Family, Statistics Canada recently released a set of data that really made me question reality; it truly embodied the term “magical realism.” Let’s look at some exciting figures first. In the first quarter of this year, the net worth of Canadian households broke through the CAD 18.6 trillion mark, with an average wealth of over CAD 440,000 per person. Converted to RMB, that’s equivalent to about 2.3 million RMB per person! Surprised? Unexpected, right? If you’re checking your pockets right now and find you don’t have that much money, don’t panic. You’re probably like most people, having been “averaged out” once again.
So where did all this money come from? Simply put, it comes down to two familiar wealth-generating formulas: real estate and stocks. The Canadian housing market, which had been stagnant for over a year, has recently shown signs of recovery. This rebound in property values has become the biggest driver of soaring wealth. Even economists at the Royal Bank of Canada have spoken out, saying that the housing market is clearly showing signs of stabilizing.
Besides those who profited from buying property, stock market investors also benefited. In the first quarter of this year, the Canadian stock market surged, driven by the energy and mining sectors, adding nearly 150 billion Canadian dollars to the financial assets of Canadian households. In other words, those who own mines, houses, and stocks have seen their assets more than double in just three months. But if the story ended here, it wouldn’t be the Canada we know.
On the other side of the coin, the reality is so cruel it takes your breath away. Just as total wealth reached new heights, another record was ruthlessly broken. According to the latest data from the Bankruptcy Oversight Office, the number of people filing for consumer bankruptcy and debt restructuring in Canada surged to over 37,000 in the first quarter of this year!
This figure directly sets a record since the 2009 financial crisis. What does this mean? Let’s do the math: In the first three months of this year, an average of 17 people per hour in Canada had no choice but to go bankrupt or restructure their debts because they could no longer make ends meet. You’re here looking at the average wealth of 440,000 Canadian dollars and marvelling at your comfortable life, but in the same hour, 17 living people are being driven to desperation by high mortgages, credit card bills, and ever-rising prices, and must declare that their finances have completely collapsed.
This is the true picture of Canada today. The seemingly glamorous “wealth growth” is just a phantom bubble created by inflated asset prices. The harsh reality is that mortgages and various debts are still climbing at an alarming rate, and high interest rates are like a Damocles’ sword hanging over everyone’s heads. Those ordinary workers who truly have no assets and rely solely on their fixed salaries are already exhausted each month just trying to cover bank interest and supermarket bills.
On one hand, the wealthy are making a fortune in the bull market through real estate and financial assets, with their paper wealth soaring; on the other hand, ordinary people are struggling between high inflation and high interest rates and even going bankrupt in droves. This extreme “two-sided Canada” not only widens the gap between the rich and the poor but also makes the so-called “wealth per capita” a huge irony.