Sunday, February 27, 2022

A Run on Canadian Banks

Here, is the issue: how much to you want to trust an economic forecasting outfit called Armstrong Economics? Its founder Martin Armstrong is a convicted felon… which does not mean that his forecasts are wrong, just that we need to remain slightly skeptical of them.

Anyway, the service has offered one plausible explanation for one event that recently happened in Canada. You know that Prime Minister Justin Trudeau froze bank accounts of protesting truckers and of anyone who had contributed to their cause. Being as Justin is apparently the bastard son of Fidel Castro, the phrase-- like father, like son-- pops into mind.

And you know that a sanctimonious twit and Canadian Finance Minister named Chrystia Freeland was flexing her considerable musculature to show who was boss in Canada.  

You also know that Trudeau managed to suppress the truckers' protest violently….

But then, after receiving a vote of confidence by the Canadian parliament and having promised that the state of emergency would continue, Prime Minister Trudeau quickly reversed himself and called it off.

Why the sudden change of heart?

Well, Armstrong Economics suggests that the executive emergency order, freezing bank accounts, canceling insurance, stopping credit cards, produced something of a run on Canadian banks. Many of those who could do so were transferring their funds out of Canadian banks, into American banks. How much? The report suggests that the sums were considerable. We do not know.

And yet, if you were an average Canadian, to say nothing of a corporate entity, wouldn’t you think that moving your funds out of Canada would be the prudent thing to do. So, it is a plausible response.... And besides, what else could have caused the petty tyrants who run Canada to reverse themselves so quickly?

Armstrong Economics explains:

Based upon reliable sources, Trudeau has been forced to abandon his Emergency Act as a staggering amount of money has fled Canadian banks. Canadians have moved accounts to the United States by the tens of thousands following Trudeau’s freezing bank accounts without a court order which has even included credit cards. Canadians began withdrawing all of their money from their bank accounts with most turning to cash, others to gold, and some to BitCoin. The demand for US dollars more than tripled in the past week.

The sheer amount of money withdrawals from Canadian banks was massive. There appears to have been a 500% increase just in the previous 24 hours. This is the problem with politicians. They are simply UNQUALIFIED to make such decisions. They have no idea that freezing accounts will undermine the confidence in the banking system.

Trudeau has created a very serious crisis and just rescinding his Emergency Act is not going to make it all better. Trudeau has driven a stake through the heart of the Canadian economy and that means that international capital will be skeptical about trusting Canada as long a Trudeau is in power.

As I said, take it with a grain of salt. And yet, if international capital decides to avoid Canada, and not just as long as Fidel’s bastard son is in power, it is a very serious problem.

You might also call it poetic justice, whatever that is.

1 comment:

Anonymous said...

And 60% of Democrats, who are currently in charge of the US, agree with it. If you think your US bank account is safe, I recommend hedging with some significant cash on hand.