Economy in worse shape than previously thought

by Joel Sandwith on October 21, 2010

Signs are everywhere these days that the supposed economic recovery was a bit of false hope.  I’ve suggested in this blog (and in many conversations) that we have not seen the end, or the worst of this downturn – in fact I’d argue that practically the recession continues.  The economic indicators that showed the recession as being over were short term flukes caused primarily by massive government spending, which cannot last.

Yesterday there were two articles that caught my attention on this subject – the first was in the Toronto Star , and the headline included the word ‘miserable’.  The article goes on to say that growth has slowed and we can’t expect to be back to normal growth until at least 2012.  The article quotes Mark Carney, the Governor of the Bank of Canada, as saying that Canadians must ‘remain vigilant’ in their quest to lower their debts.

The second article, from the Moneyville website, shows the results of a TD bank study that show that debt levels in Canada are now growing faster than debt levels in the United States, and that more Canadian households are on the brink of financial disaster.

So, here’s the problem:  at the top of the financial food chain (the Bank of Canada), we’re being told that part of the key to recovery is reducing debt, while a study of what we are actually doing is showing that we are taking on MORE debt.  This seems like a recipe for disaster.

I think part of the problem is clear – it’s just not that easy to reduce debt.  You can’t make your credit card bill zero just because a government official recommends it.  If you have a small amount of debt and can re-arrange your budget to pay it off, you should, and good for you.

But what if you are dealing with $20,000 in debt?  What about $50,000?  You might need a better plan.  If you are dealing with those levels of debt, you might benefit from a consumer proposal, or perhaps even a personal bankruptcy, to get a fresh start and rebuild your finances.  Give us a call today, toll free at 310-PLAN (7526) or locally here in Sarnia at 519-344-1058.

Share this:
Share this page via Email Share this page via Stumble Upon Share this page via Digg this Share this page via Facebook Share this page via Twitter

Leave a Comment

Previous post:

Next post: