Canadian Banks Warn Trudeau Government About Debt Binge

“The sky is not the limit” for debt, the banks have warned.

In the 2008 financial crisis, Canada was able to escape with less damage than many countries for two key reasons.

First, the Harper government implemented a well-thought out economic stimulus package, mostly focused on building tangible things quickly, and moved back towards a balanced budget (though the voters didn’t reward it in the next election).

The second reason was that Canada’s banks were relatively more responsible and not as over-leveraged as many banks in other parts of the world.

The perceived responsibility of Canadian banks is now giving rise to those same banks warning the Trudeau Liberals, who seem headed towards an extremely irresponsible debt binge.

According to a BNN Bloomberg report, finance minister Chrystia Freeland is being warned by bank CEOs about the rising levels of debt:

“Finance Minister Chrystia Freeland held a call with chief executives from the nation’s biggest banks on Thursday to discuss the economic outlook and potential policy steps. She was told that while low interest rates provide some scope to borrow more in coming years to support the recovery, it’s imperative the government recommit to specific new debt targets to impose discipline on the budgeting process, according to one person familiar with the discussion.”

Others are expressing concern as well, noting that the beginning of the economic recovery reduces the justification for a huge spending surge:

“Frankly, I am a little bit concerned about some of the messaging we’ve heard from Ottawa in recent weeks about using this ‘golden opportunity’ to launch all kinds of new spending,” Doug Porter, chief economist at Bank of Montreal, said by phone. “We have made a pretty big recovery in the last three or four months already. We should be well past the peak of spending.”

The sad irony here is that the Liberals don’t really want the economy to recover that quickly, because then they wouldn’t have an excuse to impose a radical ‘green agenda’ that nobody asked for.

Further, the Trudeau Liberals are clearly addicted to the power the crisis gave to them, and are unwilling to give it up.

Spencer Fernando

Photo – YouTube

4 4 votes
Article Rating
Subscribe
Notify of
guest
13 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Jane

There is that ‘little government banking rule’ that says our government can take our money right out of our accounts if they need it…Am I the only person that remembers this ?!

Kitxie

That makes two of us! Don’t ever think they won’t do it if needed. Where do I stash my life savings now?

Garlet Farlett

What money? My bank account has been emptied by them already!

Doug

Yeah, I remember a provision was put in one of Stephen Harpers Budget.

But I digress, its pretty rich for the Banks to be warning the Canadian Government.

We need to restore the role of the Bank-of-Canada , in creating the Nations money, just like it was prior to 1974.

Just look at a graph of debt vs time, things are going exponential after 1974.
The implications are huge, meanwhile the politicians have their heads in the sand on this one.

Garlet Farlett

Frankly, as far as I can tell, this pandemic’s “golden opportunity” has been to give the liberals unfettered power to wield without any repercussion or oversight.

In other words, a dictatorship.

alan skelhorne

do the banks have a choice in the matter, if they can say no, then they shouldn,t give trudeau anymore money. its really plain and simple.

Moe S.

Ontarian’s are still paying off the billions in debt left by the Prov. Liberals & Gerald Butts “Green Energy Act of 2009.” This time ALL Canadians will pay dearly for Trudeau, Freeland, and Butts economic ignorance.

NancyW

The biggest cost to Ontario will be happening soon as these huge windmills and fields of solar panels do not have a long life, aprox. 20 to 30 years, then need replacement, at a huge price again and they are mostly not recyclable, very little on them is, and is very costly to recycle, so we will have piles of scrap to be put somewhere.

dave

Shared.

dave

By design this leftist disease will break our backs.

Brian Dougan

Trudeau has moved to the Left of Bernie Sanders.

Miles Lunn

That is what scares me most about American left like Sanders and AOC. Not that US will ever adopt their policies, they won’t. But rather Canadian politicians will copy them and implement them here.

Miles Lunn

We the Canadian people are partly to blame. When you don’t teach your kids financial literacy, give everyone a participation ribbon, and people don’t learn about history (like 1995 crisis) this is what happens. A shockingly high number of Canadians are economically illiterate so government is doing this because it can. If they tried this back in the 90s, party would have been booted out of power. But since then you have a whole new generation that has no concept of fiscal responsibility and is perfectly fine with this.