It would almost be farcical if the stakes were not so high.The banks are begging to be regulated. "stop us from lending so irresponsibly" they are pleading to Flaherty. "We can't stop ourselves. While the other guy is pushing debt, we have to do so too, or our bonuses will suffer".
Flaherty says he won't have anything to do with it. He is a free-marketeer after all, see what they did to the Wheat Marketing Board. Unless of course you are the CMHC.
Carney witnessing the catastrophe of debt he has helped unleash is begging both sides to - please show more restraint.
Now consumers have their say. Don't lend us so much! They have this sweet naive notion that the banks who are lending them the money are somehow working in their best interests.
How cute!
Will no-one accept responsibility??
The credit unions are being squeezed to death in this low-rate environment. They have to make money somehow. Their costs of borrowing are higher than the Big 5 and they can't afford to pay out as much on their savings accounts.
ReplyDeleteSo even they are forced, by Carney's lack of action, to lend money and probably make riskier loans than they would if rates were higher and all their customers weren't splitting for half a percent more at a regular bank.
The whole nasty system feeds on itself. Once upon a time, there were many BC credit unions, maybe 60 of them. Now they've merged down to something like 25. They are waiting for higher interest rates so they can normalize profits.
the Credit Unions could well be ground zero i/when the collapse happens.
ReplyDeleteBTW- house in West Van
14.3 M - reduced to - 12.98M - reduced to 9.98 M. Just imagine someone could save themselves almost $5M! I'll take two please.
I buy tree, huzzbuh buy tree, for price of two!
DeleteI buy three, my dog buys three.
DeleteA good thing that dog and I can count to THREE.
15 new SFH in West Van. 6 price changed and 2 solds. HAM where-for-art-though?
ReplyDeletefacing murder charges at 39, 55 N, 116, 25 E
Deletealready confessed to moving US$1.5B off-shores
but the locations of Vancouver properties still a big secret
They're in Toronto to even things out. Kinda like a fat person wanting not to eat too much more cake but notices the last slice left things a bit uneven. Just taking a bit of the edges until prices there make prices here look cheap. Then they'll be back.
ReplyDelete@egghead, I worry about credit unions too, they are heavily geographically concentrated and depend heavily on deposits from the same area. They claim to be 100% backed, unlimited deposits, by the provincial government. There is a growing risk that backing will be mentioned a bit more over the coming years.
ReplyDeleteHere's something I wrote a year ago: http://housing-analysis.blogspot.ca/2011/05/tale-of-two-vancities.html
fish, you are hitting on what should be obvious: banks will lend everything they can, they cannot help it, only when loans are so obviously risky and without collateral will they stop. I don't see bank loan distribution but they will continue to make low-ratio loans with impunity until forced to do otherwise. The government, by changing CMHC insurance and implementing tighter risk management controls through OSFI, is in effect causing banks to hold back more capital on residential loans, especially in Vancouver. Banks hate it because it decreases their earnings -- less fully-hedged loans can now be made. The government is hoping this means they will start pushing loans into businesses instead of consumers. We'll see...
Well Anon you my be right. Some of them drifted back. :)
ReplyDeleteActually most of the sales went through local realtors not the usual HAM reps.
West Van did 15, 4, 9 tonight.
You do it...no you do it...no..
ReplyDeleteYou see it...no you don't see it...no..
Not a single western, democratic, and capitalist country notices that $80 billions were wired to the west until NOW!
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