Our governor of the Bank of Canada Mark Carney, not be confused with carney, a person who works in a carnival or amusement show, was out in public yesterday spreading the good news about the economy prior to the long awaited return of parliament next week and the release of the conservatives stimulus spending budget.
In an update to his October Monetary Policy Report, Carney said the country was in a worse recession than previously thought, but its duration would be shorter and its recovery process faster than the past two downturns with economic growth expecting to resume in the second half of this year, and rebound to 3.8% in 2010.This upbeat announcement by the conservative appointed governor of the bank is surprisingly positive in comparison to the bleak announcements made by Kevin Page, parliament’s budget officer two days ago. Page announced that the government could rack up to $105 billion in deficits over the next five years before they even spend dollar one of the stimulus budget.
However unlike the wide agreement amongst third party economists to the parliament’s budget officer’s projections, Carney’s pronouncements are not receiving the same support and agreement amongst the country’s economists.
For some economists, the Bank of Canada's predictions appear overly optimistic.It seems more appropriate to believe that the conservatives Carney is just out front hawking some positive news in order to obviate the realization that Harper and Flaherty have mismanaged the economy over the past two years in advance of parliament's return.
There's significant room for the Bank of Canada to be disappointed by the coming data, which may yet prompt further monetary policy easing.
In our view, the recovery in the Canadian economy is likely to be more protracted and the growth rebound will not likely be quite as robust in 2010.
Mr. Carney said the quick recovery was expected because Canada entered the recession with lower unemployment and a stronger fiscal position than in previous yearsThat’s right citizens, ignore the fact that this government had increased it’s spending and cut it’s revenues in a two year effort to buy our votes, vanquishing all surpluses at a time when they knew the economy was about to enter a recession, because it is their stalwart fiscal management that will allow the country to suffer for a shorter period of time than it did in the past.
Is that the best line that they’ve got? I can’t wait for the return of parliament. Bring on the clowns.
Reference Financial Post here.