Recession fears overblown, say industry veteran

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One mortgage lender in Alberta has a question for an economics professor predicting the current recession will last longer than expected – what recession are you talking about?

“I’ve got news for you – there isn’t a recession,” says Lestor Shore, of Optimum Mortgage, based in Alberta. “I really don’t think it is all that bad. There is no question that some folks have lost jobs, and there is no question that Calgary has been impacted more than Edmonton – but, I don’t think the world is ending.”

The analysts come on the heels of another economic forecast, this one from a Canadian economics professor sounding the alarm on the Canadian economy.

Louis-Philippe Rochon, an associate professor of economics at Laurentian University, wrote in an opinion piece for CBC that “currently, Canada is in recession. Most pundits are predicting that it is a mild recession, and that Canada will fully recover in the third and fourth quarters of 2015. But those predictions are surely wrong and are based on faulty economic logic.”

While acknowledging that “by definition” the country is in a recession, Shore says that the mortgage industry “is doing just fine,” and that from what he has seen first-hand, it doesn’t qualify as a recession.

“The Alberta unemployment numbers are now at the national average,” Shore told MortgageBrokerNews.ca. “Alberta hasn’t been hit as hard as some members of the press would like us to think. And anecdotally, at the business I run – where most of the staff is located in Alberta – we have four or five job vacancies that we can’t fill. So I say, I don’t think it’s that bad.”

The Bank of Canada will release data next month confirming whether the country was in a recession for the first half of 2015 – but Rochon argues that the macroeconomics are not adding up for a recovery in the third quarter of this year.

While Shore points to the job openings in his Alberta offices, Rochon counters that the nation’s job creation numbers are being driven by part-time and self-employed work, and not full-time work – which affects Canadians’ ability to purchase homes.
  • Victor Simone on 2015-08-27 2:00:22 PM

    I agree with Mr. Shore of Optimum, and I will be a bit more boastful and say that, if this is a recession then it's the greatest recession in the history of Canada. The US just had a huge recession and and long economic downturn. Canada was nowhere close to the American recession or past Canadian recessions prior to the early 90s.

  • tom on 2015-08-27 5:04:21 PM

    Don't listen to a mortgage guy. He does not like to hear recession because it will have an impact on his business. Lol.. he wants people to take mortgages so he gets his big commission.

  • tom on 2015-08-27 5:15:53 PM

    Reality is if the economy was in good shape, BOC would not have dropped the rate 2 times with a high possibility of a 3rd cut . Give it a few months (November to January) and then see how bad things are.

  • Franko on 2015-08-27 8:46:32 PM

    What nonsense.

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