Mises Canada features a very informative piece on Canadian Mortgage and Housing Corporation by Chris Horlacher.
As of 2009 the CMHC guaranteed over $900 billion in mortgages, about 90% of the market…The CMHC has about $9 billion in net assets to cover theirs, with the ratio working out to a staggering 100:1. To make matters even worse, 74% of the CMHC’s assets are invested in those very same mortgage-backed securities. If the Canadian housing market ever took a dive the CMHC would be bankrupt in the blink of an eye.
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Exactly the same as in The Netherlands.
Probably a good idea to sell now.
I can understand the US government doing this to create a boom market to hide the war costs. However, I thought the Canadian government was less dumb and corrupt than their DC counterparts. Is putting Canada at so much risk intentional or just pure corruption/incompetence?
They just wanted to party, and party they have been.
Corruption/incompetence. The CMHC exists to “promote homeownership”. The bureaucrats there have a lot of power and the banks and mortgage brokers actively support it. The public doesn’t understand what it does and what the implications are either. So the madness continues …
oh, fantastic. now just tell us how to short CMHC.
if one operates under the assumption their bubble won’t pop, this would make a pretty good case study for comparing and contrasting the regulations in place in canada and the US during their respective bubbles, i.e., “why canadians defend housing regulations.”
then you could follow that with why the assumption is wrong, of course.
http://greaterfool.ca/
a great blog for those more interested in the Canadian real estate bubble
@x. somehow reading hat reminds me of “this time is different”.
And well I guess most act as IF this time would be different.
We have everything in place for doom, fiat-money, debt mountains and bueraucracies bigger than ever.But sure this time the bureaucrats will save us….
Yeah, I don’t give much credibility to that site.
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