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posted by Morley Evans

Canada is a mouse that sometimes roars and always has an inflated opinion of itself. Canadians, who have always believed their lying leaders and their stooges in the media, are about to pay the price — come to think of it, Canadians are always paying the price for sleepwalking.

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JANUARY 17, 2013

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Canadian Housing Edition

How Central Banking Works

by MIKE WHITNEY

“Back in 2009, our hot housing market acted as a life preserver in a sea of economic uncertainty. Now it feels more like a cinder block tied around our necks.”

– Chris Sorensen, “The Great Canadian Real Estate Crash of 2013″, Macleans

Mark Carney, BOC Governor

Canada’s housing market is in the opening phase of a historic collapse. According to the Canadian Real Estate Association (CREA) sales of existing homes dropped 17.4 percent year-over-year in December, while sales in Vancouver plunged an eyewatering 31 percent in the same period. While prices have held firm so far, it’s only a matter of time before droopy demand leads to an excruciating correction. Sometime in the next 12 months, prices will follow sales down the plughole wiping out a sizable chunk of the equity people were counting on to feather their retirement nesteggs. Despite the media’s braying about a “soft landing”, the sharp decline in sales suggests that Canada will face a catastrophe very similar to the one in the US, the only difference being that Canada will not suffer a financial crisis at the same time. (Mortgages are not securitized in Canada.) . . .

Click this link to read the full article.

http://www.counterpunch.org/2013/01/17/how-central-banking-works/

MIKE WHITNEY lives in Washington state. He is a contributor to Hopeless: Barack Obama and the Politics of Illusion (AK Press). Hopeless is also available in a Kindle edition. He can be reached at fergiewhitney@msn.com.