Canadian Consumer Debt Zoomed 9% Y/Y in 2013 according to Equifax as reported by CBC News today in advance of Minister of Finance Mr Flaherty's Budget, scheduled to be tabled tomorrow. If the government budget again includes their mantra "We are going to Balance The Budget in 2015" (Oct 2015 is when the next federal election is), then a 9% annual growth in private sector consumer debt is going to increase even more unless lenders freak and turn off the tap, or consumers withdraw into balance sheet repair. Don't worry about non-conventional mortgages (mortgages of more than 80% Loan to Value); they are all insured mostly by you dear tax payer. Mortgage debt clocks in at almost two thirds of Canadian Consumer Debt and that increased 12% over the last year.
As can been seen by the charts below, Government Debt to GDP is curving down and that is not occurring because we are a successful export country. Nope... we are an import country as reflected in our Trade Balance which has been locked into a 5 year negative channel since the March 2009 Pit of Gloom. Government Spending Growth has been reduced (via Balance the Budget Policy) and the hit to the CA$ in the last year has driven up the cost of imports and most of the stuff we buy. In order to maintain its lifestyle, the Private Sector is using credit in the absence of Government Sector spending and a chronic Trade Balance deficit.