Greek Contagion

The events unfolding in a small nation halfway around the globe will have far reaching effects that will impact the financial & economic markets.  While Canada’s direct trade exposure to Europe is only 10%,  TD examined what a potential Greek exit from the euro would mean on our economy.

On Canada’s housing market specifically, TD writes:

While corporate balance sheets remain strong, household  debt has become excessive and the housing market is in our view 10-15% overvalued, leaving households more vulnerable to a negative economic event.

A global financial crisis could be a major catalyst for a sharp housing market correction and household deleveraging – albeit to a lesser extent than was evident in the U.S. during the past recession.

Moreover, Canadian governments would have less room to stimulate compared to the first crisis in 2008-2009. While Canada’s economy would probably still fare better than most in the eurozone under this scenario, it would likely underperform that of the United States.

In a worse case scenario, the Canadian economy would likely endure a severe recession, with the decline being substantially worse than that experienced during the recent recession as both exports and domestic spending contract heavily.

TD has written several reports on what a possible Greek exit from the euro would have. Click below to read each report:

5 responses to “Greek Contagion


    I was watching Bloomberg news yesterday, they invited Jim O’Neill from Goldman Sachs and discussed the possibility of Greece leaving the euro. The chances are unlikely. There is too much at stake and the situation is bad already, Greek exit would just trigger another wave of recession and uncertainty. Canadian real estate market is vulnerable not only because of the euro crisis in Europe

  2. Watching CNN today. It’s very unlikely, the consequences will be too grave. In which case what we need to consider is what will our market look like once this crisis blows over.

  3. Real estate is overpriced in Calgary and

    Montgomery is awesome!

  4. Greece is a joke. It will be bad for our overheated housing market. More will fail. Cheap deals a comin!

    Only great deals in albertan real estate are in montgomery calgary.

    Montgomery is awesome!!

    Montgomery triangle is awesome!!!

  5. fantastic Calgary, I wish I could buy a flat there

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