Thank you very much, Mr. Rajotte.
Good morning to all committee members.
Good morning. My name is Ian Russell. I appreciate this opportunity this morning to appear before the House of Commons Standing Committee on Finance to participate in your discussion on an assessment of the measures taken to enhance credit availability in the capital markets.
I'll keep my opening remarks fairly brief, and I really look forward to questions on a full array of the subject matter, be it the credit availability questions or the regulatory reform that we're all embarked on, not just in Canada but globally.
It did not take long for the real economy to be affected. The financial impact and loss of confidence are being felt in every region and in every sector.
We've gone through a very difficult time in financial markets over the last six months, and it's unfolding quite dramatically in its impact on the real economy. Portfolio values are generally down about 20%, with equity investments down 30% to 40%. Real estate values in Canada are in the early stages of following global trends, unemployment rates are trending higher and are already at multi-year highs, and, as you're all aware, consumer spending has retrenched.
One of the areas that I wanted to touch on and elaborate on with this committee extends a bit beyond the measures we're seeing to really an assessment of the measures that were put in place during the budget.
I have to single out the efforts of the Bank of Canada really since the beginning of this crisis in the summer of 2007. Both the bank and the federal government, through its budget, have put in place very effective measures to improve the liquidity and functioning and credit capabilities within the capital markets, but there are still liquidity concerns in the marketplace.
Despite the success of some of the measures implemented to provide liquidity to the banks, such as the insured mortgage purchase program, for example, certain capital markets products have not been able to benefit from them.
Many corporate issuers still remain on the sidelines, and while the reasons are partially due to a general de-risking of investment by buyers, a significant factor in this development is a lack of robust market liquidity. Authorities must remain vigilant in monitoring and identifying the pockets of liquidity that may disrupt the normal functioning of important sub-markets, or the market as a whole, and continue to assess what must be done over and above the remedial measures that have already been taken to address these situations.
We applaud the government for following the recommendation made by the expert panel on securities regulation, and implementing a transition plan to create a Canadian securities regulator with willing provinces and territories.
I'll close with those remarks, Mr. Chair, and again look forward to questions covering that wide range of territory.