Canada? What the heck do they know?

[Bob Hubbard]

Recent article in Newsweek "World View - Fareed Zakaria : Worthwhile Canadian Initiative"
http://www.newsweek.com/id/183670

Made the following interesting observations.

• Canada alone in the industrialized world, has not faced a single bank failure, calls for bailouts or government intervention in the financial or mortgage sectors
• In 2008, the World Economic Forum ranked Canada's banking system the healthiest in the world. America's ranked 40th, Britain's 44th.
• The Toronto Dominion Bank, for example, was the 15th-largest bank in North America one year ago. Now it is the fifth-largest. It hasn't grown in size; the others have all shrunk.
• Over the past 15 years, as the United States and Europe loosened regulations on their financial industries, the Canadians refused to follow suit, seeing the old rules as useful shock absorbers.
• Canadian banks are typically leveraged at 18 to 1—compared with U.S. banks at 26 to 1 and European banks at a frightening 61 to 1.
• Home prices are down 25 percent in the United States, but only half as much in Canada.
• Sixty-eight percent of Americans own their own homes. And the rate of Canadian homeownership? It's 68.4 percent.
• Unlike our own insolvent Social Security, its health-care system is cheaper than America's by far (accounting for 9.7 percent of GDP, versus 15.2 percent here), and yet does better on all major indexes.
• Life expectancy in Canada is 81 years, versus 78 in the United States;
• "healthy life expectancy" is 72 years, versus 69.
• American car companies have moved so many jobs to Canada to take advantage of lower health-care costs that since 2004, Ontario and not Michigan has been North America's largest car-producing region.
• The U.S. currently has a brain-dead immigration system. We issue a small number of work visas and green cards, turning away from our shores thousands of talented students who want to stay and work here. Canada, by contrast, has no limit on the number of skilled migrants who can move to the country. They can apply on their own for a Canadian Skilled Worker Visa, which allows them to become perfectly legal "permanent residents" in Canada—no need for a sponsoring employer, or even a job.

Maybe they know something our own Socialistically inclined overlords missed, eh?

 

[Sukerkin]

I concur on the prudence of the Canadian financiers and industrialists.

However, what has caused the current problems in the 'West' has not been socialism, it is the effects of unfettered, capitalist, greed that we are enduring.

 

[exile]

I concur on the prudence of the Canadian financiers and industrialists.

However, what has caused the current problems in the 'West' has not been socialism, it is the effects of unfettered, capitalist, greed that we are enduring.

Mark's right about Canada—and remember, Canada has had fully socialized medicine since the old CCF and Tommy Douglas. And TD is revered by both left and right in Canada. Who is Tommy Douglas, you ask?

He was voted "The Greatest Canadian" of all time in a nationally televised contest organized by the Canadian Broadcasting Corporation in 2004.

Check his life story here. What this country needs isn't a good .05$ cigar, it's a dozen Tommy Douglases.

Cowboy financial irrationality is foreign to the Canadian cultural personality, I think. People in Canada don't mind spending money, in the form of taxes, if they are sure it's an investment in something that will be socially and economically productive. It comes from the fundamentally cooperative ethic that I've noticed everywhere in Canada—not 'I'm all right, Jack—screw you', but more the 'bread cast upon the waters' perspective: life was very, very tough in the forests, prairies and fishing outports, and you never knew when you were going to need help from others to get by; so you gave help when it was needed. If you didn't collect, that was OK; your kid or grandkids would. And if that language seems to have religious/spiritual overtones, it's not surprising: Douglas himself was a Babtist minister, and his social democratic principles were a reflection, ultimately, of his religious convictions. He embodies, I think, just what it is that Canadians know, in their bones.

It's not the wildest or most flashy place in the world, but it's one of the most decent and civil to live in.

 

[Twin Fist]

100% wrong Mark.

the curent problems in America's economy all stem from ONE thing

the housing market

the housing market got hurt because of one thing. Democrats FORCED banks to give loans to poor people who couldnt pay for them

why did they do this? I will get to that in a second.

Other financial orgs bought up those mortages not knowing they were worthless. So alot of companies essentially bought junk bonds.

now, why did the democrats force banks to give out mortages to people that couldnt pay for them?

a SOCIALIST idea that home ownership is a right. (also so they could say look, vote for us,we got you a house.)

so SOCIALISM is the root of the current problem, and that idiot Obama pursuing a SOCIALIST agenda is making it worse everyday.

I concur on the prudence of the Canadian financiers and industrialists.

However, what has caused the current problems in the 'West' has not been socialism, it is the effects of unfettered, capitalist, greed that we are enduring.

 

[Empty Hands]

the curent problems in America's economy all stem from ONE thing

the housing market

No, absolutely not. The current crisis is a credit crisis, which has the effect it has because the banks and investment houses are overleveraged to such an absurd degree. Their massive debt could only be propped up with easy credit. No easy credit, and they can't make their debt payments. Poof, they go the way of Lehman or AIG.

The housing contraction was the initial spark that started the cascade and tightened credit. However, if it wasn't housing, it would have been something else. The foundation was unstable, and it only took a small shock to send the institutions teetering. Look at the example here on the Canadian banking system to see what happens when the banking system remains more conservative instead of taking massive unsupported risks.

 

[Steve]

100% wrong Mark.

the curent problems in America's economy all stem from ONE thing

the housing market

the housing market got hurt because of one thing. Democrats FORCED banks to give loans to poor people who couldnt pay for them.

Of course. It's the democrats fault. Just change the lyrics from Blame Canada! to Blame Democrats! I wish everything were so simple!

Bob, there are things we can learn from the Canadians, particularly in the area of health care.

 

[Bob Hubbard]

Here's the $100 question.

What's the tax situation in Canada that pays for the social programs like?
Income tax property tax, and sales tax are the big 3 I think.

 

[Gordon Nore]

Recent article in Newsweek "World View - Fareed Zakaria : Worthwhile Canadian Initiative"
http://www.newsweek.com/id/183670

Made the following interesting observations.

• Canada alone in the industrialized world, has not faced a single bank failure, calls for bailouts or government intervention in the financial or mortgage sectors

Canada tends to fare favourably in international comparisons. Periodically, reports are published saying that we have the best in country in which to live. Having only visited two other countries, I'm disinclined tell people I live in the bestest country.

PM Harper was talking about our banking system on CNN's GPS last Sunday and said, essentially, what I would say: Our government watches our banks, so major screw-ups are rare, but there really is no such thing as a sub-prime market. Mortgage seekers go to a bank or trust company. Depending on credit ratings, a buyer might have to go to a mortgage broker. Depending on the down payment a home buyer is able to raise, that buy might have to have the mortgage ensured with Canada Mortgage and Housing Corporation.

Notwithstanding our watchful nature, it is possible for homebuyer to get their fingers burned. Our bank offered us twice as much as we felt comfortable borrowing. Had we done it their way, we'd have been screwed, after both getting laid off about two years later.

Even here in Shrangrila, buyer beware.

 

[elder999]

Here's the $100 question.

What's the tax situation in Canada that pays for the social programs like?
Income tax property tax, and sales tax are the big 3 I think.

The Canadian government derives most of their funding from income tax. You can read about Canada's income tax here.

It's also worth pointing out that, at just over 33 million, Canada's population is roughly 3 million less than that of California.This is especially noteworthy in consideration of health care.

 

[Carol]

The housing contraction was the initial spark that started the cascade and tightened credit.

Agreed.

The housing contraction was the initial spark that started the cascade and tightened credit. However, if it wasn't housing, it would have been something else. The foundation was unstable, and it only took a small shock to send the institutions teetering.

Do you really think so? I don't know. I'm not so sure that what we saw was a small shock. We got through the 9/11 attacks and the haywire those played on the economy without seeing an impact like this on the housing market. Yes the market did go down, but it didn't crash the way it has.

A few years ago I read a very detailed piece in The Economist that was called something like The Two Houses That Hold Up The World. The article went in to a lot of detail about how the housing market drives the North American economy and the European economy. Which...drives the rest of the world (hence the title). The article basically described varied (positive) impact that the housing market has in our economy, from good paying jobs (that cant be outsourced) to quality of life.

 

[Gordon Nore]

Here's the $100 question.

What's the tax situation in Canada that pays for the social programs like?
Income tax property tax, and sales tax are the big 3 I think.

Sales tax is Provincial, currently RTS is 8% in Ontario. That excludes books or printed matter, unless I'm mistaken.
http://www.rev.gov.on.ca/english/taxes/rst/

Trivia: The Province of Alberta had no sales tax for decades -- I don't what the status is now. Oil revenues.

Federal Goods and Services Tax is a creation of the Brian Mulroney Tory government in 1991. Currently it stands at 5%. It was very controversial, although the govenment of the day insisted it was not an additional tax, but a folding in of existing taxes.
http://en.wikipedia.org/wiki/Goods_and_Services_Tax_(Canada)

The implementation of the tax was interesting. GST applies to postage and so we became, to my knowledge, the first country to tax stamps. The GST was also applied to printed matter (which was a traditional no-no) in this country. This has hurt Canadian publishing. Another little quirk, the gov't made a variety of determinations about what is taxable. Tampons became classified as cosmetic rather than related to health and hygene, so they were taxed.

I'll dig out more on income and property tax. These are controversial here as elsewhere.

G

 

[Empty Hands]

Do you really think so? I don't know.

I think so. The situation was fundamentally unstable. Anyone who called attention to the problem, such as risk management departments in the companies themselves, were ignored. All it took to touch off the cascade was a few days of tightened credit. A few days is all it took to start making companies like AIG unable to meet their debt payments, and start to go under after only a few days. Remember also, mortgages alone do not make up the troubled assets that underlie the reason for decreased lending. No one really knows what was in all those CDO's, or what they are worth.

 

[Bill Mattocks]

I drive from Detroit to Windsor all the time. Windsor neighborhoods are so nice - Detroit's you could die in. They're just across the river from each other.

On the other hand, I met a man in Canada recently who was getting around on one of those 'scooter' devices because he needs hip replacements. He's on a list. He got the scooter because the list is 4 years long. He told me how much better he thinks the US system is - he'd have had his new hips almost immediately. He's in pain most of the time. Some health care system.

I like Canada a lot. Won't move there - my guns would be illegal. That's a show-stopper for me. Besides, they have a Queen, even if she is just a figurehead. The bended knee is not one of my traditions.

 

[elder999]

I like Canada a lot as well....

My wife has family there. My dad went to Trinity College in Winnipeg, Manitoba-it seems like alot of his best stories started, "In Canada...". It was, for many, the last stop on the Underground Railroad....on th eother thread about "places to flee to," Canada was a consideration....

....on the other hand, Dad came back, my wife's folks kept dual citizenship and voted for Obama, and my family has called the U.S. home since....well, since before it was the U.S.

On the other hand, I met a man in Canada recently who was getting around on one of those 'scooter' devices because he needs hip replacements. He's on a list. He got the scooter because the list is 4 years long. He told me how much better he thinks the US system is - he'd have had his new hips almost immediately. He's in pain most of the time. Some health care system.

Won't move there - my guns would be illegal. That's a show-stopper for me. Besides, they have a Queen, even if she is just a figurehead. The bended knee is not one of my traditions

What he said...:lol:

Back on track, though-their apparent financial state might also have something to do with their low population.....

 

[Gordon Nore]

Besides, they have a Queen, even if she is just a figurehead. The bended knee is not one of my traditions.

Nor mine. My parents were Monarchists; I'm not. It's pretty much as simple as that around here. It's a tradition that's run its course. Some people still cleave to the Monarcy; I don't.

The Queen is technically the head of state. Her picture's on the money, but she doesn't come around much. Her representatives are appointed not by the home office but by the PM and the Provincial Premiers. It's been this way since 1867. When Queen Elizabeth passes on the reigns to Prince William, I suspect there be some pop idol interest, and that will be the end of it here. To all intents and purposes, it's a bicycle monarchy here.

Our constitution resides here, not in GB. Canada has strong historical, neighbourly ties with the UK. I haven't heard anyone sing God Save the Queen since I was a kid.

No offense to my cousins across the pond.

 

[Bill Mattocks]

To all intents and purposes, it's a bicycle monarchy here.

I know, I know. It's just something that would bug me. Hard to explain, something deep and personal.

 

[Gordon Nore]

On the other hand, I met a man in Canada recently who was getting around on one of those 'scooter' devices because he needs hip replacements. He's on a list. He got the scooter because the list is 4 years long. He told me how much better he thinks the US system is - he'd have had his new hips almost immediately. He's in pain most of the time. Some health care system.

Annecdotally, this is quite possible. I know two people who got their hip surgery in a year. Both my parents survived cancer in Ontario hospitals. On the other hand, my son waited six months for an MRI after a fall from a horse. (Ten miles each way to school uphill in a snow storm.) My doctor keeps telling me I'm too heavy -- some health care. Someone's always getting screwed someplace.

I hear Canadians who've never lived in the US talk about how great health care is there. They seldom take the bold step of actually moving south. Americans are always telling me how my health care system works.

Health care in Canada and the US is very good. The issue is how its funded and insured.

 

[Gordon Nore]

I know, I know. It's just something that would bug me. Hard to explain, something deep and personal.

No problem. I think it's an institution that is gradualizing its way out. As much as I reject, I'm glad that we don't actually want to have a big to-do about it. For me it's like being an agnostic -- I don't have to win anyone to my side, but they best not push theirs on me.

 

[BlackCatBonz]

I drive from Detroit to Windsor all the time. Windsor neighborhoods are so nice - Detroit's you could die in. They're just across the river from each other.

On the other hand, I met a man in Canada recently who was getting around on one of those 'scooter' devices because he needs hip replacements. He's on a list. He got the scooter because the list is 4 years long. He told me how much better he thinks the US system is - he'd have had his new hips almost immediately. He's in pain most of the time. Some health care system.

I like Canada a lot. Won't move there - my guns would be illegal. That's a show-stopper for me. Besides, they have a Queen, even if she is just a figurehead. The bended knee is not one of my traditions.

I hear stories like this all of the time....it makes me wonder how many of them are true.
My grandfather was 79 and needed hip replacement.......took 2 weeks to get him in.......didnt cost him a dime.
The same grandfather at age 70 went in to get looked at because he had a strange back ache; they took an x-ray and sent him on his way.
The radiologist found a tumour almost the size of a baseball on his kidney. They booked the surgery before they even called him.......when they couldn't reach him, they sent the police out looking for him.
All this didnt cost him a cent out of pocket.

Sometimes you have to take the good with the bad......if you need life saving surgery.....you will get life saving surgery......and the thought of having to mortgage your house to save a loved one never enters your head.

 

[Bill Mattocks]

I hear stories like this all of the time....it makes me wonder how many of them are true.

Well, I'm not lying about what the man told me, and he was definitely using the scooter when I met him. If he was lying about needing hip replacement and having to wait to get it, I don't know to what purpose. He sure seemed to think US health care was better, that's for sure.

Sometimes you have to take the good with the bad......if you need life saving surgery.....you will get life saving surgery......and the thought of having to mortgage your house to save a loved one never enters your head.

I wasn't trying to say that one system was better than the other, but noting that whilst I would have assumed Canadians would tend to prefer Canadian health care, I met at least one man who surprised me by asserting the opposite. As to mortgaging my house - I have insurance, so the chances of that are slim. If I were to become unemployed, then yes, it might be a problem.