By Ian Burns
September 19, 2024
Excerpt from article:
The “obvious solution” to Canada’s economic problems is to exploit the country’s “massive resource endowment,” a financial expert has said. But as things stand, Canada is “definitely against the development of natural resources.”
Stephen Johnson, the director of Omnigence Asset Management in Calgary, said Canada has suffered from “monumentally bad management” over the last three decades and a “day of reckoning” is fast approaching.
Speaking to NowMedia video host Jim Csek, Johnston, who attracted national attention earlier this year when he warned that Canada had become the “poster child for stagflation,” said Canadians have been on a “debt-fuelled consumption binge” for decades, but now “the bill has arrived.”
And contrary to the view held by many economists, politicians and mortgagors across Canada – that interest rates have been too high – Johnston said the Bank of Canada has been “suppressing” rates since the 2008 financial crisis.
“That has actually caused Canadians – government, private, corporate borrowers – to engage in what can only be described as an enormous bout of debt-fuelled consumption,” he said. “And so what we have is an economy that's over-levered, it's over-levered and it's skewed towards consumption and it under-invests in productive capital.”