks (largely brought in by the Martin and Harper governments) preventing them from investing heavily in asset backed commercial paper and requiring a relatively (to the US and UK) high cash:deposits ratio that has prevented them from going down the same route as their counterparts in the rest of the world. |
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| Skipper |
^^ I agree increased regulation in Canada has been part of our success but it's my understanding that the banks were permitted to invest in ABCP no? I thought that is what they took the write downs for many moons ago.
I think the difference mostly comes back to our lending standards in Canada, which prevented us from going through the same crash that the US is going through, although much of the ABCP floating around with Cdn investors was backed by US mortgages. |
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| DigiNut |
Lenders in the U.S. were largely bullied into handing out subprime loans to people who were high credit risks (not that they didn't make plenty of mistakes of their own to go along with it). In spite of all the political correctness here, we've tended to leave the banks alone.
Lenders here also seem to get away with much more ridiculous term sheets than American lenders. Maybe this isn't related to regulations or lack thereof, and just reflects different lending standards as Skipper says.
I do think that regulations are looser in some areas, though of course not all. That is why I added "maybe just clearer/better regulations."
As for the point about government spending, I don't have the exact statistics on hand, but didn't the federal government redirect a large chunk of of the budget to paying off the debt? Maybe I'm wrong, but if I'm right then I think that qualifies as fiscal conservatism, even if they've spent more overall as a result.
Finally, last I checked, Canada did have an ABCP market worth some $32 billion, and it was frozen in 2007 by the banks themselves, not regulators. There was even a case that went to the Supreme Court (and was subsequently thrown out) where investors were trying to get them to "restructure" so they could get their money back. Again, maybe my facts are in error here, but I don't think that government regulations had anything to do with it. |
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| Skipper |
| Why/how/by whom were lenders bullied into lending to subprime customers? |
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| DigiNut |
| quote: | Originally posted by Skipper
Why/how/by whom were lenders bullied into lending to subprime customers? |
No one bullied them into subprime loans in general; it's a question of who they loaned to. And the bullying was largely by deadbeat idiots screaming "You just won't give me that loan because I'm _______" and the courts and bleeding-heart politicians acting out of misplaced sympathy.
And if you or anybody else here disagrees, fine, I don't want to get into it, we already had this debate. I know that it doesn't exculpate the American financials from their other poor practices that were entirely by choice and not imposed, but it's a complex equation and that was definitely a factor. |
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| 7-4-7 |
harper inherited a surplus.
The only thing he has changed is his hair colour.
him.
Ignatief wins next. |
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