Mark Carney successfully safeguarded the Trust's integrity.
In a candid talk following the release of Jean-Jacques Pelletier's book, Monique Jérôme-Forget, Quebec's Finance Minister during the 2008 commercial paper crisis, shares her take on Mark Carney's role at the time. As Bank of Canada's Governor, Carney facilitated help for the Caisse de dépôt et placement du Québec (CDPQ), whose assets were on the brink.
I'm here to offer my insights, following the discussion initiated by La Presse's article on May 3rd. The article delves into the content of Pelletier's book, detailing the happenings of the CPBA crisis caught at CDPQ.
Back in 2008, I found myself right in the thick of it all. Pelletier has since retraced theCPBA incident by consulting Henri-Paul Rousseau, then CDPQ's former President. It was Pfierre Brunet, CDPQ's Board Chair, who urgently called for a meeting, and I promptly responded.
That very morning, Brunet, alongside Alban D'Amours and Louis Vachon, Presidents of Desjardins and the National Bank respectively, arrived to share the CDPQ's financial woes. The same day, I connected with David Dodge, the Bank of Canada's Governor, to share their concerns. In turn, they journeyed to Ottawa to meet Dodge.
Initially, we were discussing an $8 billion concern because the CDPQ was unaware of the extent of its CPBA holdings. Later, we learned that the risk transcended to $40 billion, nearly one-third of the CDPQ's assets.
Carney's Arrival
Apparently, Dodge didn't feel the need to intervene initially. His reign was ending, and Mark Carney was set to succeed him. I reached out to Carney to once more brief him on the CDPQ's situation.
I can still picture one of those phone calls, right before a long weekend, between Jean Charest, Premier of Quebec, Carney, and myself, discussing possible solutions to ease CDPQ's burden and give them time to strategize. These commercial papers had approaching maturity dates.
And that's when Carney stepped in. He promised to support Quebec to bridge the gap and afford CDPQ the opportunity to work on this over several months. We now know that the efforts yielded success.
Let's also remember that following Rousseau's departure, I appointed Michael Sabia, and despite speculations about his Ottawa connections, as CDPQ's head. Though Rousseau had left the CDPQ's management and had feelings of responsibility for the situation, he brilliantly proposed assembling a team to decipher the commercial papers' contents.
We turned to Purdy Crawford, a man of considerable talent who spent months working on this dossier to create the Montreal Agreement.
In the end, Sabia, with the talent we all recognize, managed to have the CDPQ recover what it had lost in record time. Let's not forget that those sleepless nights for me were due to the potential risks to Quebec's asset.
To riff on Hélène Baril's article "The Unraveled Caisse de dépôt": What do you make of it? Join the discussion
With what Jérôme-Forget shared on record, one can observe a skepticism toward Carney's role in the 2008 crisis. She suggested that Carney's portrayal of himself as a pivotal crisis manager during the Great Recession, particularly in relation to the CDPQ's situation, was somewhat exaggerated or biased[1]. This aligns with widespread analyses raising questions about the historical narrative of Carney's contributions during that period, emphasizing the complexity of the crisis and the involvement of multiple players rather than crediting a single figure with resolution[1].
- In her candid talk, Monique Jérôme-Forget, the former Finance Minister of Quebec, questioned Mark Carney's portrayal as a pivotal crisis manager during the 2008 commercial paper crisis, suggesting it may have been somewhat exaggerated or biased.
- Jérôme-Forget's account aligns with broader analyses that stress the complexity of the crisis, involving multiple players, and challenge the conventional narrative that credits a single figure with resolving it.
- During the 2008 crisis, Carney was Governor of the Bank of Canada and played a crucial role in facilitating help for the Caisse de dépôt et placement du Québec (CDPQ), whose assets were on the brink.
- The CDPQ, a significant player in the finance industry business, faced a $40 billion risk due to its Commercial Paper Bond Agency (CPBA) holdings during the 2008 crisis, with politician and business leaders like Jean Charest, Mark Carney, and Monique Jérôme-Forget promptly responding to address the situation.
