Obromney

Romney or Obama? Should investors be rooting for one or the other?

What looked like a slam-dunk for the prez six months ago turned into a contest that could rival Bush-Gore for a messy ending. Romney’s gone from the straight guy in a Gong Show Republican nomination contest full of God nuts and angry old boys to being a credible moderate. Obama squandered the massive political capital of 2008 by hunting the wrong dog. The economy’s now biting him hard.

Meanwhile the middle class has been razed and income disparities widened. The American renaissance is way too slow for most voters, and many are ready for a new approach. Whatever it is, they say, it can’t be that much worse. That attitude leads to electoral shocks.

For months markets factored in an Obama win. What does that mean?

 Well, Democrats stand for more spending, more government, more intervention and (these days) more stimulus. For example, Obama spent about $2 trillion on direct subsidies and payments to try and revive the housing market (didn’t work). Washington actually paid people to buy new cars while injecting billions into the auto companies and bailing out the very banks which helped screw the economy. The White House has supported the central bank spending billions in borrowed money (and newly created cash) to buy back government bonds. So under his watch, the deficit and debt have ballooned.

 Republicans, in contrast, are seen with an agenda of slashing government, cutting public spending, reducing taxes and regulations and focusing on debt and deficit reduction. Long term gain through short term pain, including rolling back recent health care reforms, pissing off China and gutting the tax code. Romney would likely turf Fed boss Ben Bernanke, go protectionist and devolve some powers to the states. He appeals to the god-guns-&-gold crowd, rugged individualism, Tea Party wingnuts and embodies patrician capitalism. Both he and Obama are millionaires, but Romney because he manages and Obama because he inspires. Or used to.

A clear Obama win will rally markets. A clear Romney will have little impact. An unclear outcome will fuel volatility, especially as we head for the fiscal cliff.

Whazzat? Well, horsetrading in Washington, especially around last autumn’s budget fiasco, give us a potential economic predicament. Barring new deals being struck, mandatory tax increases and simultaneous budget cuts click in at the dawn of 2013. That would make federal revenues soar almost 20% and reduce spending by 1%. The effect is dramatic – slashing the US budget deficit in half and cutting $7 trillion in future red ink over ten years.

Sounds good, but…

Such a boost in taxes, slapped on a moribund economy, would likely be recessionary. Government services, social spending and defence expenditures would all be chopped. Meanwhile, remember that debt ceiling crisis in 2011? Right. It’s coming back. The US officially runs out of money in a month or so, and the ceiling needs to be raised again.

That’s the cliff. It has the potential to undo all of the glacial recovery from the 2008-9 disaster, stall expansion and throw millions more out of work, this snuffing the housing revival. And throw in some gnashing and moaning by the financial markets.

So back to the election. If Obama wins, he’ll face opposition and delay from a Republican-dominated Congress in solving this. If Romney wins, he’ll keep the spending cuts and kill the tax hikes. If the outcome is unclear for a few weeks (distinctly possible, if polls are believable), then this pathetic blog will brim with the doomers and nugget-hoarders who swarmed last weekend.

But, of course, there will be a compromise. No US bonds will go into default. No obligations missed. And any market sell-off will be exactly what the last one turned out to be – a significant buying opportunity. If you have cash, go find your chequebook.

My conclusion: the winner’s irrelevant. US growth in the next four years will be substantial, punctuated by sharply higher consumer spending, a real estate renaissance, several million new or restored jobs and an economy expanding by at least 4% by 2015. The American president, whomever it might be, will ride it. Obama ends up the messiah he believes himself to be. Or Romney gets eight years at the helm.

Your time to capitalize on this is closing.

194 comments ↓

#1 Derek R on 11.05.12 at 10:24 pm

Agreed. Totally irrelevant.

#2 Dave B on 11.05.12 at 10:25 pm

first?

#3 TurnerNation on 11.05.12 at 10:29 pm

Wow, a political weblog!

#4 Bo Xilai on 11.05.12 at 10:30 pm

I agree… It doesn’t matter who wins.

There are so many entrenched interests in the US – FIRE (Financial, Insurance and Real Estate), Defense, Coal, etc… there is very little lattitude for POTUS to change much. The country is run by the faceless crowd of lobbyists of “K” Street.

#5 Wilson on 11.05.12 at 10:30 pm

God bless America and Canada

#6 T.O. Bubble Boy on 11.05.12 at 10:33 pm

Who wins Clinton vs. Bush in 2016?
(Hilary vs. Jeb)

#7 Smoking Man on 11.05.12 at 10:34 pm

You got one thing right, they are both owned by the same owners, and it aint the people, so it really don’t matter who wins.

Same old will apply

#8 Aussie Roy on 11.05.12 at 10:35 pm

Zero Hedge “The Canadian bubble”

Tal said “home prices in large cities like Vancouver and Toronto are overshooting their fundamentals and will likely slip as sales fall”.

“But the Canada of today is very different than a pre-recession U.S., namely as far as borrower profiles are concerned,” he wrote.

“Therefore, when it comes to jitters regarding a U.S.-type meltdown here at home, the only thing we have to fear is fear itself.”

To sum this up: there have been bigger bubbles, so ours can grow bigger too. Moreover, it is different this time.

It is actually fairly typical to find this type of thinking near the top of a bubble. The people living inside it cannot believe that it could possibly crash. Of course Canada’s economic situation is in many respects ‘different’ from the US economic situation, but that is the case with every slice of economic history. Not one of them can possibly be exactly the same. Nevertheless, one can come to some general conclusions about credit expansion-induced bubbles. Economic laws will be operative whether or not the precise historical circumstances are similar. When Japan reached the height of its bubble in the late 1980′s, it was also widely argued that the overvaluation of stocks and real estate was no reason to worry because Japan was allegedly ‘different’.

Regarding borrower profiles, Mr. Tal is mistaken if he thinks that the current profiles of borrowers are actually relevant. These profiles always look good at the height of a boom. They deteriorate only after the boom ends. To wit, here is a chart of the history of US household credit scores:

The ‘Soft Landing’ Mantra
Canada’s housing market has begun to cool markedly. As is usually the case, the first sign of trouble is a sharp drop-off in transaction volumes. Existing home sales in Canada were down by 15.1% in September year-on-year. This seems to be the result measures recently introduced by the government that are aimed at slowing down or reversing house price increases. Prices will no doubt eventually follow transaction volumes.

The WSJ reports on the cooling of the previously red-hot Vancouver market. What is so funny about this report is that government officials are patting themselves on the back for having produced this cooling without realizing that the measures are coming way too late. Yes, they may well lead to a bursting of the bubble, but the hopes for a ‘soft landing’ are very likely misguided.

Are the Banks Safe?
It is generally held that Canada’s banking system is in ruddy health and not in danger from the extended credit and real estate bubble, mainly because a government-owned organization, Canadian Mortgage Housing Corp. (CMHC) insures most of the mortgages with down payments of 20% or less. The company also helps fund mortgages by issuing debt and buying mortgage backed securities with the proceeds.

This kind of thinking has things exactly the wrong way around. It is precisely because such a state-owned guarantor of mortgages exists that the vaunted lending standards of Canada’s banks have increasingly gone out of the window as the bubble has grown.

http://www.zerohedge.com/news/2012-11-05/guest-post-canadas-housing-bubble-different

#9 timmy on 11.05.12 at 10:36 pm

Shame in Obama for not prosecuting one single criminal from the big banks and investment companies, though with Goldman Sachs being his biggest campaign contributor, we’re not surprised. If flip flop Romey gets in the poor are $^$#3ed. He’ll slash benefits including healthcare and he’ll keep the ultra low tax rates for the rich, even though the top one percent has captured about 50 percent of the gains in the last 10 years. He won’t balance the budget. Americans will be hated abroad even more, as he is totally clueless about foreign policy, aiming to piss of the second largest economy in the world, even though the prospectus of one of his companies states that the investment climate in China is favorable because of the low wage rates. If the yanks elect him, then they deserve what they get: more inequality, even though they are now the most unequal society of any industrialized nation.

#10 Led on 11.05.12 at 10:36 pm

me and every smart trader I know is shorting the market, this baby is going down. the charts spell it out. don’t invest for the time being. don’t try and catch a falling knife, especially from these altitudes.

You know a smart trader? — Garth

#11 PoorgEoisie on 11.05.12 at 10:37 pm

Don’t blame me I voted for kodos

#12 Hooked on 11.05.12 at 10:41 pm

First

#13 rex on 11.05.12 at 10:41 pm

Yes Virginia, there is a Santa Claus. Infinite growth and good times are coming in the good old USA, the best country in the world. No more food stamps, exploding middle class and don’t forget….labour shortages.

#14 garthturnerdinglehiemersmit on 11.05.12 at 10:41 pm

DELETED

#15 Jay Currie on 11.05.12 at 10:42 pm

I expect Romney to win and the markets to shrug.

Endless spending, even with a compliant Fed will end in tears when the adults finally have to step in. It is just possible that Romney is an adult and the printing will end.

And, yes, that is recessionary – so what? No one ever said that getting sober was easy, just necessary.

#16 Roland on 11.05.12 at 10:45 pm

But what if those Americans decide to go and start another war? They tend to do that quite a bit nowadays.

#17 Brico9 on 11.05.12 at 10:46 pm

I agree with Garth.

Max Keiser is has an interesting point of view….

http://www.independent.co.uk/news/world/americas/max-keiser-barack-obama-is-clueless-mitt-romney-will-bankrupt-the-country-8269633.html

After a gold filed weekend on this blog….. Why not bring out max.

#18 Boombust on 11.05.12 at 10:47 pm

“My conclusion: the winner’s irrelevant”.

Exactly.

Party A or Party B. Take your pick.

#19 peter on 11.05.12 at 10:59 pm

Garth, if the economy eventually expands as you suggest, could you explain how the Fed will need to raise interest rates without killing bonds and perhaps the market? Thanks.

#20 Paul on 11.05.12 at 11:01 pm

How will spending increase in the USA since wages have gone down and continue to do so?

#21 Not 1st on 11.05.12 at 11:02 pm

Garth, did you know Jesus is from Missouri? He’s there right now.

#22 LJ on 11.05.12 at 11:04 pm

“Recessionary?” Try depressionary. If the US economy and money supply is not growing, at a nearly exponential pace, it will be shrinking.

If there is not a clear winner Tuesday, it will probably take about two weeks to sort out and once that is all said and done, there will be no time to deal with the fiscal cliff due to the probability of a Republican Congress and Democratic Senate – and possibly a R. president and D. vice-president.

Hope y’all are buckled in and aren’t carrying too much debt, because it could be a very nasty couple of months, if not years, before we see the light at the end of the tunnel.

“The devil we know, or the one we don’t?”

#23 Smoking Man on 11.05.12 at 11:04 pm

# 10 Led

i aggree but if you are a real trader a rebuttle for garth chrip is in order.

#24 M G on 11.05.12 at 11:07 pm

Garth you are f%$#ing hilarious. A US recovery? Based on what? The McWalmart jobs most Americans have. Manufacturing is dead. The education system-dead. American spirit- dead. Half the country is victim-minded. You are very funny. Yeah i know “never bet against America.” Yeah but this time it is different. Never have they had a deficit like they have. Their econoy is reliant on Govnt spending which must end. Austerity will kill the economy as it will do in Europe. The west has been reckless and now its time to pay!!!

Buy gold. Buy real estate. At leat you have real things.

#25 DD on 11.05.12 at 11:08 pm

restored jobs and an economy expanding by at least 4% by 2015.

Ya. Nominal GDP growth of 4%. Not real. Give your head a shake if you think otherwise. Americans have not shed enough debt for 4% natural. This is only achieved via credit expansion.

#26 What R U Smoking Man on 11.05.12 at 11:09 pm

Smoking Man said: “You got one thing right, they are both owned by the same owners, and it aint the people, so it really don’t matter who wins.

Same old will apply”

Some of the time I’ve found your musings entertaining. Tonight, I completely understand what you’re saying and totally agree. Are you sober?

#27 OlderbutWiser on 11.05.12 at 11:10 pm

Garth, I read a lot of Zerohedge and they are clearly of a bearish bent. I appreciate your views of the US economy which help to offset that bias. I have always been of the view that you cannot underestimate the power of the US economy over the long haul. They are a super power. It is one of the reasons that I have been buying up USD whenever the Canadian dollar is at or above par. This is a gift to us. I have been purchasing large US blue-chip dividend growth stocks because the US market has many more to choose from than Canada does. The big blue-chips like McDonalds, JNJ, Coke, Wal-Mart, etc have fantastic records for paying dividends and increasing them every year. I just picked up some more MCD on the recent pullback. My portfolio is more than six figures so I like to invest in individual stocks because I can control what I do with them. I am in the process of building a dividend growth portfolio that will provide me with an income stream that I can live off of without having to sell any of my stocks.

For anyone who has a 20 year or so timeline before retirement (or who can save vast sums in a short period of time), I highly recommend you consider dividend growth (DG) investing. Have a look at seekingalpha.com for information on the strategy. Also have a look at mrmoneymustache.com to see what you can achieve. I wish I had known about DG investing when I was young. It makes so much sense and takes all volatility in the movement in stock prices out of the equation.

#28 Not 1st on 11.05.12 at 11:10 pm

Garth, while I would love to see you bat 100% on your predictions, on this one you are going to be slapping your forehead in about 2 years and wonder what you were smoking.

There is a fiscal cliff waiting for the U.S. no matter what they do. It might happen in january, or maybe they whip up some trick to stall it a few years. DOES NOT MATTER ONE BIT. The farther out they push it, the bigger it gets and it ends with a default even with a printing press and reserve currency. Interest on the owed debt will be unsustainable one day soon.

Maybe the U.S.A sticks it to the chinese and tells them they aren’t going to pay. Thats still a default. Meanwhile the Chinese already know this and while the treasuries are still good, they use them to buy up strategic assets all over the world.

Ever look at how WW2 was financed? — Garth

#29 Dave on 11.05.12 at 11:10 pm

I wish the media would take Gary Johnson and the Libertarian party more seriously. He did an outstanding job as governor of New Mexico.

Predictions:
* Obama will carry Ohio and win re-election
* Republicans will maintain majority in the house. Yes, that means the fiscal cliff will come down to the 11th hour again and will ultimately cause market volatility (negative for US$ and bullish for commodities, especially Gold)
* Popular vote is a coin-flip. I slightly lean towards Romney winning the popular vote. What a silly political system, when the ‘winner’ actually loses the poll of the entire nation. By the way it has happened multiple times in the past…as recently as Gore beating Bush in Y2K

#30 Sapienti Sat on 11.05.12 at 11:12 pm

It is necessary that the freemen who compose the bulk of the people should have absolute power in some things; but as they are neither men of property, nor act uniformly upon principles of virtue, it is not safe to trust them with the first offices in the state, both on account of their iniquity and their ignorance; from the one of which they will do what is wrong, from the other they will mistake: and yet it is dangerous to allow them no power or share in the government; for when there are many poor people who are incapable of acquiring the honours of their country, the state must necessarily have many enemies in it; let them then be permitted to vote in the public assemblies …, and only prevented their being magistrates by themselves.

Aristotle, Politics, III(XI)

#31 Old Man on 11.05.12 at 11:16 pm

Romney has an edge for Canada, as his main summer family home has never been in USA, but right here in the Province of Ontario for the past 60 years; he comes often as has a love for Canada.

#32 )f ) h@d a m)ll)0n d0ll@rs on 11.05.12 at 11:18 pm

I’m going to miss the snap elections once Kim Jong Harper brings in the fixxers.

Anyone have the breakdown of 1st vs. 2nd term ‘accomplishments’? Or is it all done via executive orders signed on the way out the door?

#33 renters rule on 11.05.12 at 11:35 pm

Romney will win this, and it will be good for Canada.

:-)

#34 renters rule on 11.05.12 at 11:38 pm

spells it out

http://fullcomment.nationalpost.com/2012/11/05/michael-den-tandt-canada-offers-obama-its-unrequited-love/

#35 Smoking Man on 11.05.12 at 11:49 pm

This is when you should have old your condo

see post 29, as always smoky hits em out of the patk

http://www.greaterfool.ca/2011/07/07/the-gamble/#comments

#36 GTA Engineer on 11.05.12 at 11:51 pm

4 years out you’re predicting – what kind of arbitrary timeline is that? We could have gone through 2-3 business cycles by then, at which point your prediction’s accuracy will be a crapshoot depending on the actual length of those cycles. Stick to a shorter time line – these days the cycle of boom and bust is a lot shorter than it has been in decades past.

The next election, Einstein. — Garth

#37 martin9999 on 11.05.12 at 11:58 pm

#28Dave on 11.05.12 at 11:10 pm

(negative for US$ and bullish for commodities, especially Gold)

—-
Wrong. If that would have been the case gold would have picked uptoday at least half of what it lost on friday. Fiscal cliff wont have the same effect that it did last time. Dollar and JPY will strengthen as safe heavens.

Whatch and learn dude.

#38 martin9999 on 11.05.12 at 11:59 pm

Romney wins. America gotta get goin with Iran.

#39 sluggo8 on 11.06.12 at 12:00 am

Your conclusion is spot on as the recovery and all asset classes are priced in US$. Long anything vs the greenback after the next 2 or 3 month dip will be epic as the US inflates away its problems. There’s no way any other currency could keep up in the race to the bottom and when Obama/Bernanke resume their second term in earnest, the printer will be turned to 11.

#40 Donnie on 11.06.12 at 12:01 am

Check out the lazy realtor that hasn’t update the info section of this listing. “Offers unable to be presented prior to 6:30 pm on Tuesday October 2nd.” How clueless and out of touch with the Vancouver crash is Rina Brown?

http://www.realtor.ca/propertyDetails.aspx?propertyId=12470351&PidKey=-1493657724

#41 KenR on 11.06.12 at 12:02 am

Nice post tonight Garth. Cash is ready to go. My brother is actually hosting a election night wine and cheese to get our little group together and bounce some ideas. To bad smoking man is in the 416. Then again, we drink decent wines!

#42 Dave on 11.06.12 at 12:03 am

#31, Crash Test Dummies.

You got the answer to your own question wrong. The fiscal cliff and debt ceiling are real. Yes, it will certainly get resolved – but it is not contrived by the media. That’s a weird thing to say.

The US government will be unable to service it’s massive debt if they do not agree to raise their debt ceiling. That is a fact. The media has not been contriving this story.

#43 martin9999 on 11.06.12 at 12:04 am

#10Led on 11.05.12 at 10:36 pm
me and every smart trader I know is shorting the market
———–
This is correct. Obama is already priced into the market. But heii surprise Romney wins.
S&P crashing 5-10% within 10days.

Five per cent is a ‘crash’? — Garth

#44 Grim Reaper/Crypt Speculator on 11.06.12 at 12:06 am

SmoKingKongman

Our GPS micrchip implantd in your $#@* shows you are perilously (4U) close to the Manitoba border…

#45 Smoking Man on 11.06.12 at 12:14 am

Top 10 posters on this blog since Oct 2010, or people that don’t have a life.

Take a bow gents

T.O. Bubble Boy 444
Smoking Man 367
TurnerNatio 294
Devore 218
tim 208
Nostradamus Le Mad Vlad 187
not 1st 167
Utopia 147
squidly7 133
Timing is Everything 132

#46 FTP - First Time Poster on 11.06.12 at 12:16 am

The most impressive part of this post is “the winner’s irrelevant”. True – but not for the reasons you state, rather the opposite. The “illusion of choice” is what the US election is now about as the same bureaucrats and lobbyists stay where they are – term after term.

If you want to see how effective government is – look at their emergency planning both before and after the hurricane that hit NJ & NYC. As of this morning, you had 1.9 million people without heat or power and a winter storm is forecast for the area.

Sorry Garth – while I respect your opinion, I have to disagree with you on this one. It doesnt matter who wins, the US as a global empire is coming to an end. It’s unfortunate you cant see why.

#47 Doug in London on 11.06.12 at 12:18 am

Democrats stand for more spending. Republicans, in contrast, are seen with an agenda of slashing government, cutting public spending, reducing taxes and regulations and focusing on debt and deficit reduction.

You’re joking, I take it. How do you explain surpluses and paying down the debt during the Bill Clinton administration (he is a Democrat, isn’t he?) and deficits during the George Bush Administration, a Republican, if my memory serves me right. The Barack Obama government has been running deficits as a result of the mess (including big debts and deficits) the Republicans made in the George Bush years.

#48 Smoking Man on 11.06.12 at 12:24 am

#26 What R U Smoking Man on 11.05.12 at 11:09 pm

Sadly Very Sober read on

My Name is Smoking Man and I am an Alcoholic

Wow never thought I would say that. What made me realize this obvious to you, oblivious to me thing. Blindness I guess, Kind of like a guy buying a condo today.

At approx. 5pm on Sunday, like a diamond tip bullet to the temple I now know I’m a lush that can’t stop without help.

My discovery synopsis:

Was it getting roughed up at peeler joint in Ottawa by a bouncer, who knows what I did in there? Nope

Smashing my hand and skull open in a few spots, in my room alone at Seneca Casino? Nope.

Walking into a light fixture at the Hilton in Niagara Falls Massive Gash? Nope

Doing a acrobatics in a shower nearly getting cut in half by the tub wall mid back and having a 3 inch gash open on my head? Nope

Swearing at God, and all gods, on Lake Ontario in a violent thunderstorm fighting 2 meter waves, lightning, Vodka in one hand, Steering with knee, and throttles with free hand? Nope.

Wanting to take my boat out into Ontario during Storm Sandy, lucky for me it was up north? Nope

Cigarette burns in all my Hugo Boss suits? Nope

All those days I have no memory of, It’s Sunday?, where was Saturday and Friday and Thursday ? Nope.

Then it hit me like a lead brick in Jupiter’s gravity while watching FLIGHT with Denzel Washington, I always say to myself I have this under control. I can stop drinking anytime. I really think I can.

In a scene after the crash Wit goes to his dad’s farm and starts pouring all the booze down the sink. I was ill watching that man, felt like someone just punched me in the gu. It was just a movie. I almost puked so damn upsetting.

Huston we have a problem I decree.

And I suggest that if you know anyone with a substance problem, that’s a good flick. At minimum it will get the person to think a bit, less off course they are perverts, Hot chic at the start, full frontal nudity. Very Nice.

So my super analytical brain kicks in, and it is super, make no mistake, I wrote a vb script in 20 min and pulled all my posts from Greater Fool. Started reading them while sober. Man o Man.

Why do I drink, why do I do this to myself. BOOM I figure it out.

I have done amazing things in my life, and observe things long before the herd as demonstrated here. I have a deep need to share at this stage of my life, Yet I can’t get it OUT. How I envy Conrad Back.

I have the writing skills of a child, the maturity level of an adolescent; I’m in my 50’s damn it. It’s frustrating as hell when you just can’t get it out, it’s a fking prison, a real writer in the head yet with no pen that works; the booze makes it all feel better.

Wish I was schooled instead. Less the obedience training of course.

Don’t think my book will ever be finished to my satisfaction.  But I’m cool with it.

Cheers. And yes this is defiantly a bi-polar moment. I will snap out of this fans.

#49 Nick on 11.06.12 at 12:27 am

Don’t look now, Canada, but there is still a Middle Class in the US. I know, I’m part of it.

What “Lost Decade”? On the supposed Decline of the American Middle Class.

http://www.brookings.edu/research/articles/2012/10/01-middle-class-winship

#50 Jim on 11.06.12 at 12:28 am

I’m not sure the parties differ much in terms of economic policy. Both are neo-Keynesians, believing in permanent deficits and perpetual public debt. The republicans talk about fiscal prudence, but do everything they can to avoid cutting spending (particularly to the military). Ryan is a good example of this sort of sellout. Both parties have no problem bailing out an incompetent and parasitical banking sector that controls the money supply and dominates several government branches.

And as other posters have noted, the same interests are well represented in both parties. (Oil, defense, AIPAC, etc). Perhaps the unions favour the democrats, but I have yet to see that translate into policy that actually helps the working man/woman.

#51 Jeff on 11.06.12 at 12:30 am

Garth, stick to real estate. 4% growth in the US by 2015? What are you smoking? Total debt to GDP ratio has plateaued after years of expanding, but we will need to see an actual contraction at some point to get anywhere neat historical norms. Check out Steve Keen and Richard Koo’s work. We are barely into the third inning of this bad boy.

#52 Hugh Jasz on 11.06.12 at 12:31 am

#21 Not 1st on 11.05.12 at 11:02 pm
Garth, did you know Jesus is from Missouri? He’s there right now.

I could have sworn Jesus was from Mexico……I met the dude last time I was there.

On this election eve, I’ll share this nugget. Through exhaustive googling, I found a slightly different version of the (oft-perverted?) Stalin quote about elections.

No matter the real source, there is possibly a tonne of truth in this.

You know, comrades,” says Stalin, “that I think in regard to this: I consider it completely unimportant who in the party will vote, or how; but what is extraordinarily important is this — who will count the votes, and how.

#53 The end is nigh on 11.06.12 at 12:33 am

Garth and Readers of this blog.
For a European/German view of the state of the USA,
google “Der Spiegel”, to get a perspective from Germany’s most respected weekly.

#54 Old Man on 11.06.12 at 12:34 am

I just checked the international bookie establishment and the big money is on Obama to win. Obama has three in four chances to win, and Romney has one in four chances to win. Could the Smoking Man be right about this all?

#55 Hurly on 11.06.12 at 12:35 am

The prez is just a figure head. The real power lies with the men behind the curtain. Outcome is irrelevant.

#56 Inglorious Investor on 11.06.12 at 12:42 am

Obama is like the pied piper of Hamelin. With his charm, charisma and boyish good looks, he is able to mesmerize the people and lead the innocents, in their blissful ignorance, to their doom.

Have you ever compared some US presidents of the past to Obama, the great “saviour” who was supposed bring change we can believe in?

G. Washington persevered, after losing battle after battle; refused to give up against impossible odds; and lead his fledgling nation to independence. He then refused to accept the title of King to become a mere president.

Lincoln ended slavery and kept his country from tearing itself apart despite the powerful forces working against him both within and without his country.

Roosevelt established a New Deal to put America back to work during the worst depression in their history. They built the Hoover Dam, enacted Glass-Steagall, electrified the country and created numerous other economic and banking reforms.

Eisenhower saved Europe, kicked Hitler’s butt, then came home and built the interstate highway system.

Kennedy prevented a nuclear holocaust, attempted to stop the escalation in Indochina, tried to establish detente with the USSR, and challenged his people to reach for the moon. And they did it.

In Kennedy’s inaugural address he said, “Ask not what your country can do for you; ask what you can do for your country.”

At his, Obama said, “Contrary to the rumours that you’ve heard, I was not born in a manger. I was actually born on Krypton and sent here by my father, Jor-El, to save the planet Earth.” Then, he wins the Nobel Peace Prize for doing… nothing.

US presidents used to say things like this:
http://www.youtube.com/watch?v=MX_v0zxM23Q
http://surftofind.com/secrecy ; http://www.youtube.com/watch?v=Gpmi7dBet0c
http://www.youtube.com/watch?v=CWiIYW_fBfY

Obama can certainly deliver a good speech too. He knows how to whoop up a crowd to orgiastic cheers in the face of their own destruction. Then again, we also get this:
•http://www.youtube.com/watch?v=0m7E8TuMgxc

And what does this president tell America’s hardworking small business people? You won’t believe it:
http://www.youtube.com/watch?v=YKjPI6no5ng

But beyond the words and patting his own back, what has he done? What has Obama done to fix America during and after the worst recession since the Great Depression? Think about it. It’s four years on. What has he done? For the people?

And the alternative is Romney (sigh…)

#57 Smoking Man on 11.06.12 at 12:49 am

#42 Grim Reaper/Crypt Speculator on 11.06.12 at 12:06 am

Did it ever occur to you grim, that the day you take me. I might knock your teeth out.

Keep brushing and flossing dude

#58 gaspr on 11.06.12 at 12:49 am

H. L. Mencken said this…”Democracy is the pathetic belief in the collective wisdom of the ignorant”. Hard to argue against…

#59 GTA Engineer on 11.06.12 at 1:00 am

7 GTA Engineer on 11.05.12 at 11:51 pm
4 years out you’re predicting – what kind of arbitrary timeline is that? We could have gone through 2-3 business cycles by then, at which point your prediction’s accuracy will be a crapshoot depending on the actual length of those cycles. Stick to a shorter time line – these days the cycle of boom and bust is a lot shorter than it has been in decades past.

The next election, Einstein. — Garth

—————–

In other words, arbitrary. There’s no historical correlation between business cycles and political cycles.

#60 Boomer21 on 11.06.12 at 1:03 am

#24 M G
“American spirit is dead”, “Half the country victim minded”. Despite that, voters all down the eastern coast are lining up for hours to be able to vote. Where or when have you ever seen a Canadian line up for hours to vote. We are apathetic to say the least. Americans take their right to vote very seriously. Never count out the Amercian people or their ability to “pull themselves up by their boot straps”. Right on Garth!

#61 JuliaS on 11.06.12 at 1:03 am

Who will get to read Fed’s text off a teleprompter for the next 4 years?

#62 Soylent Green is People on 11.06.12 at 1:10 am

Turn off your televisions. Ignore the Newt-Mitt-Rick-Barack reality show. It is as relevant to your life as the gossip on “Jersey Shore.”

The real debate, the debate raised by the Occupy movement about inequality, corporate malfeasance, the destruction of the ecosystem, and the security and surveillance state, is the only debate that matters.

You won’t hear it on the corporate-owned airwaves and cable networks. You won’t read about it in our major newspapers.

http://www.truthdig.com/report/item/thank_you_for_standing_up_20120123/

.
.
.

#63 Inglorious Investor on 11.06.12 at 1:21 am

#50 Nick on 11.06.12 at 12:27 am

Of course America still has a ‘middle class.’ Congratulations. But the logic in the article you refer to is more twisted than Heath Ledger’s Joker. Sorry, it proves nothing.

#64 furst on 11.06.12 at 1:22 am

Smoking man, I have a business idea. You should invest with me and I’ll make us millions. I know a million isn’t much in your case but it’ll make a big difference to me. So you in?

#65 Mel on 11.06.12 at 1:27 am

Oh my Garth, you actually believe that U.S. will grow 4% next few years? Sorry, don’t buy it!

It will be the other way around. Lower revenues all around. Higher unemployment, lower bond prices, lower stock prices, lower gold prices, lower oil prices, and another 10-20% lower house prices.

We shall get back in couple of years, and compare our predictions. Deal?

#66 MediaBuff on 11.06.12 at 1:29 am

The winner is relevant.

If Republicans get both the House and Presidency, deficits will soar. They also tend to rise more gently when the same is true for Democrats.

But when there is division, you get lower deficits. Think Bill Clinton vs. Gingrich. And think Obama, because contrary to Garth, since the last Bush budget, the deficit has dropped from 1.4T to 1.1T. Which is amazing, considering it follows a credit crisis.

How did Bush get to a 1.4T deficit? After large tax cuts, Medicare Part D, and wars, revenues dried up following the GFC.

The only way to undo that is with a Grand Bargain. It may or may not happen with Obama. But there’s no way it can happen with Romney. Fortunately, there’s little chance of Romney winning the electoral college.

#67 Blacksheep on 11.06.12 at 1:31 am

“My conclusion: the winner’s irrelevant.”
——————————————-
“There’s nothing in the street
Looks any different to me
And the slogans are replaced, by-the-bye
And the parting on the left
Is now the parting on the right
And the beards have all grown longer overnight”

take care
Blacksheep

#68 Jeff on 11.06.12 at 1:36 am

I vote for Ron Paul.

#69 Shawn Petriw on 11.06.12 at 1:43 am

I think readers of this pathetic blog will enjoy “The American Ruling Class”, an interesting “documentary” that demonstrates how there is only one party in America, with slightly different flavours:
http://www.rottentomatoes.com/m/1203562-american_ruling_class/

#70 Nostradamus Le Mad Vlad on 11.06.12 at 1:43 am

-
#7 Smoking Man and #56 Hurly — Agree, so as The Black Knight said as he was lying on the ground with no limbs, “Let’s call it a draw!” BTW, what was Hurricane Sandy good for? Extending the erection, changing votes using DIEBOLD machines (of which Romney is a big fan) and watching Ron Paul / Ralph Nader take the prize!
*
The Chinese are coming! But not to buy RE, and Polish people welcome, but Cdns. not; Bre-X deal of good proportions (if it goes through); Tampa Bay Time sharing instead of money; The Chinese Middle Class What it looks like; Frugal vs. Cheap; Complex Cdn. Charts; Stealing? That’s one way of putting it; Cash Machine Target, the US Zellers; Affording Retirement after cuts in incomes; Wills Power of attorney can get messy.

Bank Gold Run coming soon? Building Smaller Economies are changing / shifting; 4Closures Twenty cities that are being noodled; Oil and Gas could be bigger than the ‘net; Debt, Debit and Demoralized BCers are spending themselves into oblivion, but Financial Enlightenment doesn’t come from Cornflakes boxes; Reverse Mortgages Yes, they’re an evil necessity; Measuring Unemployment Wose now than any year in the GD; Gold and Silver treated and carried as regular baggage. What a novel concept!
*
Obomba A picture tells a thousand words, The Mittpocalypse Calvin and Hobbes are better qualified but these are the only ones who count, not voters; Broken Heart Syndrome There does seem to be valid reasons for it; Impotent laptop Wifi has something to do with it; Tea and Biscuits Dunking them is way better; Rare Rhinos Only seven left; 3:31 clip New planet discovered? Russia Increasing missile tests; Cheap Runabout Not really. It’s a Ferrari 599 GTB.

#71 JimH on 11.06.12 at 1:46 am

This election may be close in terms of the popular vote, but not in terms of the Electoral College vote!
http://www.intrade.com/v4/misc/scoreboard/

On other issues, Vancouver now has finally made the big time! Step right up and put your money where your mouths are, folks!
http://www.intrade.com/v4/markets/contract/?contractId=734327
(it’s a BUY!)

#72 Seriously? on 11.06.12 at 1:52 am

I kind of hope the religious zealot wins.

Then the bi-polar nature of America will mushroom.

It will be awesome.

Seriously.

Also I like saying Sh*t Zombie

#73 DonDWest on 11.06.12 at 1:54 am

Americans get to vote for the company receptionist – everyone knows the real boss is Mr. Goldman Sachs.

#74 Freebird on 11.06.12 at 1:55 am

@smokingman…I’ve only commented once on this blog and it was about a discovery I made about Garth’s other professional vocation and partnership. But since its just past midnight and I can’t sleep again due to back pain as I’m n between surgeries I wanted to reply to your comment. Yes, it as obvious you had a problem but awareness is the first step. My husband gave up drinking during his first marriage and hasn’t touched alcohol in over 25 yrs and other than occasional curiosity doesn’t miss it but did replace it with cola and sugar for many years. Anyway we discovered not long ago he has ADHD which was driving the addictions. Now? It’s managed and says he realized he had never felt we’ll or clear BUT like you has a very high intellect and ironically is a brilliant and successful programmer. We have successfully grown our business and now in the planning stages of selling. We did buy a house but much less than we were approved for and with plenty down. The money from the sale will be reinvested and a new business stated because as you we don’t do we’ll working for others. I read many blogs and usually glean more from some comments than the blog itself…no offence. My point! I hope you find your way and don’t waste any real talent you have. My husband is a bit older and now wonders what he could have done had he got help sooner. No regrets I tell him just lessons.

Good luck smoking man. Keep the more entertaining posts coming. And BTW agree that who wins in US doesn’t matter, their pretty much a puppet. Not sure if Garth’s predictions are accurate or to what degree…I’m going to watch and see but the differing speculation and forecasts are at least fun to read and watch for now.

#75 daystar on 11.06.12 at 2:02 am

My conclusion: the winner’s irrelevant. – Garth

Thats a correct conclusion under the context of a 4 year timeline, growth, RE recovery and jobs but outside of this context there is a great deal of relevance.

Consider the deregulation of banking and housing that created the GFC in the first place. It won’t blow up in Romney’s face in 4 years but it will 5, 6, 8 and 10 years down the road which is why gold buggers love him. While its true that Dem’s are labelled as spenders, Republicans love to spend on defence and false flag wars and same goes for differences in taxing the rich.

There’s a lot of differences between these two parties from their stances with abortion, civil rights, borders, energy policy (speaking of which, Republicans are good for oil not because they strive for energy independence but because they strive for the will of the status quo which is higher prices driven through less supply and greater demand for the big players), foreign policy:

http://www.huffingtonpost.com/2012/11/04/us-election-international-poll_n_2066972.html

How do you spell fear of war either military or trade with Romney? The link below is an online poll from msn (gotta be real wary of online polls) but of the 265,000 “volunteers”:

http://newsfeed.time.com/2012/11/05/poll-most-of-the-world-would-vote-for-obama-except-china/

Lets look at it from a less broader investors point of view for a moment. Housing and consumer spending will do well with either president, of that we pretty much have no doubt but beyond that:

– Defence (Romney)
– Health care (Obama)
– manufacturing (I pick Obama because of more encouraged outsourcing through Romney except with defence, its a bit of a trade off there but Obama is a better bet with manufacturing, especially with the auto industry)
– Financials (Romney in the short term until deregulation overheats a bubble in housing and then it reverses over the mid to long term, possibly much worse 5 to 7 years down the road and the U.S. can’t afford this again).
– Energy (Obama, hands down. I’m basing it on the record of Obama’s presidency with conventional and green energy alike vs who pulls Romney’s strings)
– Technology (Obama, I shouldn’t have to explain why)
– Education (Obama)
– Gold (Romney and that means a weaker dollar over the long term caused by greater spending contrary to the general concensus (think defence) and tax cuts (specifically for the rich). Lets think about this impact for a moment for Canadian investors from currency exchanges to stock market sectors.
– war (war is the wildcard that changes everything and I believe I’m speaking for the masses when I say Romney is much more likely to trigger military/trade wars than Obama.

So sure, in a broader context of say… GDP over a 4 year timeline its irrelevant to the investor but when one narrows that context into specifics, suddenly it changes and it “really changes” over longer timelines. I fear for the U.S. and the world with Romney in power, I really do. The ramifications of supreme court appointee’s with abortion, civil rights and election laws alone… the U.S. could be going backwards 40 or 50 years socially here with Romney and the consequences of this in america, how much more divided it could become… I don’t want to think about that now, just what the polls are saying and if they are right and readers take the time to click onto the grey states in the link below (swing states) they’ll likely see what I do, a squeaker for Obama with 274 votes before it goes to Florida:
http://www.realclearpolitics.com/epolls/2012/president/2012_elections_electoral_college_map.html

… and btw, should the election be decided in Florida, then we’ve got big issues because of what the Republican governor did concerning condensing absentee ballots and early voting from 14 days to 8 just months before the election with no chance in the courts for appeal, not to mention what has been happening in poll stations for voters trying get these absentee ballots or even vote. There’s a good deal of dirty politics going on in Florida right now and it could get nasty should Florida be the deciding factor in this election.

http://www.fightbacknews.org/2012/11/5/voter-suppression-runs-rampant-florida

#76 martin9999 on 11.06.12 at 2:13 am

Five per cent is a ‘crash’? — Garth

—-
now days, yes !!

#77 Canuck Abroad on 11.06.12 at 2:16 am

Garth what do you have against traders?

#78 Alberta Ed on 11.06.12 at 2:19 am

Damn… where are the Rhinos when you need them? Oh, well, get out the popcorn and chill the beer. It will be an interesting evening, but I suspect we’ll survive, either way.

#79 Jounce on 11.06.12 at 2:21 am

Interesting read.

LOL, the Garthman has outed himself. I suspect he probably works off hours for one of those CIA disnfo services.

Bankrupt Obama spending 2 trillion, in real dollars that doesn’t exist with more of this ‘endless money’ on the way portends a Zimbabwe style ending.

There everybody is a millionaire and every body is also very broke. American exceptionalism permanently defying economic gravity simply won’t work. At some point it will all reset to zero and end very badly

#80 new canadian on 11.06.12 at 2:24 am

This once “macho” blog turned into something hilarious!
US recovery? Will inflated tech stocks save US? There still might be enough morons to wait in line in NY to buy new Apple gadgets, that’s a good indicator. All Ipads are made in Asia, made by Samsung, LG, etc, Yes their market value is 1/100 of inflated Apple but they are the “real guys” doing “real economy” like producing.
US economy does produce one thing which is printed US dollar, they will do it until global demand for USD end.

Let our prayers be for affordable housing in Canada, not for imaginary lullaby like “US recovery”.

#81 Tony on 11.06.12 at 2:30 am

Obama will win a lopsided decision. Markets will initially rally then the bear market that started around October the 9th this year or the end of the bear market rally will start to bite. Looking for a retest of the 1987 highs or lows on the S&P 500 and DOW. America will be back in recession or depression by mid 2013. Commodities will revert back to levels not seen since the 1950’s.

#82 Tony on 11.06.12 at 2:42 am

Re: #10 Led on 11.05.12 at 10:36 pm

The American market should lose somewhere in the range of 50 to 80 percent. The German DAX could lose around 90 percent as the worst performer in the next decade.

#83 daystar on 11.06.12 at 2:46 am

Contrary to what some of us believe, that Democrats and Republicans serve the same masters, its not true when one looks at donation demographics and where super pac money is coming from. Obama for example is much more reliant on small individual donations via internet while Romney’s common contributors are maximum individual donations from wealthy donors. Same goes with super pacs:

http://money.ca.msn.com/video/?cp-documentid=8f7928bc-c6e7-4591-ac08-616096f2851d

Media also plays a large role in elections and leanings from media such as Fox news or from the media as whole who profits the most from a horse race, projecting elections as a dead heat when it might not be in an effort to create drama for more viewers. What viewers are subjected to by media obviously isn’t always reality.

#84 Jane24 on 11.06.12 at 3:15 am

Back to RE, my sister just phoned to say that her parents in law age 75 and 80 have now officially waited to long to sell on Vancouver Island. The 1mm waterfront home that needs everything doing to it has not sold in a year at 850k.
Agent now advises off the market, a complete reno and back on next Spring in the 700’s.

How are a 75 and 80 year old going to update a house? The answer is that they can’t, neither strength or dosh (sorry cash in Canadian).

Apparently the couple next door are even older and in the same situation.

No-one wants to buy these falling knives.

#85 futureexpatriate on 11.06.12 at 3:44 am

My prediction, for what it’s worth? After a credible litigation-proof Obama win tomorrow, Republicans will pull every last penny out of the market, in a fit of spite for most, paranoia for the less invested, to crash the economy and salt it away in the Caymans and Switzerland, while shopping for new digs in Paraguay. The Israelis call it “The Sampson Option”, where the building is pulled down on everyone’s heads. After all, these people already have more than enough money, and their lust for revenge will finally outweigh their greed, which will KEEP their money out of the market for at least four years and maybe, always. Like the Cartman character in South Park who always takes his ball when he doesn’t get what he wants “Ef you guys. I’m going home.” While contrarians might see this as a golden opportunity, if no one else does, it won’t be.

#86 skip on 11.06.12 at 3:56 am

Well, it does not matter how is in control of the White House. The Capitalist economy will be sputtering along at no more the 3% growth and the Capitalists will look for way of making more then that. In the end the Capitalist economy will make the people in charge do stupid things making it even worse.

Capitalism sucks, just look at how it has handled super storm Sandy. Ha ah Occupy Sandy, an off shoot of OWS, is bringing more relif to people than any of the Capitalist entities….ha ah Capitalism… only for the fools.

#87 Buy? Curious? on 11.06.12 at 3:58 am

Garth, interesting take on the US election. The campaign was based on blind fear and lies. The biggest voting demographic is nervous.

http://www.youtube.com/watch?v=1T_yLpn_iNY

#88 cynically on 11.06.12 at 4:07 am

Whoever wins will make the outcome very relevant and don’t think Canada and Canadians won’t be affected one way or the other. Americans are very resilient as a people. The better future lies with Obama because this time, as the winner, he’ll be able to get his huge works program on the country’s infrastructure through Congress even though the Republicans will hold power there because unlike in 2010 when they stymied him, their hope of winning in 2012 is gone and in order to have a chance in 2016 they can’t be seen as holding back employment or letting the country go over the fiscal cliff. With unemployment dropping, spending will pick up, the withdrawal from Afghanistan will cut spending and the millionaires will be paying their fair share of income tax. There are other revenue sources and spending cuts in various areas but it will take a few years for them to get back on their feet which will be beneficial to the rest of the world but they will do it. A Romney win changes the equation and what he would want to do will be subject to the approval of the Tea Party nuts and that doesn’t sound very positive.

#89 skip on 11.06.12 at 4:27 am

Dear Garth:

Bro let me explain a little reality to you.

Since about 1970 The USA economy has been grow at no more then about 3% with inflation keeping at pace.

Because of this reality, the Capitalists have had to find other ways of making money. They have do so only by the following. Turning from a manufacturing state into a financial state. Finding low wage economies in former Eastern Block Countries, South American Countries, China and other Asia countries. They have inflated various financial bubbles. The dawning of the Internet age. Engaging in never ending Imperialist wars. Reducing Business taxes. Increasing consumption taxes. Deregulation of Capital. Globalization.

Even with all of this they have never managed to increase their growth rate and end up in the same spot every 5-8 years.

The latest attempt is to deflate the wages in their own country. Well how low can you go year in and year out?

The only thing that has propped up Capitalism in the USA is the printing of money and handing it over to the financial sector. That spigot is running dry buddy.

How in the world or reality can the financial markets increase and corporate profits go up when growth is near 0? It can’t Garth. All the money the Capitalists have been making the last 4 years is fictitious wealth.

#90 Buy? Curious? on 11.06.12 at 5:35 am

Sorry Smoking Man, but I don’t think Obama’s lips will ever touch your parched lips. I do hope he wins and creates jobs but only time will tell. Will that translate into preventing a housing crash over here? I don’t know. Just know that no matter how hard it gets out there, we’ll always have fools like Smoking Man to laugh at. Always!

“Hey! Who that walking under the First Canadian Place Concourse with his pants down and what’s with the tighty-whities?”

http://www.youtube.com/watch?v=PivWY9wn5ps

#91 Juice Media on 11.06.12 at 6:06 am

“Republicans, in contrast, are seen with an agenda of slashing government, cutting public spending,…… focusing on debt and deficit reduction.”

hahaha – how easily you forget Bush under whose term the 08 crash was caused.

Democrats, Republicans, – just two wings on the same bird of prey.

For the real election debate, another classic from Juice Media …
http://www.youtube.com/watch?v=WpMPu5p_QXU&feature=player_embedded

#92 MJG on 11.06.12 at 6:42 am

A record of Republican vote rigging and election stealing: http://harpers.org/archive/2012/11/how-to-rig-an-election/ The same is obviously starting to happen in Canada supported by the same Kock brothers money and advice to Harper on how to cheat by US right wing people.

#93 live within your means on 11.06.12 at 6:56 am

Don’t know about you, but I’m so sick of this government’s constant advertising (taxpayer paid propaganda) on every channel I watch on TV. I remember those huge billboards beside a 2X2 ft patch on several rural roads in Peter MacKay’s riding. Right, conservatives are fiscally prudent. And tooth fairies exist.

Tories commit millions to ‘action plan’ ads while cutting programs

http://www.theglobeandmail.com/news/politics/tories-commit-millions-to-action-plan-ads-while-cutting-programs/article4602326/

#94 Devore on 11.06.12 at 7:05 am

http://business.financialpost.com/2012/11/05/canada-braces-as-housing-slowdown-takes-hold/

Canada braces as housing slowdown takes hold

“With the economy, I’d like to sell now. I worry about selling because it’s a condo, and that market is cooling even faster than houses,” said the newly married sportscaster. “We can’t sell it for a ridiculous amount of money any more.”

Oh noez! You don’t say!

#95 Andrew on 11.06.12 at 7:33 am

I hope you’re right on those growth forecasts for the US.

#96 EIT on 11.06.12 at 7:36 am

little boys.. playing dress-up..

http://www.flickr.com/photos/expd/8149835652/

#97 Onemorething on 11.06.12 at 8:03 am

Vote for Garth!

#98 DR. WAYNE on 11.06.12 at 8:07 am

These are some of the people voting in the US presidential election … scary sh++ …

http://www.youtube.com/watch?v=_mWtWz_aGyk&feature=related

#99 DR. WAYNE on 11.06.12 at 8:09 am

2 Dave B on 11.05.12 at 10:25 pm

first?

Yes … your question is answered … you ARE an a$$hole.

#100 live within your means on 11.06.12 at 8:25 am

#91 Buy? Curious? on 11.06.12 at 5:35 am
Sorry Smoking Man, but I don’t think Obama’s lips will ever touch your parched lips. I do hope he wins and creates jobs but only time will tell. Will that translate into preventing a housing crash over here? I don’t know. Just know that no matter how hard it gets out there, we’ll always have fools like Smoking Man to laugh at. Always!

“Hey! Who that walking under the First Canadian Place Concourse with his pants down and what’s with the tighty-whities?”

http://www.youtube.com/watch?v=PivWY9wn5ps
………………

Thanks for the video.

#101 Dave on 11.06.12 at 8:26 am

Martin9999

Thinking the US$ will strengthen as the fiscal cliff plays out is a contrarian viewpoint, that’s for sure.

(Disclaimer: I am not a gold bug, I have very little exposure to gold). As we move closer to the deadline, there will be jitters in the market and US$ will lose a little value (I don’t expect anything wild, only a few percent). This brings about 2 reasons to be bullish gold during this event.

1) gold is priced in US$, as the value of US$ goes down the net effect is an increase in gold, because it is priced in US$.

2) During a ‘currency crisis’ event such as this Gold is the real safe haven.

There. That is how the debt ceiling event will play out. Your welcome.

#102 Tig on 11.06.12 at 8:34 am

The U.S. is a declining empire. They will never return to the economic dominance we have grown accustomed to. If the economy begins to experience 4% growth, the higher interest rates it will demand will consume too much revenue. The U.S. is hooped no matter who wins.

Garth, it is obvious you are working for a Bay Street firm.

The anti-US sentiment this post has raised is fascinating. A lot of people will obviously be surprised over the next four years. BTW, I work for myself. — Garth

#103 live within your means on 11.06.12 at 8:53 am

TOT – Check out this video. Wow, I could actually watch it. For a few years I suffered from Acrophobia – especially driving in the Swiss alps. Couldn’t even watch a TV program that had anything to do with extreme heights.

Another view of mid-air re-fueling. Really beautiful.
This is totally awesome!
“ParaHawking”

http://www.youtube.com/v/pd5BMP_41bI%26rel%3d0%26hl%3den_US%26feature%3dplayer_embedded%26version%3d3

#104 fancy_pants on 11.06.12 at 9:00 am

irregardless of who wins… what could possibly go wrong? tongue in cheek. Garth, pass me another mushroom, you are hogging them again.

#105 PoorgEoisie on 11.06.12 at 9:50 am

“We must move forward not backward, upward not forward and always twirling,twirling, twirling toward freedom! The politics of failure have failed, it’s time to make them work again!”
-classic Simpsons from the Clinton/Dole election of our lifetime.

#106 Realist on 11.06.12 at 9:51 am

>>You know a smart trader? — Garth

There are plenty of traders smarter and less arrogant than you, Garth.

Anonymity breeds such bravery. — Garth

#107 Smoking Man on 11.06.12 at 9:53 am

http://www.theglobeandmail.com/report-on-business/careers/business-education/how-your-signature-affects-your-honesty/article4872350/

The above link demonstration of insanity. researchers discover that if you sign a contact top of doc. you wont fib as much.

lossers so if madoff. signed his doc at top he would be ok.

our tax dollars fund this shit.

#108 live within your means on 11.06.12 at 9:54 am

#99 DR. WAYNE on 11.06.12 at 8:07 am
These are some of the people voting in the US presidential election … scary sh++ …

http://www.youtube.com/watch?v=_mWtWz_aGyk&feature=related
………………

I couldn’t bring myself to watch the end of it. Remember Rick Mercer interviewing Americans and even US politicians years ago. It was hilarious. Unfortunately, we also have many ignorant Canadians.

#109 fancy_pants on 11.06.12 at 9:56 am

buyer is SOL IMO. If you are dumb enough to drop a million on a house without an inspection surely you can afford to remove the mice.
http://ca.news.yahoo.com/winnipeg-womans-1m-house-infested-mice-015050120.html

#110 Tig on 11.06.12 at 10:03 am

My bad…you are associated with a Bay Street firm.

What a dumb stereotype comment. — Garth

#111 Eaglebay - Parksville on 11.06.12 at 10:09 am

#87 skip on 11.06.12 at 3:56 am

You obviously don’t know what capitalism is.

#112 luc on 11.06.12 at 10:12 am

Post Canada now charging developpers for mail boxes who will tag on the cost to homes. Read at…

http://www.thespec.com/news/business/article/831287–canada-post-to-charge-developers-for-200-per-new-address

#113 Uwinsome on 11.06.12 at 10:15 am

‘Fiscal Cliff’ Deal Won’t Help US Rating: Egan-Jones

“Regardless of who’s elected, either one is going to have to deal with a rather high deficit and (deal with) the pending retirement of a number of baby boomers who have been critical to the economy,”

http://www.cnbc.com/id/49705950

#114 Stickler on 11.06.12 at 10:22 am

I have to chuckle at those who argue about republicans vs democrats…you have been conditioned to only expect and accept 2 choices.

Here is a secret, ignore a few minor differences and both parties are the same.

And I hear a lot of blow-hards in the media saying the fiscal cliff will be a non even like Y2K (implying that Y2K was some scam)…guess what? Y2K was largely a non even because of years of planning, work and billions of dollars.

Go back to sleep sheeple.

#115 Inglorious Investor on 11.06.12 at 10:32 am

Since we’ve entered into the realm of predictions…

I was at my bank’s economic and financial outlook reception dinner last night. A lot of brisk but dry economic talk by the chief, and a plethora of crisp, squiggly lines projected onto two mammoth screens.

The chief’s overall financial markets forecast for the end of 2013: FLAT. In other words, no material change from where we are today.

Just for fun, let’s assume he will be proven correct (the word is he’s pretty good at this). The interesting part is, what happens between now and then. The guy beside me assumed we’ll get a large ‘correction’ and a rebound. I’m not so sure.

That’s called a buying opportunity. — Garth

#116 Not 1st on 11.06.12 at 10:32 am

Garth, your predication for the U.S. is based on nothing more than hope and change, just like Obama.

Truth is, mathematics is a real b*tch and thats what they are facing. At a debt of 16 trillion, 40 cents of every dollar is borrowed money. If that sucker runs off to 20-22 trillion like its going to do in the next 4 years and medicare and SS costs start inching up as boomer wave accelerates and the U.S. gets a rating downgrade, that number will rise to nearly 50cents.

At this point, that is no longer a functioning economy. Your growth scenario is a temporary blip and will be quickly swamped by reality. I guess its tradable for a few years.

Did you catch this morning’s news re US housing? — Garth

#117 The real Kip on 11.06.12 at 10:37 am

If Romney wins it will be the third American Administration to use trillions of dollars in stimulus to bribe a nation addicted to it.

It is not anti-American to be critical of an out of control central government that is not acting in the interests of it’s citizens.

There, I sugar-coated my comment, maybe now it will get posted.

#118 Junius on 11.06.12 at 10:38 am

#89 Cynically,

You said, “The better future lies with Obama because this time, as the winner, he’ll be able to get his huge works program on the country’s infrastructure through Congress.”

I hope you are right but I fear that you are wrong. I don’t believe that Obama understood what he was dealing with in the Republican Party when first elected and he shows little sign of learning. More likely is that he will enter into a ”Grand Bargain” to significantly cut social services in exchange for limited tax increases and some military cuts.

Austerity will come to America in one form or another and continue the erosion of the US middle class and income equality.

There will be little done on climate change, more bad trade deals and little change on anything. More illegal surveillance, drones and destruction of civil liberties. However the good news is no more wars and the chance at some sane judges on the US Supreme Court when the 2 or 3 older ones retire in the next 4 years. In this respect Romney will be a disaster.

I find the more interesting debate in the US between the Progressives who argue that you should not vote for Obama because the “lesser evil” argument does not hold water. I have found that interesting.

#119 };-) aka D.A. on 11.06.12 at 10:40 am

There is not a single piece of real estate that I have ever owned and subsequently sold which I do not today regret having sold.

I do not for a minute believe that I will ever regret retaining ownership of that real estate I do currently own.

There have been many properties I’ve had opportunity to buy which I today regret not having bought despite my perception then that they were too costly and/or I of not enough means.

There have been many times throughout my years I thought the price of real estate could not possibly continue to rise but it did and I am not now nearly so inclined as I was then to think it won’t continue to.

#120 Willy on 11.06.12 at 10:46 am

This is poorly written compared to Canadian real estate.

Obama is cutting costs (like Clinton did) to decrease the deficit in the last four years vs bush’s term. Similiar to conversavative vs liberal is canada, the left is actually decreasing the deficit overally on federal level by cutting down costs from the military side.

Fed was doing QE 3 because Romney threats to fire Bernakes ass. If Obama wins, the stock market will go down as investor sees no reason why Fed wants to continue lifting the stock market.

The US will be entering a bad time next year as US starts to tighten both fiscal and monetary policy along the burst with Chinese real estate bubble (which triggers the commodity bubble burst that brings down canada as well). However, I do agree US will come on top like they did after Japan bubble burst in 90’s.

Thanks so much for showing me how to write better. — Garth

#121 Julia on 11.06.12 at 10:58 am

Looks like Indo-Canadian real estate investing can go the other way too.

http://economictimes.indiatimes.com/markets/real-estate/news/canadian-nri-bob-dhillon-keen-to-enter-indian-realty-market/articleshow/17115534.cms

NEW DELHI: Canada-based NRI billionaire Bob Dhillon is considering investing up to USD 100 million (about Rs 540 crore) in the Indian real estate market and is planning to approach the Haryana government for developing a township near Chandigarh.

#122 };-) aka D.A. on 11.06.12 at 11:14 am

Woman ordered to wear ‘idiot’ sign
by The Canadian Press – Story: 82885
Nov 6, 2012 / 5:52 am

http://tinyurl.com/c2435ns

I suspect there will be more of these handed out in the future along with a potential proliferation of similarly donned ‘Greater Fool’ signs. It just remains to be seen what that definition of the ‘Greater Fool’ will prove to be.

#123 Smoking Man on 11.06.12 at 11:15 am

Hey Mark Carney did you see what happend down under. street was expecting a 1/4 point drop. did not happen. curreny a rocket. ship.

good luck spiking the over night rate anytime soon. anyone check out the perfect batman on cdn bond yields. buy buy buy bonds. short equities.

Boom !!!!!! from the flick couples retreat

#124 Form Man on 11.06.12 at 11:19 am

#120 DA

so I take it you are buying real estate in Kelowna right now ? and if not…..why not ?

#125 Inglorious Investor on 11.06.12 at 11:20 am

“That’s called a buying opportunity. — Garth”

Or maybe, for those already heavily invested in the markets, it will be an opportunity to harvest large gains several months from now?

#126 Tony on 11.06.12 at 11:29 am

Re: #117 Not 1st on 11.06.12 at 10:30

Unless Obama makes sharp cuts in military spending the next 5 years America will see negative growth for the next 5 years running. The sad fact is even if they cut military spending America will probably see 5 years of negative growth looking forward.

Rubbish. — Garth

#127 Makarand Pradhan on 11.06.12 at 11:39 am

“Your time to capitalize on this is closing.”

Any specific ETFs to buy in the post election NASDAQ correction.

#128 Herb on 11.06.12 at 11:44 am

Your words in God’s ear, Garth.

#129 Arthur on 11.06.12 at 11:47 am

I am expecting a clear Obama win. Not as much as 2008 but not depending on winning any one swing state.

#130 T.C. on 11.06.12 at 11:50 am

If I had a choice of who to associate with, it would be tea baggers over occupy wall street types. Tea party types don’t defecate in public or rape one another. Nor do they stuff ballot boxes:

http://twitchy.com/2012/11/06/gop-inspectors-reportedly-kicked-out-of-multiple-philadelphia-polling-places/

#131 Alex on 11.06.12 at 11:54 am

Five per cent is a ‘crash’? — Garth

When gold drops 2% you call it a crash…

On top of a 12% annual decline, I’d say that’s fair. — Garth

#132 Hoof - Hearted on 11.06.12 at 12:12 pm

RICH CHINESE WANT TO BUY HAPPINESS — BY EMIGRATING

http://www.republicbroadcasting.org/index.php?cmd=news.article&articleID=4412

QUOTE:

BEIJING — At 49, Wang Zeqiang has achieved the Chinese equivalent of the American dream. Raised in the cornfields of eastern China’s Shandong province, he founded an auto parts business that today has several dozen employees. He has two houses, two cars and, because he’s rich enough to pay the fines for defying the country’s family planning policy, two children.

Now, all that is missing — what he covets most — is a foreign passport.

“In China, there is so much pressure,” said Wang, who recently hired a consulting firm to advise him on his first choice, Australia. He hasn’t been there yet, but he’s been surfing the Internet and likes what he sees: blue skies, open spaces. “I want to live a relaxed, happy life.”

The new Chinese emigres have little in common with earlier waves of unskilled laborers or political exiles. They’re not going abroad for economic opportunity — they’re already wildly successful — or political activism, but for a quality of life that money can’t buy in China.

A recent poll of Chinese with a net worth of more than 10 million yuan ($1.6 million) found that 16% had obtained foreign residency and that an additional 44% were planning to emigrate. Many cite a polluted atmosphere, and not just in the air they breathe: endemic corruption, a shaky political system, tainted products and poor medical care, among other problems.

The exodus of the middle and upper classes is an embarrassment to the government, with possibly serious economic implications because the emigres are taking with them money and skills. In an attempt to prevent capital flight, Chinese laws limit people from taking more than $50,000 a year out of the country, but it is easy enough to get around the restrictions.

In effect, the wealthy emigres are buying their new residencies, in what they hope is the first step toward new passports. Many of the foreign programs involve a substantial investment by the prospective expatriates, either in real estate or businesses. The recently renewed U.S. EB-5 visa, for instance, requires $1 million ($500,000 for poor or rural areas) in businesses that create at least 10 jobs.

============================
QUOTE:

The big disadvantage of the U.S. program from the standpoint of Chinese investors, said Du, is that their immigration status is contingent on the business succeeding. “If the business fails, you lose your green card too.”

Doors open and close. A Canadian program that was wildly popular is no longer accepting applicants, but Australia is still taking in rich Chinese by the thousands for ever larger sums of money. The newest program offers residency for the purchase of $5.2 million in treasury bonds.

Last year, Chinese surpassed Britons as Australia’s largest source of permanent migrants, with 29,547 arriving.

===================================

So..what did Canada do…It allowed bubble tea and housing bubble.

Can anyone think of any major job creator (aka manufacturing etc) resulting from Chinese investment other than inflated real estateprices, McMansions and condo speculation ?

Other countries have made it a privilege, not a right, to immigrate

This = house of cards…. nobody sneeze or fart.

#133 Spiltbongwater on 11.06.12 at 12:17 pm

I just bet $100 that Romney wins, will win $350 back plus my stake. Also bet that Romney wins Ohio. The fix is in, the script has been written, the sun is about to explode, but not many people are aware of this yet.

#134 };-) aka D.A. on 11.06.12 at 12:21 pm

#125Form Man on 11.06.12 at 11:19 am
#120 DA

so I take it you are buying real estate in Kelowna right now ? and if not…..why not ?

I personally think right now is an excellent time to buy and build in Kelowna and I am anxious to do both. I don’t expect values to climb too quickly nor too soon but neither do I expect they will drop so appreciably that such a well intended long term investment would not in five years’ time prove to have been a wise move made today. Of course I don’t tell clients that. I, instead, help them discover it for themselves. Some do, some don’t.

Why do you ask? You got something you feel the need to sell?

#135 Paul on 11.06.12 at 12:27 pm

#125 Form Man on 11.06.12 at 11:19 am
#120 DA

so I take it you are buying real estate in Kelowna right now ? and if not…..why not ?

A few weeks back I believe he said he was getting ready to sell his place and buy a rental property. He never answered when I asked if he had listed yet.

#136 Canuck Abroad on 11.06.12 at 12:39 pm

#94 live within your means – ‘Don’t know about you, but I’m so sick of this government’s constant advertising (taxpayer paid propaganda) on every channel I watch on TV…”

I don’t know how any of you put up with it. You will find the below stats interesting. US spending on the election came to $6 billion. GDP of Nicaragua $6.4 billion. UK spending on their last election $50 million (there are not allowed to advertise on TV over here).

http://www.zerohedge.com/news/2012-11-06/chart-day-most-expensive-election-ever-context

Just think of all the things $6 billion could buy.

#137 Form Man on 11.06.12 at 12:47 pm

#135 DA

I have not bought any land in the Okanagan since 2003. Have been selling steadily since then ( actually we did re-aquire some raw land that we had to foreclose on a couple of years ago). I likely will not resume buying until MOI is below 7, because prices will continue falling until then.

I can suggest a multitude of projects for you to invest in DA. Kelowna is brimming with financially strapped developers right now; who would sell to you in a heartbeat……..

#138 Soylent Green is People on 11.06.12 at 12:58 pm

People who managed to succeed in the crisis employed mixed strategies. They did make wise personal preparations — such as wood stoves instead of ineffectual fireplaces, natural gas generators instead of gasoline ones, a good supply of stored food and water. But they also employed ones that showed an awareness of the need for infrastructure, the importance of longer term thinking, and the strength of community.

http://www.cnn.com/2012/11/05/opinion/rushkoff-sandy-help-election/index.html

.

#139 zeeman1 on 11.06.12 at 1:04 pm

Garth, your post today basically admitted that trillions in stimulus have accomplished nothing (except avert a much deserved stock market crash), which I agree with.

My company does 80% of its business in the States and I can tell you things are not looking good at all, and have gotten worse this year.

The best that can be expected for the next 5-8 years is stagnation at best and contraction across most sectors.

#140 anotherwhistleblower on 11.06.12 at 1:09 pm

We investors would like to think that this malaise will not last for much longer…but there are no wishes granted in the stock market…it’s actually all homework and risk taking. Obviously there will be no recovery for Canadian resource stocks under the Obama administration. I think Canada’s two biggest banks that have US exposure will do well ..TD and RY……BNS will do well only if Asia rallies. Without a consumer boom in the US… China and Latin America are in the doghouse.

The US election from the socio-political perspective can bite me…..all the Obamatons in TO’s politically correct circles are anti Canada anyway. As we’ve seen here Liberals are high tax and spend junkies…..something you wouldn’t wish on your worst enemy. That is why you notice that Liberal and Unions are the biggest proponents of nig government largesse….they make out like bandits while the middle class can screw themselves. The elite civil servants want Obama…the rest of us should pine for the days of slash and curtail…NOT GIVING PAY RISES TO A FEW ELITE UNIONS.

#141 The end is nigh on 11.06.12 at 1:09 pm

#133 hoof.
Bang on!

#142 TnT on 11.06.12 at 1:24 pm

Zombies are amongst us. They make up the most of our society.

Voting for Guy “A” or Guy “B” is NOT the fix for anything. It’s the distraction.

Other distractions that make billions and Billions from the Zombies

Weight Loss
The trick to losing weight is more output than input of calories. It’s free!

Wealth
The trick to being wealthy is more input than out of money. It’s free!

Happiness
The trick to being happy is more output than input of love. It’s free!

I love the free things in life!

Live Free my peoples or die trying!

#143 Inglorious Investor on 11.06.12 at 1:25 pm

I don’t know why, but during the lunch hour I decided to check out what Michael Moore is saying about this historic election. Mr Moore is a vociferous Obama supporter. Or is he? In his latest blog he writes this about Obama’s record as president…

“And even though he never put a single one of them [Wall Street banksters] of any consequence in jail and never signed any bill that would truly stop their out-of-control greed; and even though he placed two of Wall Street’s favorite operatives – Timothy Geithner and Lawrence Summers – in charge of the Treasury and economic policy; and even though he let them use bailout money – our money – to give themselves lavish bonuses after they wrecked our economy; and even though he didn’t go for a single-payer health care system and made sure that under “Obamacare” no insurance company would be fined more than $100 a day for denying a person with a pre-existing condition (thus removing many of the teeth the new law had); and even though he let them keep their Bush tax cut for another four years – yes, even after doing all of that for the wealthiest 1%, it still wasn’t enough for them,[…]”

Gee, if all of THAT was not enough, I wonder what Obama will actually have to do in order to placate his Wall Street supporters if he gets elected again!?

#144 snowbird on 11.06.12 at 1:50 pm

got it. No matter how screwed the system is, we will turn out to be okay to buy the equity.

#145 daystar on 11.06.12 at 1:57 pm

#48 Doug in London on 11.06.12 at 12:18 am

I had to read that twice myself. Garth is referring to public perception here.

Readers, there is a public perception out there that regardless of who wins, both candidates are beholden to the same financial donors of this election. Read these links and see for yourselves whether this is true or not:

http://www.nytimes.com/2012/10/26/us/politics/obama-and-romney-raise-1-billion-each.html?ref=politics

FIRE is backing Romney to repeal Obama’s regulations on FIRE. I can only guess that its because they want to turn back the clock and create another housing bubble. Why else, and who does this make Romney beholden to?

The white haired individuals, the wise ones, are backing Obama and it sure isn’t to preserve 15% taxed capital gains, interest and dividends. A clip:

“Over all, 55 percent of the Obama campaign’s money through the end of September came in donations of less than $200, including from many people who have repeatedly sent in small checks over the course of the campaign. Just 13 percent of his checks were for $2,500, the maximum that donors are allowed to contribute for either the primary or general election.

Mr. Romney, by contrast, has cultivated business leaders and benefited from a Republican donor establishment that is eager to defeat Mr. Obama, raising an unprecedented amount of money from wealthy donors who gave the maximum allowed. Just 22 percent of his cash has come from donations of less than $200. Through the end of September, 45 percent of checks to Mr. Romney’s campaign were for the maximum $2,500 contribution.” – link

So I ask again. Who is beholden to who?

Let look at superpac spending:

http://graphics.latimes.com/2012-election-superpac-spending/

Whats this telling us? It should be obvious and expect the final numbers do grow by another 50%.

#146 ronthecivil on 11.06.12 at 2:07 pm

Unless there’s a super majority of Republicans elected why wouldn’t the democrats to anything and everything in their power (including filibustering any and all resolutions against it, a fitting revenge for Republican obstructionism) to force the US over the cliff?

It’s the only way they will ever get a tax increase past the Americans for Tax Reform prodded GOP who have all signed pledges to do vote down any tax increases.

The fiscal cliff has been the grand bargain all along. If it’s followed up by some Republican inspired cuts as well then the US will indeed be in recession again but at least this time there will be a good chance of growing their way out with the debt bomb boogey man largely neutered.

#147 Coquitlam Resident on 11.06.12 at 2:07 pm

” an economy expanding by at least 4% by 2015.”

With respect, when in the last 15 years has the US ever grown at 4% annually? I just checked public data, and the US hasn’t hit that since 2000.

4% growth in a mature economy is gangbusters. Possible, but not likely to happen given 4 more years of partisan gridlock.

/////

Furthermore, the whole idea of analyzing gold on day-to-day market fluctuations is pointless.

Gold’s value will only be realized when its too late – i.e. black swan dollar collapse leading to doubling or tripling of gold’s value within a few day period. I think that’s what people are hedging against. It could very easily happen.

Dismissing the possibility of a dollar collapse ignores the interconnectedness and inherent complex instability of today’s global economy.

#148 Duisburg on 11.06.12 at 2:07 pm

Oh look…my comment wasn’t added. You Ignorant Goof! LOL

http://www.zerohedge.com/news/2012-11-06/gold-gone-wild

** here is a real website…and link **

Not some dude now looking to make a quick $$ as a (oh wait…get this) Wannabe Financial Planner. LOL Good Luck you will need it!

Moderate that!!!

#149 spaceman on 11.06.12 at 2:09 pm

49 Smoking Man on 11.06.12 at 12:24 am

Get to AA… now… my father sqaundered everything, a 3 story house in downtown New Westminister (now a million dollar plus condo complex) a house in burnaby now worth $700,000. A business in the Cariboo all went to shit… sucked into a bottle and us along with it.

committed suicide in 86, never got to see his 5 grandchildren grow up, or his 3 sons succeed in their lives without alchohol.

Is this what you want ? keep drinking…

#150 Dupcheck on 11.06.12 at 2:12 pm

We are the new era of slaves. It does not matter who wins, the president only has maybe 5% power, the rest is from those who pull the strings. We are led to believe we live in a democracy and our vote matters. BS
It is sad, we need intervention, the system is broken.

#151 T.O. Bubble Boy on 11.06.12 at 2:26 pm

@ #137 Canuck Abroad

Just think of all the things $6 billion could buy.

Here are a few:
– 10 days of interest payments on the U.S. Debt
– The entire annual output (GDP) of Bermuda, Rwanda, or Monaco
– More than 100% of RIM
– 1 or 2 of Mitt Romney’s buddies

#152 T.O. Bubble Boy on 11.06.12 at 2:34 pm

@ #46 Smoking Man on 11.06.12 at 12:14 am

Top 10 posters on this blog since Oct 2010, or people that don’t have a life.

Take a bow gents

T.O. Bubble Boy 444

Woo hoo! And, I’ve never posted “first!”

The only reason I’m #1 is because BPOE and Devil’s Advocate were banned and/or switched handles.

#153 hard truth on 11.06.12 at 2:45 pm

DELETED

#154 Hoof - Hearted on 11.06.12 at 2:45 pm

LOCKHEED MARTIN TO LAY OFF 123,000 AND OTHER DEFENSE CONTRACTORS MAY FOLLOW

http://www.republicbroadcasting.org/index.php?cmd=news.article&articleID=4438

Quote:

President Obama’s administration has asked Lockheed Martin to delay its announcement of the layoffs of 123,000 employees to make the unemployment numbers look much better.

Lockheed Martin is one of several defense contractors ready to lay off tens of thousands and hundreds of thousands of people after the election. These numbers may indeed rocket the unemployment figures past 8%.

=================================

Eisenhower sad something about beware of the Military Industrial Complex….

No President mentioned the Wall Street Bankster cabal

#155 45north on 11.06.12 at 2:50 pm

there are four houses for sale on my street in Ottawa. They look lonely.

The announcers covering the US election on CNN look scared.

Ben Rabidoux criticises Ben Tal’s article on Canadian housing:
http://theeconomicanalyst.com/content/comments-cibcs-no-us-style-crash-canadian-housing-report-part-2

There’s a chart comparing household debt to GDP, I think Garth posted the same chart. The chart shows a dramatic fall in the US ratio whereas the Canadian ratio continues to grow. Obviously, wealthy interests have seen the chart. They want to take cover without attracting attention.

#156 Hoof - Hearted on 11.06.12 at 2:55 pm

J.P. MORGAN’S FOOD STAMP MONOPOLY: THE MORE AMERICANS THAT FALL INTO POVERTY THE MORE MONEY JAMIE DIMON MAKES

http://www.republicbroadcasting.org/index.php?cmd=news.article&articleID=4420

Quote:

JP Morgan is the largest processor of food stamp benefits in the United States. JP Morgan has contracted to provide food stamp debit cards in 26 U.S. states and the District of Columbia. JP Morgan is paid for each case that it handles, so that means that the more Americans that go on food stamps, the more profits JP Morgan makes. Yes, you read that correctly.

—————————————————–

QUOTE:

So if unemployment goes down will this ruin JP Morgan’s food stamp business?

Well, apparently not. In the interview Paton says that 40% of food stamp recipients are currently working, and he seems convinced that there could be further “growth” in that segment.

So is this what America is turning into?

A place where tens of millions of the unemployed and the working poor crawl over to Wal-Mart and the dollar store every month to use the food stamp debit cards provided to them by JP Morgan?

It turns out that JP Morgan also provides child support debit cards in 15 U.S. states and they also provide unemployment insurance benefit debit cards in seven states

==================================

This is what I keep hearing goes on in the US.

The jobs that are created are for the working poor…minimum wage…. These people also qualify for a lot of Gov’t benefits.

Thats how Wal Mart works….it wipes our competition.. pays low wages..pays no benefits because the Gov’t picks up the tab for Health care etc. for these working poor.

So, ultimately its a race to the bottom and that the middle class gets wiped out……

Can you say Comrade?

#157 };-) aka D.A. on 11.06.12 at 3:16 pm

#136Paul on 11.06.12 at 12:27 pm
#125 Form Man on 11.06.12 at 11:19 am
#120 DA

so I take it you are buying real estate in Kelowna right now ? and if not…..why not ?

A few weeks back I believe he said he was getting ready to sell his place and buy a rental property. He never answered when I asked if he had listed yet.

I would never want not to own real estate. I am ’in’ the market and intend to stay in for my experience is it is a lot easier to get out than back in. We have considered selling our ‘home’ and putting that money back into revenue properties which would pay for a ‘rented home’ wherever we might be. But we like our home and the anchor it provides that our family can depend on will always be there along with a hot meal, warm hearth and hearts always welcoming them ‘home’. I grew up in predominantly rented homes and our children are, I can assure you, better off for having not.

No we’re not selling.

#138Form Man on 11.06.12 at 12:47 pm
#135 DA

I have not bought any land in the Okanagan since 2003. Have been selling steadily since then ( actually we did re-aquire some raw land that we had to foreclose on a couple of years ago). I likely will not resume buying until MOI is below 7, because prices will continue falling until then.

I can suggest a multitude of projects for you to invest in DA. Kelowna is brimming with financially strapped developers right now; who would sell to you in a heartbeat……..

So you don’t plan on getting in while it is a ‘buyer’s market’. You are not alone. Most buyers do not buy in a buyer’s market because they think prices have yet further to drop. Most buyers buy in a seller’s market because they are afraid if they do not they will be priced out of the market by rising prices.

If you are waiting for that magic statistical measure of 7 months of inventory, when do you think it will happen? Setting aside that ongoing debate you and I have about what the real measure is right now I can tell you inventory is dropping no matter how you measure it and that by your measure we will be at what you might call 7 months’ worth sooner than you think. You and I both know as we move toward that we will be heading into a seller’s market and your window of opportunity will close. I think Form Man you are setting yourself up for quite a surprise.

But you have caught my interest… what financially strapped projects might you recommend?

#158 rembrandt on 11.06.12 at 3:23 pm

Garth: You are on the wrong side of the page but coming from a conservative I can understand. There is no hope for the USA and soon to be impoverished masses through increasing unemployment and debasement of that piece of confetti a.k.a. the US$. It therefore does not matter who becomes President.

To start to understand what likely lies ahead read: The Fourth Turning by Strauss & Howe.

#159 Bill Gable on 11.06.12 at 3:30 pm

Imagine the boost to the US Economy if the Billions wasted on stupid partisan Political ads, had gone into infrastructure and job creation in the States.

Obama blew it when he went Obama care and NOT the economy. Romney is a cipher and I get nervous when a plutocrat gets the top job.

I think Obama is a bright man, who got handed a crappy post Bush economy and a couple of Wars and a broke and dispirited Country. He seemed like he lost interest. Loves to campaign – maybe hates the job.

One more thing: If there is a prolonged mess after this election (think hanging chads) – it will be a disaster.

I am glad Mr. Turner is pretty sanguine – that is reassuring, to a degree – but I spend lots of time talking to my American friends and NO ONE is talking recovery. They are hanging on by their fingernails. Lots of angst to go around.

#160 dv8 on 11.06.12 at 3:43 pm

SO the USA will grow by 4% when will the great deflation come ?

No great deflation. No hyper-inflation. Why are people on this pathetic blog so extreme? — Garth

#161 cynically on 11.06.12 at 4:11 pm

#62 JuliaS – I would suggest a great orator like you, Julia.

#162 IM in C on 11.06.12 at 4:14 pm

Why are people on this pathetic blog so extreme? — Garth

Because it’s more fun!

#163 Hoof - Hearted on 11.06.12 at 4:24 pm

I am informed that the US vote is tallied in SPAIN….the DIEBOLD electronic voting machines send the data to HQ in Spain

WTF? What if data gets mixed up and Charo wins ? Coochee Choochee, (I don’t think anyone would notice nor demand a recount )

#164 Steven Rowlandson on 11.06.12 at 4:33 pm

Americans desperately need to go with out having any kind of government untill everyone in america has forgotten what having a government was like. While they are at it they might as well shut down all the banks and have a cancelation of all debts and debt based currency. People need to be free of all the extortion rackets , scams and politically correct BS.
People need a nice long mental health break from all the BS from the self appointed powers that be.

#165 cynically on 11.06.12 at 4:40 pm

#76 daystar – Good post with which I agree for the most part. However I would add 49 more states to your last sentence – in varying degrees but that’s US politics.

#166 Blacksheep on 11.06.12 at 4:47 pm

Daystar # 146,

“So I ask again. Who is beholden to who?”
—————————————————–
Lets keep things in perspective. Here’s some, of the top twenty contributors to the Obama campaign in 2008. Do you think he may have ‘owed’ a few favours?

Looks like supports now shifted to the Mitt’ster.

Is the fix in? We will see tonight.

Don’t misinterpret my opinion. The outcome is truly irrelevant, as Garth says. The Left vs Right paradigm is a distraction and serves to appease the Cattle. Two heads, on one snake.

(1) University of California $ 1,648,6875 (2) Goldman Sachs $1,013,091 (3) Harvard Univ. $ 878,164 (4) Microsoft Corp $852,176 (5) Google Inc. $ 814,540 (6) JPMorgan Chase $808,799 (7) Citigroup Inc. $ 736.771 (8) Time Warner $ 624,618

Grand total in the top 20 contributors $ 388,280,567

https://www.opensecrets.org/pres08/contrib.php?cid=N00009638

take care
Blacksheep

#167 Coho on 11.06.12 at 4:49 pm

We are the new era of slaves. It does not matter who wins, the president only has maybe 5% power, the rest is from those who pull the strings. We are led to believe we live in a democracy and our vote matters. BS
It is sad, we need intervention, the system is broken.

That’s a good summation. However, be careful what you wish for. The Chinese may be listening. I’m sure they’ve been taking pages out of NATO’s handbook.

It would easy for them to sell an invasion of the West to their people. Tell them that Western style democracy is so corrupted that people are starting to view their governments as cancerous tumours making their country sick and anemic. The solution: ‘Benevolent Dictatorship’ would be imposed as a better way of life whether citizens of the West want it or not. It would be China’s ‘gift’ to us…’tough love’…much like NATO is imposing (gifting) its higher moral authority on the people of the Middle East by way of bombs, butter and installation of Western Puppets.

Obama appears to have been a reluctant participant in the ongoing wars, particularly not wanting to get pulled into Libya. But British PM Cameron cried so loud Obama relented. If Romney gets in, such persuasion won’t be needed. In my opinion, he’ll be all in, guns, holster, and a belt full of bullets. Yep, more undeclared wars to come.

Muslims are asking why the people of Canada and the USA are waging war on them. I’d wager most decent people would reply that we have no beef against Muslims. They’d reply that someone does because they are being bombed. And we’d reply, “Well it’s not us, it’s our governments.” Then they’d reply, “You live in a so-called democracy do you not?” And we say “Yes, we do”. “So let us get this straight”, they say. “The people don’t want war, but your governments are waging war. Aren’t democratically elected governments supposed to abide by the wishes of its citizenry? Clearly they are not, so explain to us how this is democracy? Explain to us how your governments are reflecting the will of their people.”

We should hang our heads in shame. War isn’t even declared anymore. Pretext for war is introduced often by false claims. Demonization of western puppets who have outlived their use begins. New ones need to be installed to suit today’s needs. The war drums beat. The bombs start flying. And we quibble over granite and stainless. How nice….

#168 };-) aka D.A. on 11.06.12 at 5:00 pm

No great deflation. No hyper-inflation. Why are people on this pathetic blog so extreme? — Garth

Maybe… because you tend to lead them down that path? Seriously… think about it.

#169 Old Man on 11.06.12 at 5:00 pm

I am still betting Romney for a win, as 500 retired Generals and Admirals took out a full page ad in the Washington Post with all their names endorsing him for President. Now as for the future of USA. I believe it will become a different country that will reorganize somewhat into becoming a powerful economic force, and will maintain the USD as the world currency of choice. Hyperinflation is not on the immediate page, and lots of adjustments must be made, but just look at the latest stats of new home sales in USA, and in time the jobs will come back; do not count the USA dead and buried just yet.

#170 mr t on 11.06.12 at 5:31 pm

On Friday Garth wrote about gold falling …. and on the next Tuesday it has regained that lost ground.

Garth talks about gold being priced in US dollars, and the dollar going up, so gold as investment is best avoided.

But the biggest consumers of gold use rupees and yuan (plus government central bank buying). Gold may be mined in Canada and the US – but very little of it is bought in North America.

The supply of gold is limited, and demand is up thanks to the rising middle class in Asia.

Why shouldn’t an investor diversify and have 5-10% of their holdings in physical gold bullion — a percentage that many financial advisors have suggested over the years?

I agree with Garth’s ideas on real estate – but gold as small part of diversified portfolio of equities, bonds and other assets still seems logical to me.

If liquidity is king, then why is physical gold any different than cash?

Gold sits in your safety deposit box at the bank, and can be sold at anytime.

Sure – the price may go up and down. But so does the Canadian dollar. Heck – it was only 10 years ago when the loonie was 61 cents.

As an added bonus – profits when selling gold can also be made tax free and ‘off the books’, if you use the right gold shop.

(nudge nudge wink wink)

A small gold holding is your choice, but don’t call it investing. And if it rises, do what most gold investors can’t – harvest profits to maintain the weighting. BTW, tax evasion is illegal. Is criminal activity worth not paying a minimal capital gains tax? — Garth

#171 Mike on 11.06.12 at 5:44 pm

‘The anti-US sentiment this post has raised is fascinating’

AGREE

I think it’s a generation gap. I’ll bet it’s younger people more in tune with the political theatre excercise we are all watching with this sentiment. We ALWAYS suspected something was wrong Mr Turner, whereas folks like my parents, Boomers, had 30 or 40 years when it was damn near impossible to figure out this planet.

I won’t go all tinfoil hat on you but here is a list of things that does not change Wednesday November 7, 2012.

The status of the Federal Reserve as a private bank.
The arrangement between the Federal Reserve and the office of the POTUS.
The 16 trillion dollar debt.
The concept that new money is created via new debt.
Mega banks.
Mega corporations.
Lobbyists.
Monsanto.
Pharma companies.
All the wars.
Oil cartels.
Media outlets almost exclusively all owned by George Soros and Rupert Murdoch.
(Here is a list)
http://en.wikipedia.org/wiki/List_of_assets_owned_by_News_Corporation
It is pretty well understood that the media was invented by poweful men to usurp their foes in days gone by. Why do we assume it is different now?

There is a huge welfare class in the US that is 100% ignored by the beast that is the mainstream media.

Manufacturing gone to China…I mean, the list never ends.

I think it’s great that so many people are getting informed and questioning EVERYTHING we are told.

The only thing I know for certain is that I am a spirit first, and a human second, and my decision making follows that understanding.

It’s the only thing that has helped through this massive project that has been, figuring out what is really going on here.

If others also want to do the same, you need to do 2 things

1) no more TV
2) return to nature

#172 The end is nigh on 11.06.12 at 6:06 pm

Job numbers up.
Home sales up.
Dead cat bounce!

#173 Form Man on 11.06.12 at 6:15 pm

#158 DA

do not worry my friend, there will be lots of time to get in at the bottom, and as we both know, the bottom won’t arrive until MOI is below 7. Since it currently is at 15, we have no urgency.

Their are lots of developers in a bad way in Kelowna right now, problem is: too much debt against the property, so no real bargains. Better to wait and scavenge the carcass after forecosures wipe out some of the debt…………( and MOI is below 7 )

#174 Herb on 11.06.12 at 6:40 pm

#141 anotherwhistleblower,

“As we’ve seen here Liberals are high tax and spend junkies…..”

Would you mind saying where have you seen that except in Neandercon propaganda?

#175 Hoof - Hearted on 11.06.12 at 6:51 pm

#169 Old Man on 11.06.12 at 5:00 pm

I am still betting Romney for a win, as 500 retired Generals and Admirals took out a full page ad in the Washington Post with all their names endorsing him for President
==================================

I hear that the US Military is fed up ready to take down the Gov’t….esp after the Benghazi incident.

Retired generals ? probably work for Defence Contractors…Romney and Netenyahu are good buddies.

#176 CalgaryRocks on 11.06.12 at 6:55 pm

#169 Old Man on 11.06.12 at 5:00 pm
I am still betting Romney for a win, as 500 retired Generals and Admirals took out a full page ad in the Washington Post with all their names endorsing him for President.

Oh wow. 500 RETIRED warmongers endorse Romney. No surprise there. One more reason for Mr. magic underwear to lose.

#177 Smoking Man on 11.06.12 at 7:22 pm

#91 Buy? Curious? on 11.06.12 at 5:35 am

Your always chirping me man , you have only been posting since May. That explains it.

I seance a bit of competitive envy, its natural. I have been reading you historical post, well written, good grammar and spelling but you know what.

Topics are sort of interesting but your post lack sole, or emotion. It’s like you a teacher, subliminally talking down to your students.

Chirp all you like, but man or (BI Curious)/woman know this, there are a shit load of people here in greatest fool land that love The Smoking Man.

Just saying, and it surprised me too.

#178 cynically on 11.06.12 at 8:12 pm

#144 Inglorious Investor – You seem to think that a magic wand comes with the presidency but as someone living in the States you must know that the 3 bodies of government, as checks and balances, must pass legislation and Obama only had the Senate and the House for the his first 2 years and did get Obamacare passed but the Tea Party took over the House in 2010 and the Republicans only objective then was to stop his legislation and defeat him in 2012. For this reason he couldn’t get the rest of his efforts thru those roadblocks they threw up except for the debt ceiling raise, a fiscal cliff at the time. As for Geithner and Summers, maybe their appointments were to stop any further damage they could do by keeping a public eye on them. Finally election money from Wall Street went to Romney as well. As you must know in this corrupt system, one doesn’t get elected without millions of dollars paving the way.

#179 };-) aka D.A. on 11.06.12 at 8:13 pm

#174Form Man on 11.06.12 at 6:15 pm
#158 DA

do not worry my friend, there will be lots of time to get in at the bottom, and as we both know, the bottom won’t arrive until MOI is below 7. Since it currently is at 15, we have no urgency.

Their are lots of developers in a bad way in Kelowna right now, problem is: too much debt against the property, so no real bargains. Better to wait and scavenge the carcass after forecosures wipe out some of the debt…………( and MOI is below 7 )

Seven, schmeven. Need we flog that dead horse yet again?…

While I will agree that, at first glance, the available months’ worth of inventory in Kelowna is high, it is today half what it was in 2009 and less than last year and that year before. Additionally MOI always runs high this time of year as many listings of longer duration, which were overpriced and missed the market, hang on until their expiry date of which December 31 is a most popular one. For example, there were 655 listing contracts which expired at the end of December 2011. So too can as many be expected to expire at the end of next month this year – more I expect. That alone will get you to your 7 MOI statistic in a quick hurry Form Man. If you provide me your email, I will send you the last ten years month by month MOI along with the trend in new listings taken from which you will see you must then agree with me. Those charts will show you this is not a departure from norm but a return to it.

I am reasonably comfortable forecasting out as far as six months ahead such things as price which invariably follows volume and of course supply. Volumes are up, marginally to be true but up none the less and supply is dwindling. Based on that I see prices remaining stable and maybe even a quick but notable uptick this spring that causes many buyers to jump off the fence. It won’t be a big deal but it will take a notable number by surprise. Sure I could be wrong but the numbers are shaking out to facilitate it happening that way, six months from now, all things being equal, beyond that is anyone’s guess.

On the vultching; personally I’d rather get in on the opportunities now, invest some cash helping out the distressed developer who is in a bad way but otherwise has a good project thus build some good relationships along the way that we might both prosper. Know of any such that I am unaware of?

#180 pareto optimal on 11.06.12 at 8:17 pm

Here in the Okanagan, my lovely wife works with a young foolish and deluded Obamanaut…..hard core, complete with glassy eyes, mouth agape, and chin upward and outward as his messiah speaks. Although Canadian, he has volunteered for the Obama campaign. So I happened to see hm as I dropped off a package for my wife….
“Have you voted yet?” I asked.
He said, in the condescending tone of the hipster, “No, but I have mad a lot of phone calls down into Washington State!”……
I asked” Why have you not voted?”
Reply, again as if I asked a ridiculous question…”Because I’m not an American citizen”.
“Well that never stopped any Democrat I’ve ever known”………
RAGE as if I had desecrated a holy shrine….
Crazy kid……

#181 Fabrega on 11.06.12 at 8:18 pm

“Don’t bet against America”
Imperial Rome and the British Empire were also invincible and would last forever.

#182 TurnerNation on 11.06.12 at 8:19 pm

Tomorrow’s blog title: Obromide.

“Drill baby drill”!?

#183 Fabrega on 11.06.12 at 8:20 pm

#168 Coho
Welcome to the Matrix.

#184 Old Man on 11.06.12 at 8:33 pm

I still have my money on the line in London, England for a Romney win, and if I hit have all the babes lined up in my rant room. I will be going to Vegas after Xmas, and be staying at Hooters Hotel and Casino, as can hoop rooms for $19.95 a night with free steak dinners with a prime location. Should I invite the Smoking Man to become my barn boss? Now if I lose my bet on Romney will be eating cake.

#185 Nostradamus Le Mad Vlad on 11.06.12 at 8:48 pm

-
#157 Hoof – Hearted — “Can you say Comrade?” — Well said. See the link from last night (actually a pic), which explains how Obomba’s father indoctrinated him into Communism, training him to take down the west.

#172 Mike — “The only thing I know for certain is that I am a spirit first, and a human second, and my decision making follows that understanding.”

That’s the great experience of death, that our clay temples, physical bodies or uniforms we put on in the morning (birth), and take off at night (death) — life always continues, either in the lower psychic regions (generally) or in the higher spiritual regions (rarely). Good post.
*
2:44 clip Mitt Romney. Who he? Greece ceases functioning, and US per person debt now higher than Greece; 2:22 clip Georgia runs out of food stamps; US foreign treaties for the populace; US Suzuki files for bankruptcy. Too many cars and bikes, not enough people; Iran and Af’stan Building new oil pipeline; Hard Assets increasing in value; France Good tax break for businesses; Kodak Retirees lose benefits.
*
Damned if you do . . .; The Koreas and India – Pakistan Wars all over; 44:18 doc. The Disappearing Male. Ladies, the planet’s all yours! 3:15 clip It doesn’t matter who is elected, someone else still calls the shots in NAmerica; Cyberspace Threat China biggest threat to US; Two nine min. + clips Diebold and YouTube — brothers in arms; Stingers A product of the US military complex being used by Syrian rebels; Kuwait The west’s latest stop.

#186 Form Man on 11.06.12 at 8:51 pm

#180 DA

Sopa Square needs sales in the worst way. Problem is their prices are still too high. Certainly is a nice developer in need of a helping hand……

#187 Gunboat denier on 11.06.12 at 11:01 pm

158 DA

“We have considered selling our ‘home’ and putting that
money back into revenue properties which would pay for
a ‘rented home’ ”

Have you considered keeping it but renting it out? That
way you can always move back.

#188 Bottoms_Up on 11.06.12 at 11:30 pm

#168 Coho on 11.06.12 at 4:49 pm
———————————————-
There IS a war that has been claimed, and that is the war on terrorists–it just so happens that these individuals are religious extremists that prescribe to some warped version of Islam. Terrorists are the enemy, not Muslims. Terrorists use civilian homes as safe havens and innocents as shields. They believe if they kill people like us, in the name of their religion, that they go to heaven and get virgins. Yes, terrorists are the enemy, and they are being fought vigorously. For each terrorist killed, there may be innocent casualties, but how many other innocent lives are saved? Every car bomb that is prevented has got to be 20 or so lives saved?

#189 Riding the Pine on 11.07.12 at 2:00 am

A history lesson for those that consider any talk of failing banks, currencies, etc. as “Doomer” speak. The fiscal cliff is a real and present danger. Even the perception of danger can cause havoc to economies worldwide.

http://www.istockanalyst.com/finance/story/6010710/how-to-survive-america-s-great-fiscal-cliff

#190 futureexpatriate on 11.07.12 at 3:51 am

#86. I changed my mind a bit. Already, a kinder and gentler Fox News and conservatives on CNN as they fear the return of the Fairness Doctrine coming down on their heads. Cons are actually being civil. This COULD just work out after all. But then again, there’s always Rush on the radio tomorrow.

#191 Steven Rowlandson on 11.07.12 at 8:17 am

Republicans and conservatives are spendaholic communist debt junkies. That is why people like me don’t vote. We hate all politicians , their satanic governments and everything they stand for. Those that say we have no right to complain are full of crap and those that say we give consent to the status quo by not voting are also full of crap. Our minds, bodies and worldly goods are our only real countries and governments. Everything else can go to hell and don’t worry that out come is unavoidable . If you throw your lot in with politically correct devils you will spend eternity with them.

#192 reader on 11.07.12 at 12:49 pm

“A clear Obama win will rally markets.”

It was a landslide victory, more than a clear win.

11:45 am, the day after, the DOW is now down 338 points!

My previous post was deleted. I bet this one will be deleted too.

How is your comment consequential? — Garth

#193 reader on 11.07.12 at 1:27 pm

Well, 335 points down is not a market rally, is it? At least not today. Definitely not today :-) But I see the market is turning, it is now only 298 points down :-)

#194 aggie on 11.08.12 at 3:39 am

Silver on 11.05.12 at 5:49 pm wrote:
Agreement signed…. $1,025,000 all in… owe $165,000…
we are so out of here if this clears…
=========
Silver, are you saying that you’re coming out of this transaction with 165K shortfall as a debt that needs to be paid off? Well, congrats for at least being free of the sinkhole. And here I thought my 20K shortfall debt was big, but I’ve already chopped a big chunk out of it… being a basement dweller for a while, living close to the line, with pride. No longer coasting through life from one day to the next… no longer the pinball I’d always been. All the best to you. ~aggie