To answer this question, we’re going to look at some of the causes of the American real estate collapse

1) Interest Only Mortgages
In the US, interest only mortgages became quite popular early in the new millennium, with many families opting to purchase homes that they really couldn’t afford, with interest only mortgages. Rather than renting, they would spend roughly the same amount on owning their own home. Unfortunately, as soon as the house prices fell slightly, this caused the momentum to continue. With people holding mortgages for more than homes were worth, it was simply in their best interest to walk away from the home and cut their losses. This compounded the problem and drove already falling housing prices even lower.

In Canada: You cannot have an interest only mortgage in Canada. Most mortgages require a 25% downpayment. Therefore, unless housing prices suddenly tumble by more than 25%, this isn’t a risk

2) Failing Economy
There have recently been major issues with the US economy, particularly as manufacturing moves overseas and factories continue to close. The US economy has lagged in recent years and is projected to continue to experience slow growth for at least the next 5 years.

In Canada: While Canada’s economy was impacted by the recession of 2008, the effects have been much more minor than in the US. Canada’s economy is based heavily on natural resources, rather than manufacturing, and therefore isn’t as volatile as the American economy.

3) Failing Banks
American banks have been failing left, right and centre. The financial industry has continued to do poorly since the 2008 collapse. In fact, this is what spurred many of the widespread occupy Wall St protests.

In Canada: Canadian banks are some of the most secure in the world.

If we look at these three triggers for the American real estate collapse, we can see that a collapse in Canada of similar magnitude is highly unlikely. Furthermore, Canada has an incredibly high immigration rate, which continues to push housing prices higher in major centres. For example, in Toronto alone, more than 40,000 new dwellings are needed each year to keep up with demand.

Overall, Canadian Real Estate prices are at an all time high, and it appears that they will continue to rise for the foreseeable future.

Dhaka, Bangladesh (AHN) – Bangladesh, the world’s poorest Muslim majority country, unveiled a $22 billion deficit budget high on defense expenditures and low in farm spending. The government projects revenue income at $16.01 billion in the coming fiscal year, up from nearly $13 billion. The budget was placed in Parliament on Thursday amidst a boycott by the main opposition Bangladesh Nationalists Party.

The overall agriculture budget decreased more than 12 percent while defense spending increased almost 29 percent, the largest rise among major sectors. Instead of investing in human development and infrastructure, money will go towards increasing Bangladesh’s military firepower and salaries of defense personnel.

Finance Minister Abul Maal Abdul Muhith has called for higher allocation in the energy and farming sectors to perk up economic growth. In a move to end a serious of power outage, the power production saw an increase of almost 20 percent as the finance minister outlined a plan to increase power generation by almost three times adding 7,800 megawatts to the national grid by 2013.

The minister set a 7.0 percent growth target for the gross domestic product (GDP) starting on July 1.

The budget holds down the rising inflation, principally blamed on price spirals and depreciation of the local currency, he explained.

Economic think-tank Unnayan Onneshan, in a quick assessment on Thursday said the government might face extraordinary challenge to reach the growth target as quoted in the budget document of fiscal 20111-12 due to lack of supporting base in the overall economy of Bangladesh.

The fiscal space squeeze and IMF condition for accessing one billion dollar loan to Bangladesh might also pave the way for increasing different type of inequality; such as geographical inequality, income inequality and social inequality in the country, the think-tank said.

Finance Minister almost echoed with the think-tank and said that the next fiscal year would be challenging for the economy. “Recovery from the recession and political instability pose a great risk for the economy and we’re going to form a taskforce to deal with it,” he told journalist on Friday.

He does not hesitate to blame that the economy has fallen into trouble after recovery from recession due to commodity crisis and in Bangladesh political stability rubs salt to the injuries.

The anti-tobacco lobby expressed mixed reaction, when the government increased tax to 42.5 percent to discourage smoking. The activists were expecting strict economic restrictions of the tobacco growers.

Bank stocks went up Wednesday and Thursday riding largely on report that corporate tax will go down to 40 percent for commercial banks.

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Washington, D.C., United States (AHN) – Initial jobless claims declined by 29,000 to 409,000 for the week ending May 14 compared to the previous week’s tally of 438,000 claims.

That is still above the 400,000 mark. Analysts say first time unemployment compensation insurcance claims must drop below 400,000 and stay below that mark to signal the economy has turned around.

However, the less volatile four-week moving average was up by 1,250 from the previous figure, increasing to 439,000 claims.

The number of people claiming benefits in all programs for the week ending April 30, the most recent week such data is available fell below the 8 million mark to 7,936,548, a decrease of 47,124 from the previous week.

Here is a look at which states had the largest increase in new claims for the week ending May 7.

• Alabama (+5,767)
• California (+4,015)
• Michigan (+3,122)
• Mississippi (+1,666)

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Madrid, Spain (AHN) – Spain’s unemployment rate reached a 14-year high of 21.3 percent during the first three months of the year, up from 20.3 percent for the last three months of 2010.

The economy lost more jobs during the first quarter than it had during the entire year of 2010.

That boosted the number of jobless people to 4.9 million and government officials say they do not expect to see much in the way of job creation until the end of the year.

In addition, the economy has been depressed and Spain’s government has instituted stringent austerity measures in an attempt to deal with high public debt and deficits.

The austerity measures are not helping the economy to revive.

Retail sales fell by 8.6 percent in April compared to a year earlier. In addition, inflation rose by 3.5 percent in from the 3.3 percent rate in March.

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Toronto, Ontario, Canada (AHN) – Ontario Premier Dalton McGuinty sought Wednesday for more powers for the province in selecting migrant workers.

By seeking more autonomy, Ontario wants to have more oversight in picking newcomers and designing programs to help them integrate into Canadian society.

McGuinty complained that the top-down approach used by Ottawa to bring in migrants places Ontario at a competitive disadvantage. He said Ontario is losing to other Canadian provinces such as British Columbia and Alberta in attracting the best immigrants, in the process hampering Ontario’s attempt to jumpstart its economy.

McGuinty wants the same control over the province’s immigration program as that enjoyed by Quebec, Manitoba and BC. McGuinty attributed the current situation to previous Ontario deals with Ottawa – both Liberal- and Conservative-led – which resulted in Ontario shortchanged by $200 million in immigration funds.

However, instead of McGuinty seeking more autonomy in immigration programs, New Democratic Party-Ontario leader Andrea Horwath said the provincial government should help foreign professionals integrate and have their credential recognized. She said the lack of accreditation is the reason why some migrants in Ontario who have higher skills end up as cabbies and pizza delivery drivers.

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