For more than five years, Frank Hunt’s moving company has been a pillar of his community in Barrie, Ont., but he says his award-winning business is now on its knees — and he blames his insurance company. 

“They’re killing us. They’re literally shutting down the business,” he told CBC News. He says onerous demands from his insurer have led to a loss of about 75 per cent of his revenue.

Hunt, 73, says his company pays about $10,000 for commercial vehicle insurance each year. He says there have been no claims or accidents. “Not even a broken windshield,” he said.

His problems began in May, when his insurer suddenly demanded his drivers upgrade their licences to beyond what Ontario’s Ministry of Transportation requires. He and his drivers are legally allowed to drive the company’s five-ton moving trucks with a basic G licence.

“This year, the insurance company comes up with, ‘Oh, you’ve got to have a different licence, a D licence, or you can’t drive.’ I only have a G licence, so I can’t even drive my own vehicles anymore,” Hunt told CBC News.

The Insurance Bureau of Canada says if small business owners want to know why their policy requirements are getting tighter and their premiums are getting higher, they should look no further than COVID-19. The bureau says insurers “have been confronted with increased costs” due to the pandemic.

But that’s little consolation to Hunt and his wife Karina Shaak, 65. They tried to switch insurance companies. They were told they couldn’t, unless they agreed to pay much higher premiums — as much as $25,000, more than double what they previously paid.

So the couple hired new drivers with D licences, or higher. Their insurer refused to cover them, though, claiming the new hires didn’t have three years

The yield on Italian 10-year
TMBMKIT-10Y,
0.680%

and 30-year
TMBMKIT-30Y,
1.529%

debt fell to record lows on Monday.

As this chart from Deutsche Bank shows, the yield on the Italian 10-year is lower than it was even before Italy became a country. Deutsche Bank strategist Jim Reid attached proxies for Italian debt, such as from Naples, to chart pre-1861 data. (There is also a gap in the data series for the 1700s.)

He also charted debt-to-gross-domestic-product, which shows the Italian economy with an all-time low capability to service that debt.

The move on Monday came after the European Central Bank’s chief economist gave an interview suggesting the central bank may take further action. Among the ECB’s actions stimulus so far is the purchase of government debt from countries including Italy, through what’s called the pandemic emergency purchase program.

“Has the ECB permanently suppressed yields and spreads or are there many more twists and turns to this story over the years ahead? I would lean towards the latter but for now Italian politics and their control of the second wave are acting as strengths and not weaknesses,” Reid said.

David Stockman, the former Reagan-era budget director and acerbic critic, looked at the same chart and issued this brief but withering analysis: “when central banks crush rates, politicians bury their governments in debts.”

The current explosion in debt-to-GDP has been because the latter dropped, precipitously. The Italian economy shrank by 18% year-over-year in the second quarter.

Italy also has been issuing more debt. According to Italian bank Intesa Sanpaolo, Italy is forecast to issue a net €177 billion in new debt in 2020, compared with €54 billion in 2019.

Source Article

Fancy house with today's mortgage rates graphics.

Image source: Getty Images

Mortgage rates have been relatively stable in recent weeks, which is good news for borrowers since they continue to remain near record lows. Today, while rates ticked up very slightly, borrowers will still find very competitive mortgage rates that are well worth locking in. Here’s what you need to know about average mortgage rates for Oct. 12.

Mortgage Type Today’s Interest Rate
30-year fixed mortgage 2.908%
20-year fixed mortgage 2.758%
15-year fixed mortgage 2.374%
5/1 ARM 3.336%

Data source: The Ascent’s national mortgage interest rate tracking.

30-year mortgage rates

The average 30-year mortgage rate today is 2.908%, up .005% from Friday’s average rate of 2.903%. Rates below 3.00% used to be unheard of, but have become the norm in recent weeks. At today’s average rate, your monthly payment for principal and interest would total $417 per $100,000 borrowed and total interest costs over the loan’s life would be $49,997 per $100,000 in mortgage debt.

Check out The Ascent’s mortgage calculator to see what your monthly payment might be and how much your loan will ultimately cost. Also learn how much money you’d save by snagging a lower interest rate, making a larger down payment, or choosing a shorter loan term.

20-year mortgage rates

The average 20-year mortgage rate today is 2.758%, up .006% from Friday’s average of 2.752%. The monthly payment for principal and interest if you qualify for a loan at today’s average rate would be $543 per $100,000 in mortgage debt, while total interest costs would add up to $30,215 per $100,000 over the life of the loan.

Savvy borrowers will notice that while the interest rate is a bit below the rate on a 30-year loan, monthly payments are much higher. This occurs due to the faster repayment timeline, which also

By Joori Roh and Jihoon Lee

SEOUL, Oct 12 (Reuters)South Korea’s central bank is expected to keep its interest rates on hold on Wednesday as its concerns over rising household debt and property prices would most likely put a bar on any policy changes.

The Bank of Korea (BOK) was seen keeping its base rate KROCRT=ECI unchanged at a record low of 0.50%, according to all 34 analysts surveyed by Reuters, after a total of 75 basis points in rate cuts since the outbreak of coronavirus pandemic.

Among the 27 analysts who provided forecasts for end-2021, 22 saw the BOK standing pat by end of next year, while the other five forecast rate hikes during the second half of 2021.

“The BOK is expected to maintain its accommodative stance due to the COVID-19 uncertainties and slow economic recovery. But further easing will be limited as the board members are quite concerned about the financial imbalances,” said Shin Dong-soo, Eugene Investment & Securities’ analyst.

In fact, August meeting minutes showed that board members agreed rates needed to stay loose for the time being, though some flagged the need to pay closer attention to financial imbalances as household debt rises along with property prices.

This week’s policy review comes as South Korea has been dealing with a second wave of outbreak that emerged from a church and a large political rally in August.

“Admittedly, the second wave of virus infections has delayed South Korea’s economic recovery. … However, there are signs that the virus situation is coming under control. Social distancing restrictions have been eased. Mobility has also started to pick up in recent weeks,” said ANZ economist Krystal Tan.

In late August, the central bank sharply downgraded its 2020 growth outlook to a 1.3% contraction – the worst

A new study from the Business Development Bank of Canada finds that 76% of the small- and medium-sized Canadian businesses surveyed saw a decline in revenue and profits in 2020. Nearly half laid off staff, while about 39% of entrepreneurs have taken on more debt to survive.

The good news is that recent experience has shocked many households and businesses to focus on greater efficiency, reduce costs, and build up cash savings – critical behaviours needed to restore financial strength.

The bad news is that as the recession and under-employment continue, many lack the income needed to rebuild. Many are more indebted now than they were six months ago.

Two-thirds of small business owners say they’re in a worse situation now than before the pandemic. And insolvency trustees are warning of similar trends in Canadian households.

New Bank of Canada chief Tiff Macklem acknowledged Canada’s debt-linked fragility today in a speech: “The bottom line is that the private and public sectors together need to be acutely aware of financial system risks and vulnerabilities as the economy recovers.”

Falling commercial and residential rents are much needed for reducing overhead costs, but property prices must also follow, and the income and balance sheet losses will hurt present owners and lenders.

As shown in the chart below (source: not indicated), since 1990, central banks don’t admit it, but the policy obsession with lower and lower interest rates is the cornerstone of our present fragility.

As the interest component of mortgage payments flatlined from 2008 to 2017, prices paid soared along with the debt’s principal portion. This inflated debt is now a heavyweight on consumption and saving ability for years into the future.

Simultaneously, the low rates that have enabled record debt, unaffordable shelter and other asset bubbles have worsened retirement prospects worldwide as