Author Archives: wciecon
The federal government and the CMHC enter the fray
From a story in today's Globe and Mail: The federal government is moving to backstop the Canadian banks' capacity to lend money in an acknowledgment that not even the country's sturdy banking system is immune to the global financial crisis. A plan originally earmarked for Friday morning would see the government assume some mortgages currently […]
“Canada is not the United States”
An estimated 20,000 to 25,000 Canadian home owners are currently in arrears, said Will Dunning, chief economist at the Canadian Association of Accredited Mortgage Professionals (CAAMP), in a report released Monday. This means about 0.3 per cent of Canada's 8.05 million home owners are behind on their mortgages by three months or more, he said. […]
Liquidity, solvency, fire-sale and fair prices, and TARP: a simple model
Nick Rowe follows up his post on the origins of the crisis with some thoughts about how to deal with it: How is the Troubled Asset Relief Program supposed to resolve the problem of bank failures? I haven’t seen any clear answer, so thought I would sketch out the skeleton of a simple model where […]
When the going gets tough, the tough go shopping
Two stories that just popped up on the Globe and Mail website suggest that claims to the effect that Canada's financial sector is holding up relatively well may not be completely unrealistic: Crisis strengthens Manulife's hand in AIG bid: The chances of Manulife Financial Corp. winning parts of American International Group Inc. are rising sharply […]
An open letter to the leaders of Canada’s federal political parties from economists teaching in Canadian colleges and universities
The press release and the list of signatories (more than 230 and counting) are over here. Here's the letter: One of the few issues on which most economists agree is the need for public policy to protect the environment. Why so much agreement? Because in the absence of policy, individuals generally don’t take the environmental […]
Some thoughts on the bubble/s and financial crisis/es
Nick Rowe provides us with some talking points on how we all got into this mess: I am taking part in a roundtable on the financial crisis next week at Carleton (Wednesday 8 October 5.30-7.00 in 360 Tory, just in case anyone is interested in attending). The audience and other panel members will be mostly […]
The Basil Fawlty theory of corporate taxes
Fawlty Towers is one of the best television shows ever. It ran for 12 episodes, and each is a highly-polished gem. One of my favourites is the episode ‘Gourmet Night’, in which Basil Fawlty – the incomparable John Cleese – tries to increase the tone of his run-down hotel. At a crucial point, Basil’s car […]
What are we, chopped liver?
From Stéphane Dion's 5-point Action Plan for dealing with the economy: 2. Convene a meeting of leading independent private sector economists to report on the state of the economy and assess both domestic and international trends for the coming year. Emphasis added. Memo to the Liberal Party of Canada: there are quite a few talented […]
“Canada is not the United States”
Stephen Harper has taken a certain amount of flak for saying that phrase. But let's think about it: would it have been better if he had said 'Canada is the United States'? So let's go through the inventory. Today's data for automobile sales in September: Canadian vehicle sales nudge higher in September. Canadians bought more […]
Nick Rowe on the outlook for Canada’s housing market
Carleton University's Nick Rowe left a comment in a previous post that deserves a wider readership. With his permission, I'm recycling it as a guest post: I am less optimistic than you, though I don't think it will be as bad here. But I wish I had better evidence for my belief/hope.House prices in many […]
Worthwhile Canadian Initiative 
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