And the utter craziness has begun to “decelerate” in some markets.
At least the Bank of Canada is officially acknowledging the craziness of the Canadian housing market, which has been deemed to be the second biggest housing bubble in the world, behind New Zealand, whose central bank also officially acknowledged its housing bubble, and stopped QE cold turkey, unlike the Fed, which has refused to officially acknowledge anything.
Starting last October, the Bank of Canada began the process of ending its asset purchases. Since then, it stopped buying mortgage-backed securities, unwound its holdings of repos and Treasury bills, and cut the amount of its weekly purchases of Government of Canada bonds for the third time, from C$5 billion per week last year to C$2 billion per week now. The assets on its balance sheet dropped from C$575 billion in March to C$487 billion as of last week. And in its pronouncements, the housing bubble looms.
Housing markets react slowly, spread over years, and Canada’s housing market has started to react just a teeny-weeny bit. Home sales in June dropped by 8.4% from May, the third month in a row of declines Read More