Who do you believe? 1.A central banker, 2.banking regulator or 3. an international organization. 1. The central banker, testifying before the Senate banking committee on his latest economic outlook Wednesday, said he believes the most likely scenario is a soft landing where home prices stabilize, although he acknowledged that an imbalance in the market and high household debt remain key risks. 2. “Consumers must be considered here because, while banks may be able to withstand shocks, consumers may not,” said Julie Dickson, the head of the Office of the Superintendent of Financial Institutions. “Banks have to set aside reserves for unexpected losses and are typically far better situated to deal with shocks than consumers — who may be highly indebted and therefore particularly vulnerable to significant increases in interest rates or unemployment.”3. The OECD, the international body that ranked Canada’s housing market as among the world’s frothiest, warned today of the threat of a “disorderly correction” in prices given the record debt burden among Canadian families.
Posted on: Mon, 25 Nov 2013 23:23:35 +0000
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