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Crude oil drops to $46, time for Canada to lower interest rate

  • Last Updated:
  • Jan 9th, 2019 3:32 pm
Deal Addict
Oct 6, 2015
1428 posts
758 upvotes
EdT586 wrote:
Dec 23rd, 2018 7:40 pm
Alberta only wish WCS is $46/barrel ...it can't even sell today at $14/barrel !
Very little actual oil trades at the spot market rate. This 'low price' is all about putting the screws to the moron Alberta oil companies that are still increasing production.
Deal Fanatic
Apr 11, 2006
5741 posts
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Mississauga
Increase the interest rates.
Deal Addict
Feb 24, 2018
4258 posts
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The mild Trudeau economy coupled with the volatility in the US afford the Bank of Canada some flexibility in keeping interest rates relatively low for now.
Deal Expert
Feb 29, 2008
20464 posts
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Montreal
redflagdealsguy wrote:
Jan 8th, 2019 6:36 am
The mild Trudeau economy coupled with the volatility in the US afford the Bank of Canada some flexibility in keeping interest rates relatively low for now.
So the debt orgy continues?
Deal Addict
Oct 6, 2015
1428 posts
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mr_raider wrote:
Jan 8th, 2019 6:00 pm
So the debt orgy continues?
Nope. Just because interest is low, doesn't mean that the principal doesn't have to be repaid. And assets are falling in value, so it becomes much harder to repay loans by selling assets. Classic deflationary trap that beset the global economy in the 1930s.
Deal Expert
Feb 29, 2008
20464 posts
2261 upvotes
Montreal
burnt69 wrote:
Jan 9th, 2019 1:45 am
Nope. Just because interest is low, doesn't mean that the principal doesn't have to be repaid. And assets are falling in value, so it becomes much harder to repay loans by selling assets. Classic deflationary trap that beset the global economy in the 1930s.
I was referring to personal consumer debt. Low interest rates for a decade have generated a mortgage and LoC fetish the likes which have never been seen.
Deal Addict
Oct 6, 2015
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mr_raider wrote:
Jan 9th, 2019 11:36 am
I was referring to personal consumer debt. Low interest rates for a decade have generated a mortgage and LoC fetish the likes which have never been seen.
Yup. And a lot of houses were built because of such cheap debt. Which is now causing the prices on houses to drop considerably as they are in physical oversupply.
So low rates certainly propped things up for a while, but because the low rates stimulated more production of the underlying assets, we have the dreaded deflationary trap.

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