1. BoC rate cuts

Chance of rate cut rising as markets anxiously await details of Trudeau’s stimulus rescue
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Some commentators mentioned that BoC should print money or buy public debts to stimulate economy. Some said that US Fed had printed tons of money but USD is still strong.

If you looked back the years 2008-2012, CAD was traded at par or higher than USD.

The only reason for jumping USD was due to currency traders. They have seen US have crunched out more than 200K jobs a month for many months in a row. Of course, US employees would have money to spend in USD. At that time the interest rate of USA was around 0%-0.25%. BoC rate was around 1%. Canadian population is around 1/10 of USA, thus we need to churn out around 20K jobs a month to get higher CAD.

Strong currency requires strong job growth.

Printing money should be the last resort as tax payers would suffer the consequences of lower Lonnie. The current exchange rate of CAD is low enough as compared to USD, i.e. around $0.72 USD. Lower CAD would create huge inflation, and Canadians have been stretched with debts.

The best bet would be buying corporate bonds, because federal debts and provincial debts have been so high already. Let's corporates take risks to hire and expand business, which is their best expertise - not government expertise.

During financial crisis, US governments have loaned US banks in exchange for prefer shares or bonds with interests, thus US banks were motivated to pay back loans. At the present the rate is close to zero, thus business wouldn't be motivated to pay back, thus a maximum term, e.g. 3 yrs or 5 years, should be in place.

Source: http://business.financialpost.com/investing/outlook-2016/chance-of-rate-cut-rising-as-markets-anxiously-await-details-of-trudeaus-stimulus-rescue
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2016-01-07
BoC also considers negative rates.

* Looking at ECB using negative rates
-They have caused panicking among bond traders moving money around and yelling at governments. They eventually pay Germany to keep their money. EU is not out of the wood with negative rates.

* US was using QE and low interest rates [0.25% not negative]. US is out of recession and increases interest rates. US did invest in US companies during the late financial crisis.

* QE also lowers currency exchange rates and better bet than lowering key interest rate. Doing QE in business would create jobs.

Source: http://www.theglobeandmail.com/report-on-business/economy/canadians-should-get-used-to-lower-dollar-higher-inflation-poloz-says/article28047394/
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An example of BoC do QE by lending money to business through local banks.

* With the current rate of 0.5% and 1% fee by local banks, business would get wonderful loans for 1.5%. Business would expand and start hiring.

* QE would bring down CAD. However, BoC could raise rate to 1%, i.e. business get a loan of 2%, which is still excellent. CAD would go up a little and BoC have sent a clear message to housing market, i.e. rate does go up.
-> Housing market players have speculated rates would never go up and house prices would go up forever.