There is a clear rift in Ottawa about the role the housing market (purchases by end users and investors) should play in our economic recovery. The BoC’s top concern today is to get people spending and to support the recovery. 1/
The message here is clear. Take out a mortgage, borrow money and invest it because rates are going to be low for a long time. 2/
When asked how these policies might impact already high levels of household debt in Canada, Governor Tiff Macklem had this to say: 3/
“Right now the most important thing is to support the recovery and get people back to work. … Yes, high household indebtedness is a vulnerability but supporting the recovery and reducing that vulnerability are entirely aligned” 4/ bnnbloomberg.ca/a-long-climb-b…
CMHC on the other hand thinks the biggest problem today remains high household debt and their recent conclusions that house prices “will” fall in the near future. 5/
Their policy solution to these problems was to actually tighten credit - which I don’t think is controversial to say is a slightly unorthodox strategy during a recession. 6/
cbc.ca/news/business/…
cbc.ca/news/business/…
While the BoC appears to be trying to avoid a decline in house prices because of the significant negative side effects that could follow, Siddall is actively promoting the idea that house prices will fall, even actively sharing bearish Twitter posts - which is quite odd! 7/ 
This of course has made Siddall the darling of housing bears - the person who tells people the "truth" that housing prices are finally going to crash and if you hear otherwise from big banks, real estate companies, BoC etc. you must question their motivations. An odd message 8/
CMHC’s CEO appears to believe that their decision to tighten credit during a recession is perfectly aligned with the Bank of Canada’s policy goals to encourage borrowing and spending. 9/
Despite Siddall’s assurances there is no rift between the two government agencies, it’s quite obvious that their policies and messaging to the public are very much at odds – it will be interesting to see how this plays out. /
