Canadian economy shrank at 3.4% annual rate in the last 2008 quarter

[Canadian]

Canadian economy shrank at 3.4% annual rate in the last 2008 quarter, according to Statistics Canada. After the report the Canadian dollar dropped against major currencies. The Bank of Canada is expected to bring down the key interest rate to 0.5 per cent, but I don't think this will help our economy in any way.

[trent]

Canadian economy shrank at 3.4% annual rate in the last 2008 quarter, according to Statistics Canada. After the report the Canadian dollar dropped against major currencies. The Bank of Canada is expected to bring down the key interest rate to 0.5 per cent, but I don't think this will help our economy in any way.

It will get only worse as 2009 advances. The Bank of Canada lowered the interest rates, but this will not bring back the ailing housing market and the consumer driven economy. Until house prices fall in line with incomes (this means an average house should cost 3 times average income) the economy will not get better. All the morons who bought inflated houses in the last 3 years will continue living in denial of their housing values, until they are forced to sell (higher interest rates. job loss, relocation, etc.). The housing crash will not be quick, but it will develop in rather slow motion and it will take at least 3-4 years to complete. All this will only guarantee economic misery for the next few years.