Canada’s June’s Inflation Drops to 3.1 | Bank Of Canada Shrugs Off Inflation Worries | Yasin Nizami

Canada’s June’s Inflation Drops to 3.1 | Bank Of Canada Shrugs Off Inflation Worries | Yasin Nizami

so stats canada came out with the latest figures of inflation last week and according to that gdp grew 0.8 and inflation dropped from 3.5 to 3.1 but it is still higher than the target levels what does it mean for an average canadian we’re gonna talk about in this video so let’s dive in [Music] what is up everybody this is yasi nizami and you’re watching the passionate wheelchair which is the fastest growing youtube channel focused on canadian user market with a particular focus internal gta as well as some of the major economic factors that has an impact on the market in this video we’re gonna cover the latest cpi figures came out last week for the month of june according to that the inflation dropped from 3.5 to 3.1 compared to the month of may but it is still higher than the target level of between one to three now what does it mean for an average canadian when the cpr figures were published uh bank of canada’s government tiff magnum uh he wrote a an opinion post in financial post and he set up a narrative where he’s trying to say that the rising inflation is temporary is transitory and canadians should not be worried about it because that’s his job as a bank of canada’s chief to control inflation to control the cost of living and he’s going to make sure that he does that for canadians so i think the question is why is he coming out and writing an opinion blog i think um we have seen in the history that uh the media has been used to set up narrative when you they want to control the population in terms of setting up you know a certain narrative in their heads that’s how the media has been used uh you know for centuries and i believe this is one of the tool they’re using just before the elections but one thing i need to clarify this for you about cpi so this is the reason why i truly believe the cpi is not a true reflection of the real inflation because if you look at it you know the way stats canada major cpi is based upon uh you know collecting some some survey feedback from from canadian from consumers in terms of how much they’re paid uh on groceries how many they pay on clothing how much they pay on shoes how much depending on leisure activities like you know vacation and dining out how much they pay on sporting goods how much they pay on shelter so when it comes to shelter you’ll be surprised they only measure the monthly rent the monthly mortgage payment and renovation cost they don’t measure the appreciating housing price which we have seen it has gone like 30 40 across the country year over year it is cost of living isn’t it but guess what cpi is not considering that more so when it comes to understanding inflation the way they calculate inflation is because if the cost of consumer goods and services rising consistently or changing the price consistently year over year then it is called inflation but if the price of the goods and service goes up one year and in the next year it stays same so the rate of change is zero so in their eyes there is no inflation and this is where they’re saying that phase inflation is transitory it’s temporary because if we are seeing the rise of prices for goods and services for the reason of supply chain issue then once they are resolved those prices will not continue to go up so they are saying that this inflation is transitory in that sense but they are not telling you the whole story and this is where i use this challenge to bring an alternative view for canadians to understand what’s happening you know behind the scene which not every uh any economist or any banker will tell you openly okay when the biggest reason of rising inflation is basically the amount of unlimited money supply in the system there are two ways the money is injected into the system number one using commercial banks when they lend the money out when they give you credit card loans or when they give you mortgages or any equity personal equity loans that’s the brand money enter into the system so when you look at the consumer debt that has risen in the last 12 months that is unprecedented okay so that’s number one way to inject money number two is by financing government fiscal debt the government of canada has spent i think almost 356 billion dollars in the last year on different projects you know subsidies and um you know benefits to the canadians and you need to understand where this money is coming from that money is brand new money printed by bank of canada in return of purchasing government treasury bonds and that’s how the new money is being entered into the system so that money is created out of nothing there was no goods and services so brand new money created our air entered into the system and that actually you know increased the pool of money in the system which ultimately drive things like inflation up nobody’s talking about that and because this is political tool the government of canada the election is right right around the corner they’re not going to tell you openly that okay but they are doing it in front of our eyes and this is the reason why i believe the inflation is going to stay even though they will treat the cpi to reflect the inflation is in a below 3 but in reality the inflation is much higher than that you know that my grocery bill has gone up significantly compared to last year so to me inflation is much higher than that and that problem is people do not really understand that even though the rate of innovation goes down from let’s say three to two doesn’t mean that the prices will go down the price will still continue to go up but at a lower pace oftentimes people ask me question okay when the interest rate will go up interest rate and inflation are kind of very closely linked to each other in my opinion i think interest rate cannot go because our economy is still struggling you know we don’t have a lot of growth in the economy that it can sustain the rising interest rate especially our government because government spending is historically high and the amount of debt the government has taken from bank of canada if the interest rate goes up from let’s say 0.25 to 3 the government will likely to default on its server index because they will not be able to service the debt payments because they have taken the debt you know on 0.25 overnight interest rate and if it goes to 3 it’s certainly become a difficult task for enrollment to pay off that debt where there is not much revenue being generated out of the struggling economy not to mention the consumer that etho has also risen significantly in the last 12 to 18 months so if the interest rate started climbing up you will see a lot of insolvencies happening you know left and right so i think until the economy is boring and it is you know the gdp it climbs up with two three four percent we are not in a position to increase interest rate the prices that we are seeing rising they’re going to stay stable if not going up but don’t think that the prices will go down next year because of government of canada’s generative that the inflation is strong story that includes real estate as well we are seeing the real estate market is cooling down but the prices are not when the when the benchmark price is set it’s going to stay at that level unless we see a significant drop of demand the demand is not dropping people are still willing to buy houses we are expecting the borders to be open and we will see the external immigrants will come in and the first thing what they’re gonna do acquire real estate if you’re still holding up and thinking the prices of wheels there will go down and then you will buy you can wait for sure but i think this is not likely to happen this prices will stay the same if not going up but they’re not going down um because the market is still very competitive uh the rates are still low that they’re not still there and because of inflation uh acquisition is going to continue going up that’s it for me this week uh as always i appreciate your support and your likes and your comments so please put your comment down below and i will be more than happy to answer and i will see you in my next video take [Music] care
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Canada\'s June\'s Inflation Drops to 3.1 | Bank Of Canada Shrugs Off Inflation Worries | Yasin Nizami

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