the downside, these policies may have been one of the factors putting upward pressure on the canadian dollar. but, on balance, the effects have been positive for canada. bis central bankers ’ speeches morning in america? so where are we now, in this long process of getting back to sustained economic growth? the u. s. economy is in expansion, with the private sector taking the lead. the headwinds that came from deleveraging – consumers whittling away at heavy debt loads – are abating and the net worth of those consumers has improved markedly ( chart 6 ). and the process of fiscal consolidation – bringing the federal budget deficit down to a more sustainable level – is largely complete ( chart 7 ). bis central bankers ’ speeches but growth has remained fairly modest. it ’ s not quite clear why. perhaps uncertainty about demand is still holding back business decisions and investment. given the rocky road of the last few years, this is to be expected. while u. s. housing markets are reviving, they are following an uneven and uncertain path, and there is a lot of room for improvement. home construction is well below its pre - recession level, and the excess housing stock has largely been depleted ( chart 8 ). likewise, there is room for improvement in labour markets, which are a long way from normal. on average, about 200, 000 net new jobs were created each month during the past three years. unemployment, which spiked during the recession, has fallen by about 4 percentage points since its peak. how does canada compare? since canada experienced a shorter recession, our labour market conditions did not deteriorate as much, and were also faster to recover. for instance, by january 2011, canada had recovered the number of jobs it lost during the recession – whereas the united states only reached that point in may of this year ( chart 9 ). but since 2011, canada has been creating new jobs at a much slower pace than has the united states. similarly, our unemployment rate did not rise as much during the recession, but has been coming down more slowly – and, if measured in the same way, is now at about the same level as it is in the united states. in both countries, the unemployment rate does not fully capture the labour market slack. in both the united states and canada, there are still elevated levels of long - term unemployment and involuntary part - time employment, while wage gains continue to be moderate relative to historical norms ( chart 10 ).

, risk - free securities. as confidence that this paper could be rolled over faltered, there was indiscriminate selling of structured assets. in markets where backstop liquidity was judged not to be automatic, such as the abcp currently involved in the montreal accord, noteholders could no longer redeem their paper. 2 in markets where backstop liquidity was robust, investors could exit and, as a result, abcp came back on the balance sheets of financial institutions, which in turn raised concerns about the scale of their exposure. from a medium - term perspective, the disappearance of segments of abcp markets around the world will have important implications for the viability of many securitized products, since abcp represented an important funding source for the most senior tranches of securitized credit structures. the second cause of current market disruptions has been the lack of transparency and inadequate disclosure that characterizes many highly structured financial products. these shortcomings were ignored when times were good to the extent that many investors did not actually understand the characteristics of the securities that they owned. market participants were often less surprised by the deterioration in subprime market fundamentals than by the marked - to - market losses of subprime collateralized debt obligation ( cdo ) securities, given the defaults in the underlying mortgages. this surprise, in turn, has prompted a broad reevaluation of structured products and, in some cases, indiscriminate selling. even months later, the opacity of these structured products has made them harder to value, thus dramatically reducing secondary market liquidity. poor disclosure of many securitized products continues to make it difficult for new investors to enter the market confidently and purchase securities despite distressed prices and the presence of still - substantial global liquidity. indeed, as i will discuss in a moment, the high cost of default protection in many markets – such as that for corporate bonds – implies a pessimism about actual default probabilities that appears excessive. 3 at the same time, widespread uncertainty about the distribution of losses has fed concerns over counterparty risk. with the assumption that risk had been irrevocably transferred found wanting, market participants became uncertain about the true financial situations of their counterparties, and have sometimes been reluctant to lend, even at very short horizons. the the bank of canada raised this concern in p. toovey and j. kiff, " developments and issues in the canadian market for asset - backed