Bank of Canada Rate Cut

[BreadWinner]

With the price of everything going up the end result is the same as inflation, It takes more dollars to purchase the same goods. Controlling inflation without causing recession is almost impossible. The only way to control it is with interest rate hikes and that is impossible with the huge amounts of household debts. Im afraid low interest and expensive goods are the new normal.

[Richard5]

What I don't understand is this:

Do people and government really think interest rates make that big of difference in consumer purchases? I would understand this more when we were at prime rates of 4-6% but when it gets down to where it is now, .25, .15% don't mean anything significant in the total purchase price at the end of the day. Besides, you really don't get the same rate at the consumer level.

I believe this especially with farms. With lease debt interest rates don't mean a thing (imo). Too many fixed on the "show" and the tax

[charliep]

I see the loonie is testing 77 cents. That to me means support has been broken. And just ahead of when I go to Montana. Ouch.

[vvalk]

Sounds like the banks are only passing .1 of the .25 on. So now with 2 cuts te bank have pocketed half the drop

[cottonpicken]

The cost of borrowing effects everything.

And it's not like soverign bonds get paid off they get rolled over and repurchased. At ever lower rates so percentage government expenditures have been actually decreasing.

Now through in the banking and bonds in themselves. If rates went to 18 tommorrow what is a quarter of land worth?what is a 2 percent bond worth?overleveraged banks meaning all of them are flushed. The whole system demands inflation one way or another.

[ajl]

Canadian economy already in a depression, this rate cut just advertises the fact. This one unlike the 1930's will not end in a decade but will be permanent. Canada has three industries: oil, farming, and government. Guess which one is growing? Spot the problem.

[cottonpicken]

I had calculated the rise of our dollar but mis calculated the fall(all here over the years). I mistaking thought we would control our current account and balance of trade public deficits private deficits foreign reserves etc etc.

Now having a hard time re calibrating so very much enjoy the discussion. (Check your premise-right Pars lol i.e rand for those that never followed her)

Very worried we are being set up to fail like Australia (Malle).

[TOM4CWB]

It does not take a genius to figure out that all levels of Government 'Win" with the lowering of the CDN$... which is valid being that black oil has dropped in half.

The drought on the western Prairies also cuts revenue and taxes to all levels of Gov's... this will help mitigate the impact without a gov. program... devalue CDN$... increase value of primary Agriculture... oil and mining.

There could be a silver lining to this!!!

Cheers!

[Flatlander]

Also different leadership and ideas at BOC since Carney left. Believe Poloz comes from more an eastern manufacturing export stance.

[wilagro]

Instead of lowering the Bank Rate...they should have raised it to about 1.5% this year and also consider further raises in the future.

The true value of housing would show up quite rapidly and the people who are now considering buying these overpriced homes would be better off waiting for the prices to fall.

We have idiots running the Bank of Canada and our Federal Government.