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Mortgage Broker News | 26 Oct 2009, 11:30 AM Agree 0
Anyone following Bank of Canada governor Mark Carney lately couldn't be blamed for being a bit confused, as the clarity of the Bank's message has left a lot to be desired
  • Lachman Balani | 28 Oct 2009, 10:16 AM Agree 0
    Carney has reiterated that rates will remain constant till inflation hits 2%. So be it. If rates rise now, CAD will rise further as people will move money to CAD due its higher returns. This higher dollar will hamstring the economy and is an inadvisable move right now when recovery seems to be on the horizon.
    If homeowning is to be discouraged(??) perhaps the banks should charge the posted rate instead of the discounted rate which would make them even filthier rich than they are already. But maybe the govt can tell them to take off the ATM and account service charges( to make them in lime with PC for instance) to offset the extra moolah they would make from giving mortgage loans at posted rates. Also raise VRMs from current prime minus X to a higher rate.
    A controlled study needs to be done first though.
  • ted shackleton | 28 Oct 2009, 11:34 AM Agree 0
    I think Carney should put a sock in it or audition
    for a spot on CNBC. enough said don't ya think.
  • David Neville | 28 Oct 2009, 10:10 PM Agree 0
    The economy will recover when consumers start spending again. And not just on small items, but big ticket items like housing. Mr. Carney is making cautionary comments, but all they are doing is making an already spend-fearing population even more fearful. According to CAAMP's Will Dunning, only 1/3 of the mortgages this year were for purchases. That should be more like 55% to 65% as purchases. We need more home sales in order to fully pull out of the recession, not less. Mr. Carney's comments are well intentioned, but now is not the time for them.
  • Donald Bruce Edward Wilson | 29 Oct 2009, 07:38 AM Agree 0
    The myriad of comments in the last few weeks by various indistry observers and economists made it look like rates would rise quickly to take the sizzle off the housing market, which is hotter than anyone imagined it would be, given the state of the overall economy.

    But interest rates are used as a management tool by the Bank of Canada largely to control inflation, but also to influence the current currency exchange values, particularly against our major traditing parter, the United States.

    As long as the Canadian dollar is strong comparitively to the US, and inflation stays below the 2% target of the government, then the price of houses is irrelevant when it comes to determining interest rates.

    Period.
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