People keep saying we over loosened for the past 15 years. Low interest rates were actually needed between 2008-2013 to get Canada through the recession. What we should have done was increase interest rates when we knew government spending was going to go through the roof after 2015.
Without a doubt, Jim is right. They are holding interest rates too high because mortgage rates will kill the consumer and oil prices are high. When oil prices are high we don’t need to knee cap ourselves with high rates.
Jim's assertion of lower BoC rates fails miserably from a macro perspective when one considers the 'net' inflationary damages that would occur to Loonie FX valuations dropping as the BoC lowers rates independently from US Fed rates. Canada is an importing country...... just think what effect a 68 cent Loonie would do to Canadians already struggling for Food/Groceries and energy costs(priced globally)
Depends - 68 cent dollar can be huge for the Canadian economy from an exporting and near shoring perspective for the US economy. Ironically our best years as a country in GDP often coincide with our dollar being well below the US dollar. Despite what the current Liberal party tries to tell you, we are an exporting economy and neighbours to the largest economy in the world - that’s a good formula if government gets out of the way (carbon taxes, anti pipeline, anti agriculture, anti blue collar in general) The future trend of near shoring means we could be building chips in Canada instead of Taiwan and 68 cent dollar helps us do that…a dollar at or near the US repatriates those same jobs…to the US but a 32 percent margin, heck a 20% margin makes it attractive to open in Canada.
Canada is neither an net trade import or export country historically. We go positive when oil prices are higher and net negative when lower oil prices. We go higher Canadian dollar when oil price is higher too. If you don’t understand/talk about oil then you don’t understand the Canadian economy.
@@clo oil is a major contributor to our economy regardless of the price so I agree with you there. But regulation, taxes, market access and government policy all affect the production of oil as much if not more than purely the price. It’s also unfair to say oil is the only export. We are a major exporter of natural gas, potash, lumber, agriculture, gold, silver, we have one of the highest stores of lithium in the world but don’t mine it at scale and lots more… just because we don’t fully leverage our resources doesn’t mean they aren’t there to help drive our economy - with the right incentives and economic policy we are easily a net exporter consistently
@clo WTF are you on about ? As long as Oil is priced in USD and the disparity between wti and wcs exists.... any independent BoC lower on rates more than maybe .5 Bps from US Fed Rates would tank the Loonie making Food/Groceries most of which Canada imports from the USA MORE expensive.... and also pushing up FUEL costs (again Oil priced in USD) for Canadians(inflation). Yeah... I GET the Canadian economy.... do you "GET" cpi inflation away from Alberta/Sask ? The comment is relative to BoC rates "relative" to US Fed Fund rates and the chances therein for deviation by the BoC independent to stave off coming Mortgage defaults ?
I wish she would stop cutting him off. He’s is right on the money. When has the Fed or the BoC ever gotten anything right? Never. Wage growth will not be inflationary as mortgage rates and fuel and food prices stay high. Maybe some wage growth will help folks pay off their debt which has also increased in the past few years.
Because he's calling out the government on their irresponsible spending. What do you expect from a moron who thinks budgets balance themselves? The damage this government has done by ignoring all fiscal prudence will last a generation.
BoC said in their report that interest rate changes take 12-18 months to take effect. Reason #1 that rates increases should have been halted much earlier. Second, Jim is right: as fixed rate mortgages are due for renewal at 7% and 8% (from 2%) there will be a HUGE downward impact on the economy in 2024 & 2025.
Tiff the stiff needs to publicly suffer the humiliation he has exposed Canadians to from his disgusting misguidance that rates would stay low for years. Had he even a modicum of integrity, Tiff would resign and hide forever.
Just wait until people get what they ask for, rate cuts... Then when inflation comes back again everyone will be whining for higher rates and a recession as they will soon see that high inflation over an extended period is even more damaging than having a deep recession now. Many people see the world through a pinhole.
@@donm2067 Maybe we could send a couple more billion over to the Ukraine money laundering operation, so that all Canadians have equal opportunity to enjoy the tent cities and food banks.
@@donm2067 Let's be honest, having your shelter, food and energy costs increase 50%-100% YoY isn't something most Canadians can easily stomach. If wages are up 5% but utilities are up 150% I'm not sure how much that compensation bump helps, especially since CPP contributions will be increasing
If housing related costs represent 70% of inflation. That means the only way rates will go down is if the price of housing goes down. The only 2 things that can lower it are number 1 lower rates, which were not getting till inflation is lower, and guess what folks Real Estate value. This doesnt end without a major correction in real estate value. Which is what most people think is needed anyway.
BOC and federal reserve is trapped... the underlying economy is terrible... it will get worse by 1st quarter next year... I dont think the BOC will raise anymore, they are witnessing a breakdown in many sectors. They do not want to excite the market either... their tone will change 1st quarter/2nd quarter next year
Rent inflation is due to high rates effecting mortgages. People can't buy a house, no one qualifies. Renting is the only alternative. I mean lets be honest, no everyone has nice parents who allow you to freeload in their basement.
As a younger millennial, I can say trying to qualify now is rough; I had to put down almost $250k one of my properties last year. Anecdotally, I only know one homeowner my age who didn't get cash from the bank of mom and dad for their down payments
This inflation saga is going to drag longer and harder with the political influences.
bnn THIS IS FANTASTIC MORE OF IT PLEASE
They
didnt over tighten, they over loosened , for past 15 years. The ponzi is over.
Awsome back and forth. Love the different perspectives. Keep Jim coming back please I want to hear more of these perspectives.
BNN more of this !
Jim seems hangry. Did he skip his breakfast?
People keep saying we over loosened for the past 15 years. Low interest rates were actually needed between 2008-2013 to get Canada through the recession. What we should have done was increase interest rates when we knew government spending was going to go through the roof after 2015.
Without a doubt, Jim is right. They are holding interest rates too high because mortgage rates will kill the consumer and oil prices are high. When oil prices are high we don’t need to knee cap ourselves with high rates.
Excellent conversation !
Jim's assertion of lower BoC rates fails miserably from a macro perspective when one considers the 'net' inflationary damages that would occur to Loonie FX valuations dropping as the BoC lowers rates independently from US Fed rates.
Canada is an importing country...... just think what effect a 68 cent Loonie would do to Canadians already struggling for Food/Groceries and energy costs(priced globally)
Our dollar is screwing us.
Depends - 68 cent dollar can be huge for the Canadian economy from an exporting and near shoring perspective for the US economy. Ironically our best years as a country in GDP often coincide with our dollar being well below the US dollar. Despite what the current Liberal party tries to tell you, we are an exporting economy and neighbours to the largest economy in the world - that’s a good formula if government gets out of the way (carbon taxes, anti pipeline, anti agriculture, anti blue collar in general)
The future trend of near shoring means we could be building chips in Canada instead of Taiwan and 68 cent dollar helps us do that…a dollar at or near the US repatriates those same jobs…to the US but a 32 percent margin, heck a 20% margin makes it attractive to open in Canada.
Canada is neither an net trade import or export country historically. We go positive when oil prices are higher and net negative when lower oil prices. We go higher Canadian dollar when oil price is higher too. If you don’t understand/talk about oil then you don’t understand the Canadian economy.
@@clo oil is a major contributor to our economy regardless of the price so I agree with you there. But regulation, taxes, market access and government policy all affect the production of oil as much if not more than purely the price.
It’s also unfair to say oil is the only export. We are a major exporter of natural gas, potash, lumber, agriculture, gold, silver, we have one of the highest stores of lithium in the world but don’t mine it at scale and lots more… just because we don’t fully leverage our resources doesn’t mean they aren’t there to help drive our economy - with the right incentives and economic policy we are easily a net exporter consistently
@clo
WTF are you on about ?
As long as Oil is priced in USD and the disparity between wti and wcs exists.... any independent BoC lower on rates more than maybe .5 Bps from US Fed Rates would tank the Loonie making Food/Groceries most of which Canada imports from the USA MORE expensive.... and also pushing up FUEL costs (again Oil priced in USD) for Canadians(inflation).
Yeah... I GET the Canadian economy.... do you "GET" cpi inflation away from Alberta/Sask ?
The comment is relative to BoC rates "relative" to US Fed Fund rates and the chances therein for deviation by the BoC independent to stave off coming Mortgage defaults ?
13:34 finally someone spoke the truth ❤
This is what ripping off a bandaid slowly looks like.
I loved this GREAT JOB BNN
Jim Thorne is great….the mainstream probably hate him.
He is just freaking out because the five properties he owns are going to get wrecked, such as the US did in 08. It will be beautiful.
I wish she would stop cutting him off. He’s is right on the money. When has the Fed or the BoC ever gotten anything right? Never. Wage growth will not be inflationary as mortgage rates and fuel and food prices stay high. Maybe some wage growth will help folks pay off their debt which has also increased in the past few years.
@@jimmason8502like it or not, increased labour costs do have an effect on input costs. There is just simply too much debt sloshing around.
Because he's calling out the government on their irresponsible spending. What do you expect from a moron who thinks budgets balance themselves? The damage this government has done by ignoring all fiscal prudence will last a generation.
It’s funny how they blame union workers for negotiating higher wages for inflation but not teachers or government workers.
Jim Thorne spot on at the end✌🏼
Financial Discipline is dead at Ottawa
Ordinary people are suffering
BoC said in their report that interest rate changes take 12-18 months to take effect. Reason #1 that rates increases should have been halted much earlier. Second, Jim is right: as fixed rate mortgages are due for renewal at 7% and 8% (from 2%) there will be a HUGE downward impact on the economy in 2024 & 2025.
If our governments keep printing and spending it will keep going…
Remember when they said.. 'It's Transitory'
It doesn’t matter, the key question is how long the high rate period is. Actually the longer they pause, the longer the high rate period.
love to see people fighting each other
I love Jim
Huge mistake; should have increased.
I love Jim Thorne, he's like Canada's Cramer!
Government spending is not helping - Tiff
Trudeau didn't got the message 😂
Jim is obviously a real estate speculator
"My job is not to be intellectually correct..." 😂
I like Earl please have him coming back
Tiff the stiff needs to publicly suffer the humiliation he has exposed Canadians to from his disgusting misguidance that rates would stay low for years. Had he even a modicum of integrity, Tiff would resign and hide forever.
Last call for the Bitcoin train
I like Jim Throme but he needs to be less combative in his response
Jim is right. But why the hostess always cut him off? Why? Not a good hostess at all!
Starving Canadians who can't afford housing feel so much better now. Thank you Liberals and the B.O.C.
They can thank themselves for not being financially responsible
Just wait until people get what they ask for, rate cuts... Then when inflation comes back again everyone will be whining for higher rates and a recession as they will soon see that high inflation over an extended period is even more damaging than having a deep recession now. Many people see the world through a pinhole.
@@donm2067 Maybe we could send a couple more billion over to the Ukraine money laundering operation, so that all Canadians have equal opportunity to enjoy the tent cities and food banks.
@@donm2067
Let's be honest, having your shelter, food and energy costs increase 50%-100% YoY isn't something most Canadians can easily stomach. If wages are up 5% but utilities are up 150% I'm not sure how much that compensation bump helps, especially since CPP contributions will be increasing
"It's not rhetoric, these are statements"
Lol
I like this dude ! Hawk
If housing related costs represent 70% of inflation.
That means the only way rates will go down is if the price of housing goes down.
The only 2 things that can lower it are number 1 lower rates, which were not getting till inflation is lower, and guess what folks Real Estate value.
This doesnt end without a major correction in real estate value.
Which is what most people think is needed anyway.
guy is screaming the warning signs from the roof tops and no one is listening
Jim Thorne is unnecessarily trying to snub Earl Davis. The discussion should squarly and professionally be on topic without getting personal.
It would be great if they stop bringing the whiney old guy in glasses as a guest.
he had some good points today, but he's just so damn argumentative and unwilling to see other perspectives
They need more of him! Perspectives with passion and research.
Argentina wannabe? When the currency become worthless
BOC and federal reserve is trapped... the underlying economy is terrible... it will get worse by 1st quarter next year... I dont think the BOC will raise anymore, they are witnessing a breakdown in many sectors. They do not want to excite the market either... their tone will change 1st quarter/2nd quarter next year
Take out mortgage interest and factor in the facts that to carbon tax is inflationary, were in a bad situation
Jum is annoying Earl keep calm your wise like your take
Rent inflation is due to high rates effecting mortgages. People can't buy a house, no one qualifies. Renting is the only alternative. I mean lets be honest, no everyone has nice parents who allow you to freeload in their basement.
No its high rares on over inflated mortgages that no one can afford. 😅
As a younger millennial, I can say trying to qualify now is rough; I had to put down almost $250k one of my properties last year. Anecdotally, I only know one homeowner my age who didn't get cash from the bank of mom and dad for their down payments
inflation risks increase. Yet the government said they had inflation beat.
Current gov't is a clown show.