*Updated* Ongoing Bank of Canada Benchmark Rate Announcements

[fotze2]

Originally Posted by Paulie Walnuts

The other thing is they do have inflation under control, you can't keep the rates this high for much longer.

Just because inflation is under control does not mean the goods and services are going down in price, it just means they are not going up. Things are still expensive and you tack on interest rates high as they are that a lot of people have not gone through life is difficult.

The poor banks had to put away some extra money for loan defaults, so that should tell you enough of what is going on. The poor CEO's of the big 5 will likely have to skip a few meals now.

Oh ya, the world’s smartest people are gonna lose on any decision the BOC makes. God I wish I lived in the fantasyland most people believe they are in.

[Cecil Terwilliger]

Originally Posted by Winsor_Pilates

What's the magic number that makes someone rich and what's the magic tax rate that's simple and easily solves everything?

Originally Posted by bizaro86

Easy, anyone who has more money than me.

That’s why god invented progressive taxes. Everyone pays some. People who make more, pay more.

It actually is pretty easy.

[MillerTime GFG]

Originally Posted by GullFoss

So when rates are going down and it results in lower mortgage costs, we should count that in the data. But when rates are going up and it results in higher mortgage costs, we shouldn't count it.

Gotcha!

The overnight rate is a monetary policy the BoC can use to curb inflation. It's to cool consumer spending and slow the economy. There are clear signs these things are happening, and I assure you they do consider interest rates and their role in inflation (up and down), though they won't state that publicly.


There are more than two million mortgages up for renewal in 2024 and 2025, and many of them will be facing renewal rates almost double what they are coming out of. Canadians have far more household debt than the US. Debt to income ratios 1.85 vs 1.00. Higher mortgage rates don't have nearly the same impact in the US as they do in Canada, as terms are 25-30 years down there.


You're putting a lot of strain on Canadian households if you keep these rates high for too long.

[MillerTime GFG]

Originally Posted by Paulie Walnuts

Just wait for the banks to adjust prime on lending by .15% but start chopping GIC and Savings account rates by .50%

I had slight concern over this, though I figured it was unlikely.

Banks are indeed matching the 0.25% decrease in their prime rate. Multiple lenders have announced it already.

[Torture]

Originally Posted by Cecil Terwilliger

That’s why god invented progressive taxes. Everyone pays some. People who make more, pay more.

It actually is pretty easy.

Unless you're really really rich, then you figure out how to pay tiny amounts.

[BagoPucks]

Just out of curiosity are there special tax breaks for the ultra rich or can we all employ the right people to get advice on how to pay less tax?

[bizaro86]

Originally Posted by BagoPucks

Just out of curiosity are there special tax breaks for the ultra rich or can we all employ the right people to get advice on how to pay less tax?

Pretty much. Although the ultra-rich almost exclusively earn their money through businesses, which provides a lot more flexibility on things like timing of income.

People who have high employment income (eg professional athletes) pay the highest real average tax rates, imo.

[MillerTime GFG]

Originally Posted by bizaro86

Pretty much. Although the ultra-rich almost exclusively earn their money through businesses, which provides a lot more flexibility on things like timing of income.

People who have high employment income (eg professional athletes) pay the highest real average tax rates, imo.

Why can't an athlete set up a corp, and contract himself for "professional services"?!?

[Paulie Walnuts]

Some of the commentary I just read, says they do anticipate further cuts even though they said we still have inflation risk.

The risk to the economy is probably too high to keep the rates this high all year.

[fotze2]

Originally Posted by BagoPucks

Just out of curiosity are there special tax breaks for the ultra rich or can we all employ the right people to get advice on how to pay less tax?

It’s not a break if the money resides out of Canada. These guys don’t make their money on T4’s. Costa Rica seems to be the destination lately.

[CliffFletcher]

Originally Posted by Cecil Terwilliger

That’s why god invented progressive taxes. Everyone pays some. People who make more, pay more.

It actually is pretty easy.

We already have progressive taxation. We could take the Nordic approach and apply the top marginal rate at around $85k of income, but I can just imagine the howling from voters. “No, not us, the REAL rich!”

[Torture]

Originally Posted by BagoPucks

Just out of curiosity are there special tax breaks for the ultra rich or can we all employ the right people to get advice on how to pay less tax?

This is America and not Canada, and I doubt it's quite as extreme here, but allegedly the 400 wealthiest families in the US pay an average tax rate of about 8% vs 13% for the average American. But wait, it gets better, the 25 wealthiest paid only 3.4%

[Muta]

Originally Posted by Torture

This is America and not Canada, and I doubt it's quite as extreme here, but allegedly the 400 wealthiest families in the US pay an average tax rate of about 8% vs 13% for the average American. But wait, it gets better, the 25 wealthiest paid only 3.4%

This sounds like Wall Street's/GOP's/Conservative Party's/Kevin O'Leary's ultimate wet dream/utopia.

[powderjunkie]

Originally Posted by MillerTime GFG

Why can't an athlete set up a corp, and contract himself for "professional services"?!?

Pretty sure they can't do it for their regular employment income, but they can for endorsement income.

[Lubicon]

Originally Posted by fotze2

I don’t get why we don’t just tax the rich people more. Simple, easy and deserved.

This is supposed to be green text right?

Originally Posted by bizaro86

Easy, anyone who has more money than me.

You've nailed the definition of rich that I'd guess 99% of people would give if you asked them.

[burn_this_city]

He can't cut more without the US Fed doing the same, the decline in the Canadian dollar will make inflation worse.

[Winsor_Pilates]

Originally Posted by Torture

This is America and not Canada, and I doubt it's quite as extreme here, but allegedly the 400 wealthiest families in the US pay an average tax rate of about 8% vs 13% for the average American. But wait, it gets better, the 25 wealthiest paid only 3.4%

Source?
That sounds unbelievable.
Probably defining richest families based on old money equity; so they're not paying much tax on it now; since its not current earnings/income.

[iggy_oi]

Originally Posted by Winsor_Pilates

Source?
That sounds unbelievable.
Probably defining richest families based on old money equity; so they're not paying much tax on it now; since its not current earnings/income.

Dude it’s been pretty well established that the US tax code heavily favours the ultra wealthy. You’re going to find all sorts of conflicting numbers and reports but what you don’t find very often is billionaires releasing their tax returns to completely discredit those reports.

[Brupal]

Originally Posted by Regorium

Bank stocks have been garbage. You're better off in cash.

RY is up 20% in the past year and just hit a new all time high, so clearly you don’t know what you’re talking about.

[Locke]

Originally Posted by MillerTime GFG

Why can't an athlete set up a corp, and contract himself for "professional services"?!?

Because of Collective Bargaining.

In terms of what their teams pay them, thats the deal. Endorsements and sponsorships are something else entirely.