this post was submitted on 30 Sep 2024
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Canada's housing affordability crisis may persist for years despite rate cuts (www.reuters.com)
submitted 1 month ago by [email protected] to c/[email protected]
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Buying a house may remain out of reach for many Canadians for the foreseeable future, with mortgage costs unlikely to fall enough to offset lofty home prices and weak spending power, economists and real estate agents say. 0 Even with expectations that Bank of Canada will keep cutting rates in the coming months, the issue of home affordability - which has strangled Prime Minister Justin Trudeau's poll numbers - is unlikely to fade before the next election.

The mandate for the Liberal minority government ends at the end of October 2025, but an election could come well before then, with the Conservative opposition spoiling to end Trudeau's nine-year run at the top.

"You won't get back to an affordable range for housing on a sustained basis for a decade," Tony Stillo, director at forecasting and analysis group Oxford Economics, said last week at a conference.

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[–] [email protected] 0 points 1 month ago (1 children)

Capitalism didn’t invent greed. Humans have been killing each other and stealing each other’s resources for tens of thousands of years. Greed isn’t even exclusive to humans. If you’ve ever seen what foxes or weasels can do to a henhouse, or what giant Asian hornets can do to a beehive, then you’ll see what I mean.

Capitalism is just the idea that competition leads to better outcomes for everyone and that the best competitors are people who put their own resources on the line (rather than someone else’s). What we’re seeing today is consolidation and centralization of wealth and power, the exact opposite of competition. Anyone celebrating this is not a capitalist, they’re a (wannabe) oligarch.

As for empathy, I think the only way to build that is to work directly with people and try to make a difference in their lives. Economic planning and policy making does not achieve empathy, you have to already have empathy going into it.

[–] [email protected] 3 points 1 month ago (1 children)

That's not what capitalism is. Competition is one component that's observed in capitalist systems and it isn't strictly required, nor necessarily the natural course of capitalism. There are well established examples in capitalist economies where competition cannot exist naturally. Then you have the history of capitalist economies rife with consolidation, only sometimes impeded by intervention. I'd invite you to consider what happens to the losers in a best case scenario competitive market. What happens with their machinery, workers, brands, market share, etc. once they're our of business. I'll say it since I want to draw a conclusion - they typically get absorbed by the successful competitors. Repeat this cycle enough and you get the consolidation we see all around us. What we live in isn't not capitalism. It's just a ..late.. stage of it. The perfect competition model doesn't prove that it's a natural or a likely model of economies, there's no good evidence that competitive equilibria are likely or stable. If reality is any guide, it's the opposite.

[–] [email protected] 3 points 1 month ago

No, of course not. Competition needs to be preserved through strong antitrust laws. The US used to have a very active FTC which sued to prevent mergers and attempted to break up monopolies in order to preserve competition. Then it went through a long period of inactivity due to monopoly-friendly governments.

Now, the Biden administration and their appointee, Lina Khan, have resumed this important work. Of course, this could all be jeopardized if Trump wins the election, but so could a lot of other important things.

As for Canada, we favour oligopolies under a misguided theory that large Canadian businesses will protect Canadians from foreign competitors to the south. We’re paying the price for having no trustbuster with teeth, like Lina Khan.