The country’s household debt is rising “unprecedentedly,” said a new analysis by Canada Mortgage and Housing Corporation deputy chief economist Aled Abe Iorworth.
Household debt was 80 percent of the size of the economy during the 2008 recession, before rising to 95 percent in 2010 and surpassing that size in 2021.
Breaking down the debt levels of different generations in Canada
During the same period, household debt declined in the US, UK and Germany and remained virtually unchanged in Italy.
Ab Iorworth states that high levels of debt do the most harm when a significant negative economic event occurs and cause massive job losses because many mortgage holders find it difficult if not impossible to repay their loans. goes.
They say that in an economy where debt levels are high, massive job losses will make any recession more severe.
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