Mark Carney’s not impressive at all

Pauvre Anglais, vous pensez que Mark Carney’s est votre sauveur, détrompez-vous?

Ce n’est qu’ex-employé de Goldman’s Sack qui pense que le monde entier doit être géré par une finance mondiale.

C’est  loin d’être impressionnant, au départ le Canada était déjà en bonne position économique par rapport aux États-Unis en 2007, car les règles bancaires étaient nettement plus sévères.

Donc, quand, il est arrivé en fonction, le travail était déjà fait.

Donc, aucun, mérite, et vous dîtes, oui, mais le Canada a passé en travers?

Oui, mais à quel prix?

Comme tout bon gouverneur d’une banque centrale, il a favorisé de baisser les taux d’intérêt à
1 %, mais c’est une économie par endettement, c’est une fausse économie, car tu t’endettes jusqu’au point que la balloune risque de péter.

Par contre, endettement, veux dire BEAUCOUP BEAUCOUP D’ARGENT pour les banques, surtout pour les banques canadiennes qui sont les plus rentables au monde, normales ils jouissent d’un oligopole au départ, ce qui est unique au monde.

De plus, ils ont accordé plus de 600 milliards de prêts immobiliers les plus insolvables sans prendre aucun risque, beau stratagème, car c’est le peuple qui prend le risque par l’entremise de SCHL, mais ce sont eux qui font le profit.

Je comprends, pourquoi tous les présidents des banques étrangères jalousent le système financier canadien, tout le monde voudrait avoir un tel système chez eux.

Relativement simple, nos banques, on fait autant de profits dans les 5 dernières années que le fédéral a fait de déficit, pourquoi on accepte une telle aberration, copinage, copinage, copinage…

Pour ces confrères, c’est un héros, pour le peuple vous être pognés avec au taux d’endettement de 160 %, autant que les Américains avant qu’il pète, oups !,

Le petit vieux se sent 2 fois plus riche, car son patrimoine immobilier a augmenté de 2 fois, mais il n’a aucun mérite, car cette augmentation est due à la baisse des taux d’intérêt.

Relativement simples, les taux d’intérêt ont baissé presque de deux fois, vous êtres sentis 2 fois plus riches, car vous pouviez faire des paiements deux fois plus élevés, mais en contrepartie les maisons ont augmenté de deux fois, donc au lieu de payer 150,000 $ vous devez payer 300,000 $ pour la même maison. Évidemment pour le petit vieux si ça maison est payée, il profite de cette fausse économie.

Pour les petits jeunes, on les oublie, au lieu de s’endetter de 150,000 $, maintenant, ils sont obligés de s’endetter de 300,000 $ pour accéder à la même propriété, donc, 2 fois plus de temps à rembourser avec deux fois plus de risques, accompagner par une économie chambranlante, loin d’être  réjouissants.

Ensuite, on les traite d’irresponsable, d’antisystème, antidémocratique, anticapitalisme, les sophismes standards quoi !

Revenons, à cette fausse économie, endetter l’État ou le concitoyen ne fait que stimuler l’économie superficiellement, car tous les deux arrivent un jour à un point de saturation.

On le constate d’ailleurs, l’Économie canadienne ralentit et le Québec est au point mort.

Espérons, que l’on ne subisse pas le même sort que les Américains, les Irlandais ou les Espagnols, car ils pourraient discourir, longtemps sur le sujet.

Par contre, je dois le féliciter, il est un des seuls gouverneurs banque centrale, qui a supporté ‘Wall Street - OCCUPY ‘ en disant que leur requête était légitime.

Donc, Bonne chance aux Anglais, avec votre nouveau gouverneur de banque centrale.

J’ai ajouté trois articles sur le sujet qui méritent votre attention.


Extrait de: Mark Carney: is he really that good?, by Andrew Hepburn, Macleans.ca, November 27, 2012

Andrew Hepburn is a former hedge fund analyst. He’s a commodities bear and a keen observer of financial speculators. For Maclean’s he blogs about the economy and financial markets. 

The mourning has already begun. Mark Carney’s departure is “bittersweet” said Finance Minister Jim Flaherty.

Such is the loftiness of his reputation (Central Bank Governor of the year, no less!), that the Brits would even consider poaching Carney from the Bank of Canada.

But just how justified is Mark Carney’s figurative stock price?

Is it based on what economists like to call “fundamentals,” i.e. real world factors, or inflated perceptions—have we been witnessing something of a Mark Carney bubble in the last few years?

I’m sorry to disappoint those in the Mark Carney fan club, but signs point to the latter. The odds are that history will not judge Carney as kindly as we are now.

As the governor prepares to leave office, Canada faces the possible bursting of two large asset bubbles, both of which could do serious harm to our economy.

First, and most obvious, is the housing bubble, along with the household debt that pumped it up. For now, housing prices have been cooling rather slowly, but should the bubble burst, it will have severe consequences for everything from residential construction to consumer spending.

Canadian house prices have been rising for over a decade (granted with a small correction during the financial crisis), and their ascent now rivals that of the U.S. in its bubble days. As CIBC noted, Canada’s “household debt-to-income ratio is now above the level seen at the eve of the big American crash.”

House and Housedold dept

The second bubble Canada is faced with is a global commodities bubble. On that, too, we are on borrowed time. Resource prices have always gone through booms and busts, and the last ten years have been quite the boom, as Maclean’s pointed out last year: 

global commodities bubble

These are no small bubbles: without housing and resource prices soaring anew after the 2008-2009 meltdown, it’s very difficult to believe that our economy would be as strong as it’s been recently.

Put another way, the strength of the Canadian economy in the last few years might not have been the product of anything sustainable.

How much blame does Carney deserve for this?

In the case of housing, certainly a bit. His policy of ultra-low interest rates unquestionably made mortgages cheaper and encouraged many Canadians to borrow.

In fairness, though, Carney was between a rock and a hard place with interest rates. Keep them at rock-bottom and people will pile on debt, set them much higher and our currency—which has already become a bit of a safe haven after the financial crisis—soars even more, increasing the pain on exporters, who haven’t yet fully recovered from the Great Recession.

There’s also the matter of the Canada Mortgage and Housing Corporation’s balance sheet expansion and its impact on the housing market, a decision made not by Carney but the minister of finance. The CMHC has significantly augmented the value of mortgage insurance it issues, in effect allowing banks to grant new housing loans while the risk of default rests on the government’s shoulders.

Il aurait pu dire sur le peuple, car c’est nous qui sommes
à tout fin responsable de la SCHL (CMHC).

How about commodities?

Again, one can’t fault the governor for failing to tame the boom—they are global markets, after all.

But to the extent his job is to provide a sober look at economic trends and urge caution when exuberance abounds, Carney appeared to be doing the opposite. In early 2011 he all but uttered the most dangerous words in finance: This Time It’s Different. Thanks to the rise of China and India and their thirst for resources, the boom, he said last year, “ could go on for some time.”

Interestingly, others at the Bank of Canada, including Deputy Governor John Murray, have been warning that what goes up must come down.–

Nearly seven years ago, as another famous central banker prepared to leave office, the Economist magazine mused: “Among ordinary Americans he enjoys almost rock-star status… Does he really deserve such uniform praise? And after the accolades have faded, what will economists conclude about his tenure?”

To be sure, Mark Carney is no Alan Greenspan. He has not ignored our housing bubble and our burgeoning private sector debt. And, unlike the former Fed chair, he does not have blind faith in markets to police themselves without proper regulation.

And yet, the similarities are inescapable: both central bank chiefs left in good times as trouble neared, and both enjoyed near-rock star popularity.

Maybe there’s something about being at the monetary levers in good times that causes reputations to exceed reality.

Maybe Mark Carney has been something of a bubble all along


Extrait de: Mark Carney's 'shock' appointment means more of the same, Ann Pettifor, guardian.co.uk, Monday 26 November 2012

Osborne's choice for governor of the Bank of England will do nothing to prevent the next collapse of the financial system

Today the chancellor confirmed that there will be no real change at the Bank of England. There will be no change to the Treasury and Bank of England's obsession with inflation targeting and "price stability".

Above all,

·         He confirmed that there will be no reining-in of the banks; that banks will not be re-structured – to separate the retail and investment arms, and ensure that banks are no longer too big to fail.

He confirmed this by appointing an ex-Goldman Sachs banker, Mark Carney, as governor of the Bank of England.

The FT was right when in January this year it described Carney as [FT paywall]"the leading example of a new breed of ambitious, internationally focused central bankers who view regulatory and monetary policy issues through a more market-based lens". He favours an "open and resilient financial system" – code for giving the banks free rein in global capital markets.

And like many of his peers he believes that the key to recovery lies in all western economies "capitalising on the immense opportunity that emerging markets in general and China in particular represent". Like others, he prefers exports over the expansion and strengthening of domestic markets.

So be very afraid. Business-as-usual will prevail. And nothing will be done to constrain the City, and therefore to prevent the next collapse of the financial system.

Carney is a central banker steeped in the culture and practices of Goldman Sachs's investment banking arm. Before becoming Canada's central bank governor, he spent 13 years with Goldman Sachs in its London, Tokyo, New York and Toronto offices. He held a range of senior positions. The most significant was as managing director of investment banking.

In a speech made recently Carney made the right noises. He complained of "a system that privatises gains and socialises losses" and endorsed the approach that sets capital and leverage ratios for banks. He's even commended the Occupy movement for being "constructive".

But there is nothing in his speeches that indicates that he will help give Britain's real economy the protection it needs from its over-mighty – and still very dangerous – banking sector.

Nothing, in other words, that indicates the real economy – the productive sector – will be given priority over the City's preference for reckless global speculation.

Instead like many others who adopt a "market-based" approach to regulation, Carney prefers to tinker – retrospectively – with the capital ratios of banks. This is because he and many others in central bank circles know that most of the Britain's banks are very highly leveraged. That without the support of the Bank of England's quantitative easing programme, and its very low lending rates – all effectively backed by British taxpayers – Britain's banks would effectively be insolvent.

And so Carney will continue with quantitative easing – which has provided British banks with the liquidity needed to indulge in speculative activity both at home and abroad (genre paradis fiscaux !), speculative activity that bears a scary resemblance to that undertaken before the crisis.

He is unlikely to pressure his friends in the City's commercial banks to lend at low sustainable rates to Britain's productive sector. He is therefore most unlikely to reverse the most bizarre and historically unprecedented aspect of today's British banking system: the fact that those of us in the real economy are lending to banks. Their original mission – of lending into the real economy – has been turned on its head. Today Britain's banks are recipients of loans (deposits) from those active in the real economy – and subsidies from taxpayers.

None of this is likely to change


Extrait de: Does Mark Carney really deserve his reputation as a super-banker?, Dan McCurry, The New Statesman’s rolling politics blog, 27 November 2012

The new Bank of England governor shouldn't be given so much credit for Canada's economic success.

Super-banker Mark Carney negotiated an impressive 30 per cent increase in remuneration, in the form of pension contributions, providing him with a total of £624,000 a year for the Bank of England job. This was not agreed by the remuneration committee but was negotiated by the Treasury (George Osborne) and agreed by the bank’s non-executive directors.

If I had a time machine, I’d go back to 1938 in Cleveland, Ohio, and be in the room when Joe Shuster created comic book hero Superman. I don’t have a time machine, but I was in London in November 2012 when super-banker Mark Carney was invented. So since we’re all having to put our hands in our pockets and pay this man his extravagant salary, maybe we should dispel a few myths before going any further. Gushing Osborne describes him as an "outstanding candidate" in the press release. He loves Carney for "avoiding big bail outs and securing growth." So is that what super-banker really did?

Canada has always had a conservative banking industry and its banks were not over-exposed on entering the credit crunch. The country avoided the crisis in every way except for being the neighbour of the USA, which did cause a short term shock. Carney arrived at the Bank of Canada in February 2008, when the world crisis was already in full swing. It would be impossible for him to have implemented policy that retrospectively saved Canada from turmoil. He was simply there when nothing happened and is happy for people to believe he is a genius as a result.

As for Osborne’s comment on "securing growth"? The fact is that countries like Canada and Australia are rich in resources at a time when the expansion of China has created massive demand for them. Carney didn’t arrange for the rise of China, although if someone had attributed it to him, you can bet he’d allow the myth to perpetuate.

For Canada, the last five years have been so benign that Carney could have turned up to work and played ping pong all day. Yet, here we are, pouring praise on him. We know how Alastair Darling and Gordon Brown would respond to a major financial crisis, because they were there, for good or ill. We don’t know how this guy would be in a crisis, because he’s never been in one. Yet he’s a genius, according to George Osborne.

Osborne has returned regulation to the Bank of England, in the bizarre belief that it can do a better job. This obviously ignores BCCI and Barings. Carney is supposedly qualified as a regulator as he has private banking experience at Goldman Sachs. However, it seems that he advised Russian on their 1998 financial crisis while Goldman was simultaneously betting against the country's ability to repay its debt. This bloke doesn’t know what’s happening right under his own nose, yet he’s in charge of London?

The US has much more experience of capitalism than us, and they always, rightly, have a lawyer in charge of regulation. In a recent TV interview Adair Turner, another economist, didn’t know whether Libor cheating would constitute fraud. He was in charge of City regulation at the time. Yet here we have another economist being put in charge of regulation, when the job should go to a lawyer.

For a central banker he does at least have a very smart suit. Maybe that’s why we’re paying him an extra £144,000 of our money each year. Let’s look on the bright side, George Clooney would have wanted even more.