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Statistics Canada has recently revealed that subsequent to some historical revisions that Canada’s household debt-to-income figure was actually a whopping 163.4%. This is a marked increase from the 152% figure using the old methodology. Interestingly, this level is on par with the United States prior to their real estate correction. Although there is no definitive answer as to what economic scenarios will unfold with Canadian household debt at these levels, there appears to be a silver lining.
Bank of Montreal economist, Doug Porter, has reached a more positive inference from the numbers. There appears to be a correlation between happiness and the levels of consumer debt in a country. The chart below shows that some of the happiest countries in the world are also the ones with the most debt. According to the 2012 UN World Happiness Report, Denmark has the highest household debt in the world but is also the happiest country in the world; Canada is ranked fifth. Although Canadians have spent their way into oblivion there appears to be one positive outcome: a much happier country.
