Canadian interest rates set to rise?

Source: Mises Canada
by Caleb McMillan

“Is the Bank of Canada going raise its overnight benchmark rate? Since rising interest rates are decreed by the central bank, the real scarcity of capital in which major financial institutions can borrow and lend out overnight amongst themselves is unknown. Disconnected from any real savings, we expect the Bank of Canada to manually raise rates when the going gets good. This is flawed thinking. Clearly, the rag-tag team at the BoC have confused cause and effect once again. Through experience and logic, the idea that central banks can provide a free lunch is rebuffed by a hefty dose of reality. You need capital to have capitalism. Savings and production come before consumption. This is a priori true.” (06/14/17)