Content By: The Coming Depression Editorial Staff (dates cited below)
Copyright: include link to this article on top of reproduction if you use it.
Bookmark and Share
(No Ratings Yet)
Loading...

person drowning

“Inflation came in hotter than expected. Markets were expecting to see a 2.2% increase in headline inflation but it came in at 2.4%. The more important piece of information is what happened to core inflation because I think markets will largely look past the increase in energy prices. The more important issue is that the core inflation advanced 1.8% — that’s up from 1.5%. Markets were actually expecting an unchanged reading at 1.5%”

“I really don’t think this changes anything from the point of view of the Bank of Canada. I still think that the Bank of Canada is going to remain on hold in the coming months. There is still an awful lot of uncertainty related to the economic outlook as we’re looking at unsettled financial markets related to what’s going on in Ireland and continued concerns about the U.S. economy. I think the Bank of Canada won’t view today’s inflation report as unduly worrying. So while we have seen core inflation move back up a bit and closer to the Bank of Canada’s 2% target, it doesn’t change my assessment that the Bank of Canada is probably on hold until the middle of next year.”

“Whenever you have stronger inflation numbers, it should be positive for the currency, because it raises the odds of the Bank of Canada doing something sooner rather than later, but I think if the Canadian dollar does get a lift on that perception, I think it would be the wrong one.” source

Canadians doubt official reports

Canadians have way too much mortgage and consumer debt. The only way to curb this problem is to incease interest rates, and of course that makes most readers here (and Canadians) unhappy. Many advisors tell us that rates should be no less than 4 or 5% in this market (Canada), and we are going to continue to shoot ourselves in the foot until we get that correction. Many bankers are upset at the Bank of Canada for letting this slide. What has happened is that the Bank of Canada is punishing responsible people in favour of those in serious mortgage and debt. The result? Higher commodities for everyone.

The price of energy is up, mainly due to the HST, which drives up costs in other sectors, like food and shelter. This in turn is reflected in a higher inflation rate. The Bank of Canada justifies the need to “cool off” this inflation by raising interest rates.

shadow stats real inflation rate Real US Inflation Chart provided by Shadowstats

Consumers who are already paying outrageous interest on debt will then face even higher interest rates as the banks immediately and exponentially pass along Bank of Canada increases despite their rates never dropping in sync with the current 1% rate in the first place. Thus, cash-strapped consumers will be gouged even more, creating a vicious circle.

Probert from Canada writes:

According to my calculations, life in November of 2010 is actually costing me about 12% more than it did a year ago! Where does the 2.4% number come from?

Commuting back and forth to work now costs me 14% more today than it did a year ago. The HST increased the cost of gasoline automatically by 8% and the additional rise in fuel costs accounts for the other 6% increase. Fuel for transportation costs me 11.75% my NET EARNINGS every month. I needed a 14% increase like I need a hole in my head! This doesn’t even include the costs of financing, insurance and maintaining a vehicle.

The cost of electricity in Ontario went up automatically by 8% with the introduction of the HST. Furthermore, the introduction of “Smart Meters” is also costing me an additional 4% on my overall electrical bill! Electrcity is now costing me 9.23% of my total household NET INCOME.

What do you think the inflation rate is?

View Results

Loading ... Loading ...

My property taxes have increased every year for the past eight years! They now account for 5.76% of my total NET HOUSEHOLD INCOME! Every year, my property taxes go up, and services get reduced or illiminated, or service fees now apply.

Only the wealthy unaffected

Naturally, only the wealthy elite will receive any mitigating increases to their incomes (likely at the rate of unjust enrichment), while the rest of us are forced to struggle earning even less and paying more. I’m having a hard time reconciling Dalton McGuinty’s promise that the HST would create 600,000 jobs unless they are part-time minimum wage.

If the HST ultimately causes mortgage and debt interest payments to increase, thus causing substantial economic damage to the families, retirees, and businesses of Ontario, proving Dalton McGuinty’s promises of HST prosperity as malicious falsehoods, then he and his Liberals should face criminal charges and class action litigation.

This entry was posted on Tuesday, November 23rd, 2010 at 1:28 pm and is filed under All Posts, North America. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

Leave a Comment

Please note: Comment moderation is enabled and may delay your comment. There is no need to resubmit your comment.


Read previous post:
bank bailout ireland
Irish EU bailout spooks bank holders; banks lose 17pc deposits amid bank run

"Allied Irish Banks announced Friday it has lost a staggering euro13 billion ($18 billion), or 17 percent, of its total...

Close