Not to be outdone by the mocking of central bankers from our previous post (click here) mainstream media and the banks are also on the bandwagon about Canadians fearfully hoarding cash. But then again it’s always easier to be reckless with someone else’s money rather than your own; especially when it comes to trying to herd the sheeple. We and our readers we hope are more people than sheeple.
As a collection agency with offices in Edmonton, Calgary and the GTA we are watching with keen interest the unfolding of events with respect to these phenomenon and their impact (or lack thereof) on Canadian credit markets.
A recent article in the financial post (click here) along with the help of CIBC World Markets ramps up the propaganda against increasingly fearful Canadians hoarding cash during this time of food inflation, housing deflation in some markets (for now anyways), commodities deflation, and weakening employment numbers.
We find it rather amusing that the sage advice coming out of CIBC World markets includes such quotes as “While holding cash can guard against short-term spikes in volatility, it’s certainly a long-term drag on portfolio returns.”
As a debt collection agency our view at CASE, in what we see in the trenches of the real economy, tends to push us to prudently place a greater weight of wisdom on quotes like those of Will Rogers who was coined as saying back in the 1930’s; “I’m more concerned about the return of my money than with the return on my money”.
Our point: loss of capital is also a long-term drag on portfolio returns.
Their point: fear is for losers.