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What's Ailing Canada? Housing Sabotage: Opinion

VANCOUVER (Silver Gold Bull) -- I am far from the first writer to report that Canada's housing bubble is nearing some dramatic rupture. Indeed, I may be the last writer to have covered this topic, despite being based in Canada.

Why have I been the last scribe to jump on the media's "bubble mania" bandwagon concerning Canada's housing market? Because there has been little to report here, other than soaring debt levels, which also exist throughout the Canadian economy -- and, indeed, throughout all Western economies. The building bubble itself has not been even slightly newsworthy.

Lost in the mainstream media's disjointed reporting on individual markets is a simple truth. As long as the West's banking cabal continues its policy of destructive, near-zero interest rates, every housing market of every Western economy will be in a perpetual cycle of building bubbles or bursting bubbles. Period. Thus reporting that a "Canadian housing bubble" has formed has all the "news value" of announcing that the sun had risen again.

What finally caused me to jump into this topic are two factors: First of all, we have very strong evidence that "the end is near." Secondly, there is the entirely suicidal manner in which Canada's current government has (deliberately) constructed this housing bubble.

Regarding the former point, an asset-bubble will almost always telegraph to the market when it is about to burst, with an unequivocal signal: Falling sales. To understand why this is such an obvious warning-sign requires at least a rudimentary understanding of the mania that fuels such asset bubbles.

In the case of housing bubbles, that "mania" is composed of a mixture of the greedy and the fearful. For the greedy, the soaring prices that characterize any/all asset bubbles are like a clarion call: "Get rich quick." For the fearful, soaring housing prices cause an anxiety attack: If they don't "buy now," they will never be able to afford to make a purchase. Allowing emotions to enter into one's important financial decisions is an inevitable recipe for disaster.

What falling sales tell us is that the mania is over, and a point of "capitulation" has been reached. This occurs when both the greedy and the fearful say to themselves "too expensive" -- the death-knell of any/every bubble. In Canada's housing market, two of the largest urban markets (Toronto and Vancouver) are reporting dramatic drops in sales.

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