Slowly the wheels turn and the inevitable outcome passes another another signpost on the world stage...
This morning, for an unprecedented third straight month, Australia’s central bank raised its benchmark interest rate by a quarter percentage point to 3.75%.
On the same day, The New York Times announces that Canada is officially out of the recession.
We harken back to this speech by Bank of Canada Governor Mark Carney in which he warned Canadians that his pledge to keep the benchmark policy rate at 0.25% is “conditional” and should not be interpreted as a “guarantee.”
Carney told reporters afterward it would be unwise to assume current low rates are 'normal'. "It is an expectation, not a promise," Mr. Carney said in his remarks.
Carney told Canadians that they should "prepare for when interest rates return to normal".
Are you prepared?
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"Are you prepared?"
ReplyDeleteHell, yes! I sold and will now rent until the Vancouver market corrects itself by the expected 50%. I'm guessing two years hence.
Carney/BoC ultimately don't control interest rates; the bond market does. The people who are buying now are fooled by the "monthly payment" approach, forgetting that interest rates have averaged about 8% during the past 30 years.
Its going to be very sad, but very profitable for some, when this bubble pops.
Welcome to the blog and thanks for the comment.
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