Healthy finances moved Canada into recovery more quickly
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Canada and the United States were both hit by the 2008–2009 recession, but Canada's healthy finances at the onset of the downturn helped it endure and emerge into recovery more quickly.
Canada's national saving rate had climbed to 13.8% during the commodity boom before the recession. This reflected high saving rates by governments and corporations. By contrast, the U.S. national saving rate was below 1% when the recession began (and 3% by its end). As well, household balance sheets in Canada fell only 8.7%, and were not ravaged like those in the United States, where net worth fell 26.6% over nearly two years.
The recession was also shorter and milder in Canada partly because the flow of credit was not disrupted as it was in other G7 nations, and so the large pool of savings was available to finance spending when income fell temporarily. This reflects the strong balance sheets and the absence of problems in major financial institutions such as those seen in the United States and Europe.
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