Canada's Economy: It's not great.

Canada, a country that welcomes immigrants and refugees from around the world and a country with freedom and a great atmosphere. Yet when I take Canada into economics, it doesn't do well on my list. Canada may be the best economy in the G7, but don't see that for too long.

Previously the Bank of Canada minister issued a warning. He said we have more debt than our equity. This should have brought a warning to all to be more careful with their money, but are we? We may have tighter lending laws, but is it useful? The US had bad lending laws and banks lent money to anyone without researching them. Look at Canada, our unemployment rate is 8%, which is high. Also, many Canadians aren't going to be able to pay their mortgage if one goes out of work or if interest rates go up. What does that tell you? Well, it says that people get qualified before, but can't make the payments later. Isn't that like the US only with a delay. Lets take Lehman Brothers as an example. They sold companies at a discount and bought them back at a higher price. At first it was a profit, but it swallowed and destroyed the company didn't it?

Canada also doesn't have much to offer to the world. Look at our logging industry, we have it but nobody is buying. Banking, forget about it how would they survive if Canada increased interest rates from the lowest rate in years. Mining, at least there's some hope there until gold collapses soon. Medical, what do we have there? We have a low number of drug or research companies. The list could go on forever and with Canada having a low money supply and a high deficit. I think it's safe to say its only a matter of time.

Lets look at housing for a moment. People borrowing money that they know they can't pay back if interest rates were to rise. A bubble in markets like Vancouver and Toronto. The average home price at $344,000. Interest rates at all time lows, I think we get the picture. The housing market is at a bubble right now. The federal government has created it and is trying to stop it from popping, but it will devastatingly. The bubble will pop like how people said the Dot-com bubble would't pop or how banks were too big to fail in the US and the US housing market. They said it wasn't possible, but it happened. They tried to stop it, but it happened. How about Japan? They had a bubble and they barely borrow money to buy anything. They save money rather than Canadians and Americans. Look at their housing market, it collapsed too. Yet Canadian analysts say it's not possible, but what happens if the TSX would crash 200 points in one day. What if the Bank of Canada rose interest rates? What would happen analysts? What would happen!

They say it's impossible to try and trick you into spending more to sustain the economy. Canada could've crashed earlier and not be in such a big mess than if it were to crash now. Look it interest rates rose, the housing market would be full of foreclosures. People aren't saving a lot anymore and more people are out of work to pay their bills and mortgages and are taking a lot of debt. People try to lie to themselves saying it's a good investment without thinking of the side effects.

If the crash were to happen, it would've happened earlier as Canada wouldn't have hit hard. The harder you fall, the more you lose than to have done it earlier in life or history. It's the same with economics.