It's Different Here... but Not Much

Throughout the global credit crunch the Canadian banks have been praised for their financial conservatism compared to their counterparts South of the border. The Canadian financial system is apparently one of the safest in the world. A Globe and Mail piece today shows the dangers of getting too complacent about how "things are different here".

The piece reveals how Harper's government exposed individual Canadians to huge amounts of risk by allowing subprime mortgages - the root of all this mess - to be established here in the 2006 budget.

The article goes on to say that the Tories than had the gall to take credit for reacting decisively to the financial crisis, when in fact they exposed Canadians to the credit crunch and they were slow to recognise the danger signals, in spite of repeated public and private warnings.

"...not only did his (Harper's) own government open the sheltered Canadian mortgage market to U.S. insurers, but it also doubled to $200-billion the pool of federal money it would commit to guarantee their business."

Apparently, US financial organisations like the recently bailed-out AIG moved South in what became a "dogfight" for the thousands of high-risk consumers who would be sold 40-year, interest-only, and other dubiously constructed mortgage arrangements, many of which will now go bad, leaving individual Canadians without homes.