Hear Garth
Toronto – Sunday 2:30 pm, ‘Word on the Street’
Queen’s Park. Just show up.
Winnipeg – Tuesday 7pm. Financial Seminar
Reserve a seat here.

If this blog’s a microcosm of Canada, the country has issues. Upwardly mobile young brats taunt old Boomer farts. Alberta property lords dump on fragile Ontarians. Delusional Lower Mainlanders seek approval for their craven excesses. Bewildered Haligonians wonder what the hell everyone else is smoking.

Without much doubt, we’re in a transitional economy, trekking from near disaster a year ago to a destination unknown. Housing is up. Stocks have gained 35% since the Spring. Money is still on sale.

But at the same time, credit card debt has exploded. Unemployment’s up, not down. And, as I mentioned recently, two-thirds of people say they’d be screwed if one paycheque was one week late. In short, the bulls may be suffering from premature elation. Because consumer spending accounts for 60% of the economy, we ain’t there yet.

But I’ll have more to say on this tomorrow afternoon in Toronto and Tuesday night in Winnipeg.

Meanwhile, here’s a little follow-up to recent posts.

From the brat kid in Toronto making $200K a year with his girlfriend:

Thanks for posting a response to my email in your blog. It’s pretty funny seeing all the comments from your readers, and while some are extremely helpful and constructive, a lot or just jealous haters. Why would I make up a situation to get free advice? If they really must know, I am in the financial services industry and my fiancee is an optometrist (she’s actually only 25 since she skipped a grade, that’ll make your readers cringe even more). Seriously though, where do we get a place for $300K? We want something in the city or at least close to transit/highways but I guess we can’t have it all.

From some obvious smart guy in Burnaby:

You are doing a fine service to the citizens of this great nation. Because of you, I finally convinced my father to list his ‘box in the sky’ today.  We bought for $416,000 in 2005 in Burnaby, BC.  We listed it for $505,000 today.  Can you imagine, half a million dollars in Burnaby for a place with NO LAND!! We are hoping for a greater fool.

My fingers are crossed and am hoping that we can pay off the mortgage, pay the agents, pay the bank, and walk away…. AND NEVER LOOK BACK.

It was your insight that convinced me that I had to get my father out of the market.  Thank you Garth.  I will let you know when it sells! –Aggressively Listed in Burnaby

From the 40ish dink in Vancouver who didn’t like my advice:

After reading this and your repeated, completely out-of-context use of my “buy now or never” line, I have to wonder if you treated your constituents like this. I sincerely hope not.

The issue remains. You don’t offer much that is concrete, and persist in calling people fools, while encouraging others to do so as well.

You seem to skirt the issues, assuming only greed and speculation. I am not greedy, and I don’t think prices will go up. The only real question is, will they go down significantly? It’s looking increasingly “foolish,” at least here in Vancouver, to wager money, never mind your future, on this possibility.

From a guy some place in the country:

Garth, thanks so much for your voice of sanity.  I just bought your “Greater Fool” book and can’t wait to devour it! Question: Are mortgages in Canada “recourse” or “non-recourse”?  If house prices nose-dive, can home debtors just send the keys in and walk away, or will they have to declare bankruptcy?  One thing that is killing California is that housing loans are non-recourse, so people are just walking away, especially the $0 down crowd.  Could the same scenario play-out in Canada? Thanks and looking forward to your next post!

The answer tomorrow.