How Canada's Economy Became The Most Pathetic In The World: The Collapse Of A Nation

Summary

The video script discusses the alarming outflow of investment from Canada to the US, highlighting a net loss of $460 billion by 2022, potentially escalating to half a trillion dollars. It attributes this to Canada's restrictive regulatory environment, high corporate taxes, and lack of reinvestment by corporations. The script also criticizes the country's immigration policies, slow trade, and declining productivity, suggesting these factors are contributing to a bleak economic future, especially for the middle class and young people.

Takeaways

• 📉 The video discusses the significant outflow of investment from Canada to the United States, highlighting a net outflow of $1 trillion by 2022.
• 🏦 The script points out that Canadian businesses and investors have been moving their capital to the U.S., potentially due to regulatory restrictions and high corporate taxes.
• 📊 The OECD's FDI regulatory restrictive index is mentioned to illustrate the difficulty of foreign investment in Canada, which is much higher compared to the global average.
• 💼 The high immigration rate in Canada is presented as a sign of a struggling economy, contrasting with the ease of moving to Canada versus the difficulty of investing in it.
• 🏭 The lack of capital investment in Canadian ports and infrastructure contributes to slow trade and a decline in productivity.
• 📈 Canada's economy is heavily reliant on real estate, with the sector becoming the largest part of the economy, which is a sign of economic fragility.
• 💔 The script emphasizes the negative impact on the middle class and young people, who face an increasingly unaffordable housing market and job instability.
• 📉 The video suggests that Canada's economic future is bleak, with a decline in productivity and a lack of business investment within the country.
• 🏠 The government's response to the housing crisis is criticized for being late and ineffective, with policies that may have indirectly increased housing costs.
• 🤔 The possibility of Canada recovering economically is presented as unlikely without significant policy changes, such as reducing immigration and easing regulatory burdens.
• 🌐 The script concludes by questioning whether Canada can reverse its economic decline, suggesting that it would require a modern economic miracle to do so.

Q & A

What significant change in investment trends between Canada and the USA occurred in 2015?

In 2015, there was a shift in investment trends where Canadian businesses, investors, entrepreneurs, and professionals started moving their money out of Canada to the United States, reversing the previous trend where Canada received more foreign investment from the USA.

What was the net amount of investment that had left Canada for the United States by 2022?

By 2022, a net amount of $1 trillion in book value had left Canada for the United States, with a net value of $460 billion.

How does the speaker describe the impact of this investment outflow on the Canadian economy?

The speaker describes the impact as dire, suggesting it represents a massive outflow of potential jobs, higher wages, innovation, and business opportunities, which are critical for the economy.

What is the OECD's FDI Regulatory Restrictive Index, and how does it relate to Canada?

The OECD's FDI Regulatory Restrictive Index measures the ease with which a foreign entity can invest in a country. Canada ranks poorly on this index, indicating that it is much more difficult to invest in Canada compared to the global average.

How does Canada's corporate tax rate compare to the rest of the world, and what implications does this have for investment?

Canada has one of the highest total corporate tax rates in the world, which may discourage businesses from investing in the country and instead moving their investments to more tax-friendly jurisdictions.

What does the speaker suggest about the current state of Canada's productivity compared to historical levels?

The speaker suggests that Canada's productivity has significantly declined, falling from the sixth most productive economy in the world in the 1970s to 18th, which is the steepest decline among all countries during that period.

How does the speaker characterize the current economic situation of Canada's middle class and young people?

The speaker characterizes the current economic situation for Canada's middle class and young people as bleak, with high levels of debt, an inability to afford housing, and a pessimistic outlook on their financial future.

What is the speaker's view on the role of immigration in Canada's economic challenges?

The speaker views the high levels of immigration as a contributing factor to the economic challenges, suggesting that it has led to an influx of workers suppressing wages and an imbalance in the job market without corresponding improvements in infrastructure and housing.

What is the current state of Canada's real estate sector in relation to the overall economy?

The real estate sector has become the number one sector of Canada's economy, and its stability is seen as crucial to the overall health of the economy, despite concerns about affordability and the sustainability of current housing prices.

What are some of the potential solutions the speaker suggests for Canada's economic challenges?

The speaker suggests that reducing immigration, reopening natural resources for investment, reducing regulatory and tax burdens, and potentially changing the government could be potential solutions to Canada's economic challenges.

What does the speaker imply about the likelihood of Canada addressing its economic issues in the near future?

The speaker implies that it is unlikely for Canada to address its economic issues in the near future, given the current government's track record and the lack of immediate plans to tackle key issues like housing affordability and immigration.

Outlines

00:00

📉 Decline in Canadian Investment and Economic Woes

The video script discusses the significant outflow of investment from Canada to the United States, highlighting a shift that began around 2015 coinciding with the Liberal government's rise to power. It emphasizes the drastic change from a historical inflow of billions in foreign investment to a net outflow of $1 trillion by 2022, amounting to $1,500 per Canadian. The speaker suggests this capital flight could be attributed to Canada's regulatory restrictive index, high corporate taxes, and lack of reinvestment by large corporations. The script also touches on the irony of Canada's high immigration rate against the backdrop of its economic struggles.

05:00

🏗️ Challenges in Canadian Business and Infrastructure

This paragraph delves into the challenges faced by Canadian businesses, including high taxes, fees, and lengthy approval processes that discourage substantial capital investments. It points out the slow trade speeds, outdated port technology, and frequent strikes affecting Canada's ports, contributing to the country's low ranking in trade efficiency. The speaker also addresses the issue of productivity, noting Canada's fall from the 6th to the 18th most productive economy globally. The paragraph concludes by illustrating the impact of these issues on the middle class and young people, who face an increasingly competitive job market and a lack of affordable housing.

10:02

🏠 The Housing Crisis and Economic Dependency on Real Estate

The script's focus shifts to Canada's housing crisis, which has seen the income-to-house price ratio skyrocket from a historical average to nearly 10, effectively pricing the average Canadian out of the housing market. It discusses the implications of this trend for wealth generation, as real estate has traditionally been a key path to prosperity. The video also criticizes the government's lack of effective housing policy and its contribution to the rising cost of living. The reliance on the real estate sector as the backbone of Canada's economy is portrayed as a sign of a dying economy, with young Canadians expressing pessimism about their financial future.

15:04

🗳️ Political Challenges and the Possibility of Economic Revival

The final paragraph addresses the political landscape in Canada, suggesting that the current Liberal Party is deeply unpopular due to its handling of the housing crisis and other economic issues. It mentions the potential for economic revival through reduced immigration, opening natural resources for investment, and reducing regulatory burdens. However, the speaker is skeptical about the likelihood of these changes, given the current government's policies and the lack of a coherent plan to address the housing crisis. The video ends with a call to action for viewers to subscribe for more content.

Keywords

💡Foreign Investment

Foreign investment refers to the act of investing in a country by entities outside of that country. In the video's context, it highlights the shift in net foreign investment from Canada to the USA, indicating a significant economic trend. The script mentions that from 2001 to 2014, Canada received more foreign investment from the USA, but this trend reversed post-2015, with a net outflow of $1 trillion by 2022.

💡Net Investment

Net investment is the difference between the total amount of investment made and the total amount of disinvestment. The video emphasizes the net investment leaving Canada for the USA, which has reached a staggering $460 billion, signifying a massive capital outflow that impacts the Canadian economy negatively.

💡Regulatory Restrictive Index

The OECD's FDI Regulatory Restrictive Index measures the restrictiveness of a country's regulations on foreign direct investment. The video script points out that Canada has a high index value, making it difficult for foreign entities to invest, which contrasts with the ease of immigration into the country and contributes to the economic challenges faced.

💡Corporate Tax

Corporate tax is the tax paid by corporations on their profits. The video discusses Canada having the highest total corporate tax in the world, which incentivizes businesses to move their capital to countries with lower tax burdens, thus affecting the domestic economy and investment climate.

💡Capital Hoarding

Capital hoarding refers to the accumulation of capital or assets by corporations without reinvesting them into the economy. The script uses the metaphor of a dragon hoarding treasure to describe how Canadian corporations are holding onto significant amounts of capital, which is not being used for investment, research, or job creation.

💡Productivity

Productivity measures the efficiency of production, often expressed as the ratio of output to inputs. The video indicates a decline in Canada's productivity ranking from the sixth most productive economy in the 1970s to 18th, reflecting a decrease in the country's economic efficiency and competitiveness.

💡Immigration Rate

Immigration rate refers to the number of immigrants entering a country in a given period. The video points out that Canada has the highest immigration rate in the history of the Western World, which, while intended to boost the economy, has led to an influx of low-wage labor and increased cost of living without corresponding infrastructure improvements.

💡Housing Affordability Crisis

Housing affordability crisis describes a situation where housing costs are too high relative to average incomes, making it difficult for the average person to afford a home. The video script discusses how the income-to-house price ratio in Canada has soared, pricing many Canadians out of the housing market and contributing to economic instability.

💡Trade Efficiency

Trade efficiency refers to the speed and cost-effectiveness of importing and exporting goods. The video script highlights that Canada ranks poorly in trade efficiency, with outdated technology and bureaucratic hurdles slowing down trade, which affects the country's competitiveness and economic growth.

💡Economic Future

Economic future pertains to the projected economic conditions and prospects of a country or region. The video suggests that Canada's economic future is bleak, with high levels of debt, low productivity, and a real estate-dependent economy, leading to a pessimistic outlook for the country's prosperity.

💡Middle Class

The middle class is a socio-economic group that falls between the working class and the upper class. The video discusses the impact of Canada's economic challenges on the middle class, noting that they are bearing the brunt of the affordability crisis, stagnant wages, and economic uncertainty.

Highlights

Canada experienced a net inflow of $10 billion more in foreign investment from the USA annually from 2001 to 2014.

After 2015, there was a significant shift with Canadian businesses and investors moving capital to the USA.

By 2022, $1 trillion in book value had left Canada for the USA, reflecting a net outflow of $460 billion.

The potential 2023 outflow could reach half a trillion dollars, impacting job creation and economic growth.

Canada's high corporate tax rates and regulatory burdens are cited as reasons for the outflow of investments.

The OECD's FDI regulatory restrictive index ranks Canada as having a high difficulty for foreign investment.

Canada's immigration policies are contributing to an economic imbalance with high rates but insufficient infrastructure.

Canada's productivity ranking has fallen from 6th to 18th globally, indicating a significant decline.

High taxes, fees, and lengthy approval processes are hindering capital investment and economic productivity in Canada.

Canadian corporations are holding large sums of money in bank accounts, contributing to a lack of reinvestment.

Canada's real estate sector is now the primary driver of its economy, with high house price to income ratios.

The average Canadian can no longer afford an average house due to skyrocketing real estate prices.

Canada's economic future is considered bleak, with a reliance on real estate and a lack of diversification.

The Canadian government's response to the housing crisis has been slow and ineffective.

Reducing immigration and easing regulatory burdens are suggested as potential solutions for Canada's economy.

A change in government policies and approaches could be necessary for an economic turnaround.

The current economic situation is causing pessimism among Canada's youth and middle class.

Transcripts

this is a graph showing a massive sign

of the dire state of Canada's pathetic

economy and it actually has nothing to

do with any of Canada's hot button

issues like Canada's insane housing

prices the affordability crisis or

Toronto Maple Leafs fans not having

their hopes and dreams crushed once

again you see this is the net amount of

investment between Canada and the USA

every single year in the amount of

billions of dollars from 2001 up until

2014 Canada took in 10 of billions of

more foreign investment from the United

States than vice versa meaning that

businesses large and small from Walmart

to your local carpenter were much more

likely to move to Canada and grow the

economy than it was for a business to

leave Canada for the United States

however this changed in 2015 and

coincidentally or not lined up with the

current liberal government getting into

Power regardless quickly over the next

decade Canadian businesses investors

entrepreneurs and professionals started

taking their money out of Canada and

moving it to the United States and well

where is that number now well I am

hoping that you are sitting down because

this number was so shocking that it

inspired me to make this video by

2022 $1 trillion in Book value had left

Canada for the United States and a net

value of

$460 billion left for the United States

that is $1,500

per person in Canada in net investment

leaving Canada for the us and that

number for 2023 or even this year is

potentially going to reach half a

trillion dollars in net outflow of

investments from Canada to the US that's

about

$12,500 per person keep in mind that

represents potentially tens of thousands

hundreds of thousands maybe even a

million jobs for Canadians while it

could also mean potentially much higher

wages higher innovation research

building of machines contracts

opportunities for businesses and much

more so despite this being a DOT on a

graph this is technically about half a

trillion dollars leaving Canada but you

know what that might actually be enough

money to help bribe Satan to lift the

curse off of the Toronto Maple Leafs a

number that I once thought was

impossible but the real question is why

is this money leaving Canada

specifically why is so much investment

leaving Canada for the us and why aren't

American businesses in investing as much

into Canada well once again this is the

sign of a dying and pathetic economy

let's start off with one reason why no

one wants to invest in Canada there is

something called the oecd's FDI

regulatory restrictive index and yes

that is a mouthful but just to explain

what it is it pretty much puts a number

on how easy it is for a foreign entity

to invest in a country the easiest

country to invest in is Germany Japan is

somewhat middle of the pack the United

States is actually double most of the

other nations on this list and then

there's Canada essentially tripling the

difficulty to invest in the country

compared to the average and this is

because of a Litany of laws regulations

taxes and more and the irony is it is

extremely difficult to invest in Canada

at the moment yet it is extremely easy

to move to Canada as Canada currently

has the highest immigration rate in the

history of the Western World which is

also a sign of a Dying economy but we

will get to that in a bit you see Canada

is a part of this globalized economy and

whether you like it or not a globalized

economy allows for big businesses to see

the entire world as their playing field

they are not just locked in to their

home country so when Canada has the

highest total corporate tax in the world

and plans to keep raising it the

corporate overlords of Canada have no

allegiance to stay and lose out on

billions of dollars in profit why would

they do that when they can legally just

park it in another country and save that

money and even the ones that keep their

money within Canada they tend to not do

anything with it you see the big banks

in Canada and the largest corporations

have the equivalent of onethird of the

entire country's GDP sitting in bank

accounts doing absolutely nothing not

investing in the country not researching

anything not creating jobs just sitting

you know I always joke about how some

large corporations in Canada are kind of

like small from The Hobbit essentially

they're like a giant dragon that Hoards

all of the gold and the treasure and

there's nothing that a normal person can

really do about it because well smog is

just so powerful and that's kind of what

Canadian corporations are like they are

like well smog in fact one of the

craziest stats about Canada is that it

is the world leader in one other thing

you see it leads the Western World in

the lack of capital Investments per

employee meaning that no other country

has businesses that hoard their profits

better than they do in Canada just some

perspective Canada does this at a rate

of about double that of the United

States a country that is well known for

its corporate overlords hoarding their

profits many Business Leaders cite high

taxes fees and long approval processes

as reasons that they don't do anything

substantial with this money and there is

some truth to that in the real estate

sector in a city like Vancouver it costs

$125,000 in government fees alone to get

the approval to build a one-bedroom

condo now also Canada is one of the

slowest countries in the world in terms

of trade out of 113 tracked countries

that have their speed of trade time

measured Canada ranks 103d in fact one

of Canada's fastest ports is the port of

Vancouver that has a turnaround time of

about 2 days which is twice as slow as

some of the comparable ports like the

port of Melbourne and the Port of Long

Beach and it's not even in the same

ballpark as the world leaders in trade

and ports like the port of of Busan

which has a turnaround time of about

half a day so why does it take so long

to import or export anything in Canada

well the largest reason is because of

something we already talked about lack

of capital investment into these ports

you see a lot of these ports are running

on the same Tech from half a century ago

and have not been updated meanwhile the

world leaders ports look like they were

created from a sci-fi movie that

Canadians could only dream about

Canadian ports are also notorious for

going on strike sometimes even multiple

times a year and Canada has a long list

of regulatory checkpoints for anything

that goes into or leaves the country

meaning that the country has a lot more

bureaucracy surrounding Goods compared

to most other countries now all of these

things mentioned so far make it seem

like Monopoly money is a better

investment than the Canadian dollar but

we've only just briefly touched on the

core issues because one of the arguably

biggest results from all of these things

mentioned so far is a lack of

productivity in the Canadian economy

meaning how much do Canadians make stuff

back in the 1970s Canada was the sixth

most productive economy in the world and

now Canada has fallen to 18th the

steepest decline in the world during

that time in fact Canada's productivity

is 30% lower than the poorest United

States states like Alabama and is losing

ground to Alabama a big reason as to why

Canadians are making less stuff is

because of the previous things mentioned

as well Canadians make things the money

comes in and corporations choose to not

reinvest that money into Canada once

again hoarding it like smog so we have

Canada's economic situation looking

pretty bad right now so bad that they

are viewed as having the worst economic

future of any advanced economy in the

world for the next three decades and the

people that are paying the price for

this are the middle class and young

people you see once upon a time just two

decades ago you could go go to school

get a decent paying job with having only

a few people to compete against if you

got that job you would have some job

stability you could raise a family and

buy a house without needing to sell your

kidney for a down payment this led to

many Canadians owning homes having low

debt and being able to enjoy life in one

of the most prosperous economies in the

world but just two decades later oh how

things have changed the government of

Canada decided to bring in 10 times more

immigrants per capita than the United

States and most of this immigration is

men between the ages of 18 and 40

essentially this has been catapulting

Canada's population into unforseen

growth in hopes of keeping Canada's GDP

numbers up and to hopefully help fix a

lack of Labor in the job market but well

that's what they tell the public in

reality Canada did not have a shortage

of workers there was a shortage in

people willing to work for minimum wage

jobs at a time when the lack of

affordability to live was skyrocketing

you used to to be able to rent out a

studio apartment in most cities for

Simply Having a low-wage yet full-time

job in Canada yet now you may not even

be able to afford to split a condo with

roommates for that wage so now there's

an influx of workers to suppress wages

and to fill the lowest paying jobs which

has led to one of the craziest economic

experiments in history so one thing that

has happened because of this influx is

there is now a major gender imbalance in

Canada there are now 10% more men than

women between the ages of 18 and 40

which in a monogamous Society could lead

to some sort of issues down the road to

say the very least the second of which

is despite having the biggest population

explosion in history nothing else has

kept pace by that I mean housing builds

are down infrastructure investment is

down there are the same amount of

hospitals police stations fire stations

and so on so there are now millions of

more people in Canada and yet

infrastructure and supply of things like

housing has not improved and that leads

us to this graph this is the in come to

house price ratio of Canada for most of

Canada's history this number was at or

under three meaning that if someone

earned $50,000 a year the average house

price would be about

$150,000 there were a few times when

this number touched as high as five in

the late 8s and early 1990s meaning that

someone who earned $50,000 a year could

expect to see house prices at around

$250,000 but then 2015 happened and for

the first time in history this number

far exceeded five and this was an

important year because the typical

mortgage rules say that you can only get

a mortgage on a house that is at maximum

five times your annual income so when

the average income to price ratio

exceeds five that means that the average

Canadian can no longer afford an average

house and that's what happened in 2015

and it only kept getting worse in 2020

that number hit around seven and this

year that number is nearing 10 meaning

that the average Canadian couldn't even

afford half of a mortgage on an average

house in Canada and when you consider

that the number one path to wealth in

Canada has been real estate young people

are now being locked out of the only way

that the previous three generations have

generated wealth in fact real estate has

become so important in Canada that it is

now the number one sector of Canada's

entire economy and the Canadian

government has said repeatedly that it

does not want real estate prices to come

down because if prices come down the

entire economy might collapse so this is

where we are another sign of a truly

dying economy the only thing that is

keeping Canada's economy from collapsing

is literally buying and selling houses

think about how crazy that statement is

this has caused Canada's youth to become

so pessimistic that only 27% see their

personal financial situation improving

in the near future and only onethird

foresee Canada as a country that that

will prosper again anytime soon so an

important question arises can Canada

ever dig itself out of this mess and if

so how well can it that answer is yes

will it that answer is probably not you

see there is a few things that need to

happen in order for Canada to help bring

Prosperity back to the middle class one

of which will almost certainly not

happen is reducing immigration numbers

which is also quite an interesting topic

because not too long ago the left Wing

parties in the Canadian government were

very anti-immigration you see they

viewed immigration as a gift to

corporations for bringing in low-skilled

workers and suppressing wages yet the

leftwing parties today view it as a

positive and stick on a stamp of

diversity is our strength which is quite

a 180 compared to just a few decades ago

however from what I've been able to find

not one of the single three major

parties in Canada expect to reduce

immigration anytime soon in fact the

current government plans to keep ramp it

up so expect Canada's population to keep

ballooning along with the cost of living

another important thing that comes from

an RBC report is that they said if

Canada could begin reopening its natural

resources for investment and get rid of

the highest Regulatory and tax burden in

the world that could provide an actual

boom to the Canadian economy they cite

government restrictions on oil and

natural resources as a key factor as to

the lack of investment in Canada another

thing that could potentially help is

well just switch wiing governments the

current Liberal Party of Canada is the

most unpopular party in the modern

history of Canada and a good example as

to why this is is well this anecdote

when the price of housing was climbing

in 2015 they had no housing plan when

housing prices exploded in 2020 they had

no housing plan in 2023 they decided to

start caring about housing again in

Canada by having the government go on a

paid housing Retreat for a weekend all

expenses paid and guess what they came

back with no housing plan it wasn't

until about a month and a half ago after

having a housing crisis for essentially

8 years that the Canadian government

finally put together an actual plan for

the thing that Canadians care about the

most which is housing they waited until

Canadians reached a point of bankruptcy

and becoming the most indebted people in

the world to actually start caring about

this issue and keep in mind this is also

despite having their other policies like

immigration their money printing taking

out more debt and so on directly

increasing the cost and price of housing

regardless Canada's economy is pathetic

and dying right now it is entirely based

on real estate and its current economic

future is Bleak young people are

struggling productivity is falling off a

cliff and companies are leaving Canada

at a record Pace will it correct its

course anytime soon it seems unlikely

but it is possible and if that were to

happen we would experience one of the

very few modern economic miracles in

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