I have a tremendous amount of admiration for those that can craft words in in a way to enlist emotion, and to make people say, “What the hell?”  I’m not talking gibberish or some inane cliché.  Real articulation and pictures being painted with words is an art.  Indeed, my tired eyes have glimpsed a Picasso of statements.  The artist? Outgoing Bank of Canada Governor, Mark Carney. Today was Mr. Carney’s last monitory policy update prior to his departure this summer.  It’s an art form to be able to say the same thing 32 consecutive times, and make it sound interesting.

In fairness I did detect something new when reviewing the text of his speech.  For example, how would you describe your business today?  Challenging?  Concerning? Apprehensive?  I have a sneaking suspicion you didn’t think of this, “constructive evolution of imbalances in the household sector.”  These were Mr. Carney’s words used to describe the current economic state of affairs.  In fairness, here’s the entire statement, “With continued slack in the Canadian economy, the muted outlook for inflation, and the constructive evolution of imbalances in the household sector, the considerable monetary policy stimulus currently in place will likely remain appropriate for a period of time, after which some modest withdrawal will likely be required , consistent with achieving the 2 per cent inflation target.”  See, nothing has really changed with exception of the categorization of our industry, and the real estate market in general.  “Constructive evolution of imbalances in the household sector” sounds so much better than the market has slowed down significantly, the condo market is weak, job loss in the housing sector may reach 180,000 due to a real estate slowdown, many borrowers can no longer qualify for mortgages and household credit posted its slowest annual growth in 17 years in April.  I’m not debating the importance of slowing down consumer debt or the Bank of Canada’s policy in general.  I’m just admiring the phraseology.

So Mr. Carney bids us adieu with a message of, well, much of the same.  So we wait with bated breath to hear from the new leading man, Stephen Poloz.  The market will cast its eyes, and especially its ears, to the new governor of the Bank of Canada.  Markets move up and down based on statements made by the governor of the Bank of Canada.  So don’t expect absolute clarity from the new governor as it relates to future predictions of what the Bank of Canada may or may not do.  Wiggle room is always required.

Until next time,

Cheers.