Targeting the Economic Crises
Policy Briefing Note: Bubble Prevention
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Proposal (Outline the policy option that you recommend to deal with the current economic crisis. This section should clearly and succinctly state the policy and offer a brief description of what it proposes. – 100 words)
Put in place regulations and systems to prevent speculative bubbles from developing in real estate, commodities, stocks, credit and other assets.
Implementation (Describe how the policy would be implemented, as well as the proposed timeline. – 100 words)
Cost of Proposal (Detail the cost of the policy to the Government, either in added expenditure or foregone revenue. – 100 words)
Expected Impact – Short-term (Describe concretely how the policy will help Canada deal with the current economic crisis over the next twelve months. How will it impact taxpayers and families? How will it affect industry and labour? – 200 words).
Expected Impact – Long-term (Describe concretely how the policy will impact Canada over the next five years and beyond. How will it impact taxpayers and families? How will it affect industry and labour? – 200 words)
Background (Present the background considerations that are relevant to this policy proposal. You should list the various facts and figures that support the policy. Has this measure been adopted successfully in other jurisdictions? – 200 words)
Considerations (Present key factors that must be taken into account with this policy: environmental impact, provincial/municipal jurisdictional issues, etc. - 200 words)
How will regulators know when increases in asset values has become a bubble?
Asset values are determined by supply and demand; supply can be tracked, but how are regulators to determine whether the aggregate demand for an asset satisfy a genuine need or are speculative in nature?
Political Implications (What will the impact be on public opinion? Can opposition parties be expected to support this proposal? What interest groups will support this measure? Which interest groups will oppose it? - 200 words)
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