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Delinquency rate highest since 2012

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The percentage of Canadians who are three months or more behind on their debt payments has hit the highest since 2012, according to the most recent quarterly data from Equifax Canada.

Canada’s so-called 90+ day delinquency rate on non-mortgage payments climbed to 1.2 per cent in the final three months of 2019, an 11 per cent jump compared with the same period in 2018, Equifax data shows.

Canadians owed an average of almost $73,000 at the end of 2019, of which nearly $24,000 is non-mortgage debt, including credit cards, loans and lines of credit.

Delinquency rates had been “marching higher” for much of 2019 and will likely keep going up in 2020, said Bill Johnston, vice-president of data and analytics at Equifax Canada, in the report.

The trend is strongest in British Columbia, Ontario and Alberta, where delinquencies are now back above their 2016 level.

The data comes as Canada sees rising numbers of consumers defaulting on their debts even amid a healthy economy and solid job market. Consumer insolvencies were up more than 10 per cent in January 2020 compared to the same month in 2019, according to the latest figures from the Office of the Superintendent of Bankruptcy.

That’s a trend Scott Terrio, manager of consumer insolvency for Hoyes, Michalos Licensed Insolvency Trustees, has been seeing on the ground for some time.

“People are hitting the wall.”

 

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Interest rate hikes are likely in part responsible for the growth in delinquencies and insolvencies, Terrio said.

The Bank of Canada implemented five interest rate increases over the span of two-and-a-half years, lifting its trend-setting rate from 0.5 per cent to 1.75 per cent between July 2017 and October 2018, before lowering it to 1.25 per cent on March 4 amid rising concerns about the economic impact of the coronavirus outbreak.

A study by the Canadian Association of Insolvency and Restructuring Professionals found that there is usually a two-year lag between when interest rates start to rise and when consumer insolvency filings begin to increase.

But Terrio said much of the debt he sees from clients filing for insolvency is much older than two years.

“We’ve run up debt for most of a decade,” he said.

Some borrowers are simply getting to the end of the runway, according to Terrio.

That may be especially true among renters, who, according to Terrio, made up more than 90 per cent of debtors who filed for insolvency with Hoyes Michalos over the last couple of years.

While sky-high home prices allow many homeowners in expensive cities to keep borrowing against their home equity, renters have fewer options to keep borrowing and consolidate debt.

But while the pile of debt carried by Canadian households has been growing for the better part of a decade, what may be pushing debtors over the edge are expensive loans from online alternative lenders, an industry that’s boomed over the past few years.

“There’s less and less more recent debt from the big banks as opposed to non-traditional and payday lenders,” Terrio said. “That’s driving people to insolvency because the interest rates on those loans are horrible.”

Still, the Equifax report noted consumer demand for non-mortgage debt has been cooling off.

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“Outside of mortgages, we have seen a significant pullback in demand for credit,” Johnston noted.

Consumers, Terrio said, are “entering a period here of self-policing.”

“They’re in trouble enough that they’re not going to get more credit.”

 

Homebuyers, however, are bucking that trend, with mortgage debt up 5.2 per cent in late 2019 compared to a year earlier.

The increase reflects homebuyers having adjusted to the 2018 mortgage stress test, Equifax said.

Looking forward to the rest of 2020, Terrio said the Bank of Canada’s recent rate cut would likely fan the flames of the mortgage market.

“We’re going back into low rates again here, which for me spells danger.”

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County judge strikes down Ohio abortion ban, citing voter-approved reproductive rights amendment

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COLUMBUS, Ohio (AP) — The most far-reaching of Ohio’s laws restricting abortion was struck down on Thursday by a county judge who said last year’s voter-approved amendment enshrining reproductive rights renders the so-called heartbeat law unconstitutional.

Enforcement of the 2019 law banning most abortions once cardiac activity is detected — as early as six weeks into pregnancy, before many women know they’re pregnant — had been paused pending the challenge before Hamilton County Common Pleas Judge Christian Jenkins.

Jenkins said that when the U.S. Supreme Court overturned Roe v. Wade and returned power over the abortion issue to the states, “Ohio’s Attorney General evidently didn’t get the memo.”

The judge said Republican Attorney General Dave Yost’s request to leave all but one provision of the law untouched even after a majority of Ohio’s voters passed an amendment protecting the right to pre-viability abortion “dispels the myth” that the high court’s decision simply gives states power over the issue.

“Despite the adoption of a broad and strongly worded constitutional amendment, in this case and others, the State of Ohio seeks not to uphold the constituional protection of abortion rights, but to diminish and limit it,” he wrote. Jenkins said his ruling upholds voters’ wishes.

Yost’s office said it was reviewing the order and would decide within 30 days whether to appeal.

“This is a very long, complicated decision covering many issues, many of which are issues of first impression,” the office said in a statement, meaning they have not been decided by a court before.

Jenkins’ decision comes in a lawsuit that the ACLU of Ohio, Planned Parenthood Federation of America and the law firm WilmerHale brought on behalf of a group of abortion providers in the state, the second round of litigation filed to challenge the law.

“This is a momentous ruling, showing the power of Ohio’s new Reproductive Freedom Amendment in practice,” Jessie Hill, cooperating attorney for the ACLU of Ohio, said in a statement. “The six-week ban is blatantly unconstitutional and has no place in our law.”

An initial lawsuit was brought in federal court in 2019, where the law was first blocked under the landmark 1973 Roe v. Wade decision. It was briefly allowed to go into effect in 2022 after Roe was overturned. Opponents of the law then turned to the state court system, where the ban was again put on hold. They argued the law violated protections in Ohio’s constitution that guarantee individual liberty and equal protection, and that it was unconstitutionally vague.

After his predecessor twice vetoed the measure citing Roe, Republican Ohio Gov. Mike DeWine signed the 2019 law once appointments by then-President Donald Trump had solidified the Supreme Court’s conservative majority and raised hopes among abortion opponents.

The Ohio litigation has unfolded alongside a national upheaval over abortion rights that followed the Dobbs decision that overturned Roe, including constitutional amendment pushes in Ohio and a host of other states. Issue 1, the amendment Ohio voters passed last year, gives every person in Ohio “the right to make and carry out one’s own reproductive decisions.”

Yost acknowledged in court filings this spring that the amendment rendered the Ohio ban unconstitutional, but sought to maintain other elements of the 2019 law, including certain notification and reporting provisions.

Jenkins said retaining those elements would have meant subjecting doctors who perform abortions to felony criminal charges, fines, license suspensions or revocations, and civil claims of wrongful death — and requiring patients to make two in-person visits to their provider, wait 24 hours for the procedure and have their abortion recorded and reported.

The Canadian Press. All rights reserved.

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More rain in B.C. forecast, although ‘nothing’ compared to atmospheric river

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The District of North Vancouver is getting ready for another bout of rain after an atmospheric river weather system drenched B.C.’s south coast last weekend, triggering a mudslide and localized flooding that killed at least three people.

The North Shore mountains could see another 75 millimetres of rain this weekend, and Lisa Muri, a councillor with the district, said staff were preparing by cleaning up culverts and placing sandbags throughout the community.

Muri said last weekend’s storm was unprecedented, bringing nearly 350 millimetres of rain to North Vancouver over three days.

The downpours caused creeks to swell and pick up wood debris and gravel that blocked culverts and drainage channels, she said, sending torrents of brown water down streets in the waterfront neighbourhood of Deep Cove.

District Mayor Mike Little said on Thursday that his daughter heard about the flooding in Deep Cove last Saturday and they headed to the area.

“We drove down, and within 10 minutes, the entire contents of Gallant Creek was overflowing over the road,” he said, adding they immediately called the fire department to come and block off nearby roadways.

“It was very, very shocking to see how much water was coming down the road.”

Several Deep Cove businesses have taken to social media to share their experiences with the flooding, including Caf/EH, a restaurant that shared a statement saying it is closed until further notice after sustaining extensive damage.

Little said Gallant Creek has seen other “significant rainfalls” in the last decade, and the district has been working to upgrade the catch basin system.

But last weekend’s rainfall was so intense, it overwhelmed the system, he said.

Ken Dosanjh, a meteorologist with Environment and Climate Change Canada, said the rain in the forecast this weekend will be “nothing” compared with the last storm, and it will come in a series of “pulses” rather than forming an atmospheric river.

He said North Vancouver could see up to 75 millimetres of rain in the coming days, but it will fall over multiple days at a lower intensity than it did last weekend.

“With the atmospheric river, we saw precipitation rates on the order of 10, even upwards of 20 millimetres an hour, which is extremely high,” he said Thursday.

“In this case, we’re noticing precipitation rates kind of fall around four to eight millimetres per hour, maybe reaching 10 (in) extreme cases.”

Little said District of North Vancouver crews had been working throughout the week to ensure drainage basins are clear for this weekend’s expected rain.

“We’ve been out scooping up the rock and debris that came down the creeks and rivers out onto the streets all across the district,” he said Thursday.

Little said he’s confident the district’s systems will be able to handle the rain in the forecast for this weekend, though he’s concerned that certain areas are still “vulnerable to a moderate amount of rainfall” after the recent drenching.

He said the Woodlands area of North Vancouver has seen rocks falling into creeks since last weekend, and the channels need to be cleared out.

Little, whose basement was also flooded, said some homes in the district are “seriously damaged,” and it will take residents time to recover.

Muri, too, said the district has been working to mitigate the risks of heavy rains and flooding, but the sheer volume of rain last weekend was difficult to manage.

“It’s not like we’re going to be able to completely stop flooding in the future, because Mother Nature and climate change are very, very fierce,” she said.

“We can’t engineer ourselves out of climate change. We just have to prepare, be proactive and mitigate where we can.”

This report by The Canadian Press was first published Oct. 24, 2024.

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The dark sky over an urban park in central Mexico attracts stargazers who worry it might not last

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JOYA-LA BARRETA ECOLOGICAL PARK, Mexico (AP) — As night descended, a rumble of frogs filled the air in this park outside the central Mexican city of Queretaro. In the sky, tiny stars appeared one by one, aligning into constellations.

Juan Carlos Hernández used his weight to adjust a large telescope. “Aim for me, Rich!” he yelled to his friend. Ricardo Soriano focused a green laser on a small patch of clouds, targeting where the Tsuchinshan-Atlas comet will soon be visible.

Hernández and other amateur astronomers worked to certify Joya-La Barreta Ecological Park last year as the first urban night sky space in Latin America by DarkSky International, an organization working to educate the public about the harm of indiscriminate lighting.

The park sitting at about 8,520 feet (2,600 meters) above sea level on the outskirts of Queretaro gives unobstructed access to the night sky. While over 200 dark sky places exist globally, Joya-La Barreta park is only one of 11 in areas that are considered urban. Its dark sky status is under constant threat, however, from increasing light pollution and urbanization.

Fading stars

Hernández, who just turned 40, has advocated relentlessly for the night sky for more than 20 years.

The president of Queretaro’s Astronomical Society and one of the founders of the stargazing tourism agency Astronite, the aerospace engineer by day has been chasing dark areas to observe the stars since he can remember.

“In 2014 you could see Omega (Centauri) sitting in the sky just above the city,” he said of a constellation over 17,000 light years away. “Today it’s unimaginable.”

A 2023 study that analyzed data from more than 50,000 amateur stargazers found that artificial lighting is making the night sky across the world about 10% brighter each year. As of 2016, more than 80% of the world lived under light-polluted skies.

Studies in Mexico show that increased urbanization and the need for city lighting in relation to security issues have caused more light contamination.

Fernando Ávila Castro of the Institute of Astronomy at the National Autonomous University of Mexico said a good analogy to explain light pollution is noise pollution.

“We constantly hear traffic noise from the street, but past a certain level that intensity becomes annoying, it doesn’t let you rest,” he said. “The same thing happens with light. Especially because all living beings have this internal clock, the circadian rhythm, which depends on the external values of light.”

“When we go to sleep, we forget that an entire world remains active,” Castro said.

Under the spotlight

The moon and stars are the light source guiding nocturnal activity for plants and animals — determining when animals emerge from hiding to find food, when plants reproduce and when certain animal species migrate. Artificial light has boomed since the industrial revolution in the 19th century, with efficient, affordable LEDs the latest type in wide use.

“There’s also this whole part about the biodiversity,” Analette Casazza, president of another Queretaro astronomy association, said while standing under the stars Saturday night. “We can hear the singing from all the animals that live here (in Joya-La Barreta). A lot of these pollinating animals, their activity is at night.”

Joya-La Barreta park hosts 123 species of vertebrates.

“The real challenge we have is to get citizens involved,” said María Guadalupe Espinosa de los Reyes Ayala, Queretaro’s environment secretary. “When people arrive at a place like this and realize how much it has to offer, they see the need to protect and conserve it.”

Conservation challenge

Hernández and other astronomy activists continue to fight to conserve the park’s nocturnal conditions and pass state regulations to reduce light pollution.

Hernández is also fighting for the enforcement of Mexico’s General Law of Ecological Balance, passed in 2021.

The law provides general recommendations to minimize light pollution. It’s been recognized in certain Mexican states like Sonora, Baja California and Hidalgo to protect observatories and professional astronomical observations. However in Queretaro, Hernández submitted an amendment to the state congress in 2023 to apply the regulations, but hasn’t had any luck.

Three times a year, the citizen astronomers at Joya-La Barreta have to submit light pollution reports to DarkSky. Increased light pollution levels or a lack of visitors to the park for astronomical activities can put their certification at risk. For Ricardo Soriano, another founder of Astronite, it’s a constant cause for concern.

“If contamination continues to grow and the government doesn’t support us, and doesn’t do more to see more beyond our certification, then we can lose it,” Soriano said. “We’ll have to leave Queretaro to try to find another park like this. I hope they can see it as something important for the state and community.”

On Saturday, as the comet came into focus, 10-year-old Matti González, accompanied by his parents Antonio González and Brenda Estrella, burst into a smile looking through his telescope.

“What are you going to dress up as for Halloween?” González asked his son. “An astronaut!” Matti yelled.

Throughout the night, Hernandez ran back and forth between attendees with a red headlight guiding his path. He explained certain celestial bodies or helped focus a scope on Saturn’s rings. Pausing for a moment, he thought about Carl Sagan, and how the astronomer said the same elements that form in the final gasps of a dying star — hydrogen, oxygen, carbon — are elements found in our bodies today.

“Looking at the sky is the most spiritual experience there can be,” Hernández said excitedly. “It’s the connection to our true molecular origins, but also to our cosmic destiny.”

Looking up at the stars, he said: “For me, the most important thing is that the future generations know that a resource their grandparents had is being lost.”

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Follow AP’s coverage of Latin America and the Caribbean at

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