Ottawa didn’t handle the near bankruptcy of Home Capital Group Inc. all that well.
The authorities behaved like it was 1996, the last time a Canadian financial institution failed. They said little in public, while reportedly doing all sorts of prudent things behind the scenes. Meanwhile, flimsy parallels to America’s housing meltdown spread through international markets via Twitter; the instant-messaging functions on Bloomberg data terminals; and the financial press, which appeared a tad too eager to cover a crisis.
It came a month too late, but someone in Ottawa finally explained in convincing detail why Home Capital could never be Canada’s “Lehman moment.” At a press conference on June 8, Carolyn Wilkins, the No. 2 at the Bank of Canada, laid out all the reasons why a national housing meltdown is so remote.
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