Post by
Form001 on Jan 04, 2022 10:51am
Dont look nice…..
The Globe and Mail reports in its Saturday edition that markets are discounting five or six rate hikes in 2022 from the Bank of Canada (125 to 150 basis points). The Globe's Jason Kirby quotes David Doyle, head of North American economics for the Macquarie Group, saying that this would be the most in a calendar year in more than two decades. The potential impacts could be the most significant since 1980. This is owing to hyperleveraging. The non-financial private-sector debt-to-GDP (gross domestic product) ratio has doubled over the past 35 years, with much of this occurring over the past decade. Mr. Doyle says that exacerbating the potential for an outsized impact from rate hikes is the continued dominance of residential investment. Despite a recent moderation, this remains more than 9 per cent of gross domestic product. This is more than three standard deviations elevated relative to its long-run average. He adds that such a highly elevated structural imbalance opens up the potential for a severe decline in the aftermath of a rate-hike cycle.
Comment by
Form001 on Jan 04, 2022 10:57am
COMPQ index down, possibility to see 65.00CDN, rate hike always a bad thing for techs. IMHO