Jie is Chinese. But not the HAM kind. He immigrated to Canada with his wife, chose Vancouver, and has done okay. They make double the average income but can’t afford a house. Of course. Who can? Today at least 12 families would have to get together and donate their entire year’s pre-tax earnings just to buy one average, crappy, abode.
“You must feel like a lone ranger sometimes,” he writes me. “I know I do. Even this morning on CKNW news, when the BMO’s prediction about housing price drop was brought up, they were still saying that first time home buying was still affordable due to low interest rate!!! What affordability??? Sure, it is affordable if one is reckless; but recklessness has been awarded and prudence has been punished; there is recklessness all around me.”
Recklessness. Damn fine word, Jie. It describes our world – and not just the cowboy capitalism now etched on the streets of Vancouver.
Governments have been reckless, spending obscene amounts try to maintain normalcy. Now we have less-than-normal, debt crises and the surety of higher taxes. Lenders have been reckless. Is there a 40-year-old you know who isn’t in hock? Money’s been cheap and loose, with lending standards at ankle levels. Borrowers and buyers have been reckless, spending without discipline. It will make the trip back down even more dramatic. The HAM Chinese have been reckless, extreme-buying on whim, gossip and the wisdom of a crowd.
Says Jie: “As for the HAM, I am afraid of it, at least for the near term. The herd mentality in Chinese culture is far more rampant than in Canadian culture because the phrase “critical thinking” is very difficult to find in the Chinese vocabulary if it exists at all. The point? There are 1.3 billion lemmings in China. I want to see control in place for foreign real estate ownership but that’s not likely to happen. In the meantime, the Canadian lemmings are anxiously but nonetheless eagerly joining the march to destruction, supported by our very own government.”
But reckless doesn’t stop there. Its unstable and toxic zenith lives in those who exploit the confusion and emotion of the times. The pumpers and humpers and spinners of the real estate industry, supported by media sycophants, have walked tens of thousands of buyers into assets that could eat them alive. Anyone buying a house at market levels in 2011 is taking on massive risk. And those who say, ‘buy now or buy never’ are sleazy merchants of both greed and fear.
Slithering to the oily top is Cam Good, the Vancouver-Toronto marketer who’s making a career out of fostering fear and loathing when it comes to the Chinese. He’s the king of hyperbole and stunts, and his comments in the vid posted below – that people in Vancouver “maybe should live somewhere else” if they don’t like what HAM is doing – have touched a collective nerve.
“There will be destruction one day; I just don’t know who will be destroyed,” says Jie. “Would it be the reckless people (the ones riding the “Vancouver buck”) or would it be us (the ones with savings)? I feel we are in the minority here and the minority usually gets screwed in a democracy (runaway inflation would eat up our savings). What can we do to protect ourselves?
“This could be the darkest hour before the sunrise; and man, is it ever dark right here in the lower mainland! Please keep up your voice of sanity and prudence. From time to time, I reach out for your voice for moral support in this dark hour.”
For some time on this blog I’ve argued the greatest threat to the ability of people to own houses is not horny Mainland Chinese with bags of money (they tear up some neighbourhoods), but the sleazeball marketers who amplify the Asian Invasion, using it to goad everyone else into paying more everywhere. The result has been million-dollar shacks, a mass bubble mentality, rampant speculation, and the delusional conviction the only thing holding back prices is the sky.
Jie, you know it. This will not end well.
But end it will. Be patient and pure.
Soon Cam Good will be back on TV. At 2 am selling Furminators.