Carney Warns Canadians About Debt

Global risks rising: Bank of Canada
The Bank of Canada warned Thursday that the risk of another global economic shock is rising and Canadians may not be prepared for it.The recovery in Canada and globally is slowing, the central bank said in the December issue of its Financial System Review. It said the main risk is the growing seriousness of Europe's government debt crisis. Another threat is the unwillingness of countries to take action to reduce imbalances in exports and imports between countries.Canadians won't be spared another shock, the bank said, because during the current period of tough economic times, they have continued to take on debt.Household debt has risen to 145 per cent of disposable income as Canadians have taken advantage of super-low interest rates to purchase homes and other consumer items on credit.