Buying America: Canada Becomes a U.S. Creditor for First Time
March 10, 2016 — 1:38 PM EST
Canada is now a creditor to the U.S. for the first time on record, government data show, reflecting the northern nation’s love affair with assets south of the border.
The stock of U.S. assets held by Canadians in the fourth quarter of 2015 -- everything from corporate acquisitions to portfolio investments -- exceeded assets held by Americans in Canada for the first time since at least 1990, according to quarterly data published Thursday by Statistics Canada.
Easy credit, strong balance sheets, and lack of investing opportunities at home have been the main factors driving Canadian money managers and companies on a shopping spree south of the border. The value of those investments has jumped over the last couple of years as the U.S. dollar has strengthened. U.S. investors, meanwhile, haven’t been reciprocating.
Erik Hertzberg/Bloomberg
Canada’s net asset position with the U.S. was C$82.2 billion ($61.6 billion) in the fourth quarter, the first ever positive figure for the country. Canada had a net liability position of C$39.9 billion in the third quarter. The average since 1990 has been a net liability of C$248 billion.
That’s quite a turnaround between the two countries. Canada has historically relied on U.S. investment to finance its economy to the point where U.S. ownership has always been a contentious issue. A separate annual data series that date backs to the 1920s shows Canada has always been a net debtor to the U.S.
MORE...
http://www.bloomberg.com/news/articles/2016-03-10/buying-america-canada-becomes-a-u-s-creditor-for-first-time
= new reply since forum marked as read
