Is Canada Headed for a Recession in 2017?

Canadian Economy Contracts

Canadian gross domestic products (GDP) contracted in October, a sign the Canadian economy is not as resilient as some thought. And it comes at a terrible time. Canadian’s are taking on record amounts of debt, wages are flat, and the unemployment rate remains near seven percent. The idea of Canada slipping into a recession in 2017 is not out of the question.

After four months of modest but inconsistent growth, Canada’s monthly gross domestic product (GDP) contracted -0.3% month over month in October.1 This is a huge disappointment. Economists had forecast Canada’s GDP in October would ring in at zero. In the first nine months of 2016, Canada’s GDP has contracted four times.

This wasn’t a case of one sector weighing down the data. The decline was broad based. Economic activity declined in 13 of 20 sectors tracked by Statistics Canada. The mining, oil and gas sector fell by -1.2% while construction was down -0.5% (the fifth decline in six months).

Retail trade increased 0.7% month over month, which means that the country is creating more jobs for waitresses and waiters. This helped Canada’s unemployment rate dip to 6.8% in November. But not all is as it seems.

Unfortunately, the improved jobs data came because more people, like retiring Baby Boomers, were leaving the workforce. Moreover, many of the jobs that were created were low-paying, part-time jobs. On top of that, youth unemployment in Canada remains near 13%.2

Will Canada Slip into a Recession in 2017?

Canada’s inconsistent GDP data goes to show how weak and vulnerable the economy is and that it is susceptible to a recession. Because of the unexpectedly bad economic data, it is widely expected that the Bank of Canada will cut interest rates even further in the first half of 2017.

It is hoped this will help stimulate the economy. But years of artificially low interest rates hasn’t worked yet. It is unlikely to kick-start the economy, but it will encourage more and more Canadians to take on additional debt.

Canadian household debt hit record levels in the third quarter as the ratio of disposable income climbed to 166.9%. This means that for every dollar of disposable income, Canadian households owe $1.67.3

Canadian households have been able to borrow cheap money because the Canadian housing market has been so strong. A weakening economy though could lead to a recession, which translates into higher unemployment. This will make it very difficult for those with mortgages and bigger debt loads—and will lead to foreclosures.

In recession, Canadians spend less money, which means delaying the purchase of a home; at least until the economy shows signs of sustained growth. This will inevitably put a chill on property prices. When housing prices fall, household wealth goes down with it. This will also put a crimp in consumer spending, which is a huge driver of GDP growth in Canada.

And the future doesn’t look particularly bright. According to one report, Canadian economic growth is forecast to be stall at two percent (or less) until 2030. From 2016 to 2020, GDP is expected to be just 1.8%; from 2021 to 2030, it will improve to just two percent.4

Learn-To-Trade.com, Toronto’s Leader in Stock Market Trading Courses

Will the country’s weak GDP continue and carry over into 2017? If so, the idea of Canada slipping into a recession isn’t out of the question.

Fortunately for Canadian investors, there are proven ways to make money whether the country is in a recession or the economy is running on all cylinders. These same proven trading strategies can also help investors profit when the stock market is going up, down, sideways, or crashing. The key is having a comprehensive understanding of these trading strategies and knowing how to read the markets.

Learn-To-Trade.com is the oldest and leading provider of stock market trading courses in Canada. Led by licensed, industry professionals, Learn-To-Trade.com’s stock market trading courses can help investors of every skill level trade more confidently and profit consistently.

Learn-To-Trade.com’s stock market trading course will teach you how to read stock charts, about fundamentals, about risk management, and about capital preservation. You will also learn about stock options, stock index trading, futures trading, commodities trading, futures option trading, and FOREX trading.

Learn-To-Trade.com also has a unique Lifetime Membership that allows you to re-attend any part of the program as often as you’d like.

To learn more about Learn-To-Trade.com’s stock market trading course, contact us at 416-510-5560 or by e-mail at info@learn-to-trade.com.

 

Sources:

  1. “Gross domestic product by industry,” Statistics Canada web site, December 23, 2016; http://www.statcan.gc.ca/daily-quotidien/161223/dq161223a-eng.htm.
  2. “Labour force survey,” Statistics Canada, December 2, 2016.
  3. “National balance sheet and financial flow accounts, third quarter 2016, Statistics Canada web site, December 14, 2016; http://www.statcan.gc.ca/daily-quotidien/161214/dq161214a-eng.htm.
  4. “Canada’s economy to lose ground globally as growth stalls at 2% for more than a decade,” Financial Post web site, December 28, 2016; http://business.financialpost.com/news/economy/canadas-gdp-growth-to-stall-at-two-per-cent-for-more-than-a-decade-report-says.
The following two tabs change content below.
George Karpouzis is the co-founder of Learn-to-Trade and has been personally providing education and mentoring to over 3000 members since 1999. George has been trading in the stocks, options, futures and forex markets using technical analysis since 1986. With the help of advancements in trading technology the Learn To Trade program is now accessible worldwide. His background and passion for teaching brings an invaluable asset to our members. George is constantly striving to improve the program content and develop new strategic relationships for the benefit of the members. Add me to your G+

Testimonial 1

Don’t hesitate jump into it right now. You will be glad you did!

Susan C

Learn To Trade
4.0
2014-08-19T04:45:40-04:00

Susan C

Don’t hesitate jump into it right now. You will be glad you did!

Testimonials 2

The ongoing support has been the reason for my success

Patrick L

Learn To Trade
4.0
2014-08-19T04:46:33-04:00

Patrick L

The ongoing support has been the reason for my success

Testimonial 3

I wanted to let you know that I had taken your course in the fall of 2013. I took your advice and used demo accounts for the last quarter of 2013. I switched to real money trading account in the Near Year, when I finally felt comfortable. Following the lessons taught to me by you (don’t jump on a moving train, peaks and valleys, EMA..etc), I wanted to let you know that I have been successful beyond my own expectations. Thank you very much – taking the Learn-to-Trade course was, by far, the best decision I made in my business career.

Steven R

Learn To Trade
4.0
2014-08-20T02:56:18-04:00

Steven R

I wanted to let you know that I had taken your course in the fall of 2013. I took your advice and used demo accounts for the last quarter of 2013. I switched to real money trading account in the Near Year, when I finally felt comfortable. Following the lessons taught to me by you (don’t jump on a moving train, peaks and valleys, EMA..etc), I wanted to let you know that I have been successful beyond my own expectations. Thank you very much – taking the Learn-to-Trade course was, by far, the best decision I made in my business career.

Joseph L

The past options and forex tutorials taught by George were very helpful. I find these tutorials invaluable for a busy person like myself. I was able to keep myself up to date and on track ready to continue the learning process. Thanks for all the help and keep up the great work.

Joseph L

Learn To Trade
4.0
2014-08-20T10:36:37-04:00

Joseph L

The past options and forex tutorials taught by George were very helpful. I find these tutorials invaluable for a busy person like myself. I was able to keep myself up to date and on track ready to continue the learning process. Thanks for all the help and keep up the great work.

Harley S

The course is amazing. Where were you 30 years ago?

Harley S

Learn To Trade
5.0
2014-08-20T10:37:39-04:00

Harley S

The course is amazing. Where were you 30 years ago?

Partick M

I learned the basics I needed to trade successfully.

Partick M

Learn To Trade
4.0
2014-08-20T10:38:34-04:00

Partick M

I learned the basics I needed to trade successfully.

Iouri G

I like making money. I’m very happy, so far so good

Iouri G

Learn To Trade
4.0
2014-08-20T10:39:27-04:00

Iouri G

I like making money. I’m very happy, so far so good

Akos B

I learned things it would have taken me years to figure out

Akos B

Learn To Trade
5.0
2014-08-20T10:40:05-04:00

Akos B

I learned things it would have taken me years to figure out

Robert B

There is always someone ready to answer my questions.

Robert B

Learn To Trade
4.0
2014-08-20T10:40:59-04:00

Robert B

There is always someone ready to answer my questions.

Uldus V

I was impressed with the course’s professionalism and enthusiasm.

Uldus V

Learn To Trade
5.0
2014-08-20T10:41:40-04:00

Uldus V

I was impressed with the course’s professionalism and enthusiasm.

Dean K

I wish I knew about trading as a business years ago!

Dean K

Learn To Trade
4.0
2014-08-20T10:42:24-04:00

Dean K

I wish I knew about trading as a business years ago!

Peter P

Learn to Trade provided me with strategy, self-confidence and discipline

Peter P

Learn To Trade
4.0
2014-08-20T10:42:57-04:00

Peter P

Learn to Trade provided me with strategy, self-confidence and discipline

Shelley P

I took your course in 2008 and loved it. Since then I have been using what I learned at Learn-to-Trade to nicely supplement my pension income. Wanting a carefree type of trading, I have for the most part just sold options and made a monthly income which is a nice addition to my pension. I know I never would have made this kind of trading income without Learn-to-Trade. Thank you!

Shelley P

Learn To Trade
5.0
2014-08-20T10:34:39-04:00

Shelley P

I took your course in 2008 and loved it. Since then I have been using what I learned at Learn-to-Trade to nicely supplement my pension income. Wanting a carefree type of trading, I have for the most part just sold options and made a monthly income which is a nice addition to my pension. I know I never would have made this kind of trading income without Learn-to-Trade. Thank you!

Amir

Hi George,

I just wanted to thank you again for the amazing work on the tutorials especially Options trading.   Prior to joining, I had underestimated the quality of the trainings but they certainly far exceeded my expectations. Only I wish I’d found you 5-10 years ago!
Learn To Trade
5.0
2016-10-07T08:56:52-04:00
Hi George, I just wanted to thank you again for the amazing work on the tutorials especially Options trading.   Prior to joining, I had underestimated the quality of the trainings but they certainly far exceeded my expectations. Only I wish I’d found you 5-10 years ago!
4.0
14