There was an article I saw in Yahoo Finance yesterday that said that Canada avoided the worldwide downturn. Their banks are healthy. The experienced 6.1% growth in the first quarter of 2010. They are enjoying the 12th straight year of budget SURPLUSES! Their employment situation is quite a bit brighter than ours.
How did they do it? First, they controlled government spending (I guess their government-run health care system didn’t bankrupt them – we must be way dumber than they are). Perhaps as important, through common sense regulation they kept their banks under control. They had reasonable capital requirements and did not allow their banks to sell mortgages to Wall Street, thereby maintaining the risk relationship between lender and borrower. Funny how banks are more careful with their lending processes when they have to worry about the loan’s risk. Duh. Banking is supposed to be boring, safe – not some risky casino-like operation.