The household debt-to-income ratio reached the highest level ever recorded, as concern rises about Canada’s economic vulnerability.
According to Statistics Canada, the ratio of debt to income has now reached 167.8%, meaning Canadians on average have $1.68 of debt for each dollar of income.
As reported by Reuters, RBC economist Paul Ferley said “Certainly it’s confirming that debt levels remain high and (are) creeping up a little bit higher. That’s been an ongoing vulnerability for the Canadian economy.”
The president of the Credit Counselling Society Scott Hannah, raised a prospect many are becoming increasingly concerned about:
“Canadians continue to ‘tread water’ and are at risk of reaching their tipping point where they can no longer manage their debt payments,” said Hannah.
Rising interest rates are an added concern, as the burden of paying off debt could reach dangerous levels.
“Borrowing outpaced wage growth”
In another sign of how our current “growth” is based off a mirage, Reuters noted that “borrowing outpaced wage growth.”
Any economy can grow for a while if debt continues to expand, but every expansion of debt relative to income brings greater vulnerability.
This is the inevitable result of the economic policies pushed by the elitist consensus that dominates Canadian politics.
Our nation – and our workers – have been sold out to the false “free trade” ideology that has hollowed out many of our communities, and eliminated countless well-paying jobs. As a result, more and more Canadians are trying to keep up by going further into debt, as stable employment is tougher to find. Decades of stagnant wages, a bigger government burden, and our country being sold off to the highest bidder has left us only able to “grow” by borrowing more money.
It’s not sustainable, and unless we can replace the elites who have put us in such a dangerous economic position, Canada is at risk of a serious and long-lasting economic downturn in the near future.