Carney "Stops Short" of Admitting Real Estate Bubble

This morning BoC Governor Mark Carney (pic. below) was guest to the radio station that earlier in the week dubbed him a "banking superstar"--the publicly owned CBC Radio 1. It was no surprise that the he was not pressed particularly hard when he said that the greatest danger to Canada's economy is the ongoing situation in the European Union. I would have though that Mr. Carney's targeted robbery of my chequing account at 2% per year would have been it!

Carney danced around the issue of the developing real estate bubble that even statist propaganda machine CBC is beginning to mention--so it must be pretty bad. While he patted himself on the back for "steering the economy" in safe waters during the previous meltdown, the Governor made sure to absolve himself of the upcoming meltdown by reminding us that he does not make our decisions for us... with the minor exception of the whole money supply thing.

As CBC's Evan Solomon put it, Carney "stopped short" of admitting the presence of the bubble. However, CBC has already been running segments about Toronto's record setting condo construction, as well as the similar scenario developing in Vancouver. It seems that these to centers are most vulnerable with entire building floors being bough sight unseen, as Carney's money printing extravaganza is being supplemented by money pouring in from the Middle and Far East. I am hearing gossip of $200-500bil. being injected into Canadian banks through such sources alone. The reason for this influx is, apparently, the stability Canada's banking and real estate sectors showed in the 2008 Wall Street collapse.

Of course, we will be feeling the pain ourselves not too far down the road, as Canada has done everything wrong that the US did before it went tits up.

The lesson from this episode: central planning cannot work because there is no omniscient being. Had Mark Carney known beforehand of the Eastern money that is pouring in now, he would probably not have printed as much money, say 3, 6 or 9 months ago. Yet, he could not have know this, as every actor on the market makes his own decisions based on the ever changing information available to him.

Keep praying Mark, we'll all need you to.