5% interest rates right now would bankrupt millions.
Exactly.
Governments reduce interest rates to increase borrowing so people will spend more money in order to increase GDP growth during struggling economic times. When rates went to 4-5% in the USA millions of homeowners started foreclosing and the housing market collapsed on itself.
In Canada, interest rates went to historic lows following the 2008 recession and stayed low for years. So a lot of people bought houses using this cheap credit. This helped Canada's housing market skyrocket (among other factors), and now people are in deep, deep debt unlike any time in Canadian history. A lot of people used the cheap credit to buy investment properties in the hot house markets to take advantage of the rising home prices, which further increased housing prices. Over-speculation causes bubbles.
https://www.investopedia.com/terms/s/speculativebubble.aspIf the feds or banks have to put interest rates to 4 or 5% the whole bubble could collapse & we become the USA in 2008. The feds are in good shape financially, but Canada as a whole, including individuals and provinces, are knee-deep in debt.