Susan – ISP

19 06 2011

New and Revised Journals:

Mortgaged Houses: Should You Abandon it or Not?

Tips on Making A Better Economics Class

Marked Journals:

Paid Incentives in School will Destroy the Integrity in Learning

New Economic Challenges of Canada: Federal Debt and Possible Burst of Housing Bubble

Four Comments to be Marked

Comment 1

Comment 2

Comment 3

Comment 4

Ten Comments

Comment 1

Comment 2

Comment 3

Comment 4

Comment 5

Comment 6

Comment 7

Comment 8

Comment 9

Comment 10

Consumer Debts, Mortgage Prices and Housing Prices Summary

3 06 2011

Key Concerns/Issues

– Possible burst of the housing bubble, as housing prices continue to rise (as a result of surging multimillion dollar property sales and increasing foreign investors that bids up the price) and number of sales go down (as the interest rate and household debt rises).

– Consumer debt is rising lately

– The economy is growing but the growing slows down due to decreased consumer spending

– Many Canadian aren’t aware of the current economic downturn that can affect their financial situation and debt is continuing

Resulting Challenges to Canadians

– If the housing bubble is burst, there will be a rise in housing foreclosures as middle class Canadians fail to pay their mortgages, debts or simply lost their source of income (More middle class Canadians will lose their homes)

– This rise in foreclosures will increase the supply line in housing, significantly dropping the housing prices and shutting away more jobs in the housing market.

– They also have to deal with their mortgages especially when they’re taking out home equity.

– Another major hurdle Canadians may have to deal with is the housing bubble bursting, dropping housing prices and value, leaving Canadians with more debt than they own in home value

Supporting Statistics and Evidence

– Average price of home sold in April across the country was $372,544, which is 8% rise from last year.

– Slow April sales figures shows that there is an activity dip of 4.4% from March, which is 14.7% down from last year.

– When the housing bubble burst inToronto andVancouver in the past, in the worst case had 35% of average housing value wiped out

– Household debt rose to $1.3 trillion in 2008

– 42% of people said that their personal debts were rising in the last three years

32% of respondents have no saving

– People under $35,000 a year, 49% people reported that their debt levels rose in the last three years. In comparison, 42% of those making $35,000 to $75,000 a year reported their debt levels rose, while 38%of those making over $75,000 annually reported an increase.

– Personal loans from banks was $48.5 billion, up 8.1 per cent from a year earlier, bank credit-card receivables were up 8.9 per cent at $51.5 billion.

– Consumers normally are 60% of the GDP, but high debt levels and the rising cost of living has brought that number down substantially.

– 3-4% of all mortgage holders representing about 200,000 home owners say they have no room for additional monthly increases in their payments

– Graph 

Possible Solutions

– Price ceiling for housing  to prevent skyrocketing housing prices

– Allow the market to burst the housing bubble and fall down quickly before demand rises again

– A series of mortgage rules set out by the government (such as increasing the interest rate on mortgage and decreasing the insurable amortization period) to prevent an unrealistic rise in housing demand and eventually burst of the housing bubble.

– In general mortgage laws and regulations should be changed to promote lowering debt for consumers, which would in turn promote consumer spending.

– Stricter laws on consumer borrowing, to prevent those already deep in debt from sinking further


Canadian Economic Challenges: Housing Prices

30 05 2011

To view the news article, click here.


  1. Do you believe the Canadian housing bubble will burst in the near future? If so, why? If not, why?
  2. Do you believe that shortening the insurable amortization period (the number of years you pay for your mortgage) is good for sustaining the housing market?

Supply and Demand Assignment

3 03 2011

Rising Cocoa Prices May Leave Chocolate Fans Bitter

The price of the cocoa is rising because Ivory Coast, a West African country that produces 40% of the world’s cocoa beans is currently in a political unrest with a ban on cocoa bean exportation to the global market. This ban dramatically decreased the quantity of cocoa supply available globally and brought an increase to its price. Another factor that caused the rise of cocoa bean price is the increasing demand of cocoa bean from the global market, especially from highly populated countries such as China and India. Therefore, while the demand for cocoa is continuously rising, the supply of cocoa bean is considerably decreasing, which result in a high equilibrium market price for cocoa bean.