This article points out the overall changes in average Canadian home prices. It also highlights nicely the differences between many Canadian cities' housing markets. The stats in this article are not a surprise. Many market watchers and government organizations have been calling for an overall cooling in the Canadian real estate market. The hope has been that a necessary cooling would not end up as a downward spiral of any kind. It appears that this regular cooling is actually what is happening in a few overheated markets...with the major exception of Winnipeg, which is causing some chatter on Bay Street.
On Wednesday, Ben Bernanke (Head of the US Federal Reserve) stated before the US House Financial Services Committee that he would continue to do exactly what he has been doing and what he said he would do with respect to monetary policy. This is not, however, what was expected. The markets thought that he would give an indication that further stimulus could be coming. After Mr. Bernanke indicated that the economy did not require further stimulus at this time, the markets dropped. This article is worth the lengthy read; it gives a very good synopsis of what is going on in the US economy and the world economy. Bernanke comments on the treasury markets, inflation, unemployment levels and the continuation of more transparency in the operational aspects of the US Federal Reserve.
Equity markets have been rising for about 6 months and oil prices have also been creeping higher. The higher that oil prices rise, however, the greater the chance that increasing oil prices will start to push down the world stock markets and potentially stall the economy on its path to recovery. Why? Consumers have only so much to spend each month. When they have to spend more on fuel, they will spend less in other areas. This causes revenue declines across many asset classes, from clothing stores to restaurant chains. The companies themselves also face rising costs from fuel, then get squeezed with less revenue from customers. How to avoid this? Income and employment levels would need to rise to support the high cost of oil.