Canada’s mortgage bonds as debt in debt in debt?

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I don’t understand but [this]( sounds both real bad an real stupid: can someone please ELI5?

In: Economics

Anonymous 0 Comments

Honestly, I believe it is a misleading headline.

Canada is planning on spending 30 Billion dollars on propping up mortgages to stimulate housing. Canada is also planning on running a 40 Billion dollar deficit in it’s budget this year. and yes, 30 IS 75% of 40.

But, You could also phrase it as “Canada to spend 75% of it’s deficit on running the military this year.” Or “Canada to spend 150% of it’s deficit on healthcare this year.” Since they are planning on spending 60 Billion on the national healthcare.

So it is not specifically “Canada is taking debt to buy debt”. It is “Canada will have a budget deficit this year, because all these different programs combined cannot be funded by just tax revenue.”

Sure, you could blame the mortgage bonds, but you could also blame the military, and the healthcare system, and every other thing the government funds (Like running Nunavut).