Why is Canadian debt wrong?

We have the Banking Act of Canada, that limits how far in debt any Canadian can go, based upon various tests against their income. If someone borrows outside of the banking system, they are on their own. Naturally, factors like developing a disability, or changes in family life are not a consideration for the opinion of this article.

If most Canadians are servicing their debt in agreement with the terms, why is it wrong that they have incurred the debt? If a family is building a future, that might include a recreational property, or recreational equipment, why has an environment been created that forces them to change a plan, because a renewal might make it unaffordable because of higher interest rates.

Raising the interest rates has done little to stop inflation, but it has forced some of the middle income group to cancel some of their plans and dreams, because they’re smart enough to not let things get out of control, other than the interest rates, that are out of their control.

Inflation has slowed, but was it really inflation? Some businesses became opportunistic, when supply became challenged, but for many items, supply has returned. Some prices are dropping, but not really many. People have held back on spending, which causes other people to lose their jobs, since the financial support to sustain them has disappeared.

Demand on social services like the Food Bank, and Social Housing have increased dramatically. Is that inflation? I think it’s more of a repercussion from trying to curtail a vibrant economy, so it’s more of a backfire. Are some of these people those that held jobs pre-covid? What happened to all of those people? Are they now independently wealthy? I don’t think so.

If people are buying more goods and services; taking more holidays, and generally using up more of everything; why is that bad? Workers are needed to fulfill the delivery of all of those items, so is that not creating employment, and therefore enabling more people to spend money to sustain and improve their lives.

Canadian debt right now, is only helping the banks. It’s not adding value to anyone or anything else. Larger items are now harder to obtain or keep. Outside of housing resales, used items are not measured for their contribution to any market conditions, nor commented on as a driver.

The government is now asking banks to not use the stress test when renewing mortgages, so that people will not lose their houses due to inability to qualify for the financing. Are they merely delaying what may be inevitable, if nothing else changes in our economy?

For many, living has become unaffordable, and we need to fix that!