does anyone remember CIBC’s $10B loss on CDO’s and CDS exposure… basically they lost 10B trying to make a couple million… great risk mgmt there

or NBF’s ABCP debacle

or BMO’s oil trading debacle

oh and if TD and Royal Bank were so prescient to exit the MBS market, why did they both buy US banks near the peak of the market

canadian bankers are not smarter than their US counterparts, just less risky

thats all

But it is certainly not just the result of superior management/regulation. Bank executives are very conservative by nature up here because they can survive without being aggressive. But they still had a good share of toxic MBS from the US because they believed the NY ratings houses.

IMHO, elborbah is correct. We were going to purchase a house in Canada, but when we found out (if i remember correctly) we had to pay something close to sales tax on the purchase price and also found out the mtg interest wasn’t tax deductible, it was more cost effective and less risky to rent.

Rewind the US for 10 years and imagine these tax burdens and add the higher Canadian tax burden (total VAT is 15%, plus i think income tax we paid in Canada was about 40%) and houses are the great investment everyone thought they were from 2000-2006.

The government and bank rants above made me laugh out loud.

Beer tax was so high in Canada that we went with all of our neighbors to the make your own breweries.

Every time we went back to the states, all our neighbors asked us to buy shoes, clothes, small appliances, etc. for them from the US because they were much less expensive. None of my US neighbors asked me to purchase things in Canada for them.

Don’t get me started on my personal experiences with Canada’s “free” health care. [Obama is using the same marketing dept as the Canadian government.]

It looks like maybe Canada is just behind the rest of the world in the evolution and popping of their housing bubble, if the writer in that link that eren provided is accurate in his assessment of the situation.

No. We didn’t let the bubble get blown up quite as much. We had a CBer that was targeting the inflation rate (1% – 3% band) while Uncle Alan down south was targeting asset prices during the craziest part of the housing bubble. It kept the bubble within reason for us. That CB head has since been replaced with a Goldman guy and things have been a lot more unstable. That is obviously deliberate. These guys are worse than black marketers. They profit from chaos. In the case of banks it is not so much war but economic chaos

I felt a sense of dread go through me the day the media proudly announced the new CB head was a Goldman guy. I would have told anyone who was willing to listen that our financial stability just went out the window but not a man in the street would have understood a word I was saying and would only have given me back a blank stare

I’m a Canadian who has lived in the U.S. for 12 of the past 20 years. Lots of American banks are solid institutions that are doing fine. They’re the banks that didn’t pursue mergers or “innovations” and didn’t get caught up in the excesses of Wall Street culture.

Can anyone imagine CEOs at Citi, GS or Lehman doing that in 2005? Remember the “as long as the music play, we got to dance
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RBC did the same thing. When it bought Centura, an American bank, it quickly sold off its MBS/real estate portfolio for the same reasons.

They could afford to do it because their multiple was compared to those of Cdn banks and not US ones.