Canada's Bank Bailout

from ChaoticFate.com by qew

http://www.globalresearch.ca/index.php?context=va&aid=12007

The 64 billion dollar budget deficit should come as no surprise. 

It is directly related to a 75 billion dollar bank bailout program for Canada's chartered banks, announced, virtually unnoticed,  four days before the October Federal election. 

The bank bailout received close to no media coverage; its budgetary implications were not analyzed. 

In a statement by Prime Minister Harper on October 10, the bank bailout was casually presented as a commitment by the Federal government to purchase an initial $25 billion in "secure" bank mortgages from the Canadian chartered banks. The transaction would be implemented through Canada Mortgage and Housing Corp:

"Canada Mortgage and Housing Corporation (CMHC) will purchase up to $25 billion in insured mortgage pools as part of the Government of Canada’s plan, announced today, to maintain the availability of longer-term credit in Canada." (Canada Mortgage and Housing Corporation Supports Canadian Credit Markets, CHMC Press Release, 10 October 2009)

The decision implies a money transfer into the coffers of Canada's financial institutions. The money is "fungible" and can be used by the banks as they see fit:  

"The federal government's [initial] $25-billion takeover of bank-held mortgages to ease a growing credit crunch faced by the country's financial institutions is not a bailout similar to recent moves made in the United States and other Western countries, Conservative Leader Stephen Harper said Friday.

The 25 billion dollar allocation was announced four days prior to the elections. Two days following the federal elections, the first mortgage purchase took place leading to an initial cash injection of 5 billion into the coffers of the chartered banks.  

Barely a month following the federal election, on November 12 2008, another $50 billion allocation was announced. 

It received no news coverage. Moreover, opposition party leaders did not analyze the official statement of the Ministry of Finance. 

The likely consequences of the Canada bank bailout on the federal fiscal structure were not the object of discussion or political debate.

What we are dealing with is a cash injection equivalent to 4.6% of Canada's Gross Domestic Product (GDP), which is financed through a massive public debt operation.