Vancouver Peak

Yesterday, the Globe & Mail offered up an editorial that I felt worth posting here. Garth Turner, love him or hate him, has long posted the same sentiments about Finance Minister Joe Oliver vs Jim Flaherty at his blog The Greater Fool (Turner is a former Tory MP). Personally, I think it significant for the Globe & Mail to call into question the sanity of the Harper government’s economic policies which at heart is what this editorial does.

Any thoughts on this? Will Harper follow through? Has he or is he now leading the country into an economic abyss?

Here is the Globe & Mail editorial in its entirety...

Quote:Harper's promises throw caution to the wind in overheated housing market
Globe Editorial, The Globe and Mail
Published Thursday, Aug. 13, 2015 6:35PM EDT Last updated Friday, Aug. 14, 2015 9:26AM EDT

Last week, just a couple of days into the election campaign, Conservative Leader Stephen Harper vowed to bring back the Home Renovation Tax Credit. This week, he floated another home-related goody, promising Wednesday to increase the RRSP withdrawal limit for first-time buyers.

Question: What happened to the Conservatives who once focused on cooling the housing market and getting Canadians to cut back on household debt? You know – the Tories from last year? Who are these new ones who are encouraging people to draw down their savings, acquire mortgages and invest money in new decks and bathrooms? We miss you, Jim Flaherty.

Mr. Harper says his government would raise the amount first-time buyers can pull out of their RRSPs from $25,000 to $35,000. He justified his promise by saying the family home is most Canadians’ “biggest asset and their most significant investment in their future financial security.” He made a similar argument while promising to revive the home-reno tax credit and make it permanent, which could cost Ottawa $1.5-billion a year.

As we said, there once was a Conservative party that would not have encouraged people to transfer their retirement savings into their home equity in the middle of a countrywide price surge that the Canada Mortgage and Housing Corp. says is at high risk of a correction. That other Conservative party would also not have subsidized the overheated housing and the construction industry by resuscitating a tax credit created as a temporary stimulus measure during the 2008-09 Great Recession.

But the Conservatives do have one good idea on housing. Mr. Harper announced Wednesday that a new Tory government will collect data “on foreign buyer activity in Canada’s housing market.” Market regulators and observers have long called for better information on what is driving prices. Then again, promising more information is also an admission that information is lacking, and that the market may be out of balance.

When he was the finance minister, the late Mr. Flaherty fought to reduce Canadians’ risks by tightening the mortgage market. It’s disappointing that his caution and wisdom have been abandoned.

Hat Tip to southseacompany over at Vancouvercondo.info for drawing our attention to this editorial (Comment #73).

And now, a new PM will get all the blame when things unravel, as they ultimately will.

(10-21-2015, 02:14 AM)RFM Wrote: [ -> ]And now, a new PM will get all the blame when things unravel, as they ultimately will.

Agree. I wonder if Justin's election will provide the catalyst for said unravelling? Poloz looks unlikely to cut again because of the effect on the currency, and there seems to be little steam left in the market...

I’ve been sitting on a Reader’s Comment since August 4th when it appeared in response to a Globe & Mail story titled ‘Tories recycling rhetoric and renovation rebate in campaign.’

It was such a great comment that I had to save it and though I’m a little late it’s a good time to post it here.

Quote:Recession is when your neighbour loses his job.

Depression is when you lose yours.

Recovery is when Stephen J Harper loses his.

Thank you, cool canadian.