Matt Blackman

Canada vs. U.S. - Whose Banks Are Safer?

Interesting analysis. But anyone who thinks the Canadian housing market will avoid the global downdraft is deluding themselves. Some very good research has been conducted by BMO Capital Market's Doug Porter who showed a very convincing 2 year lag between Canadian and US housing prices. So although the Canadian housing market appears to be in better shape, their downward cycle just began last year and I expect prices here will drop a minimum 25% if not more. The amount of the final correction will depend on how bad this recession gets...

As long as housing prices fall, Canadian banks will suffer downward earnings pressure which means lower stock prices.