Early Friday morning, a text message wakes me up. I pick up my cell phone to read the next lines which are nothing close to a “Good Morning” -type of message I was hoping for.  “Damn, markets are crashing!”, appeared on the screen. Not knowing the time, I suddenly think that I slept through the world’s biggest financial collapse. I quickly find the remote and tune into CNBC and BNN (Canadian Equivalent of CNBC), to my surprise its not even 10 am and the DOW is down big and the TSX even bigger (almost 6%). “Today might actually be the day”, I think to myself. Then again, volatility is so high that we are probably going to turn positive for the day. The markets did not see green that day but they did not crash either.

Welcome to the end of year 2008! The reality that we are living in today is full of uncertainty and fear. The topic of any conversation, radio show, newspaper, or TV show is about the financial crisis.  This time it is an issue that effects everyone, the rich and the poor. The rich are losing money on a

grand scale, middle class is fearing to open their portfolio statements, and the poor are just afraid of losing their low-paying jobs.

Surprisingly, our Western society is still very optimistic regarding the whole crisis.  Last night, I was chatting with some friends over dinner at a restaurant which is filled with people who are still spending on expensive entrees and drinking wine in order to make the topic of financial crisis a little more “fun”. As many of us still have our plastic friends with massive limits who got us in this whole mess. The conversation was about the same old as nothing changes these days. But most of my friends were still very positive regarding the whole issue being unraveled at the moment. Myself, however, was on a different side. A little background on me, to my friends I am known as one of the most optimistic people out there.

Here is where the problem lies. Up here in Canada, in the land of a strong deteriating petro economy and best financial systems in the world, we might not be getting out of this mess. Over another conversation at a fine sushi restaurant with my former bank co-worker, we chatted about the same old (fianancial crisis). Since I haven’t personally approved any loans since I left my post at one of the largest banks in Canada, I asked him regarding the atmosphere in the bank.  No suprise, as getting credit is definitely not as it used to be. In addition, banks have now thought of the greatest idea that will save them in the short run but destroy everyone in the long run. Our governments are trying to stimulate the economy by lowering our interest rates. But the banks are hiking rates, in the times when they should be cooperating with the government. Some of our lines- of-credit, which may secured by our homes, used  to have the same rate as the prime interest rate, and now banks are considering and some already implementing Prime+1%. I remember the days, when a customer would try to negotiate a good rate on a mortgage and would be able to get “Prime – n”  on their mortgage. Not anymore, as most variable rate mortgages come with an additional premium.

I would be very optimistic if banks wouldn’t be squeezing us consumers. We simply won’t get out of this mess if credit remains expensive. Now ask yourself, how are our economies going to be stimulated by actions like these? There is no benefit for us to go out to spend. Unless banks smarten up and co-operate with the government intends, then this might be a very long downturn for everyone.