Here is a bit of a contrast between the financial management habits of businesses and the way average people look after their balance sheet.
A snapshot of borrowing habits of these two demographic categories shows businesses are reducing their debt while households are increasing it.
The latest credit numbers are from May and they show the amount owed by Canadians on mortgages, credit cards and other forms of borrowing has increased every month so far this year. This in the face of high interest rates.
Private businesses, on the other hand, reduced their debt obligations almost every month so far this year.
The money management discipline being shown by business is quite clear in this report and it stands in sharp contrast to the challenges people are seeing in their personal financial matters.
Simply put, the graph depicting the growth in household debt tracks rising house prices in the country, especially in the big cities. Housing shortages are driving up prices along with the volume of debt financing required to secure those properties.
