| US fears of a double dip recession are slowly | | | | prolong the recession because housing has the single |
| becoming a reality. Based on data released on housing, | | | | biggest psychological effect on consumers and when |
| employment, construction and manufacturing it is | | | | house prices go down spending goes down and |
| becoming quite clear that things will more likely get | | | | savings go up. |
| worse before they get better with the world's largest | | | | Canada will have to cut deficits which have already |
| economy facing a huge uphill battle. | | | | wiped out ten years of repayments in one year and |
| One of the main indicators is housing sales which had | | | | with an aging population of two million climbing to ten |
| a 30% month over month decline which happens to be | | | | million in the next decade it is hard to imagine how they |
| the largest on record. US Unemployment numbers | | | | can do this when they barely accomplished debt |
| spiked month over month as well so the employment | | | | repayments at the best of times. Are we really that |
| market will remain under stress for some time. | | | | far behind Greece? |
| The recovery we thought we had was not | | | | Hind sight is always 20/20, but it would have been nice |
| accompanied with job growth which is needed for long | | | | for our politicians to pay down more debt when they |
| term growth. A jobless recovery is not practical or | | | | were over taxing us and running huge surpluses |
| likely and the stimulus spending has done nothing more | | | | instead of going on spending sprees. |
| than create a short term recovery. With western | | | | The only way the government will accomplish the |
| governments preparing to tighten their spending and | | | | needed reductions in debt is to slash spending on |
| reduce deficits the economy has a chance to remain | | | | government programs, benefits and ultimately tax |
| stagnant, but more than likely will decline. | | | | increases. My biggest fear is they usually go for the |
| What does all this mean for Canada, a country that | | | | tax increases first because it is easier to deal with the |
| has done relatively well during this crisis and | | | | public than deal with the public sector unions. Once |
| subsequent recession. Well history can tell us that | | | | again putting strain on our purchasing power which |
| Canada is usually one to two years behind the US | | | | does not help the economy one bit. |
| since most of our exports go to the US. If this | | | | Have we not already seen some tax increases |
| assumption is true then Canada has not really hit the | | | | (HST)? As a Canadian we all must take part in |
| bottom yet. So further economic declines will keep | | | | correcting this mess which will result in short term pain |
| inflation low with a period of deflation possible. Giving | | | | for long term gain but most of all we must hold our |
| the Bank of Canada no reason for to raise rates in the | | | | politicians responsible for the mess they created and |
| short term with very modest increases possible in the | | | | demand more long term vision and accountability. |
| foreseeable future. | | | | We must stop frivolous government spending, |
| One could argue that Canada will find other trading | | | | corporate welfare and funding special interests groups |
| partners and while that is true it will not happen | | | | that do not represent or benefit the masses. We must |
| overnight and even the other trading partners are | | | | demand that government sector workers pay and |
| facing similar challenges. Did we not prove in the | | | | benefits stay in line with what's going on in the private |
| financial crisis that when the US sneezes the world | | | | sector and only then will this disconnect between the |
| catches a cold? | | | | two stop. |
| So with the majority of the western hemisphere in | | | | This entitlement that society feels combined with I |
| decline and China feeling slowing pressure on their | | | | must have it now thinking, short term vision and the |
| economy which many countries hoped that China will | | | | belief that it can go on forever is what brought us here |
| lead the world out of this recession, it is foolish or naive | | | | today. It will get better and if everyone takes some |
| to think that Canada can go on without feeling the | | | | responsibility the world will be a better more |
| effects of the rest of the world. | | | | responsible place. |
| If housing prices start falling as predicted it will only | | | | |