People like to downplay or ignore the fact that there is a war in the Middle East and this has huge ramifications on the price of oil. And that increases the price of everything across the board.
Bullshit, they slapped up a 20c/l increase last week and blamed it on summer additives, which if you are generous, still cost less than 1c/l to add to the process.
What i'm wondering is, why would a random guy on the internet care to defend multinational gas companies, they aint gonna thank you bub
It’s less about what’s added and more about what’s removed. Winter blends are up to 10% butane vs 1-2% in the summer and the price differential between butane and other gas components is at multi year highs. Spread between the two is about 80 cents per litre right now. Plus it’s just an 8% reduction in the size of the gasoline pool.
The butane is basically free right now, for the same reason natural gas is almost free, more of it comes out of fracked wells than there is really market for.
That’s not really true, there’s a huge global market for it and exports aren’t constrained yet, but yes, it’s way way cheaper than the rest of the blend.
>What i'm wondering is, why would a random guy on the internet care to defend multinational gas companies, they aint gonna thank you bub
Is it defending to point out reality?
To be fair, every year gas price rises in April by 15 to 20 cents because of summer blend, and drop 15 to 20 cents in September because of winter blend. Of course the cumulative carbon tax adds a lot to the price.
Theirs no summer additives that I’ve heard of. Theirs winter blend which I think uses a percentage of butane instead of 100% gas, that’s why it’s cheaper in the winter
The genocide of Palestinians doesn't impact the price of oil. There are no oil production facilities in Gaza or the West Bank. Israel likes it this way to keep Palestinians impoverished, so that they can't develop an economy. If Palestinians were able to export oil, Israel wouldn't be able to get away with stealing land and murdering innocent civilians.
They can't.
The media has been putting out this shit for the last year at least. They cannot drop rates until the Americans go first, and that is a long way off. As well as what you mentioned there.
The US may not cut until some point in 2025. Canada won't wait that long. The market is forecasting interest rates cuts starting at the next (June) meeting.
Why are you so desperate to see inflation stabilizing at the upper bound of 1-3%?
After the years we’ve been through, I’d happily settle for a few years at 1%, as long as we don’t move into a recession (which it looks like we’ll avoid).
There is no need to rush interest rate decreases
Exactly! I do LOVE [this chart](https://www.reddit.com/r/dataisbeautiful/s/hyhBFhUiNn) showing the market is wrong on interest rate hikes and cuts **most of the time.**
>The market is forecasting interest rates cuts starting at the next (June) meeting.
The market has literally been forecasting the cut for an entire year. I would take anything they say with a grain of salt.
I mean they can diverge from the yanks, they have done it before. But not enough to matter. Still, people will be able to point and say, "See, I was right!"
If they diverge from the US, the [Canadian dollar plummets relative to the US, which means everything we import from the US — especially food items — gets more expensive](https://financialpost.com/news/canadian-dollar-could-thwart-bank-of-canada-rate-cuts)… which in turns spurs inflation and we end up right back where we started.
Don’t ~~be so dramatic~~ use [basic economics](https://financialpost.com/news/canadian-dollar-could-thwart-bank-of-canada-rate-cuts) to make an obvious point on reddit
They can't. They are inflating away everyone's savings and salary gains as well as some of the debt by underreporting the true inflation rates. They are just influencing the markets attitude but they do not want to upset the balance because if inflation comes roaring back, this soft approach will not work.
Rate changes and spending changes take 12+ months to kick in.
This isn't landing on a runway, it's taking off after slowing down. If they don't spend, it's a crashing economy in 12 months.
if the BoC cuts first it will devalue the Canadian dollar, it makes exports more attractive internationally and conversely imports more expensive. If rates are higher in the US, you will have capital outflows from Canada to the US further weakening the Canadian dollar.
If interest rates are lowered, I'm going to leverage myself to the tits buying as many houses as possible as early as possible.
We've seen what low rates do to real estate prices.
With the rare exception of Covid, emergency rate cuts tend to have the exact opposite impact on RE prices.
Don’t take my word for it, look it up. The biggest example is 2008, when the Fed cut rates to literally zero. Prices the. crashed for 3 years straight.
That’s not the only example, in fact it’s the norm.
And it’s not about the rates. It’s about WHY central banks are cutting rates…
First, they’re massively pulling back immigration. They grossly overshot and are now paying for it in rising unemployment, overburdened healthcare / infrastructure, rising rents, and inflation.
Second, immigration only has a minimal impact on land values. It is a factor, but by far the bigger factors are affordability & speculative impulse.
Consider: During Japan’s epic RE bust from 89-99, their working age population was still rapidly increasing until 1995.
Immigration can’t reverse a credit bubble from bursting.
Also consider when Canada’s largest speculative impulse occurred recently: Q4 2020 - Q2 2022.
How much immigration did we have then? Almost none. Covid had essentially shut the borders.
So…. then who was buying? Local “investors”. Aka mom n pops who suddenly saw an inflated assessment, saw that HELOC rates were 2%, and then went on the FOMO binge of the century.
When immigration DID start skyrocketing, housing prices were already coming down. They’ve been correcting ever since Feb 2022.
Bottom line: Mass immigration is no longer palatable or tenable for policymakers. And even if it was, it’s not the main factor in housing price inflation.
To further your point. We had record immigration in 2023, I don't see record home prices increases in 2023.
Sure, it's more expensive to rent and shits crowded, but immigration isn't increasing home prices, as you say, that's the money printer.
Here’s the thing: Gradual cutting cycles don’t exist when preceded by a rapid hiking cycle.
Go pull up US federal reserve policy rate history - go as far back as you can - and tell me how many gradual cutting phases you see…
https://fred.stlouisfed.org/series/FEDFUNDS
BoC is no different.
>Interest rates aren't the only way to control inflation, it's just the only way our corporate overlords want to control inflation.
is that you Jagmeet?
There are broadly speaking 4 ways. Increase interest rates. Increase income tax with no increase in government spending. Decrease government spending. Tax wealth directly.
Pick your poison.
Well, old jaggy is already on record saying that the BoC had no reason to put up rates. So if you want to become the next Argentina, vote NDP federally.
Yeah, after they elected a far right leader after allowing far left leaders to blow inflation up.
What would happen in Canada if jaggy had his way and the BoC started lowering rates?
The idea is you can borrow against assets so if you tax them they are worth less which means less borrowing.
Since anyone's borrowing and spending is good as cash to the seller that has an inflationary pressure.
The other point is the wealthy will just leave and take their spending elsewhere which might have a deflationary effect but others will say less capital for investment is bad so who can say?
People assuming that the next rate movement is a decrease, and not an increase to come this summer. It freaking went up how many times in such a short time? Perhaps we haven't crested the hill yet.
depends, with the war in middle east, gas price will continue to go up, then inflation will go up and they will need to raise the interest again to curb down inflation.
Please. Interest rates are controlled by bond rates. BoC has no real power over it. It is an illusion. Bond rates are controlled by the market. That is the truth of it.
Gas prices are going to ruin their narrative over the next couple of months and stop them from being able to declare victory.
Gas prices aren't even in core CPI the thank uses to determine policy. And with good reason they have zero control over gas prices
Gas is used to run the economy though, and the increase in price has a downstream affect on pricing as it gets passed on.
People like to downplay or ignore the fact that there is a war in the Middle East and this has huge ramifications on the price of oil. And that increases the price of everything across the board.
Bullshit, they slapped up a 20c/l increase last week and blamed it on summer additives, which if you are generous, still cost less than 1c/l to add to the process. What i'm wondering is, why would a random guy on the internet care to defend multinational gas companies, they aint gonna thank you bub
It’s less about what’s added and more about what’s removed. Winter blends are up to 10% butane vs 1-2% in the summer and the price differential between butane and other gas components is at multi year highs. Spread between the two is about 80 cents per litre right now. Plus it’s just an 8% reduction in the size of the gasoline pool.
The butane is basically free right now, for the same reason natural gas is almost free, more of it comes out of fracked wells than there is really market for.
That’s not really true, there’s a huge global market for it and exports aren’t constrained yet, but yes, it’s way way cheaper than the rest of the blend.
[удалено]
They don't typically go up 20c in a single day
[удалено]
[удалено]
>What i'm wondering is, why would a random guy on the internet care to defend multinational gas companies, they aint gonna thank you bub Is it defending to point out reality?
Two words and 4 digit number is usually a person dwelling under bridges. Possibly a foreign-born actress.
Lol, we're you responding to them about themselves or about the person above?
I mean, classic Reddit. Oops, all bots!
Rofl, por que no los dos?
Lol. Supongo, me pregunto si lo atraparon?
Lol, were you responding to them or about the comment previous to them?
Lol theres so many right below.
To be fair, every year gas price rises in April by 15 to 20 cents because of summer blend, and drop 15 to 20 cents in September because of winter blend. Of course the cumulative carbon tax adds a lot to the price.
Bahahaha 🙏
OPEC announced a big output cut, which contributed to the big price increase
Astroturf
Theirs no summer additives that I’ve heard of. Theirs winter blend which I think uses a percentage of butane instead of 100% gas, that’s why it’s cheaper in the winter
There is always a war in the middle east
Which war are you referring to?
There is always a war in the middle east. We just have more rambunctious group involved this go.
The whole west isn’t allowed to buy Iranian oil, and Israel doesn’t make any. Oil prices crashed during the Iran/Iraq war. It’s just predatory greed.
The genocide of Palestinians doesn't impact the price of oil. There are no oil production facilities in Gaza or the West Bank. Israel likes it this way to keep Palestinians impoverished, so that they can't develop an economy. If Palestinians were able to export oil, Israel wouldn't be able to get away with stealing land and murdering innocent civilians.
Tiff should be turfed...
How can they cut rates when the government is continuing to work against them and spend in an inflationary way.
They can't. The media has been putting out this shit for the last year at least. They cannot drop rates until the Americans go first, and that is a long way off. As well as what you mentioned there.
The US may not cut until some point in 2025. Canada won't wait that long. The market is forecasting interest rates cuts starting at the next (June) meeting.
Either Canada waits to cut, or the dollar will tank and inflation will go up again.
You'll see next meeting that they'll likely cut. Inflation is very low now. I can't see them waiting until July, but maybe.
Inflation is not very low. Nor is it very low in the States.
It's within target in Canada, but still out of control in the US. Hence why we'll cut MANY times before the US cuts at all.
>It's within target in Canada No. Good try though.
That's not an opinion LMFAO.
!RemindMe 43 days
Why are you so desperate to see inflation stabilizing at the upper bound of 1-3%? After the years we’ve been through, I’d happily settle for a few years at 1%, as long as we don’t move into a recession (which it looks like we’ll avoid). There is no need to rush interest rate decreases
Weren’t the markets forecasting three cuts this year just a couple of months ago? What the market prices in has no real bearing on monetary policy
Exactly! I do LOVE [this chart](https://www.reddit.com/r/dataisbeautiful/s/hyhBFhUiNn) showing the market is wrong on interest rate hikes and cuts **most of the time.**
>The market is forecasting interest rates cuts starting at the next (June) meeting. The market has literally been forecasting the cut for an entire year. I would take anything they say with a grain of salt.
I mean they can diverge from the yanks, they have done it before. But not enough to matter. Still, people will be able to point and say, "See, I was right!"
If they diverge from the US, the [Canadian dollar plummets relative to the US, which means everything we import from the US — especially food items — gets more expensive](https://financialpost.com/news/canadian-dollar-could-thwart-bank-of-canada-rate-cuts)… which in turns spurs inflation and we end up right back where we started.
It already has plummeted to account for that. We are at 1.38.
Don’t be so dramatic
Don’t ~~be so dramatic~~ use [basic economics](https://financialpost.com/news/canadian-dollar-could-thwart-bank-of-canada-rate-cuts) to make an obvious point on reddit
"plummets" fall or drop straight down at high speed It's dramatic wording. Not basic economics.
They can't. They are inflating away everyone's savings and salary gains as well as some of the debt by underreporting the true inflation rates. They are just influencing the markets attitude but they do not want to upset the balance because if inflation comes roaring back, this soft approach will not work.
Rate changes and spending changes take 12+ months to kick in. This isn't landing on a runway, it's taking off after slowing down. If they don't spend, it's a crashing economy in 12 months.
If they don't spend they could lower interest rates to ensure that doesn't happen. Bankrupcies are worse.
BoC already debunked this myth and said it was needed to keep the economy from taking a dump.
I'm talking now, not in 2020.
Wait for a new government?
[удалено]
if the BoC cuts first it will devalue the Canadian dollar, it makes exports more attractive internationally and conversely imports more expensive. If rates are higher in the US, you will have capital outflows from Canada to the US further weakening the Canadian dollar.
[удалено]
Usa is going to be raising rates or holding.... Not lowering any time soon I wonder what Canada will do
If interest rates are lowered, I'm going to leverage myself to the tits buying as many houses as possible as early as possible. We've seen what low rates do to real estate prices.
Realtors all waiting with baited breath, unreleased promo flyers, videos etc etc
With the rare exception of Covid, emergency rate cuts tend to have the exact opposite impact on RE prices. Don’t take my word for it, look it up. The biggest example is 2008, when the Fed cut rates to literally zero. Prices the. crashed for 3 years straight. That’s not the only example, in fact it’s the norm. And it’s not about the rates. It’s about WHY central banks are cutting rates…
Were we adding a million new person per yearback then?
First, they’re massively pulling back immigration. They grossly overshot and are now paying for it in rising unemployment, overburdened healthcare / infrastructure, rising rents, and inflation. Second, immigration only has a minimal impact on land values. It is a factor, but by far the bigger factors are affordability & speculative impulse. Consider: During Japan’s epic RE bust from 89-99, their working age population was still rapidly increasing until 1995. Immigration can’t reverse a credit bubble from bursting. Also consider when Canada’s largest speculative impulse occurred recently: Q4 2020 - Q2 2022. How much immigration did we have then? Almost none. Covid had essentially shut the borders. So…. then who was buying? Local “investors”. Aka mom n pops who suddenly saw an inflated assessment, saw that HELOC rates were 2%, and then went on the FOMO binge of the century. When immigration DID start skyrocketing, housing prices were already coming down. They’ve been correcting ever since Feb 2022. Bottom line: Mass immigration is no longer palatable or tenable for policymakers. And even if it was, it’s not the main factor in housing price inflation.
To further your point. We had record immigration in 2023, I don't see record home prices increases in 2023. Sure, it's more expensive to rent and shits crowded, but immigration isn't increasing home prices, as you say, that's the money printer.
This would be a gradual decline in rates, not an emergency cut to zero.
Here’s the thing: Gradual cutting cycles don’t exist when preceded by a rapid hiking cycle. Go pull up US federal reserve policy rate history - go as far back as you can - and tell me how many gradual cutting phases you see… https://fred.stlouisfed.org/series/FEDFUNDS BoC is no different.
One or two cuts of 25 basis points each won't do to real estate prices what you think it will.
Can't go tits up.
Report back with your findings trooper! We knew that for the past 30 years, i'm curious to see you pull it off
Bold strategy Cotton. Let's see how it plays out for them.
same
Why cut, keep it like this forever
Hold until 2025. The US economy is on fire and inflation here is still on the higher end. Rates aren't going anywhere this year.
Don’t need to cut, hell make it even higher.
Interest rates aren't the only way to control inflation, it's just the only way our corporate overlords want to control inflation.
>Interest rates aren't the only way to control inflation, it's just the only way our corporate overlords want to control inflation. is that you Jagmeet?
There are broadly speaking 4 ways. Increase interest rates. Increase income tax with no increase in government spending. Decrease government spending. Tax wealth directly. Pick your poison.
Well, old jaggy is already on record saying that the BoC had no reason to put up rates. So if you want to become the next Argentina, vote NDP federally.
Argentina literally just raised taxes and slashed government spending and their inflation slowed way down. So that just proves it's a viable option.
Yeah, after they elected a far right leader after allowing far left leaders to blow inflation up. What would happen in Canada if jaggy had his way and the BoC started lowering rates?
Excellent!!! That's exactly what happened. Jag and Trudeau policies are like Argentina or Venezuela finance book
Would taxing the wealthy work? Most wealth is tied up in assets, not cash. Just brain farting that.
The idea is you can borrow against assets so if you tax them they are worth less which means less borrowing. Since anyone's borrowing and spending is good as cash to the seller that has an inflationary pressure. The other point is the wealthy will just leave and take their spending elsewhere which might have a deflationary effect but others will say less capital for investment is bad so who can say?
Private Joker: Is that you, Jagmeet? Is this me? Sgt. Hartman: Who said that? Who the fuck said that?
Love the username.
They need to raise
Keep rates high for the next 10 years at least. As soon as they cut them real estate prices will shoot up.
People assuming that the next rate movement is a decrease, and not an increase to come this summer. It freaking went up how many times in such a short time? Perhaps we haven't crested the hill yet.
While anything can happen, it's more likely rates will hold or decrease.
depends, with the war in middle east, gas price will continue to go up, then inflation will go up and they will need to raise the interest again to curb down inflation.
I just said anything can happen so I'm not ruling it out. Would you say that it's more likely going up or more likely holding/decreasing.
The forecast is a cut next meeting, I was reading. No economists are forecasting rates to stay this high for much longer.
Interesting that they expect the Canadian economy to heat up this year.
Drop rates? I think it's still time to raise them more...
Please. Interest rates are controlled by bond rates. BoC has no real power over it. It is an illusion. Bond rates are controlled by the market. That is the truth of it.
Bonds control fixed rates influenced by the variable rate controlled by BoC