Issue: Is it Fed lower interest regime in 2000 onwards cause the 2008 financial crisis?
Not directly perhaps. Canada interest rate track closely to the US. Nothing happen to the boring Canadian banks. Why?
Simply because, Canada banking system is very stringent with bank leveraging. That's what differentiate the Canadian vs US. Derivatives in Canada banking system is limited.
By Paul Krugman (theStar, 3 Feb 2010)
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