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Canadian inflation down to 2.3percent.

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    Canadian inflation down to 2.3percent.

    http://www.theglobeandmail.com/report-on-
    business/economy/inflation-takes-a-breather-in-
    canada/article2309065

    What do you guys think of this?
    Interest rates staying low?
    Canadian dollar going higher?

    #2
    Raise interest rates 1 percent and everyone that owns an overpriced house is underwater. And there is alot of that.

    Comment


      #3
      Take Interest to 5 percent from 2.99 on
      a 25 year home mortgage. A mortgage of
      520000 average around me will take
      payments from 2400 a month to 3100 thats
      a 700 increase per month, take to 7
      percent and now 1200 plus. Wages dont go
      up that fast. THis is 25 year home
      mortgage.
      But the mortgage isnt the problem if its
      a locked in rate you can ride it out its
      credit card debt and line of credit debt
      that people have problems with.

      Comment


        #4
        The central bank is obliged to follow the bond
        market,and with global capital flying to safe
        havens canadian bonds are easy sell so rates
        could easily fall or even go negative.

        The carry trade situation will become an
        interesting story.

        Real inflation on the other hand is much higher
        than is being reported,therefore real gdp is much
        lower than what is stated.

        Comment


          #5
          Our belief is that the loonie will drop
          further in 2012. Agree with comment that
          rates may actually go negative. Japan
          experienced this in 1990s.

          Loonie trading below 95 cents U.S. could
          occur if China economy shakes.Also crude
          oil is way overvalued to the fundamental
          market right now. Iran sabre-rattling
          has to subside first.

          Deflation is now a real risk to
          commodity contrary to any political or
          banker thinking.

          Errol

          Comment


            #6
            US inflation has got to be huge. I cant believe
            how much prices for food and of course gas have
            risen in the last 5 years. Just returned from
            Vegus. The e pty houses and nice areas that
            have turned into ghettos, unbelievable. Areas
            where 7-10 year old 400 - 500 thousand dollar
            house stood are noe littered with jacked up half
            tons and broken tv's on the sidewalk. The city of
            Las Vegas evidently has no plan to reverse the
            trend. Hope our government is cautious with
            immigration policy.

            Comment


              #7
              Thanks guys.
              Errol, what would deflation mean to my farming
              operation. Low rates are good, drop in grain
              prices is bad. I doubt inputs will go down. Lower
              Cdn dollar is good.

              I am just try to figure out if kneed to change
              anything before I get busy this spring.

              Thanks again, I enjoy learning from you fellows.

              Comment


                #8
                Inflation in Canada is high. A year ago a bag of
                coffee beans was 12 bucks. Now it's 20. Nuts
                are a good 20'% higher. Inflation is rampant; they
                probably changed the foods in the basket they
                compare to determine the inflation rate. Dont be
                fooled Pars

                Comment


                  #9
                  Actually food only makes up 18% of the "basket" of goods and services, with a whole range of other things like transportation, utilities, recreation, etc.
                  A falling CPI doesn't necessarily mean prices are going down.....maybe people are just spending less? Replacing steak with hamburger....foregoing that meal out....running the old car longer?

                  Comment


                    #10
                    Most traders who follow this stuff use john
                    williams shadow stats for accurate numbers.

                    Us inflation is slightly over 6 percent and
                    unemployment is ruffly 22 percent.

                    The government fudges many numbers for many
                    reasons and they where a publicly traded
                    corporation they would be put in jail.

                    If you want a dose of reality youtube the gao and
                    watch the head government accountant david
                    walker try to tell everybody hoow screwed things
                    are......years back.

                    By the time obama leaves office he will have run
                    up more debt than from george washington to
                    george bush.

                    If you think this is some how deflationary you are
                    wrong.

                    Comment

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