What's Happening to Our Economy?

The current global economic downturn is in everyone's mind these days.

Most people are asking:

What is happening to our economy?

What is going to happen?

How will it impact me and my family?

How will it affect our job, mortgage, spending, savings and investments?

How can we cope in the face of all these uncertainties and challenges?

The latest assessment of the Canadian economy has been released by the Organisation for Economic Co-operation and Development (OECD) which portrays a grim future for most people.

Canada in recession: OECD

• Canada has fallen into a recession that will last for most of next year as the world falls into the worst slump in a quarter of a century, says a respected international think-tank.
• The Organization for Economic Co-operation and Development says Canada will not be immune from the global malaise, the worst since the deep recession of the early 1980s, and will see its economy shrink by an average 0.5 per cent next year.
• It predicts unemployment will rise above seven per cent from the current 6.2 per cent and that federal and provincial governments will record an accumulated deficit of 1.3 per cent of gross domestic product.
• "The general government is expected to move into deficit in 2009 and 2010, a largely cyclical outcome that is not alarming and leaves room to absorb eventualities but underlines the need to keep a lid on discretionary expenditure increases."

How is the Canadian government responding to this economic crisis?

• Finance Minister Jim Flaherty said Monday he expects to introduce a significant stimulus package comprising largely of construction projects to rebuild Canada's infrastructure in the next budget.
• Flaherty suggested he will move forward the timing of the budget to early next year to ensure the economic stimulus occurs as quickly as possible.
• The OECD said the Bank of Canada should also act by reducing interest rates, something economists predict will occur at the next scheduled action date, Dec. 9.

As the story unfolds, expect to read more about the state of our economy. More importantly, we will post information on how best to cope with the impact of these developments in our lives, to our jobs and our families' well-being.

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