Off Topic

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
2412 posts
1311 upvotes
EdT586 wrote: 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
7437 posts
2444 upvotes
Mississauga
Increase the interest rates.
Deal Guru
Feb 24, 2018
12837 posts
13569 upvotes
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
23572 posts
2869 upvotes
Montreal
redflagdealsguy wrote: 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
2412 posts
1311 upvotes
mr_raider wrote: 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
23572 posts
2869 upvotes
Montreal
burnt69 wrote: 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
2412 posts
1311 upvotes
mr_raider wrote: 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.

Top