Jun
27

Canadian Concern

From 2000-2007, American and Canadian debt-to-disposable-income ratios rose in tandem from 100% to 140%. They have since diverged. The US rate has steadily declined to 103%, while in Canada it’s 175%, one of the highest ratios anywhere! Canadians now spend a record 14.9% of disposable income on debt service, here it’s just 9.9%. Devoting so much income to debt service will drag down consumer spending and constrain the central bank.

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