The problem is that the Bank of Canada has not taken into account that while the total inflation rate, as they calculate it, is about 2%, but the inflation rate on housing is about 10% for the country and 30% in Toronto and Vancouver. There is huge inflation in the largest asset class in the country. And, it is largely debt financed. This is a serious problem that is being largely ignored by all levels of government. This is what caused Japan's current mess, and it started in 1989. Almost 30 years later and they still haven't solved it.