shadowspar

Oh, what's this? For months -- if not years -- we've heard about how our banks are on a sound footing, how there's no mortgage crisis in Canada, and how the Canadian banking system is the most stable in the world...

Canada does not have banking crisis: Harper

Monday, October 06, 2008
TORONTO (Reuters) - Prime Minister Stephen Harper said on Monday that the Canadian banking sector is not in crisis and vowed to help other countries cope with their financial difficulties.

...In fact, we've heard this all this week...

Canada's banking system kept high and dry by strict regulation: Flaherty

TORONTO — High banking standards have kept Canada's financial institutions afloat and out of the kind of trouble that has sunk many of their international peers, Finance Minister Jim Flaherty said Wednesday [8 Oct 2008].

...until this morning: with the Conservatives slipping in the polls because people feel they're not concerned enough about the economy:

Flaherty announces measures to stabilize lending industry

The federal government plans to buy $25 billion in Canadian mortgage-backed securities in a bid to ease a growing credit crunch faced by the country's banks and other financial institutions, Ottawa announced Friday.

Finance Minister Jim Flaherty said the government's plan is to buy the securities through the Canada Housing and Mortgage Corporation and provide much-needed cash to financial institutions that sell the so-called "National Housing Act mortgage-backed securities."

Flaherty announced the new measures in an attempt to assuage concerns over the burgeoning global financial crisis and defuse criticism that the Harper government was ignoring the spreading lending crisis.

That's 25 billion dollars in cash money handed over to the banks, ladies and gentlemen...$748 for every man, woman, and child in Canada. While the taxpayers get a bunch of (probably not worthless) mortgage-backed securities in exchange, it's still nice to know that the gov't is ready to step in and hand the banks a huge cash purchase when anything comes anywhere near to causing them problems with their bottom lines. Honest to God, these guys have no idea what they're doing with managing the economy. Certainly they have no more idea than anyone else.

The worst part about it is that since the banks dole out credit, they have us over a barrel when it comes to economic growth, and the alternative of letting them sit on the mortgages and starve for credit might very well amount to cutting off our nose to spite our face.