The Bank of Canada was back at it with their latest views on the direction for monetary policy. The latest dove at the helm, Tiff Macklem, signalled his commitment for a zero interest rate policy, and unprecedented levels of Quantitative Easing. Both interest rates and QE are here to stay, until the recovery is well underway, and that will take at least a few years. In other words, as Macklem so eloquently put it, “Interest rates are very low, and they’re going to be there for a long time. We recognize that Canadians, and Canadian businesses are facing an unusual amount of uncertainty, and so we have been unusually clear about the future path for interest rates. So If you’ve got a mortgage, or if you’re considering to make a major purchase, or you’re a business and you’re considering making an investment, you can be confident that interest rates will be low for a long time.” In central bank lingo, they call this forward guidance. On main street, we call it a green light to lever up on cheap credit. Borrow to your heart’s content. It’s a slippery slope, however. Canada currently ranks third amongst the G-20 in terms of private debt

The Vancouver Real Estate market made headlines this past week with a whopping 64% increase in sales on a month-over-month basis. While headline readers may be stricken with a sudden panic of missing the dip (if you can call it that), further analysis suggests there really is nothing to fear. Due to the rather inconvenient timing of a once in a lifetime global pandemic, the spring housing market was essentially shut-down this year. In what is normally the two busiest months of the year, April & May were complete duds, recording multi-decade lows in sales. As the economy re-opened, the pent-up demand from the spring market resulted in nice uptick in June. It looks like the spring market was essentially bumped to this summer. However, after further review,  it turns out the pent-up demand was rather not that impressive after all. June sales were still 21% below their ten year average. Suggesting home buyer demand remains weak. The real story here is all about inventory. The total number of homes for sale in June slipped 27% year-over-year, as sellers opted to stay put in their homes during these uncertain times. Considering the government essentially mandated stay at home orders, issuing