Reader JD, via email; Since we can’t put images in comments, here is a chart showing money growth from the Bank of Canada, plotted from the Bank of Canada stat for Cash and Cash equivalents in the Canadian economy.
(Click for full size.)
Reader JD, via email; Since we can’t put images in comments, here is a chart showing money growth from the Bank of Canada, plotted from the Bank of Canada stat for Cash and Cash equivalents in the Canadian economy.
(Click for full size.)
How does the Bank of Canada’s government debt buying spree (printing money) scheme factor in?
From Dec 2019 to Sep 2020 it’s balance sheet grow from $119 billion to $530 billion. That’s $411 billion increase. Where it has gone in the last 6 months, we can guess up.
It doesn’t appear that this +$400 billion is in the graph. Likely additional money.
Dropping sacks of money from helicopters!
Seeing unidentified criminals dropping from helicopters would hasten the beginning of that graph reversing the trend.
Note that the graph is in $millions of dollars, and ends at Jan 1, 2021 because there is a 3 month delay in reporting…
December 2019 – $2,621,517 x 10^6
September 2020 – $2,980,842 x 10^6
Difference is $349,325 x 10^6
not far off the $411 billion
It is less which would mean for the $411 billion to be included, money supply elsewhere would have been materially contracted. I cannot believe that, money supply normally grows and I would have expected it to have grown more than normal, not less and certainly not contracting. My guess is that the $411 billion is “hiding” because the Bank of Canada has booked it rather than it going on the Government of Canada’s account (which is where currency would get booked).
Inflation is coming and we ain’t going to like it much. If you haven’t figured out yet that this is straight up sabotage I can’t help you. This is nothing short of treason. They’re greasing the skids for a bailout from a foreign entity and as these things go it’ll have some strings attached.
Y’know, it isn’t a conspiracy theory when they’re in your face about it.
https://www.bankofcanada.ca/2020/08/the-great-reset/
Inflation is already HERE, in our housing markets, but housing never gets counted in the official inflation calculations.
Our economy increasingly reminds me of the premise of Whose Line Is It Anyway? “The rules are made up and the money don’t matter!”
That’s why they want pensioners to die. Of hunger. Starve of money. Fixed pensions.
Remember when in time of Mulroney’s smug rule, they wanted to tax or hold back pensions for those that had an income more than 60K? The government backed down?
They don’t want that to happen to the so called “Liberals”, may as well corner them in care facilities and kill them off with the Wuhan virus.
No protests.
Since the time of the Pharoahs, every generation believes that it, and it alone, has found the secret of the magical never-ending money fountain.
Money indeed does just grow on trees. Who knew?
MMT is just another way to try out the ideas of a command economy. Good luck, Westerners, you are going to need it.
It used to grow on trees, ie. paper, but now it comes from the ground, plastic from oil, the stuff the liberals want to get rid of along with most of the people in Canada.
The way your country is printing and spending money … I suggest there must be a few million Canadian dollars out in the middle of the Pacific Ocean’s GIANT swirling plastic patch. Doncha think?
Oh wait! Silly me. Since nobody has really been able to locate, photograph, or clean up said swirling plastic patch (the size of Texas) in the Pacific … we now have to FEAR … microplastics. Plastic Canadian dollars have broken down into such small, microscopic, pieces that virtually everyone on the planet is “carrying” some of Canada’s debt … in their livers.
Really clever comment, Kenji. Thanks for my morning smile. Now if only we could shovel the politicians into the Pacific gyre…assuming we could find it.
All praise dear leader.
Justine will make us all millionaires.
No shit. This will be part of the election propaganda,where in CBC will be telling us how much richer we all are for the massive amounts of debt,created by the Children’s Crusade.
And our Eastern Comrades will lap it up and re elect the idiots.
For unstated in the eastern assumptions/myths is the clear knowledge/belief that debt is not a problem,for the dummies out West will be the ones paying.
Same as it has ever been in the Great Confederated Kleptocracy.
There is no fear of Western Separation out east,for it is inconceivable to our Eastern Comrades,that we might love our children enough to want them to have a future,at least as luxurious the our present..
That Debt Slavery is no legacy,apparently never crosses the mindset of central Can Ahh Duh.
Buffalo shall thrive,free of the Parasitic Overload.
As long as we refuse to allow such madness to duplicate here.
Far too many seeking “freedom from the Ottawa thieves” seem to still accept the stealing,just as long as our thieves are doing it.
An Independent West is pointless if we fail to learn from Canada’s failure.
A society without individual rights and responsibilities, stagnates and is over run by group think parasites,always has been that way,once the freeloaders find they can vote themselves other peoples wealth..why they vote most enthusiastically.
A society in bondage doesn’t have to worry about it. You will get your daily ration and you will be happy.
Amazing what you can do if you just -buy- all the newspapers, eh?
Eternal indebtedness to the State is a main plank of the platform to the “Great Reset” and “Build Back Better” concepts.
The one truly accurate identifier of inflation, an increase in the money supply without an increase in productivity. Much worse to come as the liberals crank up the money supply and the debt.
As long as you can keep the supply of money high, its price can be held low, aka interest rates, in the short run.
Unfortunately, as you point out, investors like to make real money, after inflation income, before being savaged by taxes.
We’ve been quantitatively eased into a monetary and debt crisis. Coincidentally the Bank of Canada is underwriting covid debt.
What if the Bank lets inflation run wild by buying negative real return bonds nobody else wants? The peasants? Oh well.
Monetary policy meets fiscal policy; government’s junk bonds get bought up by the “autonomous” bank.
Just market clearing operations folks, nothing to see here? Maybe not yet, but coming soon. Stagflation 21st century style.
Recall at one point in recent history, most Germans were millionaires. They did it by taking on huge debt. That worked great.
Luckily for our governments, we work hard and produce things so they can then tax the crap out of us and our stuff.
In terms of the Austrian economists (Mises, Hayek, etc.), this is called INFLATION.
I guess we could all move to Venezuela. Our economies will be competing with North Korea for starvation rates. Thanks Moronto.
Read somewhere that economics is not a science.
Economic pronouncements, as it is, are going to be correct at one time or another, depending if you get lucky.
Its a crap shoot as they prosaically say sometimes, no different than slots at you neighborhood pub.
As Mary Chapin Carpenter being alert would sing.
Sometimes you’re the windshield
Sometimes you’re the bug
Sometimes it all comes together, babe
Sometimes you’re a fool in love
Sometimes you’re the Louisville slugger, babe
Sometimes you’re the ball
Sometimes it all comes together, babe
Sometimes you’re gonna lose it all
And so it is with Magic Monetary Theory
You see, while it is a theory, there is an escape from being right to being one hundred percent wrong, even though your idea is “brilliant” as the suckups would say.
One thing you never see economists talk about is how banks create most of the money in the system. Its not the Fed or the Bank of Canada. If you account for those and the debt private banks create you get a better picture. And credit is shrinking now.
Banks do not create money. The banking system creates money. In general bank loans are limited to less than deposits. A short-term shortfall can be funded by the Bank of Canada. A long-term shortfall usually involves the Canadian deposit insurance corporation.
How does the banking system create money? Borrowed money is deposited in the bank where it is reloaned, redeposited, and reloaned ad infinitum subject only to reserve requirements. Note that a banker does not wake up one day and say, “I am going to create a billion dollars today.” To gain the ability to lend money, a banker normally has to seek deposits.
Don’t worry. If you don’t own anything you can’t owe anyone.
Duh.Searching..Best places for feral humans Canada.
A physicist, an engineer, and an economist are all marooned on a deserted island along with a single can of beans. As the day passes, they debate the means to open the can without a can opener. The physicist proposes to climb a tall palm tree, and drop the can of beans on a large rock, rupturing the can. The engineer talks about smacking the can with a sharp rock driven by a second heavier and blunter rock to the same effect.
The economist, unsatisfied with either suggestion because of the losses involved, goes down to the beach and for the next three hours, writes equations on the beach with a stick. Finally, he says “Aha” and comes back to consult with the physicist and the engineer. He says “Imagine that we have a can opener…”.
The only economist joke that I know, but it makes the point: Reality, who needs it?
I first heard that one during my senior undergrad year from a grad student in–wait for it!–economics.